Massachusetts Electricity Rates Explained

If you live in Massachusetts and feel like your electricity bill is unreasonably high, you're right. Massachusetts has the third most expensive electricity in the entire country, behind only Hawaii and California. The average residential rate sits at roughly 31 to 33 cents per kilowatt-hour in 2026 — that is 43 to 57 percent above the national average of 17.78 cents. Translated into dollars, the typical household pays $172 to $178 per month for electricity, even though Massachusetts residents use significantly less power than the national average.

Those numbers have been climbing fast. Over the last decade, Massachusetts electricity prices rose 65 percent, roughly double the 32 percent increase seen nationally. In late 2025 alone, regulators approved rate hikes of 25 to 30 percent for Eversource and 11 to 13 percent for National Grid. The trend is not slowing down.

But here's what most Bay Staters do not realize: there are concrete, proven ways to cut your bill by hundreds of dollars per year. Community Choice Aggregation programs, Mass Save rebates, heat pump discount rates, and smart energy decisions can make a real difference. This guide will walk you through exactly what is driving your costs and what you can do about every piece of your bill.

Why Massachusetts Electricity Rates Are So High

Understanding why rates are elevated is the first step toward making smart decisions. Five factors combine to make Massachusetts one of the most expensive electricity markets in the country.

Natural Gas Pipeline Constraints

New England sits at the very end of the country's natural gas pipeline network, with no local oil or gas reserves. Only a handful of supply pipelines serve the entire region. During peak winter demand, home heating and electricity generation compete for the same limited gas supply. When pipeline capacity maxes out on cold days, prices spike dramatically.

This matters because 51 percent of New England's electricity was generated from natural gas in 2024. When the fuel that produces most of your power gets expensive, your electricity follows.

Transmission and Delivery Costs

Massachusetts is geographically far from major generation sources, and the aging transmission infrastructure requires expensive upgrades. Delivery charges — the cost of getting electricity from power plants to your home — actually make up about 55 percent of your total bill. Within those delivery charges, regional transmission accounts for roughly 38 percent and local distribution accounts for 53 percent.

For a deeper understanding of how these charges appear on your statement, check out our guide on how to read your electric bill and spot overcharges.

Renewable Energy Mandates

Massachusetts requires 63 percent renewable energy in 2025, rising to 69 percent in 2026. The Renewable Portfolio Standard for new renewables (Class I) jumps from 27 percent in 2025 to 30 percent in 2026, and the Clean Energy Standard increases by 2 percent annually until reaching 80 percent in 2050. Compliance costs are passed to ratepayers through charges on your bill.

These mandates are driving real progress — Vineyard Wind, America's first large-scale offshore wind farm, completed construction in March 2026. But the transition has costs that show up on your bill today.

Grid Modernization

All three major utilities are investing heavily in smart meters, advanced metering infrastructure, and extreme weather hardening. These are necessary upgrades, but they drive distribution rate increases. The DPU-approved rate hikes for Eversource and National Grid in late 2025 were partly driven by these investments.

Growing Demand

Electricity demand in Massachusetts is expected to rise 1.8 percent annually over the next decade, driven by EV adoption, heat pump installations, and data center growth. More demand on a constrained system pushes prices higher.

How the Massachusetts Electricity Market Works

Massachusetts deregulated its electricity market in 1997, making it one of the first states to do so. This means you have a choice about where your electricity comes from — but only part of it.

Your electricity bill has two main components:

• Supply charge (roughly 45 percent of your bill): the cost of generating the electricity you use. You can choose your supplier.
• Delivery charge (roughly 55 percent of your bill): the cost of getting that electricity to your home through poles and wires. You cannot choose your delivery company.

Three investor-owned utilities handle delivery for most of the state: National Grid, Eversource, and Unitil. Which one serves you depends on where you live. Additionally, 49 municipalities operate their own municipal light plants and fall outside the competitive market entirely.

The Massachusetts Department of Public Utilities (DPU) oversees the market, licenses competitive suppliers, sets distribution rates, and manages the procurement of Basic Service rates.

