Summary
This post offers some complicated data which boils down to the following:
- Winter gas rates have doubled since 2016 and are up 11% over last winter.
- Last Friday, February 28, taking direction from the Governor, the Department of Public Utilities made moves to cut gas rates.
- One DPU order will essentially shift some costs of March and April gas consumption into the summer, but will not reduce the high March bill that people will receive for February usage.
- Another DPU order will cut the Mass Save program, resulting in overall gas rates being perhaps 4% lower than they would have been; but this will not take effect until May 1. Even with the cut, the Mass Save three-year budget is increasing substantially compared to the prior period.
- Mass Save costs gas heating customers approximately $500 per year.
- All policy-driven costs including Mass Save add 17.5 to 24.5% to electric bills and 12.3 to 39.1% to gas bills (these amounts vary by customer type, season, and utility territory).
- We need to continue to scrutinize these costs.
- Help in reducing bills is available from multiple sources.
The outline of this post is as follows.
DPU response to concerns
Many have spoken out about high utility bills this winter, especially gas bills. Rates have gone up over the last decade, especially over the last few years. In mid-February, the Governor publicly expressed concern to the Department of Public Utilities.
On Friday, February 28, the DPU responded with an order lowering rates for gas consumption in March and April. See the DPU File Room, Docket #24-PGAF-GRID, which may be viewed directly here. The main elements of the order are:
- The DPU ordered the gas utilities to shift costs away from the winter peak when rates are highest and when usage is also highest. This shift of costs will cut the bills for March and April gas consumption by approximately 10 to 15% below what they would have been otherwise.
- Note, however, that the true peak (December through February) has already passed. March bills for February gas consumption will not be reduced.
- Summer bills will rise to recover the revenue lost as a result of the savings given to ratepayers on March and April consumption.
- The utilities have agreed not to charge any interest on the delayed recovery of their costs.
- The DPU ordered the gas companies “to continue to communicate effectively and transparently with their customers regarding bills, payment plans, and other ways to address natural gas costs.” Links to web resources regarding payment plans and discounts appear below.
In a separate order issued on the same day, the DPU ordered a reduction of $500 million in the three-year (2025-2027) budget for Mass Save residential programs. See DPU File Room, Docket #24-144, which may be viewed directly here at page 204. This will result in a reduction of approximately 4% in residential gas rates from what they would otherwise be. However, as discussed below, the Mass Save budget is still increasing.
[NOTE: The approximate 4% cut in gas rates due to the Mass Save budget cut is estimated as follows: Mass Save is funded by charges on utility rates. The $500 million cut will be split evenly between the electric utilities’ residential programs and the gas utilities’ residential programs, amounting to a 15% cut for electric residential programs and a 25% cut for gas residential programs. There is no cut in low income programs or commercial/industrial programs. If the full 25% residential budget cut were reflected in residential gas rates, this would amount to an approximately 5% cut in the overall residential gas rates. However, since there is no cut in Mass Save low income programs and these are funded in part through the residential rates, it appears that residential gas rates will go down by a somewhat smaller percentage, approximately 4%. For Boston Gas, residential rates cover 67.5% of the Mass Save low income sector resulting in a current charge of $0.0881 per therm or approximately 20% of total the residential energy efficiency charge. As a result, Friday’s 25% cut will affect only 80% of the residential energy efficiency charge; the energy efficiency charge is approximately 20% of the residential gas rate. 20% x 80% x 25% = 4%. See the Boston Gas rate Annual LDAF Filing for the period November 1, 2024 through October 31, 2025, 24-PGAF-GRID. These calculations are approximate and the impact will vary across utilities.]
The shift of charges from winter to summer and the Mass Save reduction offer modest relief. However, we do need to have a continuing conversation about how to bring down all the components of the gas and electric rates, including the Mass Save budget and the Gas System Enhancement Program. Overall, according to the DPU, Mass Save and other policy driven measures add 17.5 to 24.5% to electric bills and 12.3 to 39.1% to gas bills (these amounts vary customer type, season, utility territory). See DPU three year plan order at page 208. Further below, this post summarizes current and historical rate components for perspective.
