Mass Save and Energy Efficiency
As a long-term energy efficiency initiative, Mass save has been a popular topic in discussions that argue for balancing climate action and affordable costs of living among Bay Staters. But what is the history behind our state’s green initiatives, and how has Mass Save developed as a result of them?
Conversations and legislative efforts surrounding energy and energy production in Massachusetts are nothing new to Bay Staters.
Since the 1990s, the state has established and implemented various programs addressing the need for energy, the need for renewable and efficient energy, and how energy use can be transitioned so that the state can meet both its climate goals and energy needs in productive ways.
The 1997 Electric Industry Restructuring Act is the first of many initiatives to change how Bay Staters access energy. This act was meant to “break up the existing utility monopolies into separate generation, distribution and transmission entities, and it will allow non-utility generators access to the retail end user market.”
By allowing for customers to choose their own energy suppliers, coupled with measures to increase competition among energy retailers, customers saved $775 Million by 2000. In other words, this act was an important step in the direction of transparent and affordable energy for Massachusetts ratepayers – a goal which would later be combined with efforts to combat climate change.
Setting the Stage for Energy Efficiency
In 2008, the passage of the Green Communities Act brought with it the funding to establish programs that would promote energy efficiency across the state. This legislation came with another act, the Global Warming Solutions Act (2008) Massachusetts setting the goal of reaching a 20% cut in 1990-level greenhouse gas emission by 2020 and an 80% cut by 2050.
As of right 2020, Massachusetts has seen upper estimates of a 31% reduction in greenhouse gas emissions. That being said, 2020 was not an unusual year with unusual amounts of travel or other greenhouse gas emitting activities, given the pandemic.
Under the act, both energy distributors (i.e. gas and electric companies) and municipalities work together to create and implement energy efficiency programs across the state.
While there is a lot to this act, one of the major initiatives that came as a result of it was the “Green Community” designation for cities and towns.
In order to become a “Green Community” under the Green Communities Act, towns and municipalities must prove that they meet 5 requirements, including:
- An established site that is specifically reserved for renewable energy projects
- Expedite renewable energy project permits
- Establish an energy baseline that would lower energy use
- Purchase energy efficient vehicles for municipal use
- Implement the Massachusetts Stretch Building Code
Once a municipality becomes a designated “Green Community,” they are eligible to receive grants for the implementation of green initiatives.
Said initiatives focus primarily on energy solutions, including cutting energy costs, providing access to grants for clean and affordable projects, and promoting energy-efficient infrastructure. The Green Communities Division, which is under the Office of Energy and Environmental Affairs, also educates, promotes, and helps to coordinate clean energy initiatives within the state.
Another initiative that was established through the Green Communities Act, and which has gotten plenty of coverage lately, is Mass Save.
What is Mass Save?
Through the Green Communities Act’s legislative foundations, Mass Save was established. Mass Save is the trademark name for an efficient energy model created by multiple Program Administrators, i.e. the electric and gas administrators of efficient energy programs across the state. Each Program Administrator is required to create individual and joint plans for gas and electric energy efficiency programs every three years, which are then submitted for approval by the Massachusetts Department of Public Utilities (DPU). With the rising push for Massachusetts to meet its greenhouse gas emission reduction goals by 2050, the scope of Mass Save’s mandate has increased.
Rather than coming from the municipalities themselves, Mass Save is a model created and implemented by its Program Administrators, including National Grid, Eversource, Berkshire Gas, Liberty, Cape Light Compact, and Unitil.
The latest Mass Save is the Massachusetts 2025-2027 Energy Efficiency and Decarbonization Plan.
This $5 billion plan, which had $1.9 billion specifically reserved for “equity-related investment,” was ultimately cut down to $4.5 billion by the EEAC, given concerns that have been increasing over high energy costs for Mass Save customers. These costs are matched by the ambitious nature of the 2025-2027 plan, which includes a number of goals to increase energy efficiency within the state.
With that being said, the funds for this program comes primarily from the Green Communities Act’s System Benefit Charge (SBC) and the Energy Efficiency Reconciliation Factor (EERF), which are surcharges on ratepayers’ bills, with about 11% of the funds coming from Regional Greenhouse Gas Initiative auction proceeds. While customers ultimately gain back much of what they pay through incentives, rebates, and other benefits, they are burdened with paying the initially high costs.
While the final approved plan was cut, the original plan that was submitted by the Program Administrators to the Massachusetts Department of Public Utilities (DPU) included:
- Installing heat pumps in 119,00 households, with 23,000 of them being low- to moderate-income and 15,000 being rental units
- Weatherizing 184,000 households, with 75,000 of them being low- to moderate-income and 51,000 being rental units
- Reducing greenhouse gas emissions (namely CO₂e) by 1 million metric tons
- Delivering a total of $13.7 billion in benefits, with $4.4 billion being in equity benefits
- Delivering 1.1 billion therms and 8.3 MWh in energy savings
- Investing $1.9 billion in equity-related investment, with $1.3 billion being incentives for low- to moderate-income households and $615 million reserved for renters
- Supplying over $3.4 billion of customer incentives
There are various ways in which Mass Save works with its customers to improve their energy usage.
While Mass Save’s initiatives appear to be a great step toward energy efficiency and significantly reduced greenhouse gas emissions, many Bay Staters are left wondering if this expensive program is worth the funding it will ultimately receive.
