GlobalFoundries and the Conservation Law Foundation told the Vermont Public Utility Commission Wednesday they had reached an agreement that would allow GlobalFoundries to create its own electric utility.
“Today’s hearing was a big deal,” said Chase Whiting, an attorney with the Conservation Law Foundation.
The Conservation Law Foundation had opposed a previous proposal to let the semiconductor company with a large plant in Essex Junction become its own electric utility, in part because GlobalFoundries and the Scott administration had asked the Public Utility Commission to release the chip maker from several environmental and tax obligations, according to Whiting.
The Public Utility Commission will now decide whether to allow a new company formed by GlobalFoundries to become an electric utility. Previously, the chip maker had proposed to become its own utility, a proposal the commission shot down. Commissioners set September deadlines for submission of written arguments as to whether or not the chip maker should be allowed to proceed.
Under the terms of the proposed settlement, GlobalFoundries would promise to follow Vermont environmental laws and commit to building a solar facility in Essex Junction.
“GF is pleased to have reached an agreement that benefits the citizens of Vermont and is consistent with our mutual global environmental goals,” GlobalFoundries spokesperson Gina DeRossi said in a statement. “As part of the agreement, GF will continue to expand our energy efficiency efforts and environmental sustainability initiatives at our Essex Junction site.
GF appreciated the opportunity to present our petition to the PUC. We await their final decision.”
Under the agreement, GlobalFoundries commits to follow Vermont’s renewable energy standard, which Whiting called “Vermont’s single most effective and important law at reducing greenhouse gas emissions.” The law requires utilities to purchase increasing amounts of energy from renewable sources.
“It has resulted in cleaning up Vermont’s energy sector,” Whiting said.
If GlobalFoundries is allowed to create its own electric utility, it would no longer have to buy electricity from Green Mountain Power. The company could buy most of its electricity from the regional grid operator, ISO-New England, but Whiting said it also would be required to buy a portion of its energy from Vermont renewable energy generation.
“That is good for Vermont because it encourages a more local and resilient electricity grid that fosters good solar and wind energy jobs right here in Vermont,” Whiting said.
GlobalFoundries also commits to pay taxes on the electricity its electric utility will sell to the semiconductor company. Those taxes help fund Vermont’s program to weatherize homes of low-income people.
Among the witnesses who testified at Wednesday’s hearing was Jeff Cram, senior manager of GlobalFoundries’ plant in Essex Junction, who confirmed that the chip maker is committed to building a 5-megawatt solar plant in Essex Junction. The solar plant would generate a fraction of 381.2 million kilowatt hours the Essex Junction chip factory consumes annually, court documents presented Wednesday showed. The plant consumes 8% of all electricity used in Vermont.
Financial and operational details of the usually secretive company and its Essex Junction plant were discussed during testimony.
They included documents showing that GlobalFoundries paid $196 million in compensation to its Vermont employees in 2021 and invested $380 million in the Essex Junction plant since the company bought the plant from IBM in 2015.
Documents also showed that GlobalFoundries pays significantly more for its electricity in Vermont than it does in New York. In 2021, the company’s Essex Junction plant paid $0.091 per kilowatt-hour for electricity, compared to the $0.063 per kWh its plant in East Fishkill, New York, pays and the $0.050 per kWh its plant in Malta, New York, pays, according to the documents.
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