How Vermont’s pioneering clean heat plan fell apart

Nearly three years ago, Vermont passed a landmark law that aimed to cut greenhouse gas emissions by shifting residents away from using fossil fuels to heat their homes and businesses. Last month, that plan officially died before ever being put into action — and the path toward cleaner heating in the state is murkier than ever.

In May 2023, Vermont legislators passed the Affordable Heat Act, which is widely considered the first law to require the development of a statewide clean heat standard to lower emissions from heating sources. But after years of contentious debate and recent inaction from lawmakers, regulators closed the case in February, possibly for good.

More than one-third of Vermonters rely on furnaces and boilers fueled by oil — one of the dirtiest and most expensive home-heating sources — and about another 20 percent primarily use propane. Though the clean heat standard did not mandate a switch to electric heat pumps, the policy would likely have spurred greater adoption of the appliances, which are cleaner and cheaper to run.

Some see the clean-heat turnaround as a financial victory for Vermonters, while others see it as a frustrating loss that will only hurt residents and the planet. How, though, did the pioneering plan manage to fizzle out before it even got started? The answer is a mix of complicated politics, an even more complex policy design, and interference from out-of-state conservative groups.

“There ended up being an enormous amount of misinformation floating around about it, which was very frustrating,” said state Senator Anne Watson, a Democrat/​Progressive who voted for the law. ​“When people are not circulating well-vetted info, that doesn’t serve anybody — that just serves to scare people.”

Vermont has set a legally mandated target of reducing greenhouse gas emissions 80 percent from 1990 levels by 2050. Almost all the electricity generated in Vermont comes from renewable sources, including hydropower, solar, and biomass, but the state is still heavily dependent on fossil fuels for heating and transportation. That’s where the clean heat standard came in.

A clean heat standard, broadly defined, is a policy mandating that providers of heating fuels steadily lower the emissions associated with their operations. It’s an adaptable approach, said Richard Cowart, a former Vermont utility regulator and a principal at the nonprofit Regulatory Assistance Project, which advises governments on clean energy policy. Each state implementing such a standard will make its own rules about what kinds of clean energy to include, how quickly to transition, and what fuels to target for reduction.

“It leaves choice in the hands of building owners, homeowners, small-business operators,” Cowart said. ​“It allows some creativity in implementation and flexibility in the way programs can be rolled out.”

This vision has sparked interest in several other states, but is hitting some obstacles. Colorado passed a law in 2021 requiring natural gas distributors to create clean heat plans. Massachusetts’ Department of Environmental Protection has a clean heat standard in the works, but Democratic Governor Maura Healey recently delayed the implementation until 2028. Another six to nine states have expressed interest in or have begun exploring the concept, but nothing else is on the books, Cowart said.

Vermont’s idea was to create a ​“market-based system” in which fuel dealers would obtain a certain number of clean heat credits each year. Credits could be generated by installing weatherization upgrades or heat pumps, or by selling fuels with lower emissions; dealers could offer these services themselves or buy credits from other entities doing that work. Either way, the system would have helped pay for a less emissions-intensive heating system across the state.

A complicated history

The standard’s political foundations were never unshakable. The first shot at establishing the policy occurred in 2022. The heavily Democratic legislature passed a bill creating a clean heat standard, but Republican Governor Phil Scott vetoed the measure. An attempt to override the veto fell one vote short in the state House.

In 2023, a bill was again passed and again vetoed. This time, the veto override succeeded by one vote in the Senate. Part of the deal that helped the legislation pass was a provision that required regulators to design the program and then bring it back to lawmakers for another vote before it could be implemented.

“That was pretty unusual,” Watson said. ​“Usually, you design a program, then the rules take effect, basically, immediately.”

Lawmakers never had a chance to take that second vote.

Regulators released their program design and cost estimates in 2025. Those intervening years gave opponents time to build their case against the program. Their main argument: The clean heat standard would dramatically raise prices for any Vermont household still using heating oil, as sellers would pass their compliance costs on to customers. Scott’s administration repeatedly claimed the plan could increase heating oil prices by up to $4 per gallon (for comparison, current prices average $3.65 per gallon), though the basis of this number was never clear.

While the numbers weren’t available until 2025, utility regulators ultimately calculated that the program would cost residents a total of about $956 million in its first 10 years of operation and provide societal benefits of $1.5 billion. The average price of heating oil would go up an estimated 8 cents per gallon in the beginning, rising to 58 cents in 2035. But those using heat pumps could expect to save some $500 per heating season on fuel costs compared with burning oil, or to save over $1,000 compared with using propane.

Shortly before the bill passed, Americans for Prosperity, a national conservative policy advocacy group founded by oil-industry billionaires Charles and David Koch, arrived in the state as part of an effort to expand the organization’s work into traditionally left-leaning states. In May 2024, it launched a direct-mail campaign attacking the clean heat standard and inaccurately complaining that the policy would put severe restrictions on natural gas, impose a tax on heating oil, and mandate the installation of heat pumps in homes.

“We were not having a full and fair and accurate conversation about the costs and the opportunities the program could deliver,” said Johanna Miller, energy and climate program director for the Vermont Natural Resources Council.

Then came the 2024 election. In historically deep-blue Vermont, Scott was reelected and 22 legislative seats flipped from Democratic to Republican, eliminating the supermajority that had enabled the veto override the previous year.

At the time, there was widespread concern in the state about property tax increases related to education funding. Republicans took advantage of this ongoing financial unease to inflate and mischaracterize the costs of a clean heat standard, said former state Senator Chris Bray, a Democrat and major force behind the clean heat standard bill, who lost his seat in the election.

“It got weaponized in the campaign season, with a broad misinformation campaign,” Bray said.

Design difficulty

The highly detailed work of designing the clean heat standard created its own complications.

In February 2024, state utility regulators issued the first mandated progress report on their efforts and noted that most participants in the process — including the public utility commissioners themselves — had ​“serious misgivings” about whether a thoughtful and effective policy could be put together on the timeline dictated by the law.

The complexity of the program came up again and again. Commenters noted that the standard was difficult for average Vermonters to understand, and extensive education and outreach efforts would be needed. Others suggested that cost and confusion would drive small fuel dealers out of business, leaving consumers with fewer choices and potentially higher prices.

“We opposed this not because the idea wasn’t good, but because the execution was fatally flawed,” said Matt Cota, a lobbyist for fuel sellers who was a member of the Clean Heat Standard Technical Advisory Group.

Even the regulators who designed the standard ultimately advised against adopting it. In a January 2025 report, the public utility commissioners concluded that ​“the Clean Heat Standard is not well suited to Vermont.” A more effective choice, the commission said, would be to expand upon existing programs, such as the fee that generates revenue for electric-efficiency programs.

In the face of a likely gubernatorial veto, and the recommendations from the commissioners, even those lawmakers who still believed in the policy saw no way forward.

“It was the chastened legislature that was unable and unwilling to pick it up and go further,” Bray said.

Lawmakers say the clean heat standard, in the form passed in 2023, is unlikely to be introduced again. Some supporters of the standard worry that further action is unlikely as long as Scott is governor. But advocates of the underlying ideas think some program to incentivize greenhouse gas reductions from heating is necessary and inevitable, even if it is not a fast process.

“That’s going to come back, because it’s something that we know has to be achieved,” Cowart said. ​“Over the course of a generation this work is going to get done.”

This story was originally published by Grist with the headline How Vermont’s pioneering clean heat plan fell apart on Mar 7, 2026.