Current Debates Surrounding Mass Save
Given that Mass Save is funded “primarily by energy efficiency surcharges on all monthly gas and electric bills for customers of the Mass Save utilities,” many customers are feeling disillusioned by the high energy costs they have been billed with. This is only exacerbated by the fact that these utility companies have been unclear in what the charges on bills are actually being used for, which allows for them to hide their profits from their customers and use Mass Save as a scapegoat for their high costs.
These costs are not helped by the “Liberation Day” tariffs that Trump has placed on our key trade partners. Tariffs on energy coming into the United States from Canada do nothing but increase the stress on homeowners and renters who are seeking not only efficient, but also affordable energy solutions.
Some, namely those who do not support a move toward more renewable and efficient energy usage, argue that the implementation of programs like Mass Save is too costly. It is true that it can be costly to implement, however, with Mass Save, customers are expected to get back about 70% of the initial $5 billion through the rebates and incentives that Mass Save’s plan promises to them.
There is also research which supports that timely implementation of efficient and clean energy now can cut down costs and risks further down the road. In investing in clean energy infrastructure and projects now, renewable energy costs will become lower than fossil fuels, jobs can be created through energy projects, and the climate and environment will benefit, leading to healthier living conditions. Not to mention that Massachusetts is farther along in its clean energy implementation and investments than other states
While there are clear benefits to clean energy and Mass Save, this doesn’t mean that Mass Save has no issues or opportunity for program improvement.
There is a lack of understanding among prospective customers and even current customers that parts of their initial expenditures will be given back to them through incentives and rebates. While this is more of a marketing issue rather than a programmatic one, it is still vitally important to the success of the program and to energy efficiency programs in general.
Still, low- and moderate-income households are left facing the brunt of the economic burden of the program. Wealthier households pay a proportionally lower cost than lower-income households, meaning that the low- to moderate-income ratepayers are using a higher-percentage of their income to pay for their energy.
The $500 million cut in the proposed budget has sparked a lot of pushback from various groups.
Homeowners and taxpayers have felt that the DPU was unclear in their announcements about the ultimate $4.5 billion budget, arguing that many understood the $500 million cut to be a cut to the 2022-2024 budget plan of about $4 billion, rather than a cut to the proposed $5 billion budget. In other words, some customers thought that the new 2025-2027 budget would only be $3.5 billion rather than $4.5 billion. This misconception highlights how little Bay Staters understand about Mass Save, the DPU, and clean energy initiatives in general among Bay Staters, as well as the need for better communication between Mass Save and ratepayers.
In another response to the budget cut, the Conservation Law Foundation and the Beyond Gas Coalition have argued, “To deliver energy affordability for Massachusetts residents, Governor Healey and the State Legislature must take tangible steps to address the root cause of what’s driving up energy costs: excessive spending by gas and electric utilities for costly infrastructure projects and decisions designed to line corporate pockets, not lower bills, like excessive infrastructure projects, political spending, and high salaries.”
These “excessive infrastructure projects” include high costs for the repairing and replacing of gas pipelines, which is estimated to cost about $880 million this year alone.
What’s Being Done at the State Level?
Recently, Healey has announced a $50 discount on April 2025 electric bills via the Energy Affordability Agenda, which will come in the form of a credit to National Grid, Unitil, and Eversource customers. The funding for these credits will come through “from funds collected to support clean energy,” though it is unclear whether this funding is coming from Massachusetts Clean Energy Center (MassCEC) – the state’s clean energy economic development agency, or via another source.
Along with this discount, the state has assured customers that it is working toward alternative ways to decrease high energy costs and keep utility companies transparent in what they are charging customers for.
But what good is a $50 discount for one month’s bills when said bills can be hundreds of dollars?
The Healey-Driscoll Administration’s Energy Affordability Agenda does more than just provide a $50 credit. In conjunction with the DPU and utility companies, the administration has also worked on other initiatives, such as:
- Work to improve discount rate enrollment among those eligible
- Create discount rates for low-income electric customers
- Expand rates for heat pumps, which will ultimately save an average of $1000 per customer throughout the winter season and increase overall savings for heating pump customers
- Support and enforce stronger regulation of utilities companies so that customers are not taken advantage of and overcharged
- Reviewing alternative methods of financing new grid infrastructure so that customers are not charged for it
- End programs that met their goals and prevent the costs of said programs from falling onto customers
- Fix clean energy pricing so that there customers are susceptible less market volatility
- Research alternative rate designs that reduce costs for customers
According to the Healey-Driscoll administration, the projected savings over the next 5 years for customers can amount to over $1.2 billion.
With that being said, affordable housing and climate activists have agreed that costs of living are too high, but that cuts in costs should not be coming from programs like Mass Save and other clean energy initiatives. High costs of living will only be heightened by Trump’s recent tariffs, but clean energy and climate initiatives should not and cannot be jeopardized in exchange, especially when the Trump administration has condemned and ignored said initiatives at the federal level.
The Commonwealth has a responsibility to help fund initiatives that work toward its common goals, which in this case are reduced greenhouse gas emissions and better renewable energy. Supplementary funding that is not coming directly out of ratepayers’ paychecks is crucial to both bolster the program and reduce financial burdens.
Blog post by Sydney Mascoll, Act on Mass Policy Fellow Spring 2025