What Is Basic Service?

If you have not actively chosen a competitive electricity supplier, you're on Basic Service. This is the default generation rate, procured through competitive auctions overseen by the DPU. Residential Basic Service rates change every six months — on January 1 and July 1.

Basic Service is not a penalty rate. It is competitively bid and, as you'll see below, often cheaper than what third-party suppliers charge. Think of it as the "do nothing" option — and in Massachusetts, doing nothing is frequently the smart move on the supply side.

What Massachusetts Residents Actually Pay

Here is a snapshot of what the major utilities charge in 2026:

Remember, these Basic Service rates cover only the supply portion of your bill (roughly 45 percent). Your total rate, including delivery charges, lands in that 31 to 33 cents per kWh range.

How Massachusetts Compares

The entire Northeast pays roughly 42 percent more than the national average, but Massachusetts stands out even within New England.

Average Monthly Usage

Massachusetts households use about 559 to 600 kWh per month — well below the national average of roughly 900 kWh. Smaller homes, milder summers compared to the South, and the prevalence of gas heating all contribute to lower consumption. Despite using less electricity, Massachusetts residents still pay high monthly bills because the per-unit cost is so steep.

Community Choice Aggregation: The Biggest Opportunity Most Residents Overlook

Community Choice Aggregation — called Municipal Aggregation in Massachusetts — is one of the most powerful tools available to reduce your electricity costs. It is also one of the least understood.

Here's how it works: your city or town negotiates a bulk electricity supply contract on behalf of all residents. Because the municipality is buying power for thousands of households at once, it gets better rates than any individual could negotiate. The program uses an opt-out model, meaning residents are automatically enrolled but can leave at any time with no penalty.

The Numbers Are Compelling

• 167 of 351 Massachusetts municipalities have a DPU-approved aggregation plan
• A UMass Amherst study found 80 percent of municipalities with CCA achieved reduced rates
• Typical savings run 15 to 20 percent below retail residential rates
• Boston's Community Choice Electricity program saved households an average of $200 per year between February 2021 and December 2024, totaling $260 million in savings across all customers
• Lawrence locked in a CCA rate of 13.263 cents per kWh for 30 months (May 2025 through November 2027)

Since the DPU approved new Municipal Aggregation Guidelines in July 2024, the agency has approved 47 new plans, with 35 of those already entering supplier contracts. CCA adoption is accelerating rapidly.

How to Check if Your Town Participates

Visit Mass.gov's list of approved municipal aggregation programs or check your town's website. If your community has a CCA program, you may already be enrolled. Look at your electricity bill — if the supplier listed is not your utility's default, you might be on a CCA rate.

Many CCA programs also offer opt-up tiers with higher renewable energy content. The default tier typically includes more renewable energy than the Basic Service minimum. If you want 100 percent renewable electricity, your CCA may offer that option at a modest premium.

The Supplier Switching Warning Every Resident Needs to Hear

Massachusetts is deregulated, which means you can shop for a competitive electricity supplier on your own. The state even runs EnergySwitchMA.gov as an official comparison tool. But there is a critical fact that most consumers do not know.

The Massachusetts Attorney General found that most customers who switched to competitive suppliers paid more than if they had stayed on Basic Service.

Read that again. In a state where you're free to shop for electricity, the data shows that individual shopping usually makes things worse, not better. Competitive suppliers often lure customers with low introductory rates that eventually rise above Basic Service, or they lock in rates that sound reasonable but turn out to be above what the DPU-procured Basic Service rate delivers.

This is the opposite of what happens with CCA programs. When your town negotiates on your behalf with professional energy brokers and the buying power of thousands of households, the results are consistently positive. When individuals try to beat the market on their own, the results are consistently negative.

The bottom line: if your town has a CCA program, stay enrolled. If it does not, Basic Service is likely your best option for the supply portion of your bill. Only consider a competitive supplier if you've done thorough research and the rate is clearly and sustainably below Basic Service.

