Massachusetts commercial power: who can shop

The first question is not price, it is which world your meter is in

Massachusetts runs two electricity delivery systems side by side, and they do not offer the same options. One is the investor-owned network regulated by the Department of Public Utilities, where a business can buy its commodity from a licensed competitive supplier or from the utility's own default supply. The other is the municipal light plant network, owned and governed by individual towns, where the light department buys power itself and there is no competitive supplier to choose. A procurement conversation that starts with rates before it starts with the address is aimed at the wrong question, because a business inside a light plant town cannot shop at all. The eligible part of the market is large, though: the investor-owned utilities serve most of the state's load, and the Department licenses the suppliers, brokers and aggregators who operate in their territory. Establishing which of the two worlds the meter sits in is the work that comes before any offer.

• Investor-owned territory is competitive; municipal light plant towns are not.
• The DPU regulates the investor-owned utilities and their suppliers.
• A light plant buys power itself and sets its own rates.
• Confirm the address before asking anyone for a price.

Three investor-owned utilities, and the light plants beside them

Eversource operates the largest territory, covering eastern Massachusetts including Boston, the North Shore and South Shore, Cape Cod and the western communities it inherited from Western Massachusetts Electric. National Grid covers central and eastern Massachusetts, including much of Worcester County, the Merrimack Valley, MetroWest and the South Coast. Unitil runs the smallest territory, centred on Fitchburg and parts of north-central Massachusetts and the northern border towns. Alongside them sit the municipal light plants, locally governed public utilities such as Holyoke Gas & Electric, Chicopee Electric Light, Belmont Municipal Light and Taunton Municipal Lighting Plant. The Metropolitan Area Planning Council's white paper counts 41 light plants serving all or part of 50 communities and about 13 per cent of the state's electricity, and it notes that the count of systems differs from the count of towns because some plants serve more than one community and some towns are only partly served by one. That gap between communities and systems is why a town name alone does not settle whether a site can shop.

• Eversource covers eastern Massachusetts, Boston and Cape Cod.
• National Grid covers central and eastern Massachusetts.
• Unitil covers Fitchburg and north-central Massachusetts.
• MAPC counts 41 municipal light plants serving all or part of 50 communities.
• Light plants deliver about 13 per cent of the state's electricity.

Basic Service: the utility's own supply, and the clock it runs on

A Massachusetts business that has not chosen a supplier is on Basic Service, the utility's default commodity supply, whose price the utility procures and the DPU approves. It comes in two shapes. Fixed Basic Service holds its price for the pricing period; Variable Basic Service moves with the utility's monthly procurement cost. Which one a business gets by default turns on its rate class: residential R-1 and small-commercial G-1 customers are placed on the fixed option, while medium and large classes, G-2 and G-3, are placed on the variable option unless they choose otherwise. The reset calendar is utility-specific. National Grid resets its residential and commercial fixed price on the first of February and August, its industrial fixed price on the first of February, May, August and November, and its variable option monthly. Eversource describes a six-month fixed period for residential and small-commercial customers and a monthly variable price for large business, with a three-month fixed period where it is available. That calendar is what a supplier is being compared against, and it is why the utility's own price is not the same from one quarter to the next.

• Basic Service is the utility's default supply, priced under DPU approval.
• Fixed holds for the period; Variable moves monthly.
• R-1 and G-1 default to Fixed; G-2 and G-3 default to Variable.
• National Grid resets fixed prices 1 February and 1 August for commercial classes.
• Industrial fixed prices reset quarterly; variable prices move monthly.

ISO New England capacity, and why New England winters cost more

New England buys generating capacity separately from energy, through ISO New England's Forward Capacity Market. The energy market pays for electricity actually produced; the capacity market pays resources for being available, and its costs are recovered from load-serving entities and flow into customer supply prices. Because capacity cannot always move freely around the region, ISO New England runs the auction in capacity zones, including a zone for northeastern Massachusetts and Boston and a zone for the rest of the state, alongside southeastern and northern New England. A constrained zone can clear higher than the wider system, so the same annual usage can carry different capacity exposure depending on where it sits. Winter adds a second pressure. New England leans heavily on gas-fired generation, its pipeline capacity into the region is limited, and on the coldest days heating customers hold firm pipeline rights while some power plants run on interruptible or non-firm gas. When gas is not available, generators may burn LNG or oil, so winter power prices can rise even when annual demand is ordinary.

• ISO-NE buys capacity separately from energy in the Forward Capacity Market.
• Capacity clears by zone, including a northeastern-Massachusetts/Boston zone.
• A constrained zone can clear higher than the wider system.
• New England relies heavily on gas-fired generation.
• Winter heating demand competes with power plants for limited pipeline gas.

