In an order issued Monday, the board said the request by the Vermont Gas Systems to extend its system will provide significant economic benefits to the state without undue adverse environmental impacts.
Vermont Gas has a long-term goal of extending natural gas service to Rutland. They are also considering a spur line that would cross beneath Lake Champlain and provide natural gas to the International Paper Ticonderoga Mill, in New York.
Many vocal opponents along the path of the pipeline opposed the project.
Gov. Peter Shumlin said the decision will provide businesses, industry and residential homes with a less expensive source of power.