CVPS, state reach deal over Peterson Dam

Vermont Business Magazine, Aug 01, 2005 by Kelly, Kevin

The Public Service Board will soon review an agreement that would restore one of Vermont's premier salmon spawning grounds - at the cost of increased rate payments by customers of the state's largest utility.

The board is expected to hold hearings later this year on a multiparty settlement that would result in removal of the Peterson Dam on the Lamoille River in 2025. Central Vermont Public Service Corp, the Rutland-based utility that operates the dam, agreed to the deal in 2003 after lengthy negotiations with environmentalists and state and local officials.

The Peterson Dam is one of four along the Lamoille that provide CVPS with a total of 21 megawatts of hydroelectric power. Peterson, the dam situated closest to Lake Champlain, is the most controversial of the four because its construction in 1948 prevented walleye and landlocked salmon populations from reaching their spawning grounds on the Lamoille.

The Vermont Natural Resources Council and the fishing group Trout Unlimited have sought for years to have the Peterson Dam removed. CVPS eventually entered negotiations because it faced the prospect of a legal battle to gain a needed water-quality certificate from the state's Agency of Natural Resources. VNRC had successfully challenged the agency's issuance of an operating license for the dam in 1994.

Jon Groverman, an attorney with VNRC, says he is hopeful the Public Service Board will in effect ratify the dam-removal deal. "All the signatory parties are asking for approval of an order to allow CVPS to recover costs associated with removing the Peterson Dam," Groverman says.

He notes that the dismantling of the dam 5.8 miles upstream from Lake Champlain will benefit not only fish populations but the area's entire ecosystem. "Getting rid of the dam will allow that part of the Lamoille to be reconnected with the lake. It will be good for boating as well as for fishing," Groverman says.

But the dam has long served as a source of clean and comparatively cheap energy sufficient to light 3000 average-size Vermont homes. In recent comments, CVPS officials made clear they are not eager to see the dam taken out but will honor the deal they made with the environmental groups, the Agency of Natural Resources, the Department of Public Service and the Town of Milton.

"Under the agreement," the company said in June, "the Public Service Board must approve recovery from ratepayers of costs of a decommissioning fund, payments to Milton, the dam's removal, an environmental enhancement fund, and replacement power." CVPS spokesman Steve Costello added that the board will have to decide whether "the costs of Peterson Station's removal, when weighed against any environmental benefits, [are] ultimately good for the state."

Some Milton residents had opposed removal of the dam because of the property taxes it generates for the town. Governor James Douglas has said he will respect the agreement to dismantle the dam in 20 years' time.

All four of the Lamoille dams were recently granted 30-year operating licenses by the Federal Energy Regulatory Commission. In addition to Peterson, the dams include Fairfax Falls, Clark Falls and Milton Station.