Vermont lawmakers hear warning of post‑2027 weatherization funding cliff
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Summary
Presenters told the House Energy and Digital Infrastructure committee that weatherization funding in Vermont rises through 2027 because of one‑time federal dollars but could fall sharply afterward unless new funds are identified, putting low‑income weatherization capacity at risk.
Representative Kathleen James convened the House Energy and Digital Infrastructure committee on the first 2026 meeting to review the state's weatherization funding picture.
Neil Lunderville, president and CEO of Vermont Gas Systems and co‑chair of the Energy Action Network weatherization team, told the committee that federal one‑time funds (ARPA, IIJA/BIL and IRA) have driven a recent uptick in weatherization work but that those funds are scheduled to decline after 2027. "We don't have an immediate funding challenge for weatherization, but we do have a long term funding challenge," Lunderville said, adding that the analysis assumes $29,000,000 in IRA funds for low‑income weatherization in 2026 but that those funds are uncertain.
Lunderville and other presenters said the state's recurring baseline for weatherization is substantially smaller and is principally composed of the energy efficiency charge (Efficiency Vermont and Vermont Gas programs), RGGI‑derived funds administered through the Thermal Energy and Process Fuels (TEPF) process, and the fuel surcharge that supports the Weatherization Assistance Program (WAP). The one‑time federal dollars are responsible for the current peak in activity: Lunderville showed the total package rising to roughly $33.5 million in 2027 from about $28 million in 2026 before tapering in later years.
The presenters quantified program outcomes tied to that funding path: low‑income weatherization work is projected to peak at about 1,500 homes in 2027 and could fall to less than half that rate by 2030 if additional funds are not identified. Lunderville cautioned that the ramp‑up has enabled contractors and community action agencies to staff up and reduce backlogs, and that a precipitous fall in funding would make it harder to retain crews and sustain momentum.
Efficiency Vermont representatives echoed the concern and explained how RGGI auction proceeds and forward capacity market revenues feed a thermal funding line that is subject to PUC review through multiyear demand‑resource plans. Peter (Efficiency Vermont) said the agency and the Department of Public Service are taking a conservative stance on revenue projections but noted recent auction results and capacity market outlooks have been somewhat better than earlier estimates.
Committee members asked clarifying questions about calendar‑year accounting, whether the analysis includes privately funded weatherization (it does not), eligibility definitions (income is household occupant income), and rental unit challenges (the "split incentive" problem where landlords do not pay energy bills). Presenters also stressed the importance of pre‑weatherization repairs (leaky roofs, mold, hazardous materials or wiring) that must be fixed before weatherization can proceed, and they noted the limited, and diminishing, pool of funds available for that work.
The committee took no formal votes. The meeting recessed for a break with a next witness scheduled at 2:30 p.m.