Vermont Energy Grid: Blackout Risk, Infrastructure & Reliability

Vermont's ISO New England grid has fundamentally restructured since the 2014 closure of Vermont Yankee nuclear, shifting from nuclear-powered energy independence to heavy reliance on Canadian hydro imports and distributed renewables in a small, rural system with limited indigenous generation.

Last updated: 2026-02-02 · Data: EIA, NERC, state utility commission filings

Vermont's power grid faces a defining moment. The Green Mountain State generates just 28% of its electricity needs, relying heavily on imports from neighboring states and Canada. This heavy import dependence, combined with aging transmission infrastructure and the 2014 closure of Vermont Yankee nuclear plant, creates significant reliability risks as demand grows.

Vermont operates within ISO New England, serving 647,000 residents across a largely rural landscape. The state's net summer capacity stands at approximately 1,100 MW, but total supply reached 5.8 million MWh in 2023 — with 4.2 million MWh imported from out-of-state sources. This 72% import dependence makes Vermont one of the most grid-vulnerable states in the nation.

The state's generation mix tilts heavily renewable: 55% hydroelectric (mostly small-scale run-of-river), 16% solar, 15% biomass, and 14% natural gas. While this clean profile supports climate goals, it creates new reliability challenges during winter peaks when solar output drops and hydro flows diminish.

Key Vulnerabilities

• Import Dependence: Vermont imports 72% of its electricity, making it vulnerable to transmission line failures and regional supply disruptions

• Winter Peak Stress: Heating electrification drives demand spikes precisely when renewable output is lowest, straining the import-dependent system

• Transmission Bottlenecks: Limited high-voltage lines connecting Vermont to neighboring grids create single points of failure

• Nuclear Gap: The 2014 closure of Vermont Yankee eliminated 620 MW of baseload capacity — never fully replaced

• Aging Infrastructure: Much of Vermont's transmission network dates to the 1960s-70s, with equipment nearing end-of-life

• Extreme Weather: Ice storms and flooding increasingly threaten above-ground lines and equipment

The Demand Surge

Vermont's electricity demand is climbing despite a stable population. Heating electrification drives the biggest increase — cold-climate heat pumps are replacing oil and propane systems across the state. The Vermont Public Utilities Commission projects residential electricity demand could rise 30% by 2030 as homes switch from fossil fuels.

Transportation electrification adds another layer. Vermont has committed to 100,000 EVs on the road by 2025, requiring an estimated 200 GWh of additional annual demand. Data center growth remains modest compared to neighboring states, but even small facilities stress Vermont's constrained grid.

The real challenge comes during winter peaks. January demand can exceed 1,000 MW — nearly the state's entire generating capacity — forcing massive imports precisely when regional grids face their own stress.

Infrastructure Spending Pipeline

Vermont is pursuing several major grid projects to address these vulnerabilities. The New England Clean Energy Connect transmission line will import 1,200 MW of Canadian hydropower through Maine, with Vermont receiving allocation rights. The $1 billion project faced delays but remains on track for 2026 completion.

Green Mountain Power, the state's largest utility, is investing $500 million in grid modernization through 2028. This includes smart grid deployment, battery storage installations, and transmission upgrades. The utility has already deployed 20 MW of grid-scale batteries and plans another 55 MW by 2027.

Federal infrastructure spending is flowing to Vermont as well. The state received $110 million from the Infrastructure Investment and Jobs Act for grid hardening and clean energy projects. The Inflation Reduction Act provides additional tax incentives for utility-scale renewable development.

The Vermont Public Utilities Commission has approved 400 MW of new solar development over the next 3 years, though much of this capacity requires transmission upgrades to deliver power effectively.

What This Means for Investors

Vermont's grid transformation creates opportunities across multiple infrastructure sectors. Transmission equipment manufacturers benefit from urgent upgrade needs — names like Quanta Services (PWR) and MYR Group (MYRG) have active projects in the ISO New England region.

Energy storage demand is accelerating as Vermont seeks to balance intermittent renewables with import dependence. Fluence Energy (FLNC) and Tesla's energy division are deploying battery systems for Green Mountain Power and other utilities.

The broader New England grid rebuild favors regional utilities with Vermont exposure. Eversource Energy (ES) owns transmission assets serving Vermont, while Avangrid (AGR) benefits from the Canadian import projects.

Copper demand from Vermont's electrification push may seem small in absolute terms, but the state represents a microcosm of national trends. Every home switching from oil heat to electric heat pumps requires significant rewiring — multiplied across rural New England, this creates meaningful infrastructure metal demand.

For income-focused investors, the VanEck Utilities ETF (VPU) provides exposure to the regulated utility spending driving Vermont's grid upgrades, while the First Trust Nasdaq Clean Edge Smart Grid Infrastructure Index Fund (GRID) captures the smart grid equipment deployment underway across the region.

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Frequently Asked Questions

Is Vermont's power grid reliable?

Vermont's grid faces reliability challenges stemming from the closure of Vermont Yankee nuclear plant in 2014, which removed 620 MW of firm baseload from a state with only about 1,000 MW of peak demand. The state now depends heavily on power imports from Hydro-Quebec and ISO New England markets. Vermont's rural, mountainous terrain makes transmission and distribution infrastructure expensive to maintain. The state's small utility system has limited generation resources to draw upon during regional supply shortfalls.

What causes blackouts in Vermont?

Ice storms and heavy snow are Vermont's primary blackout causes, with the state's forested mountains amplifying tree-related damage during winter storms. Tropical storm remnants, like Tropical Storm Irene in 2011, can cause catastrophic flooding that damages substations and washes out access roads needed for restoration. High winds during any season cause frequent distribution outages in this heavily wooded state. Vermont's dependence on imports means regional New England supply constraints can also affect reliability.

How is Vermont investing in grid infrastructure?

Vermont is investing in distributed renewable generation, primarily rooftop and community solar, to reduce import dependence. Green Mountain Power is pursuing innovative utility business models including home battery programs that aggregate customer storage for grid services. The state's long-term contract with Hydro-Quebec provides a firm clean energy import that partially replaces Vermont Yankee's output. Distribution system investment focuses on storm hardening and accommodating growing distributed solar penetration.

What is Vermont's energy mix?

Vermont's in-state generation is primarily from small hydro, biomass, wind, and solar, but the state imports the majority of its electricity from Hydro-Quebec and ISO New England markets. The long-term Hydro-Quebec contract provides roughly one-third of the state's electricity needs. Distributed solar has grown rapidly, driven by net metering incentives and community solar programs. Vermont's renewable energy standard requires 75% renewable electricity by 2032, achievable primarily through continued solar deployment and Canadian hydro imports.

This analysis is part of Energy Macro's state-by-state grid infrastructure research. For our complete framework on positioning for the $14 trillion grid rebuild — including specific allocations and income strategies — see The Blackout Fortune Playbook.

Updated: February 2026 | Data sources: EIA, ISO New England, Vermont Public Utilities Commission