By Stuart Blood

Vermont Gas Systems (VGS) has petitioned the Public Utility Commission (PUC) for approval of a contract for “renewable natural gas” (RNG) produced at the notorious Seneca Meadows Landfill in Waterloo, NY. Although VGS claims that the contract aligns with the requirements of Vermont’s Global Warming Solutions Act (GWSA), at the same time, they acknowledge that the amount of RNG delivered to customers from the landfill will be negligible at most.

So-called “voluntary” customers, those willing to pay a premium for RNG, will get fossil gas, mostly fracked, but it will be sold as “renewable” because VGS will have the “environmental attributes” from the landfill’s RNG. It’s bad enough that customers will likely be misled. What’s worse is that if a bill similar to last session’s Clean Heat Standard bill passes, VGS may be allowed to claim “clean heat credits” by selling fracked gas with renewable attributes attached. In fact, at a workshop presentation on the contract to the PUC, Tom Murray of VGS mentioned the CHS twice in that context.

This latest expansion of VGS’s renewable natural gas program, which environmentalists are referring to as Virtual RNG, follows on the heels of contracts to “deliver” much smaller volumes from a landfill in Ontario and a waste water treatment facility in Iowa. This current case, #22- 2230-PET, was filed on June 13. On July 12, the PUC opened an investigation, which falls under a fast tracked provision for review of gas contracts. A final decision must be made within 120 days. If the PUC misses the deadline, the contract is automatically approved.

What’s particularly interesting about the contract for the gas from Seneca Meadows is that it gives VGS the option to redirect some of the purchased gas into the transportation market, where it can be sold for a higher price per unit of energy than their regulated price for rate payers. They propose to exercise that option as a way to keep down the rates for the customers of their regulated business. In the first year of the contract, two thirds of the RNG purchased from the landfill will go to the transportation market, not to VGS customers.

A VGS customer in Burlington, Catherine Bock, has been granted party status in this case at the PUC. She gained entry to the case only after a fight and insisting on reconsideration of an initial denial of her motion to intervene. As Catherine says in her motions, although the Department of Public Service claims to represent her interests, it is not addressing the issues she has raised. Those include the concern that the contract will result in an increase to her bill without providing any benefit to her. She also asserts that the contract does not align with the greenhouse gas emission reductions required under Vermont’s 2020 Global Warming Solutions Act.

Does the contract align with Vermont’s climate requirements?

VGS acknowledges that none, or almost none, of the RNG produced at the Seneca Meadows Landfill will “physically flow” to Vermont and that there is “no claim by VGS that a participating 2 customer is directly burning an RNG or biomethane molecule.” It would be difficult for them to claim otherwise given the “physical path” by which the RNG molecules could make their way to Vermont. What will be delivered to VGS customers, who are willing to pay a premium, are “environmental attributes”, abstractions that come into existence when RNG is produced. Those attributes can and will be disassociated from the actual RNG and reattached to fossil gas – fracked gas – elsewhere in the distribution system.


Figure 1

Figure 1 shows a map of the pipeline route that VGS has identified in its filings with the PUC for the transport of RNG from the landfill in New York to the point at which all out-of-state gas enters Vermont at the Quebec border. The flow from Waterloo is westward, away from Vermont. The path turns southwest just before Niagara Falls and crosses Ohio, passing near Cleveland and rounding the southern end of Lake Erie. From there it will flow northeast, past Detroit before it crosses the international border. VGS takes ownership of a volume of gas at Enbridge’s Dawn Hub in Ontario, one of the largest gas storage and transfer facilities in the world. Any RNG from Seneca Meadows that has actually made it to that point will be comingled with fracked gas from western Canada and from the Marcellus shale fields of the eastern U.S. At this point it will be almost entirely fossil gas, the majority of it from fracking wells, but the “environmental attributes” that were stripped from the RNG produced at the Seneca Meadows Landfill will be attached to it.

From the Dawn Hub, gas flows to Parkway outside of Toronto, then into the TransCanada Pipeline to the north, which will take it all the way to the Québec-Vermont border. 3 Emissions due to leakage of any RNG from Seneca Meadows that could have made the passage through more than 1000 miles of existing pipeline would be the same as for the fossil gas that the system transports. Since RNG and fossil gas are both almost entirely methane, and so chemically indistinguishable, sending RNG through long-distance pipes does nothing to reduce greenhouse gas (GHG) emissions.

Expert testimony was submitted to the PUC on Catherine Bock’s behalf by University of Notre Dame Associate Professor of Sustainable Energy Policy, Emily Grubert. Prof. Grubert has authored 60 peer-reviewed journal papers and previously served as the Deputy Assistant Secretary for Carbon Management at the US Department of Energy. She noted that GHG emissions due to RNG “are typically dominated by methane emissions over the life cycle, with further emissions associated with GHG-producing inputs to the production, processing, transportation, and use of RNG – e.g., combustion of fossil natural gas to compress RNG for pipeline transport.”