Solar Energy and the SMART Program

With electricity at 31 to 33 cents per kWh, solar panels in Massachusetts have strong economic potential — every kilowatt-hour you generate is worth more here than in most other states. But the incentive landscape changed significantly in 2026.

The Federal Tax Credit Is Gone

The 30 percent federal solar tax credit (Section 25D) expired on December 31, 2025. Homeowners who purchase solar in 2026 receive zero federal tax credits. This is a major shift that changes the math on solar installations. If you're considering panels, check out our complete solar panel buyer's guide for help evaluating your options.

SMART 3.0 Picks Up the Slack

Massachusetts stepped in with its own incentive. The Solar Massachusetts Renewable Target (SMART) program relaunched as SMART 3.0 in September 2025 with 900 MW of capacity. Here's what residential customers receive:

These payments are made monthly for 10 years. Combined with Massachusetts' full retail net metering — where exported solar electricity is credited at roughly the retail rate — solar remains financially attractive even without the federal credit.

Community Solar

If your roof is not suitable for panels or you rent your home, community solar is an alternative. Massachusetts offers enhanced community solar incentives under SMART 3.0, and subscribers typically receive a 10 to 20 percent discount on their electricity bill with no installation required.

Mass Save: One of the Best Efficiency Programs in the Country

If you take only one action after reading this guide, make it this: schedule a free Mass Save Home Energy Assessment.

Mass Save is a collaborative program funded by all Massachusetts electric and gas utilities. It provides rebates, incentives, and services that can dramatically reduce your energy costs. Energy efficiency experts consistently rank it among the best programs in the nation. For more ways to slash your usage, see our guide on how to cut your electric bill in half.

Free Home Energy Assessment

A professional will visit your home at no cost and assess your insulation, air sealing, and heating and cooling efficiency. They will identify specific savings opportunities and lay out a roadmap for improvements. This assessment is the required first step for most Mass Save rebates.

Heat Pump Rebates (2026)

Heat pumps are a major focus of the Mass Save program. Here's what's available in 2026:

These are slightly lower than 2025 levels (which were $3,000/ton and $10,000 max), but still substantial. A typical three-ton whole-home system would qualify for $7,950 in rebates.

Important requirements for 2026: only heat pumps using next-generation refrigerants (R-32 or R-454B) qualify for Mass Save rebates. Models using the older R-410A refrigerant were removed from the qualified product list as of January 1, 2026. Homes must also be sufficiently weatherized before installation. For help choosing a system, see our guide to the best heat pumps for your home.

Income-Qualified Enhanced Incentives

If your household qualifies based on income, Mass Save offers even more:

• No-cost weatherization (insulation and air sealing)
• Air-source heat pumps at up to no cost
• Electrical panel upgrades for heat pump installations if needed

These enhanced incentives dramatically reduce the barrier to home electrification for lower-income households.

Federal Tax Credits Have Expired

The IRA heat pump tax credits expired on December 31, 2025. Mass Save rebates are now the primary financial incentive for heat pump installations. If you had a qualifying expenditure in 2025, rebate applications are due by February 28, 2026.

Heat Pump Discount Rates: A New Way to Save

In July 2025, the DPU approved seasonal heat pump-specific electricity rates for all three major utilities. This is a significant new benefit for Massachusetts homeowners.

If you heat your home with a heat pump, you qualify for a discounted electricity rate during the heating season. The expected savings: roughly $540 per winter for participating customers. This rate is available to all electric utility customers who use heat pumps — it is not limited to low-income households.

Combined with Mass Save rebates (up to $8,500), the heat pump discount rate makes the economics of switching from gas or oil heating increasingly attractive. For a comprehensive look at transitioning your home off fossil fuels, read our whole-home electrification guide.

Clean Energy Mandates and Vineyard Wind

Massachusetts is pursuing some of the most aggressive clean energy targets in the country. The Next Generation Roadmap Act of 2021 sets binding emissions limits: 50 percent below 1990 levels by 2030, 75 percent below by 2040, and net-zero by 2050.

