VELCO surges ahead with project amid protests

Vermont Business Magazine, Aug 01, 2006 by Kelley, Kevin

The Vermont Electric Power Co. has completed about half of one of the biggest and most expensive utility projects ever undertaken in Vermont.

Construction of taller and highercapacity transmission lines is well advanced in a 37-mile corridor running from West Rutland to New Haven, and VELCO plans to start work next spring on the remaining 26-mile segment terminating in South Burlington. The project also involves rewiring of a line between Williamstown and Barre.

But public opposition is strong in locales where the new wires have not yet been put in place, and controversy continues even in some of the areas where work is nearing completion. State agencies have also criticized aspects of VELCO's plans and performance, heightening pressure on the company to make changes in its implementation of the project.

Cost estimates for what VELCO refers to as the Northwest Reliability Project have meanwhile climbed to unanticipated heights. And Vermont electric ratepayers are likely to be handed a much larger bill for the project than was originally calculated. Consumers' share was put at $12 million when the project was unveiled in 2003 with a total price tag of $120 million. The full projected cost has nearly doubled since then, reaching $228 million.

When the reliability project's price was put at $120 million, VELCO estimated that the average household in Vermont would see its electricity bill rise by only 85 a year. The company now says it cannot yet compute how much Vermonters will have to pay for a project that is part of the New England-wide transmission system. But critics calculate that the full amount to be billed to Vermont ratepayers will be more than $50 million.

The price of a separate VELCO line being built to meet growing electricity demands at Stowe resorts has also been revised upward. Initially estimated at $13 million, the 9.4-mile line from Duxbury is now expected to cost as much as $40 million.

Four of 13 planned sub-stations along the West Rutland-New Haven portion of the northwestern Vermont line had been completed as of July, according to VELCO project manager Tom Dunn. Three more are under construction along the route of this 345-kilovolt line, which is scheduled to be completed by November, Dunn says.

The sub-station in New Haven, however, has been the target of heated complaints from local residents and from the state's Agency of Natural Resources, which says it may ask that VELCO be fined for work carried out in violation of the project's permits. "What VELCO has done here is outrageous and unacceptable," says Sansea Sparling, a member of a New Haven group that has raised $150,000 from the town and private sources to fight the project. Sparling expresses particular concern over a 50-foot-tall earthen mound that VELCO bulldozed into place in order to shield the seven-acre sub-station site from public View.

The Agency of Natural Resources charges that VELCO has destroyed "very sensitive" Native American archaeological sites in New Haven. "We view that archaeological area as a loss," says agency attorney David Englander.

VELCO may be required to carry out mitigation work as a result of its unapproved actions in New Haven, Englander adds. The company could be ordered, for example, to finance archaeological excavations at a different site in the state, he suggests.

In a protest to the Vermont Public Service Board, the project's state overseer, the agency further accuses VELCO of duplicitous behavior. Englander told. the board that the company -had submitted one set of plans for the sub-station to the state's Department of Historic Preservation and a different set to the U.S. Army Corps of Engineers. In addition, the company's own investigation of its work was little more than a whitewash, the agency implies.

A review that VELCO was ordered to conduct by the Public Service Board minimizes the nature and character of the violations and does not provide a complete and accurate picture of the incidents," Englander wrote in a June 22 letter to the board. The company also does not identify "who caused the violations, how they caused the violations, what VELCO has done about the violations, and how VELCO will undertake construction of one of the most significant utility projects in Vermont's recent history with much greater care so as to prevent further violations."

The agency is holding discussions with VELCO in preparation for a formal recommendation that will soon be submitted to the Public Service Board, Penalties are possible, Englander says.

For its part, VELCO acknowledges that it made "mistakes" in regard to work related to the New Haven sub-station. Project manager Dunn adds, however, "We take our responsibility to protect all natural resources very seriously. We have devoted enormous resources to that task." The 100,000-cubic-yard berm blocking views of the New Haven sub-station is not in its final form, Dunn notes, saying that planned landscaping will make it appear less intrusive.

Public Service Department Commissioner David O'Brien, says that "VELCO can and must do a better job of complying with its permits." But O'Brien also suggests that the company may be subject to some overly restrictive and costly requirements. "We have to make sure we're not imposing regulations that don't have great value to the public but add to the cost of the project," says the head of the department responsible for representing the public interest on utility-related issues.