Semiconductor Manufacturer GlobalFoundries approved to handle its own Utility power operations at Vermont plant

Oct. 24, 2022
The VPUC originally rejected GlobalFoundries plan to be its own utility in about four years, and now has reversed its stand. The manufacturing plant will still receive its electricity from generator Green Mountain Power for four more years

State utility regulators in Vermont have approved a manufacturing company’s desire to manage its own electricity transmission needs at its facility in that state.

GlobalFoundries, which produces semiconductor components, is forming its own GF Power LLC to be the electric utility for the facility in Essek Junction, Vermont. The state Public Utilities Commission voted for a Certificate of Public Good approving the utility formation and operation.

A global competitor in semiconductor manufacturing, GlobalFoundries is the only transmission (higher voltage) class customer in Vermont, according to the report. The plant employs more than 2,000 people and produces more than 600,000 semiconductor wafers per year.

“GF is pleased with the PUC's decision to issue the CPG approving the formation of our electric utility, which will assist GF in making our Essex Junction site more globally competitive,” said Ken McAvey, GF Vice President and General Manager of Fab 9 in Essex Junction. “We appreciate the partnership with Green Mountain Power (GMP), the Department of Public Service and VELCO, as well as our community partners, Greater Burlington Industrial Corporation, Lake Champlain Chamber and Vermont Chamber, to make this a reality."

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In February, the VPUC originally rejected GlobalFoundries plan to be its own utility in about four years, and now reversed  its stand. In the meantime, the manufacturing plant will still receive its electricity from generator Green Mountain Power (GMP).

The power purchase agreement with GMP will cover that four-year transition period and includes a $15.6 million transition fee to be paid to GMP by GlobalFoundries.

The company worked with the Vermont Chamber of Commerce, the local chambers, the GMP utility and Vermont’s Department of Public Service on creating an acceptable framework for transitioning to a self-owned and operated utility.

GlobalFoundries wants to acquire power directly from the grid via a competitive marketplace instead of the current utility customer relationship. Company leaders believe it could save money and make GF more competitive globally.

The U.S. is working to shore up its semiconductor supply chain in the wake of the issues caused by both the COVID-19 pandemic and friction with suppliers such as China.

The federal government recently announced it would provide about $30 million to aid GF in upgrading the Essex Springs manufacturing plant. 

GlobalFoundries acquired the former IBM plant in 2015