Offshore Wind Is Here

The most tangible result so far is Vineyard Wind 1, America's first large-scale offshore wind farm. Located south of Martha's Vineyard, its construction was completed in March 2026 after briefly pausing in late 2025 due to a federal order that was overturned by court injunction in January 2026. The project features 62 fixed-bottom turbines producing 804 MW of capacity — enough to power roughly 400,000 homes.

Massachusetts has mandated procurement of at least 5,600 MW of offshore wind by 2027. While additional projects face federal headwinds, Vineyard Wind demonstrates that large-scale offshore wind is feasible and can help diversify the region away from its dangerous dependence on natural gas.

What This Means for Your Bill

In the short term, clean energy mandates add costs to your bill through compliance charges. The renewable energy charge on your bill is currently $0.0005 per kWh, funding the Massachusetts Clean Energy Center. But over the long term, diversifying away from natural gas — especially with wind resources that do not have fuel costs — should reduce the price volatility that drives winter spikes.

Governor Healey has ordered the pursuit of 15 GW of clean energy resources including storage and virtual power plants. The goal is a more resilient, less gas-dependent grid. Getting there will take time, but the infrastructure is being built now.

Low-Income Assistance Programs

Massachusetts offers some of the most robust low-income energy assistance in the country. If you're struggling to pay your electricity bill, these programs can help significantly.

Discount Rates

Low-income customers are eligible for a 32 to 71 percent discount on electricity depending on the utility. Unitil offers a flat 40 percent discount (Rate R-2). Eligibility requires qualifying for LIHEAP or receiving food, cash, or medical benefits from the state. Many eligible customers are enrolled automatically.

Fuel Assistance (LIHEAP)

Massachusetts received $146 million for LIHEAP in fiscal year 2026. Benefits include:

Eligibility: household income cannot exceed 60 percent of estimated State Median Income. Applications open October 1 for each heating season. Contact your local Community Action Agency or apply through the state portal.

Arrearage Management Program (AMP)

If you have overdue utility balances, the AMP allows eligible low-income customers to have past-due debt forgiven. Pay your current monthly budget amount on time, and the utility forgives one-twelfth of your past-due balance each month. To qualify, you must have a minimum $300 outstanding balance at least 60 days past due and qualify for LIHEAP or state benefits.

Winter Moratorium

Massachusetts law prohibits utility shut-offs during winter. The standard period runs November 15 to March 15. For the 2025-2026 season, the DPU expanded the moratorium to begin October 27, 2025, and run through April 1, 2026. This protection applies to residential customers whose utility service is needed to heat the home. Bills continue to accrue during the moratorium — it is a protection against disconnection, not debt forgiveness.

Frequently Asked Questions

Why is my Massachusetts electricity bill so high?

Massachusetts has the third highest residential electricity rates in the country at roughly 31 to 33 cents per kWh, compared to a national average of about 18 cents. The main drivers are natural gas pipeline constraints that cause winter price spikes, expensive transmission and distribution infrastructure, renewable energy mandate compliance costs, and grid modernization investments. Delivery charges alone make up about 55 percent of your total bill.

Can I switch electricity suppliers in Massachusetts?

Yes, Massachusetts deregulated its electricity market in 1997. You can choose a competitive supplier while your utility (National Grid, Eversource, or Unitil) continues handling delivery. However, the Massachusetts Attorney General found that most individual customers who switched to competitive suppliers paid more than if they had stayed on Basic Service. Your best options are typically your town's CCA program or staying on Basic Service.

What is Basic Service and should I stay on it?

Basic Service is the default electricity supply rate, competitively procured through DPU-overseen auctions. It changes every six months on January 1 and July 1. For most consumers, it is a reliable and often cheaper option than competitive suppliers. Unless your town has a CCA program offering better rates, Basic Service is generally the smartest choice.

Does my town have a Community Choice Aggregation program?

Currently, 167 of 351 Massachusetts municipalities have DPU-approved aggregation plans. Check your town's website or the Mass.gov list of approved municipal aggregation programs. If your town has one, you may already be enrolled since CCA uses an opt-out model. You can leave at any time with no penalty.

