Last Updated: December 19, 2024

Overview

Vermont is the only New England state without an Atlantic Ocean coastline. The state's forest-covered mountains and fast-running rivers are home to substantial renewable energy resources, but the state has no fossil energy reserves.^1,2,3,4 Less than 100 miles across at its widest, Vermont lies between the shores of the Connecticut River on its eastern border with New Hampshire and Lake Champlain and the Hudson River Valley on its western border with New York. The mountains that run the length of Vermont, from Canada in the north to the hills of Massachusetts in the south, occupy most of the state and have Vermont's greatest wind energy resources.^5,6,7 Rivers that flow from the mountains and those that form the state's borders provide hydroelectric resources.⁸ Forests that cover almost three-fourths of Vermont support the state's wood products industry, whose byproducts also fuel electricity generation and provide home heating.⁹ More than one in eight Vermont households use wood for their primary heating source, more than 10 times the national average and the largest share of any state.¹⁰

Vermont is the second-smallest state by population, after Wyoming, and the eighth-smallest state by area.^11,12 More than one-fourth of Vermont's residents live around Lake Champlain in the northwestern county of Chittenden that includes the city of Burlington, the largest city in the state.^13,14 Most other Vermonters live in small towns and on farms. Based on the percentage of its population that lives in rural census districts, Vermont is the second-most rural state, after Maine, in the nation.¹⁵ In part because of the state's small population, Vermonters use less total energy than the residents of any other state in the nation, and their total energy consumption per capita is among the lowest 10 states.^16,17 Vermont produces less than one-fourth of the total energy it consumes.¹⁸ The transportation sector accounts for almost 34% of state energy consumption. The residential sector, with its high heating requirements during the state's cold, snowy winters, closely follows with 33% of Vermont's energy consumption, even though one in six homes are occupied only seasonally.^19,20,21 The commercial sector uses 20%. The industrial sector, which includes the manufacture of electrical components, food production, and agriculture, accounts for about 13% of state energy use.^22,23 Although agricultural production and processing generate only about 3% of Vermont's GDP, the state is the largest producer of maple syrup in the nation.^24,25

Vermont is a member of the Regional Greenhouse Gas Initiative (RGGI), which was established in 2005 to cap and reduce greenhouse gas emissions from power generation.²⁶ The state has the lowest carbon dioxide emissions of any state in the nation.²⁷ Proceeds from the sale of RGGI carbon allowances help fund state energy efficiency programs that provide energy efficiency services to consumers.^28,29

Electricity

Vermont's in-state electricity net generation has come almost entirely from renewable resources since the permanent shutdown of the Vermont Yankee Nuclear Power Station at the end of 2014. Prior to its shutdown, Vermont Yankee alone accounted for about half of the state's generating capacity and typically supplied between 70% to 80% of the state's net generation.^30,31,32 Since the power plant's closure, more than 80% of Vermont's electricity supply comes from out of state.³³ The largest share of the state's electricity comes from hydroelectric power, most of it generated in Canada.³⁴ In 2023, the largest share of Vermont's in-state electricity generation came from hydroelectric power, about 57%. Solar, biomass, and wind supplied almost all the rest. Solar energy's contribution has increased steadily since 2011. Solar generation at both utility-scale (1 megawatt or larger) and small-scale (less than 1 megawatt) facilities has surpassed wind's contribution each year since 2021. Natural gas and petroleum-fired generation are used when needed for grid reliability and when power demand is high. They fueled minor amounts of Vermont's in-state generation in 2023.³⁵

Vermont ranks tenth lowest among the states in per capita electricity sales and ninth lowest in residential per capita electricity sales. However, Vermont is lowest in the nation in total electricity retail sales.³⁶ Although only about 1 in 10 Vermont households use electricity as their primary home heating source and a similar proportion use air conditioning, the residential sector accounts for two-fifths of the state's electricity consumption. The commercial sector uses more than one-third, and the industrial sector accounts for about one-fourth.^37,38,39 Vermont's average electricity price is the 10th-highest in the nation.⁴⁰

Vermont is the only New England state that has not restructured its electricity industry to allow retail competition. The state has 17 electricity distribution companies: 1 investor-owned distribution utility, 14 municipal utilities, and 2 rural electric cooperatives.⁴¹ In 1956, Vermont's electric utilities pooled their transmission systems to connect with hydroelectric generators in New York and Canada, creating the nation's first statewide transmission-only company.⁴² That company represents the state's utilities in power pool matters with the New England regional transmission operator, Independent System Operator—New England (ISO-NE), which is responsible for managing reliable electricity flow across the six New England states.^43,44