Bill assistance
The chart below shows links for bill assistance for each of the utilities in my district. See also this FAQ sheet from the DPU.
Assistance available from utilities in my senate district
| City/Town | Electric (link to assistance) | Gas (link to assistance) |
|---|---|---|
| Belmont (information) | Belmont Light | National Grid** |
| Boston (assistance) | Eversource* | National Grid** |
| Cambridge (assistance) | Eversource* | Eversource*** |
| Watertown (information) | Eversource* | National Grid** |
Additional assistance links include:
- Home Energy Assistance Program (income eligible)
- Residential Assistance for Families in Transition (income eligible)
- S.W.A.N. Society in Boston, Inc. (discretionary)
- Seniors Save (Boston)
And, of course, people with high bills this winter might be able to lower next winters’ bills with help from Mass Save.
Finally, people struggling with energy bills may always call my team for assistance in navigating the options.
Gas rate comparisons
Charges on a gas bill are mostly driven by volume; although there is also a relatively small monthly minimum ($12 for National Grid customers). The volume-driven charges are expressed as dollars per “therm.” A therm is 100,000 BTU, which is just a little more than 100 cubic feet of gas. A home with gas heating and hot water might use approximately 900 therms per year. The chart below shows the last two years of per therm charges for residential heating customers of National Grid and Eversource. The charges are shown as of January 1, during the winter heating season. Eversource rates have jumped more sharply, but National Grid rates are a little higher in both years.
Chart 1: Components of Eversource and National Grid gas rates for residential heating customers, January 2024 and January 2025, rates in $ per therm.
The next chart shows the history of National Grid charges back to 2016. The seasonal fluctuation is apparent, but so is a rising long term trend: overall, peak winter rates rose 105% from January 2016 to January 2025. During the same period, the consumer price index rose 34%, so the real (inflation-adjusted) increase was 53%. All major components of the gas rate have increased since 2016, although the gas supply component (which is driven by the commodity market) has actually backed down since 2022.
Chart 2: Historical components of National Grid gas rates for residential heating customers, 2016 to 2025, rates in $ per therm. All rates as of January 1 (Peak) or July 1 (Off Peak); intermediate rate changes not reflected.
The Department of Public Utilities offers a good overview of how gas rates are set and regulated. There are basically three components of gas rates:
- Gas supply — the local gas companies (National Grid and Eversource) are not allowed to make a profit on selling gas. They just pass their costs through to customers with no additions. Gas supply costs include (a) the wholesale commodity price of natural gas at major trading hubs (b) the costs charged to physically transport the gas to the local gas company. Gas supply rates are set at least twice a year to reflect peak (winter heating season) market conditions and off-peak market conditions. Gas typically costs more in the winter.
- Distribution (Gas delivery)– the local gas companies are permitted to earn a regulated profit on the service of delivering gas — maintaining the pipes in the streets, the meters, etc. The regulation of local delivery charges involves complex but well-established computations about the permissible financial return that utility owners may derive from their investments. The Attorney General represents ratepayers in regulatory proceedings to review distribution charges.
- Policy driven charges (combined in the “Local Delivery Adjustment Factor” or “LDAF”) — the LDAF is a collection of approximately 15 policy driven charges, the bulk of which support energy efficiency programs (MassSave), gas system enhancements (accelerated investment in repairing leaky pipes), and subsidies for lower-income ratepayers. These three components are shown separately in the chart above.
As to gas supply and local delivery charges, the main regulatory roles are (a) to verify charges, (b) perhaps to shift charges in time to even costs out over the year, and (c) in the case of delivery charges, verify that returns are commercially reasonable. However, the legislature and the Department of Public Utilities have more control of the policy driven charges.
Mass Save Charges
Mass Save energy efficiency programs support homeowners, tenants, and businesses in making energy efficiency improvements — primarily insulation and heat pumps. Mass Save is funded primarily by Energy Efficiency charges added to gas and electric bills. The Chart 2 above shows that for National Grid, the Energy Efficiency charge has more than tripled since 2019, rising from $0.1323 per therm to $0.4676 per therm. As of January 2025, the Energy Efficiency Charge comprised 19% of National Grid’s total per therm charges.
