Trystan Casey
Electric rates in Massachusetts have been volatile, with prices increasing during the winter and dropping during the summer. This volatility is due to the state's reliance on fossil fuels, particularly natural gas, for electricity generation and heating. However, recent developments indicate that electric rates may be decreasing. For instance, Eversource customers in Massachusetts saw a significant decrease in their electric bills starting July 1, 2023, with a 38% reduction in eastern Massachusetts and a 33% decrease in western Massachusetts. Additionally, the state's commitment to adding more renewable energy sources to the grid is expected to stabilize electricity prices and lead to a downward trend in the long term.
| Characteristics | Values |
|---|---|
| Average residential electricity rate | 31.22 cents per kilowatt-hour (kWh) |
| Cheapest electricity rates | Constellation Energy and Clearview Energy |
| Energy choice program | Allows residents and businesses to compare electricity rates from competitive suppliers and switch to a new supplier |
| Energy suppliers | National Grid, Eversource, Unitil |
| Energy rate change | Twice a year |
| Energy rate change factors | Fossil fuel prices, demand |
| Energy rate change season | Summer and winter |
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What You'll Learn
Electric rates decreased for some Eversource customers in July 2023
Electric rates for some Eversource customers in Massachusetts decreased in July 2023. The price of electricity for customers on the utility's basic service rate fell by 38% in eastern Massachusetts and 33% in western Massachusetts. This change is expected to save the average household using 600 kilowatt-hours of electricity per month about $58 in eastern Massachusetts and $42 in western Massachusetts.
This reduction in electricity prices comes after Eversource submitted a rate of 13.82 cents per kilowatt-hour (kWh) to the state's Public Utilities Regulatory Authority (PURA) in May 2023. The rate change took effect on July 1, 2023, and will last until December 31, 2023. According to Eversource, this new rate will provide some relief to customers who have been facing high energy prices.
However, it is important to note that this rate change does not apply to all Eversource customers in Massachusetts. Customers who are part of a municipal aggregation plan or those who get their electricity from a competitive supplier will not be affected by this rate change. Additionally, Eversource has stated that customers tend to use more electricity during the summer months, which will be reflected in their bills.
Looking ahead, Eversource expects that any price increases in the fall will be typical and less significant. In the longer term, as Massachusetts and other New England states integrate more renewable energy sources into the grid, electricity prices are anticipated to decrease and stabilize further.
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The Massachusetts energy choice program
The program allows customers to choose a competitive electricity supplier, while the utility continues to deliver the electricity and send the bill. This means that the utility company will still be responsible for the physical delivery of electricity and the billing, but the source of the electricity can be chosen by the customer. The Massachusetts utilities that are open to energy choice include National Grid, Eversource, and Unitil.
The Energy Choice Program offers customers the flexibility to terminate their plan at any time as variable-rate plans do not lock them into a contract. Additionally, there are prepaid and no-deposit plan options, where customers can pay for energy upfront and receive alerts about their account balance. Many electricity providers in Massachusetts also offer renewable energy options, such as renewable energy credits (RECs) or sourcing 100% green energy.
To get started with the Energy Choice Program, customers can select a supplier from an approved list, ensuring they meet the qualifications set by the Massachusetts Department of Public Utilities. The savings will depend on the contracted price of gas and the usage patterns. It is important to shop around for the best price, as rates can change frequently.
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Renewable energy plans
Renewable energy in Massachusetts has become an attractive option for homeowners and businesses. The state has become one of the United States' renewable energy leaders, with significant growth in renewable energy sources such as solar, wind, and hydropower.
The deregulated energy market in Massachusetts allows residents and businesses to compare electricity rates from competitive suppliers and switch to a new supplier to lower their supply rate per kilowatt-hour. This freedom to choose an electricity supplier provides consumers with the ability to support green energy initiatives.