Vermont has the highest number of electric vehicle charging locations per capita. However, the state ranks 32nd in the nation in terms of total public charging locations, with 426 as of October 2024.^45,46

Renewable energy

Vermont has the largest share of in-state electricity net generation from renewable resources of any state, reaching almost 100% every year since 2015.⁴⁷ In 2023, conventional hydroelectric power was the largest source of in-state electricity generation at 57%.⁴⁸ Most of Vermont's 47 hydroelectric plants are run-of-river plants, which means they do not have a reservoir.^49,50

In 2023, solar energy from both utility-scale (1 megawatt and larger) and customer-sited, small-scale (less than 1 megawatt) photovoltaic installations accounted for about 16% of Vermont's total generation.⁵¹ By September 2024, Vermont had about 333 megawatts of solar capacity installed at large- and small-scale sites across the state.⁵² The state's largest solar farm, with almost 20 megawatts of generating capacity, began operating in December 2018. Two new solar farms, 20 megawatts and 2 megawatts in size, are scheduled to come online by the end of 2025.⁵³

Biomass, almost entirely from wood and wood waste, accounted for about 15% of Vermont's total generation in 2023.⁵⁴ In addition to the one in eight Vermont households that rely on wood for heat, one in three Vermont students attend a school heated with wood.^55,56 Vermont's biomass resources also provide feedstock to the state's one wood pellet manufacturing plant, which has a production capacity of 14,000 tons per year.⁵⁷ Vermont has two utility-scale wood-fired power plants.⁵⁸ As part of its renewable energy goals, Vermont is looking to meet 35% of its thermal energy needs from wood by 2030.⁵⁹

In 2023, Vermont's five utility-scale wind farms contributed about 13% of the state's total generation, a larger share than in two-thirds of the states.^60,61 Two of Vermont's commercial wind farms are on mountain crests near the state's southern border. The others, including the state's largest, are located in northern Vermont, where the states best wind resources are located.^62,63 The state's utility-scale wind facilities have about 150 megawatts of combined capacity.⁶⁴

Vermont enacted a renewable energy standard (RES) in 2015, which was updated in June 2024. The RES requires that the state's retail electricity suppliers obtain 63% of their annual electricity sales from eligible renewable sources by 2025, increasing by at least 4% every three years until reaching 100% by 2030, including a 5.8% carve-out for new, in-state, renewable generation at customer-sited facilities with capacities of 5 megawatts or less. Municipal utilities with 7,000 or fewer customers have a lower requirement.⁶⁵ Vermont joins 24 other states and territories that have introduced 100% renewable energy goals.⁶⁶ The state allows net metering of up to 500 kilowatts of capacity from customer-sited installations that use eligible renewable resources. State regulations limit net metering of combined heat and power systems that use non-renewable fuels to 20 kilowatts and requires that they meet efficiency standards.⁶⁷

Petroleum

Vermont has no crude oil reserves or production, nor does it have any petroleum refineries.⁶⁸ Although there are no petroleum product pipelines in the state, there is a petroleum product terminal in the Burlington area.⁶⁹ Refined products arrive by rail and truck from neighboring states and Canada.⁷⁰ One intermittently-used crude oil pipeline, the Portland-Montreal pipeline, crosses Vermont, but makes no deliveries in the state.⁷¹

In 2022, about 57% of the energy consumed in Vermont was petroleum-based, the second highest share in the nation, after Hawaii.⁷² Although the state uses less petroleum than all the other states, Vermont uses more petroleum per capita than almost two-thirds of the states.⁷³ Vermont's transportation sector consumes the largest share, accounting for almost three-fifths of the state's total petroleum use.⁷⁴ Vermont has identified strategies to reduce petroleum consumption in the transportation sector, including increased vehicle efficiency, increased use of alternative-fueled vehicles, increased use of biofuels, and land-use planning that reduces the need for automobiles.⁷⁵ The residential sector accounts for nearly one-fourth of Vermont's petroleum consumption.⁷⁶ Almost 6 in 10 Vermont households use fuel oil, kerosene, or propane to heat their homes, a larger share than in all other states except Maine and New Hampshire.⁷⁷ As a result, the state is particularly vulnerable to heating oil shortages and price spikes during the winter months. The U.S. Department of Energy's Northeast Home Heating Oil Reserve—created in 2000 in response to heating fuel supply disruptions in the region—holds 1 million barrels of heating oil at storage sites in four states.^78,79 The commercial and industrial sectors use almost all the rest of the petroleum consumed in Vermont, and together they accounted for about one-fifth of the state's total petroleum use in 2022. The electric power sector intermittently uses a very small amount of petroleum.⁸⁰