What happened to the federal solar tax credit?

The 30 percent federal solar tax credit (Section 25D) expired on December 31, 2025. No federal tax credit is available for residential solar installed in 2026. Massachusetts state incentives remain available through the SMART 3.0 program ($0.03 per kWh for 20 years for standard residential systems, doubled to $0.06 for low-income households), and full retail net metering credits still apply.

How much can I save with Mass Save?

Mass Save offers free home energy assessments, heat pump rebates of $2,650 per ton (up to $8,500 per home in 2026), weatherization incentives, and enhanced no-cost programs for income-qualified households. Combined with heat pump discount rates that save roughly $540 per winter, a homeowner who weatherizes and switches to heat pumps could save thousands over the first few years. A home energy monitor can help you track your savings.

Am I protected from winter shut-offs?

Yes. The standard winter moratorium runs November 15 to March 15, and for the 2025-2026 season it was expanded to October 27 through April 1. During this period, utilities cannot disconnect residential heating service. However, bills still accrue — the moratorium protects against disconnection, not against accumulating debt. If you're behind on payments, ask your utility about the Arrearage Management Program.

How much do heat pumps save with the new discount rates?

The DPU approved seasonal heat pump discount rates for all three major utilities in July 2025. Participating customers save an estimated $540 per winter on electricity costs. Combined with Mass Save rebates of up to $8,500 for installation costs and the elimination of oil or gas fuel bills, heat pumps are increasingly the most economical heating choice for Massachusetts homeowners. Check out our guide to the best smart thermostats to maximize your heat pump's efficiency.

Your Action Plan: How to Lower Your Massachusetts Electricity Bill

Here is a concrete plan you can start working through this week:

Today:

1. Pull out your most recent electricity bill. Identify your utility (National Grid, Eversource, or Unitil), your current supply rate, and your monthly kWh usage. If you need help understanding the charges, use our guide on how to read your electric bill.
2. Check whether you're on Basic Service, a CCA rate, or a competitive supplier. This information appears on your bill under the supply charges section.

This week:

3. Find out if your town has a Community Choice Aggregation program. Visit Mass.gov's list of approved municipal aggregation programs or your town's website. If your town has one and you're not enrolled, contact your town hall to sign up.
4. If you're currently with a competitive supplier, compare your rate to Basic Service and your town's CCA rate (if available). The Attorney General's data suggests you may be overpaying. Switching back is free and causes no service interruption.
5. Schedule a free Mass Save Home Energy Assessment at masssave.com. This is the single highest-value action on this list — it costs nothing and unlocks access to thousands of dollars in rebates.

This month:

6. After your Mass Save assessment, prioritize weatherization. Air sealing and insulation provide the highest return on investment and are prerequisites for heat pump rebates.
7. If your assessment recommends a heat pump, get quotes. With $2,650 per ton in Mass Save rebates (up to $8,500) and seasonal discount rates saving $540 per winter, the payback period is shorter than most people expect.
8. Look into solar. Even without the federal tax credit, SMART 3.0 incentives ($0.03 per kWh for 20 years) plus full retail net metering make solar viable in Massachusetts. If rooftop panels are not an option, explore community solar programs.

If you're struggling to pay your bill:

9. Check your eligibility for low-income discount rates (32 to 71 percent off) and LIHEAP fuel assistance (up to $850 for utilities). Contact your local Community Action Agency to apply.
10. If you have past-due balances, ask your utility about the Arrearage Management Program — you can have debt forgiven by staying current on monthly payments.

Massachusetts electricity rates are among the highest in the nation, and that is not going to change overnight. But between CCA programs, Mass Save rebates, heat pump incentives, solar options, and low-income assistance, there are real opportunities to take hundreds or even thousands of dollars off your annual energy costs. The residents who save the most are the ones who take action — start with the steps above and work through them one at a time. If you want to explore time-of-use rate strategies for additional savings, that is another lever worth pulling.