Chart 3 below shows the annual contribution to statewide Mass Save programs for homes heating with gas in the communities that I represent — over $600 per year for homes in Belmont, Boston, Cambridge and Watertown, based on the January 1, 2025 rates. Chart 3 does not reflect any benefits that a resident might derive from the Mass Save program. Belmont electric users do not contribute to Mass Save because they are served by a municipal utility, although they may contribute as gas users.
Note that as a result of the recent DPU order reducing the Mass Save residential programs budget discussed above, the annual contributions will be lower than shown in Chart 3, perhaps 20 to 25% lower. Even if the annual contributions are 25% lower, the 2025 to 2027 total of Mass Save charges may still exceed $1,000 for homes heating with gas. The actual outcome will depend on how the budget evolves over the coming months and years.
Chart 3: Annual contributions to Mass Save for home heating with gas (2024-2025 winter rates, before cuts ordered by DPU on February 28, 2025)
Note that in addition to the Electric Energy Efficiency charge shown in the chart –which is composed of the “systems benefit charge” as well as the “energy efficiency reconciling factor” — Mass Save’s 2025-2027 three year plan contemplates the following additional funding sources.
- Indirect electric ratepayer funding through the Forward Capacity Markets (FCM) and the Regional Greenhouse Gas Initiative (RGGI) estimated respectively at $103 million and $150 million over the three years of the plan. These amounts are buried in energy supply costs. We estimate them as the equivalent of a $0.0020/kwh rate component (estimating from the fact that the systems benefit charge is $0.0025/kwh and is projected to raise $321 million for the three year plan). This adds approximately another $12 annually for the average non-heating electric customer in the chart above.
- $71.8 million in confirmed federal aid and other funding sources with the possibility for additional funding to be identified — a relatively small contribution to the originally proposed $5 billion three year plan.
See the recent DPU order approving the 2025-27 plan at page 180 for more discussion of the funding sources. See also statewide summary table of Funding Sources in “Funding” Tab in Appendix C, to the 2025-27 Efficiency plan, DPU 24-149.
Even after the budget cuts ordered by DPU, Mass Save’s 2025-2027 budget is up substantially in the residential sector, in the low income sector and in total as compared to the 2022-2024 plan. Chart 4 below shows the combined gas and electric statewide increase. Not shown in the chart below, the residential sector budget for gas utilities (taken alone, excluding the electric utilities) increases by 10.5% as shown in the “Natural Gas Budget” tab of the attached spreadsheet.
Chart 4: Mass Save Budget Growth — Current (2025-27 as reduced by DPU) vs. Prior (2022-24, Evaluated for first two years, planned for 2024).
Resources
These resources relate to the details of utility rates. For assistance, see above, Bill assistance.
- Spreadsheet of calculations and sources for this post
- More analysis of electric rates
- Department of Energy Resources
- Department of Public Utilities
- National Grid
- Eversource
- Mass Save Studies
- Energy Information Administration
- MassGIS
Thanks. Will, but way too complicated.
How much did rates rise over the past 6 months (say, for National Grid)?
Did Democrats stopping pipeline projects especially in Mass. have anything to do with it?
Thank you, Dee. I’ve added a summary to make it more digestible.
Thank you Will. That’s a lot to digest. One immediate point, the $500M “savings” appears to be a misrepresentation. If the old budget was $4B, the MassSave addins mandated by the legislature increased that to $5B, then the DPU reduced it to $4.5B, that’s still a $500M INCREASE the ratepayers will be burdened with. Calling that a reduction appears to be slight of hand.
I probably explained that badly. This is what I was trying to express:
https://www.bostonherald.com/2025/03/01/massachusetts-dpu-accused-of-not-telling-truth-about-500-million-mass-save-budget-cut/?share=dgbcbhsni0dwbctcelou
You are right. I’ve added a chart highlighting the point.
Will, thank you very much for shifting our costs from March to June. I am sure there is value in that, but the biggest value seems to be that people will be complaining less, despite paying roughly the same.