Prof. Grubert pointed out that while Vermont’s GWSA requires absolute emissions reductions – 40% below 1990 levels by 2030 and 80% by 2050 – substituting RNG from Seneca Meadows can not achieve emissions reductions commensurate with those requirements. Moreover, VGS did not compare substitution of RNG for fossil gas to any measures that would actually achieve the mandated reductions nor did they identify any such measures. That’s the wrong approach, according to Prof. Gruber because “if an investment does not have a path to zero GHG emissions but long-term efforts require achieving zero GHG emissions, the investment will eventually need to be replaced with an alternative that does have that path.” The business plan that VGS proposes, however, depends on the continued use of fossil gas infrastructure. And that’s a serious problem because, as Prof Gruber notes, “[t]he principal risk of expanding the RNG market is committing funding and infrastructure to a system that fundamentally cannot provide services without GHG emissions.”

VGS and the Clean Heat Standard

The Seneca Meadows RNG will be diluted by fossil gas and constitute far less than 1% of the volume delivered to Vermont Gas Systems at the Dawn Hub. Significantly, however, VGS makes a point of providing third party certification that there is indeed a physical pathway from the point of production to the “delivery point”.

For the gas from a wastewater treatment facility in Dubuque, Iowa, for example, an engineering firm confirmed “the existence of a physical pathway comprised of interconnecting pipeline systems between the injection point at the [renewable gas] Facility and point of extraction at VGS end.”

Figure 2 illustrates the “delivery” of the Iowa RNG to the VGS pipeline system. Note that the environmental attributes are stripped from the actual gas when it enters the pipeline in Iowa. The attributes are attached to whatever gas is “delivered” to VGS at the Dawn Hub.

Figure 2


Why does VGS take such pains to document the existence of a physical pathway from the point of production to the point of delivery at the Dawn Hub? The answer to that question may lie in the history of the Clean Heat Standard, which was conceived at VGS and crafted into a bill last legislative session. That bill took language from the Clean Heat Standard White Paper, which was developed under the auspices of Energy Action Network (EAN).

The Clean Heat Standard Network Action Team includes the former and current CEOs of VGS, the latter of whom sits on the board of EAN. The CHS bill was passed by the House and Senate. The House failed to override the Governor’s veto by a single vote. The CHS bill contained this language, taken nearly verbatim from the Clean Heat Standard White Paper:

(c) For pipeline renewable natural gas and other renewably generated natural gas substitutes to be eligible[for clean heat credits], an obligated party shall purchase renewable natural gas and its associated renewable attributes and demonstrate that it has secured a contractual pathway for the physical delivery of the gas from the point of injection into the pipeline to the obligated party’s delivery system. 

In other words, VGS could be eligible for clean heat credits simply by showing that a pipeline system exists between Dubuque and Dawn or between Waterloo and Dawn, and that VGS had purchased the rights to transport a quantity of gas from a specific source to a specific delivery point through those pipes. There needn’t be a demonstration that any RNG from those out-ofstate facilities actually arrive in Vermont. In case the CHS bill makes its way back onto the legislative agenda in January, there needs to be close scrutiny of its motivation and consequences. VGS will be the big winner if passage results in a system allowing VGS to sell fracked gas with “renewable attributes” reattached so clean heat credits can be claimed.

The economics of RNG supply and demand RNG is much more expensive than fossil gas.

A 2019 study by the American Gas Foundation (AGF) cited by VGS, estimated that “the majority of the RNG produced in the high resource potential scenario is available in the range of $7-$20/MMBtu”. Presumably, that range reflects production costs, only. In June 2019, the (fossil) natural gas citygate price in Vermont was $3.56/MMBtu. The AFG study projects that the cost of RNG produced from landfills will rise steeply as the supply is increased, just the opposite of an economy of scale.

How much of the demand for fossil gas could RNG replace? The National Renewable Energy Laboratory report Biogas Potential in the United States says that RNG “could displace about 5% of current natural gas consumption in the electric power sector and 56% of natural gas consumption in the transportation sector” if all potential feedstocks are exploited. A report by the Washington State Department of Commerce, Promoting Renewable Natural Gas in Washington State, found that RNG produced in state could replace only 3 to 5 percent of the state’s existing gas use.

The AGF study cited by VGS estimates the “RNG potential that could be realized given the right market considerations (without explicitly defining what those are)“ [emphasis in the original]. Not surprisingly the study concludes that a much higher percentage of the demand can be met by RNG because the “right market considerations” requires a willingness to aggressively degrade the very systems that provide the greatest climate mitigation. For example, the study envisions generating the most RNG by removing “agricultural residues” from the field, using “biomass generated for logging”, as well as “materials from public forestland”, and harvesting “energy crops”, all to be turned into methane. That methane, of course, would be transported using the existing leaky infrastructure that has served to transport fracked gas.

The PUC needs to read your comments about this contract

To file a written comment:

  • Go to
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