What a Massachusetts bill separates, and what aggregation changes

A Massachusetts electric bill separates two functions. Supply is the commodity: the electricity itself, plus the clean-energy compliance costs the seller carries, which include the state's Renewable Portfolio Standard and its Clean Peak Standard. Those programme costs are embedded in the supply price rather than printed as separate lines on every bill. Distribution is poles, wires, substations, meters and system operations, delivered by the local utility under a regulated tariff, and it also carries delivery-side riders and public-policy charges. The split decides what any arrangement can move. A competitive supplier changes the supply side only. A municipal aggregation changes the supply seller only. Neither replaces the distribution company, which keeps the meter, the wires, outage response and the billing administration whoever supplies the commodity. So a business comparing offers is comparing the supply line, and the delivery line is a constant it should separate out before it judges whether one offer beats another.

• Supply is the commodity plus the seller's clean-energy costs.
• RPS and Clean Peak Standard costs sit inside the supply price.
• Distribution is the utility's regulated delivery tariff.
• A supplier or an aggregation changes supply only.
• The distribution company keeps the meter, wires and outage response.

The municipal light plant world: no competitive supply at all

The municipal light plants are not a variant of the competitive market; they are a different model. Each is a locally governed public utility that procures its own power and sets its own rates, and the DPU's competitive-supply framework does not reach them. A business in one of these towns cannot choose a licensed competitive supplier, because the town's light department is the supplier, and it has typically been so since long before retail choice existed. The state's aggregation statute reinforces the point from the other direction: it expressly bars a municipality from aggregating customers who are served by an existing municipal lighting plant, because those customers are already on a municipal supply arrangement. That leaves two real paths for a light-plant town. A business can work with its light department on load management and rate class, or it can relocate a load-bearing operation to a site in investor-owned territory where supply can be shopped. Nothing about a competitive offer applies to a meter the light department supplies.

• Municipal light plants procure their own power and set their own rates.
• The DPU's competitive-supply framework does not reach them.
• A business in a light-plant town cannot choose a competitive supplier.
• The aggregation statute bars aggregating light-plant customers.
• The options are the light department's own rates or a site that can shop.

Municipal aggregation: how a business account is actually enrolled

Massachusetts municipal aggregation runs under General Laws chapter 164, section 134, with the Department of Public Utilities' guidelines in D.P.U. 23-67-A setting the plan and reporting requirements. A town or city starts one by a vote, in a town meeting or by a city council with the mayor's approval, then develops an aggregation plan with the Department of Energy Resources and submits it to the DPU for approval. Participation is legally voluntary, but an approved programme may use automatic enrolment with opt-out rights: the municipality notifies eligible customers in advance, and a customer that takes Basic Service and does not opt out is transferred to the programme's chosen supplier. The distribution utility keeps delivering, metering and billing. Two details decide whether a business is swept in. First, automatic enrolment principally reaches customers on utility Basic Service, so a business already buying from a competitive supplier is generally not moved. Second, eligibility is programme-specific: Boston Community Choice Electricity states that commercial accounts using under 1.5 million kilowatt-hours a year are eligible, and it offers a bulk process for multi-account businesses. Cape Light Compact is the long-running regional example on the Cape and Martha's Vineyard.

• Authority is G.L. c.164, s.134; the DPU guidelines are D.P.U. 23-67-A.
• A town vote and a DOER-developed, DPU-approved plan come first.
• Approved programmes may auto-enrol Basic Service customers with opt-out rights.
• A business already with a competitive supplier is generally not auto-enrolled.
• Boston CCE enrols commercial accounts under 1.5 million kWh a year.

What to gather before asking for a Massachusetts offer

The Massachusetts-specific questions are the ones about which side of a line the account sits on. Confirm whether the delivery utility is one of the three investor-owned companies or a municipal light plant, because that decides whether there is anything to shop at all. Establish the rate class, R-1, G-1, G-2 or G-3, since it sets whether the account defaults to fixed or variable Basic Service and when that price resets. Find out whether the site sits in an approved aggregation and, if so, whether the account is on Basic Service and therefore exposed to automatic enrolment. Then pull twelve months of usage with demand readings or interval data, note the current supply position with its end date and notice period, and compute the load factor, because that ratio is what a supplier prices against. Only licensed suppliers, brokers and aggregators may operate here, so the counterparty can be checked against the Department's list. One eligibility caveat applies to every energy page on this site: competitive supply depends on the service address, the meter and the utility territory, and municipal utilities, cooperatives and some jurisdictions have no choice at all. HighGround may receive compensation from providers on completed purchases, and an inquiry places no order and switches no supplier.

• Confirm whether the utility is investor-owned or a municipal light plant.
• Establish the rate class, because it sets the Basic Service default.
• Check whether the site is in an approved aggregation.
• Gather twelve months of usage with demand readings.
• Compute the load factor before asking anyone for pricing.
• Licensed suppliers, brokers and aggregators can be checked with the DPU.
• An inquiry places no order and switches no supplier.

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