Thank you also for reducing the Mass Save tax! I did not realize before that I needed Mass Save to help us decrease energy consumption – so that we can afford payments to Mass Save that are part of those high rates!
I presume that our esteemed Governor and Legislators built such a perfect Commonwealth that they can’t find a penny to save anywhere else in the government or a way to stimulate energy production. Makes us feel happy.
I hear your irony and do not push back. I’m not saying that what was done is wonderful. I’m just reporting the facts. I acknowledge we have more work to do.
It’s the year 2025 of the common era, nuclear technology has come a long way.
I appreciate the make-work wind projects, but the penny-wise, perhaps statistically insignificant gains are off set by the pound-foolish losses to tourism. Who wants to stand on a Cape Cod beach and stare at that field of lights when you could stare into the ponderous infinity of the mother ocean?
Also, the people voted to lay bare the Massachusetts Legislature and smooth out the antidemocratic distortions. A democratic state is about more that a patina of buzzwords. It’s time for the Leg and the AG to stop playing the obstructionist.
Again, I appreciate the wind projects because they breathe life into the trade schools, because the greedy “it takes a village” and other off-shorers have turned their backs on America and underwrote China’s industrialization with trade policy and the illicit release and theft of intellectual property all at the expense of the American worker, American industry and American progress. There is no debt owed to China, in fact they are in the red and have the greenbacks to service part their debt to us.
I appreciate my Party standing with unions and the consumer. We must focus on three things only: the economy, opposing truly unlawful executive actions and holding the line against the remaining ember of the “Evil Empire” and the current axis of evil. Senator Pelosi humiliated the party by petulantly tearing up Trumps speech, but redeemed herself in measure by standing up and saying~ “With Trump, all roads lead to Putin.” We must be clear-eyed and prepared for the potential of a “Philby” et al. in high office. There is no business as usual when the POTUS is rehabilitating our longest enemy. Do not fritter our energies on base, tribal electioneering.
Thanks Senator Brownsberger. I would add that by utilizing Mass Save services repeatedly over the last 15 years, I have been able to save a lot of money while reducing my home heating and electric bills, and at the same time reducing my greenhouse gas emissions.
These services are still available to all homeowners — free consultations and discounts on energy-saving equipment. You have to ask to get the free and discounted services (see link above).
Speaking of government waste. In my personal experience, Mass Save was a virtue-signaling and completely useless initiative.
The only interaction I had was 100% useless, as the only “efficiency improvement” I knew I needed (getting a utility closet insulated) the representative was completely clueless on how to do it and whom to call. A couple of LED bulbs and a powerstrip would not compensate me even for the time I had to take from work.
It all brings the question: do they have any metrics to justify the huge budget?
I completely agree with Alex B’s experience.
After paying into this Mass Save program for over 30 years, all I have ever gotten is a few light bulbs and a couple of water saver shower heads and a multi plug. I was promised some insulation last year, but never received anything.
It is clear that all the governmental focus on pushing electric heat pumps has overshadowed the need to have abundant NG sources available until the time comes when we have a reasonably priced alternative.
I have spoken to people who have gas heating and also heat pumps, they said the electric bill was so much higher they just shut off the heat pumps all together. They feel cheated that they spent so much on the heat pumps only to not use them.
It seems clear, heat pumps are nowhere near economical compared to NG for heating.
Please put some focus on having a more robust supply of NG until alternatives are economically sensible.
Will, I appreciate these substantive and detailed updates. I am trying to understand how the order from the DPU to the Program Administrators to reduce
the budget for the Three-Year Plans by a total of $500 million will actually affect what Mass Save attempts to do during the 2025 – 2027 Plan period. Do the PAs now have to decide what to cut, or has the DPU told them what to cut? I read the Executive Summary of the DPU Order approving the 2025 – 2027 plan, as well as sections III.D and IIIE. but didn’t find any mention of what will be cut. Do you happen to know if I just need to keep reading in order to understand what will be cut? Thank you.
The Program Administrators have to come back to DPU and tell them how they are going to make the cuts.
Thank you very much for the response.
All I can say is this; in October of 2022, Maura Healey bragged, “Remember, I stopped two gas pipelines from coming into this state.” As a result, enough natural gas is not piped into Massachusetts to meet the need forcing a reliance on expensive imported LNG.
