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More details have emerged in recent days as Vermont utilities and regulators dig deeper into the impacts of potential tariffs on goods imported from Canada, including electricity and fuel.

Earlier this week, President Trump threatened Canada with a 25% tariff on most goods and a 10% tariff on energy, but has since negotiated a .

After earlier forecasts showed tariffs could raise prices dramatically, state regulators warned lawmakers Tuesday that there are more questions at this point than answers.

They say it’s possible that the major contract Vermont distribution utilities have for Canadian hydropower could be exempt from any potential tariffs.

“It’s not clear at all � I don’t have independent corroboration on this, nor direct conversations, but our utilities and my team is looking at: not sure at all that even if the energy tariff is implemented, it would apply to the Hydro-Quebec contract,� Public Service Commissioner Kerrick Johnson testified to the House Committee on Energy and Digital Infrastructure.

Vermont utilities and fuel dealers welcomed the pause, but say it’s left them with even less clarity about what the regional energy market could look like in the coming months.

Vermont and Canada are close trading partners, with the Green Mountain State importing $6.2 billion in goods from over the border annually, according to from the Canadian Consulate General in Boston.

Energy accounts for about half those imports, and Vermont’s Department of Public Service says Canadian hydropower accounts for about a quarter the state’s electricity portfolio, if not more.

Roughly 30% of the fuel oil, kerosene, propane and gasoline sold in Vermont is imported from Canada. That figure is higher in the northern part of the state.

In the Champlain Valley, nearly all of the gas powering stoves and furnaces in Vermont Gas Systems� customers� homes comes from Canada.

Additionally, Green Mountain Power and Vermont Gas Systems � Vermont’s two largest utilities � are Canadian-owned companies.

Speaking to lawmakers, Public Service Commissioner Kerrick Johnson said he and his staff worked through the weekend with utilities to try to understand how a tariff might affect the power and gas they get from Canadian companies.

Vermont electric utilities have a contract to purchase some 24% of the state’s power from Hydro-Quebec through 2038. That electricity generally flows into Vermont through Highgate and comes from large dams in northern Quebec.

Abagael Giles

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DPS is still doing research, but has major questions about whether the agreement between Vermont utilities and Hydro-Quebec would even be subject to potential tariffs on electricity, in part because the contract is with an American subsidiary of the company, among other factors.

Johnson says if for some reason Canada were to cut off Vermont and New England’s supply of hydropower, the state’s grid operator � VELCO � is confident the local grid won’t crash.

“The lights will stay on, the grid will stay reliable, and then the question will be: What’s the price?� Johnson said.

Broadly, he says the state is feeling increasingly optimistic that most Vermont ratepayers would be relatively well insulated from major cost increases from potential tariffs.

Vermont Electric Coop and Vermont Gas Systems

Johnson says one electric utility � Vermont Electric Coop � is uniquely vulnerable.

The rural utility owns distribution infrastructure that spans the Canadian border, and has customers that draw power from both Vermont’s grid and Quebec’s.

VEC gets about 40% of its power from other contracts for Canadian hydropower that would likely be subject to potential tariffs.

If a 10% energy tariff were imposed, CEO Rebecca Towne says it could yield a 2% rate increase for their customers.

And she says, Canadian hydropower is a critical � and affordable � part of VEC’s efforts to procure less power from fossil fuels.

“Our board has made a commitment to 100% carbon free [electricity],� Towne said. “And if the cost of that commitment goes beyond what we think our members can bear, then that might be something that we would have to ask some hard questions about, and that would be very unfortunate.�

VEC is collaborating with other Vermont utilities to continue reviewing the contract and look at ways to mitigate potential cost impacts, including with Green Mountain Power, or GMP, Vermont’s largest electric supplier.

“We’re engaged in deep analysis, and there is a lot of information still needed on how, or even if, any of this would be applied to electricity,� said Kristin Carlson, with GMP. “Our initial review is it does not appear that it applies, but we’re going to keep reviewing.�

Similarly to VEC, Vermont Gas Systems estimates a 10% tariff would yield $6-7 million in additional annual costs for their customers, whose gas supply flows into the state pipeline system almost entirely from Canada.

Under that scenario, President and CEO Neale Lunderville says they’d be looking at ways to mitigate that impact � including by purchasing more domestic natural gas.

“Other than the small amount of renewable natural gas that we produce in Vermont, nearly all of Vermont Gas� supply comes from Canada,� Lunderville said. “We have what’s called a single feed system that connects at the Canadian border.�

In Vermont, utilities pass on energy costs to their customers, who would ultimately foot the tab. VEC, GMP and Vermont Gas Systems say they’re all researching ways now to alleviate that burden if a tariff is imposed.

Still, they say any rate impacts would likely be gradual and delayed. If President Trump does decide to impose energy tariffs in a month, natural gas and electricity customers likely wouldn’t see their bills change until spring or even summer.

Heating fuel 

The impact could be felt more immediately for liquid heating fuel customers, and at the gas pump.

In New Hampshire, Irving Oil customers reported seeing higher heating fuel bills over the weekend. The company said in a that tariffs would for its American customers.

Matt Cota, with the Vermont Fuel Dealers Association, said he expects a 10% tariff would yield a 25 cent increase on fossil heating fuel and gasoline prices within a day or so of going into effect.

“The 30-day reprieve certainly gives us time to consider the broader implications. � It also gets us out of one of the coldest months of the year,� Cota said.

Cota says these tariffs won’t drive small fuel dealers out of business, but it could force them to drive to New York and Massachusetts to fill up on fuel � and introduce potential supply and demand constraints at those regional hubs.

He says the liquid fuel market is volatile, and dealers are used to navigating market disruption due to wars or other events.

“This is not a supply crisis. There’s plenty of fuel � this is something created, an artificial crisis,� he said. “And it’s unnecessary, in our opinion.�

Cota says they’ll pass on the cost of driving those extra miles to their customers, which will hit the Northeast Kingdom and northern Vermont hardest � parts of the state where many people already spend a disproportionately high share of their income on energy bills.

Gov. Phil Scott also weighed in Tuesday, announcing a new multi-agency task force to analyze the impacts of Trump’s proposed policies on Vermont.

“As I have said in the past, I am not a fan of increasing tariffs on our friends and close allies,� Scott said in a statement. “And most Vermonters agree, a trade war with our larger trading partner, which could increase costs on already overburdened working families, seems like a bad idea.�

However, the governor says his team will take a data-driven approach to evaluate the risks tariffs pose to Vermont’s economy, while trying to understand the president’s policy goals.

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