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Vermont Gas outlines expansion into heat pumps, efficiency and community geothermal pilots
Summary
Vermont Gas Systems told the House Energy and Digital Infrastructure Committee it is diversifying beyond pipeline gas into heat pumps, energy-efficiency services and community-scale shallow geothermal pilots while managing workforce and regulatory constraints.
Vermont Gas Systems representatives told the House Energy and Digital Infrastructure Committee on Jan. 30 that the company is expanding services beyond pipeline natural gas into electric heat pumps, energy-efficiency programs and pilot community geothermal systems.
The shift, company leaders said, aims to keep customer bills affordable while reducing greenhouse-gas emissions and preserving the utility’s role as a local energy-service provider. Neil Lunderville, president and CEO of Vermont Gas Systems, said the company “really think[s] of ourselves in the energy delivery business” and is adding products and services to meet customer demand.
Vermont Gas said it serves about 56,000 customers in Franklin, Chittenden and Addison counties, with roughly 50,000 residential and 6,000 business customers. The utility described three electric heat-pump product lines it has introduced: a heat-pump water heater offering first launched in 2022, centrally ducted heat pumps introduced in 2023, and ductless mini-split systems rolled out in 2024. Company testimony said those offerings complement longstanding energy-efficiency work the utility began offering in 1992 and formally took on as an energy-efficiency utility in 2016.
The utility said it operates nearly 900 miles of distribution lines and about 120 miles of transmission piping, and maintains an in‑home services workforce unusual for a gas utility. Lunderville said Vermont Gas employs nearly 30 field service technicians who install and service boilers, furnaces and heat pumps, and a separate team of about nine energy-efficiency professionals who work with homes and businesses on weatherization and other measures.
Company officials told the committee that workforce training is a major constraint for rapidly scaling heat-pump installations. Dylan Jemekhesa, director of public affairs for Vermont Gas Systems, said technicians must be cross-trained and accredited to work in customers’ electrical panels and on refrigerant systems and that the state has been working with utilities and contractors to develop that capacity.
Vermont Gas also discussed community-scale shallow geothermal (ground-source) heat-pump pilots. The utility said it has applied for federal grant funding for a project called Windy Ridge in Hinesburg and is training staff on ground-source design and installation. Lunderville said such systems, when networked across multiple buildings, can use shared piping and waste-heat recovery to lower costs for users and could be attractive for new development and affordable housing.
On regulation, the company made a distinction between its regulated gas business and unregulated customer services. Lunderville said gas rates and gas cost recovery are regulated by the Vermont Public Utility Commission and state law; the company’s heat-pump installation services are unregulated commercial activities. He added that profits from non‑gas services are used to offset gas-rate pressure on customers.
Company witnesses also discussed program capacity and funding. They said some programs—cited examples include the state’s “Switch and Save” support for heat‑pump water heaters and federal stimulus dollars used for weatherization and electric panel upgrades—have been in high demand and that the utility is “subscribed at capacity” for some heat-pump programs while working with Efficiency Vermont and other partners to allocate funds and prioritize income‑qualified customers.
Lunderville and Jemekhesa framed the shift as a business diversification to remain viable: “If we don't do these diversification things, we will be out of business,” Lunderville said, adding that the company is pursuing a mix of energy-efficiency, electrification and lower‑carbon supply options to continue serving customers.
The presentation closed with committee questions about program capacity, workforce training and regulatory reporting; company staff said they share program rate and performance information with the Public Utility Commission and coordinate with state workforce and climate efforts.