Natural gas

Vermont has no natural gas reserves or production.⁸¹ Vermont's single natural gas utility receives its supply from a small-capacity pipeline that brings natural gas south from Canada. The utility is committed to reducing greenhouse gas emissions by 30% in the next 10 years through increased use of renewable natural gas.^82,83 The utility distributes natural gas in the counties along Lake Champlain down to the Burlington area and Addison County.⁸⁴ The northwestern part of the state remains the only area with access to natural gas service.⁸⁵ As a result, Vermont is the nation's second-smallest total natural gas consumer and the second-smallest natural gas consumer on a per capita basis among the states. Only Hawaii uses less natural gas.⁸⁶

Vermont's commercial sector accounts for about 55% of the natural gas consumed in the state, and the residential sector uses almost 29%.⁸⁷ Because much of the state's population lives in the Greater Burlington area, nearly one in six Vermont households rely on natural gas for their primary home heating fuel.^88,89 The industrial sector consumes most of the rest. The transportation sector uses very small amounts of natural gas as vehicle fuel.⁹⁰ The state has two compressed natural gas vehicle fueling stations, all located near Burlington.⁹¹ The only natural gas used in the electric power sector is consumed as a secondary energy source at a biomass-fueled power plant and at a natural gas and biomass-fueled combined heat and power plant.^92,93

Coal

Vermont does not have any coal mines or coal reserves and there are no coal-fired power plants in the state.^94,95 Vermont is part of the six-state ISO-NE regional grid, which receives a decreasing share of its power from coal-fired power plants. In 2023, ISO-NE received less than 0.2% of its electricity supply from coal-fired power plants. However, ISO-NE remains dependent on out-of-state coal-fired facilities during periods of peak electricity demand.⁹⁶

Endnotes

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² Roberts, Billy J., Forest Residues in the United States, National Renewable Energy Laboratory (January 15, 2014).
³ Oak Ridge National Laboratory, The 2020 National Hydropower Map, updated October 1, 2024.
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⁵ NETSTATE, Vermont, Vermont Almanac, updated March 9, 2018.
⁶ Sanford, Gregory and Charles Thomas Morrissey, Vermont, Land, Relief, Britannica, updated October 26, 2024.
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⁹ Vermont Agency of Natural Resources, Department of Forests, Parks and Recreation, Wood Energy, accessed November 1, 2024.
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⁶⁴ U.S. EIA, Electric Power Monthly (September 2024), Table 6.2.B.
⁶⁵ NC Clean Energy Technology Center, DSIRE, Vermont, Renewable Energy Standard, updated June 20, 2024.
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⁶⁷ NC Clean Energy Technology Center, DSIRE, Vermont, Net Metering, updated June 18, 2024.
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⁷⁰ Global Companies, LLC, Global Burlington VT, accessed November 5, 2024.
⁷¹ Canada Energy Regulator, Pipeline Profiles: Montreal and Throughput and capacity, accessed November 4, 2024.
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⁷³ U.S. EIA, State Energy Data System, Table C15, Petroleum Consumption, Total and per Capita, Ranked by State, 2022.
⁷⁴ U.S. EIA, State Energy Data System, Table F16, Total Petroleum Consumption Estimates, 2022.
⁷⁵ Vermont Department of Public Service, 2022 Vermont Comprehensive Energy Plan, Executive Summary, p. ES9-ES12.
⁷⁶ U.S. EIA, State Energy Data System, Table F16, Total Petroleum Consumption Estimates, 2022.
⁷⁷ U.S. Census Bureau, Tables, Table B25040, House Heating Fuel, Vermont, United States, All states within the United States, 2023, American Community Survey 1-Year Estimates.
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⁸⁰ U.S. EIA, State Energy Data System, Table F16, Total Petroleum Consumption Estimates, 2022.
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⁸⁶ U.S. EIA, State Energy Data System, Table C16, Natural Gas Consumption Estimates, Total and per Capita, Ranked by State, 2022.
⁸⁷ U.S. EIA, Natural Gas Consumption by End Use, Vermont, 2018-23.
⁸⁸ Vermont Center for Geographic Information, 2020 Census Data (August 12, 2021).
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⁹² U.S. EIA, Electricity Data Browser, List of plants for natural gas, Vermont, all sectors, 2023.
⁹³ U.S. EIA, Natural Gas, Natural Gas Consumption by End Use, Vermont, 2018-23.
⁹⁴ U.S. EIA, Annual Coal Report (October 30, 2024), Tables 1, 15.
⁹⁵ U.S. EIA, Electric Power Monthly (February 2024), Table 1.4.B.
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