The cost of energy is one of the greatest sources of financial hardship for many American families, and Vermonters are no exception. Senator Leahy is well-aware of the strain on households and businesses trying to cope with fluctuating prices at the pump and the debt incurred in the course of trying to heat a home in the winter time. He recognizes that for many Vermonters, the choice to pay the monthly heating bill or buy food is very real, and he knows that this is a decision no individual or family should ever have to face.
Senator Leahy's work on energy prices is multifaceted, as are the problems consumers face on a daily basis. He continues to champion the Low Income Home Energy Assistance Program (LIHEAP), which has provided assistance to many Vermonters struggling to pay for heating fuel. Senator Leahy has also worked to address issues related to increased electricity prices due to dilapidated transmission systems and poor design.
As chairman of the Judiciary Committee, Senator Leahy has worked to investigate questionable practices employed by many energy producers and distributors that have continually driven up the price of fuel. As long as Vermonters continue to suffer at the hand of energy producers reaping massive windfall profits, Senator Leahy will continue to act as an advocate on their behalf.
Senator Leahy believes that we must employ an “all of the above” approach to address high energy prices, especially for gasoline. This approach encompasses reducing energy consumption through the development of energy efficient technologies and promoting clean, renewable energy sources to turn away from a fossil fuel-based energy system. New innovations in fuel efficiency alone are estimated to save Americans $1.7 trillion and reduce our oil consumption by 2.2 million barrels per day by 2025.
Vermont relies on several different sources of power for electricity. Nuclear power plays a larger role in electricity-generation in Vermont than in any other state. The Vermont Yankee plant in Vernon accounts for roughly 75 percent of the electricity generated within Vermont annually. The remaining 25 percent is generated by a combination of hydropower, wind, and wood. For more information on Vermont’s electricity profile, please visit the Energy Information Administration’s website by clicking here. Vermont’s electricity profile will undergo great transformation after the shutdown of the Vermont Yankee nuclear power plant.
A variety of factors determine electricity prices in homes and businesses. At the most basic level, a monthly electricity bill is based on the price per Kilowatt hour (kWh) for the electricity and the number of Kilowatt hours used by the consumer. One of the greatest determinants of electricity prices is the cost of the fuel used to produce the electricity. Additionally, electricity prices are subject to the basic principles of supply and demand that apply to the pricing of many other goods and services. A solid understanding of electricity price mechanisms begins with knowledge of how electricity is produced and transmitted. If you would like to learn more about these processes, please click here.
Fluctuating Fuel Prices
Prices at the pump have seemingly been on a rollercoaster over the past few years. Turbulent economic conditions and unsavory business practices have led to unpredictable spikes and drops in fuel prices, making it difficult for consumers to make sound long-term financial decisions.
Each month, the Vermont Public Service Department issues a Fuel Price Report for the state. This report details the changes in fuel prices and tracks long-term patterns for different sources of fuel and power. To learn more about the Fuel Price Report, please click here. In addition, the Energy Information Administration continuously monitors price changes from a variety of different energy sources including crude oil and petroleum products.
Just like electricity, the price of fuel products is partially determined by the production and transmission process that is necessary to deliver these products to consumers. Before crude or refined oil products are made available to the public, they pass through a standard multi-step process. This process is designed to move petroleum products safely and efficiently to retail stations around the country. Crude and refined petroleum products are transported via pipeline or barge to regional terminals located near ports, large cities, or very near the ends of the major pipelines. Once the products have reached the regional terminals, they are either put into storage or sold at wholesale prices directly from the regional terminal. Finally, any refined products that are to be sold at retail prices are transported by truck to retail stations. Unfortunately, the cost of transportation to retail stations may be higher for those stations located further away from regional terminals, such as those in Vermont, and this increase in cost may be reflected in the price of gas.
Senator Leahy will continue to look for additional opportunities to relieve any burden placed on the consumer by unreasonable fuel prices.
Low Income Home Energy Assistance Program
Vermonters derive much of their heat from fuel oil, electricity, natural gas, and wood. Unfortunately, prices for each of these commodities tend to fluctuate on a regular basis due to a variety of factors, and many people find themselves locked-in to price schemes that seem unreasonably high.
The Low Income Home Energy Assistance Program (LIHEAP) has saved many Vermont families from severe economic hardship and the hazards associated with dangerously low temperatures. Senator Leahy has been proud to co-sponsor amendments to increase funding for this program. The funds appropriated for this initiative are allocated to states in the form of block grants which are then used by individual state heating assistance programs to help families in need.
The Department of Children and Families administers the fuel assistance program in Vermont. Through this program, families may find some relief from overwhelming energy bills and mounting financial pressure. To learn more about the fuel assistance program, please click here. In addition, Vermonters who are customers of Vermont Gas can find further information about fuel assistance programs by clicking here.
Senator Leahy has actively supported congressional efforts to increase funding for LIHEAP on a regular basis. On July 11, the Senate Committee on Appropriations approved the Fiscal Year 2014 appropriations bill for Health and Human Services and Education, which includes $3.6 billion for LIHEAP.
Foreign Oil Dependence and Speculation
One of Senator Leahy's greatest concerns in relation to energy is our continued dependence on foreign sources of oil. Our reliance on fossil fuels is not only a threat to our future economic and environmental health, our need to import petroleum products also endangers our national security. To create an independent energy platform, Senator Leahy believes we need to invest in energy efficient technologies, modernize our infrastructure, and build awareness to improve energy productivity in the United States.
Many Vermonters have expressed concerns regarding speculation in domestic energy markets and price manipulation at the local level. Senator Leahy strongly encourages any Vermonter with a formal complaint related to energy price gouging within the state of Vermont to contact their local Consumer Assistance Program or the Office of the Attorney General. For more information, please click here.
Senator Leahy was proud to vote in favor of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which set important standards for curbing uncontrolled speculation, including a mandate that the Commodities Future Trading Commission enact and enforce position limits to eliminate excessive oil speculation. In addition, the Dodd-Frank Act holds corporations accountable and protects American consumers by requiring companies involved in oil, natural gas, or minerals development to disclose reports of payments made to the United States or foreign governments.
Senator Leahy will continue to push legislation that supports renewable energy sources and energy efficiency technologies to wean our nation off of fossil fuels. He will also fight against any effort to undermine important financial reforms under the Dodd-Frank Act.