Many electricity providers in Massachusetts offer renewable energy options. Some companies offer renewable energy credits (RECs) to offset environmental footprints, while others source 100% green energy from solar power or other sustainable sources. For example, Inspire Clean Energy offers competitive flat-price plans that give customers access to 100% renewable electricity.
Massachusetts has implemented various initiatives to promote renewable energy development. The state has set a goal of producing 80% of its electricity from clean energy sources by 2050 and plans to acquire 5,600 megawatts of offshore wind power by 2027. Additionally, the state offers incentives for electric vehicles, aiming for all new vehicle sales to be zero-emission by 2035.
Transitioning to renewable energy in Massachusetts provides multiple benefits, including reducing greenhouse gas emissions, improving energy security, and stimulating job creation and economic development.
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Demand and pricing
Electricity rates in Massachusetts change frequently, sometimes daily, and are impacted by demand, which typically increases during the winter months. As a result, electricity rates tend to rise in winter and drop in summer. The state's heavy reliance on natural gas for electricity generation and heating leads to energy rates that reflect the price of natural gas.
Massachusetts' deregulated energy market allows residents and businesses to compare electricity rates from competitive suppliers and switch to a new supplier to lower their supply rate per kilowatt-hour. This market dynamic enables customers to shop strategically and lock in lower rates during milder seasons, such as spring or fall, when demand is typically lower.
The state's energy landscape is further influenced by the addition of renewable energy sources to the grid. As Massachusetts and other New England states integrate more renewables, such as solar and wind power, electricity prices are expected to decrease and become more stable over time.
To make informed choices, customers can utilise platforms like Choose Energy to compare rates, providers, and plans. Prepaid and no-deposit plans, renewable energy plans, and the ability to terminate variable-rate plans at any time offer customers flexibility in managing their energy expenses.
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How electric rates are calculated
Electric rates in Massachusetts are calculated based on a combination of factors, including the cost of electricity generation, transmission, and distribution, as well as other associated costs such as taxes and fees. The average residential electricity rate in Massachusetts is 31.22-32 cents per kilowatt-hour (kWh), which is significantly higher than the national average of 20 cents per kWh. This rate is subject to change and can vary on a monthly and even daily basis.
The deregulated energy market in Massachusetts allows residents to compare rates and plans from different suppliers and choose the one that best suits their needs. The Massachusetts energy choice program enables customers to switch to a new supplier to lower their supply rate per kilowatt-hour. This competitive market provides significant savings to customers compared to the utility company's default rate, also known as the "price to compare".
To calculate the cost of electricity, residents can multiply the rate per kilowatt-hour by their monthly consumption. For example, if a household consumes 857 kWh of electricity per month (the average in Massachusetts), they would multiply this by the rate of 0.32 to get a monthly cost of approximately $274. This calculation can be adjusted for seasonal variations in energy usage, such as during milder seasons like spring or fall when demand tends to drop.
Additionally, Massachusetts offers various options for renewable energy plans and incentives. Some companies offer renewable energy credits (RECs) to offset carbon footprints, while others provide 100% green energy from solar power or other sustainable sources. Installing solar panels can help reduce or even eliminate electric bills over time, providing long-term savings for residents.
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Frequently asked questions
Electric rates in Massachusetts change frequently, and historically, electricity prices rise every winter and drop every summer. However, as of July 1, 2023, electric rates for Eversource customers in Massachusetts decreased by 38% in eastern Massachusetts and 33% in western Massachusetts.
New England, where Massachusetts is located, relies heavily on natural gas for electricity generation and heating homes. So, when the demand increases during the winter, prices and electric rates tend to follow.
You can save on your electric bill by shopping strategically in deregulated markets. For instance, you can lock in a lower rate by signing up for a new plan during the milder seasons of spring or fall when demand drops. You can also compare rates and switch to a new supplier with a lower rate per kilowatt-hour.
As of April 29, 2025, the average residential electricity rate in Massachusetts was 31.22 cents per kilowatt-hour (kWh).