Clear enough?
Thanks, Bob P.
I would like a response from your statement by Will.
Absolutely, if Maura Healey is so concerned about the high cost of gas she merely needs to look in a mirror.
It’s definitely fair to ask what the consequence of those pipeline decisions were. But it’s not obvious what the answer is. It is true that on the coldest winter days there is not enough pipeline capacity to supply all the gas in New England, so we rely on LNG deliveries and/or stored gas. At the same time, even without those particular pipelines, from 2017 to 2023, we grew pipeline capacity by 20% (from 3.01 to 3.59 billion cubic feet per day). If we had built those pipelines, we would be paying for them in our rate structure and I don’t know how that would compare to the costs of our existing system which combines some expanded capacity with expenditures on peaking. My knowledge about pipeline capacity is thin; I rely on one respected source, the Avoided Energy Supply Cost Study, see pages 29 through 44 for a discussion of the New England Gas Market.
Hi Will,
Thanks as always for your thoughtful and thorough communications. I haven’t had the time yet to absorb the extensive data you’ve given us, but two points stick out for me as someone who only uses natural gas for cooking (so have a relatively low monthly bill from National Grid):
–The plan to offer a token reduction in gas (and perhaps also electric?) bills in the short term with higher summer bills so the companies still get to “recover” their lost revenue is not really that helpful. While perhaps spreading the pain more over time, the costs is still just as high, and we have no reason to expect to be better off economically by summer when the repercussions of the new tariffs will also be felt more acutely. How did DPU even approve of those ridiculously high delivery charges to begin with? Something needs to be done to reality check what feels to me like sheer greed and opportunism on the part of the utility companies. Or perhaps on closer look I’ll see some data in your materials above that better justify those significantly spiked charges?
–My electric bills (Eversource) feature the same dramatically spiked bills (up at least 15% from the same time last year even on bills that congratulate me for using some percentage less electricity vs the same period last year), and that seems mainly due to the spike in delivery charges. Again, how were those serious spikes justified, and if the point is to help fund an assistance program, why was it allowed to happen so acutely instead of gradually increasing over time (I’m all for providing assistance in principle)? How can we know that there isn’t a significant component of greed an opportunism on the part of the utility companies?
Thanks again.
Will be posting more on electric bills.
We’ve been in our house for over fifty years and have long ago done all the insulation, weatherstripping, etc. . So $500 of my gas bill goes to Mass Save?! What a scam, get us the hell out of that!
“Mass Save is funded by charges on utility rates…”
That is the problem. Surcharges on utility rates are regressive, not proportional to ability to pay. In my opinion, Mass Save should be funded wholly from the state income tax, which is progressive: the more your income, the more you pay. (Yes, the state income tax could be even more progressive, but that’s another conversation.) And, the state rather than the utility companies should run the Mass Save program.
I do wish our legislature would have the collective courage to make this change of course.
And as always, I very much appreciate Senator Brownsberger’s informative communications, even though I live outside the Senator’s district. Wish that my Arlington Senator and Representatives would follow suit!
YES to having the state run the Mass Save program.
One of the biggest problems with Mass Save is that there is a mandate that there is no insulation cost reduction offered directly to the homeowner for installing insulation on their own. There would be a great deal of cost savings to the Mass Save program if there was a DIY component to it.
Thank you for asking and listening.
Senator:
What are next steps? How do we reduce the cost, not just shift it. We don’t have the money anymore its been spent and then some over the last 40 years. I worry about the debt that we have loaded onto our kids.
I think we need to scale back the MassSave program. It was 4 billion and moved to 5 billion. A 25% increase in one year and What are next steps? How do we reduce the cost, not just shift it.ost likely is planned to grow even faster. Also, the program should be provider neutral and focus on its original intent which was to reduce energy consumption overall. Frankly I see the removal of higher energy efficiency on gas or other fuel option appliances as collusion by the government with the electric generators BIGE. Also, stupid if we are burning gas to make the electricity to make heat. Lots of loss of efficiency in the conversion and transmission process.