S 3167

SENATE . . . . . . . . . . . . . . No. 3167
  The Commonwealth of Massachusetts
  _______________
  In the One Hundred and Ninety-Fourth General Court
  (2025-2026)
  _______________
1by inserting after section _ the following section:-
2"SECTION_. Paragraph (2) of subsection (c) of section 21 of Chapter 25 of the General
3 Laws, as appearing in the 2024 Official Edition, is hereby amended by adding the following
4 sentence:- The department shall not approve a plan if the plan’s total costs are greater than the
5 total costs incurred for the 2022 to 2024 plan approved pursuant to this section, plus 6.25 per
6 cent."
7And moves to further amend the bill by inserting at the end the following section:--
8“SECTION _. Subsection (f) of section 11F of chapter 25A, as appearing in the 2024
9 Official Edition, is hereby amended by adding the following sentences:-
10Not less than fifty per cent of alternative compliance payments made pursuant to
11 this section shall be credited directly to electric ratepayers. The department of energy resources,
12 in consultation with the department of public utilities, shall establish by regulation a mechanism
13 to ensure that: (1) all such payments are returned to ratepayers in the service territory of the retail
14 electricity supplier or municipal aggregator that submitted the payment, on a per kilowatt-hour
15 basis or other equitable crediting method; and (2) the credits shall appear as bill reductions or
16 refunds to ratepayers within 90 days of the close of the compliance year in which the payment
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17 was made. Any administrative costs associated with implementing this subsection shall be
18 minimized and may be deducted from such payments prior to their return to ratepayers, provided
19 that such deductions do not exceed reasonable expenses as approved by the department of public
20 utilities."
21And moves to further amend the bill by inserting at the end the following new section:--
22 ”SECTION_. (a) There is hereby established an electric rates task force to advise and make
23 recommendations to the joint committee on telecommunications, utilities and energy and the
24 executive office of energy and environmental affairs on the current and future cost of electricity
25 in the commonwealth.
26(b) The task force shall consist of the following members: the executive director of the
27 office of energy transformation, who shall serve as chair, the secretary of energy and
28 environmental affairs or a designee; the commissioner of energy resources or a designee; 1
29 representative from the department of public utilities; 2 members appointed by the speaker of the
30 house of representatives who shall have a background in and understanding of electric rates; 1
31 member appointed by the minority leader of the house of representative; 2 members appointed
32 by the president of the senate who shall have a background in and understanding of electricity
33 rates; 1 member appointed by the minority leader of the senate; the chairs of the joint committee
34 on telecommunications, utilities and energy; the attorney general, or a designee; 1 representative
35 from each investor-owned electric utility with a combined service territory of more than 100,000
36 retail and commercial customers; and 1 representative from ISO New England, Inc.
37(c) The executive director of the office of energy transformation may assign staff and
38 resources, as necessary, for the work of the task force.
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39(d)(1) Not later than September 30, 2027, the task force shall produce a report which
40 shall: (i) identify each cost component that comprises the electric bill of residential and
41 commercial customers of each investor-owned electric distribution company in the
42 commonwealth with a combined service territory of more than 100,000 retail and commercial
43 customers; (ii) include the total revenue raised statewide from each cost component separated by
44 utility and customer class; (iii) include the current total cost to each customer class on a kilowatt-
45 hour basis and monthly basis for a typical user in each rate class; and (iv) include the annual rate
46 increase for each cost component for the previous 10 years and the projected annual rate
47 increases or range of rate increases expected over the next 5 years. The report shall compare
48 individual rate components to current and projected rate components of all other New England
49 states and at least 3 other states considered to be economic competitors of the commonwealth.
50(2) The cost components identified pursuant to clause (i) of paragraph (1) shall include
51 the date of origin and purpose of each cost component and whether said cost components are
52 related to electric utility distribution costs, regional transmission costs or energy supply costs and
53 whether the cost components were added as a result of compliance with meeting greenhouse gas
54 reduction goals established pursuant to section 3 of chapter 21N of the General Laws; provided,
55 that the report shall include and identify any cost components that are expected to be added to
56 ratepayer bills over the next 10 years. The cost components identified pursuant to clause (i) of
57 paragraph (1) may be combined if they serve a similar purpose; provided, that the cost
58 components shall not be currently listed separately on a customer bill or necessary to meet
59 greenhouse gas reduction goals pursuant to said section 3 of said chapter 21N.
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60(e)(1) The report pursuant to subsection (d) shall be made publicly available on the
61 websites of the attorney general and the executive office of energy and environmental affairs for
62 public comment for 30 days.
63(2) The task force shall consider all public comments and may make any changes to the
64 report based on public comment, if applicable, as determined by the task force.
65(f) Not later than 30 days after the closing of the public comment period pursuant to
66 subsection (e) for the report pursuant to subsection (d), the task force shall submit a final report
67 to the governor, the speaker of the house, the president of the senate, the house and senate
68 committees on ways and means, the chairs of the joint committee on telecommunications,
69 utilities and energy and the clerks of the house and senate.
70(g) The report pursuant to subsection (d) and the final report pursuant to subsection (f)
71 shall be made publicly available on the websites of the attorney general and the executive office
72 of energy and environmental affairs."
73Moves to further amend by inserting after section _ the following new section:-
74SECTION _. Chapter 25 of the General Laws, as appearing in the 2022 Official Edition,
75 is hereby amended by adding the following section:-
76Section 24. Public Hearing and Comment Period for Department of Public Utilities Rate
77 Changes
78(a) The Department of Public Utilities shall be required to hold at least one public hearing
79 and a 30-day public comment period before approving any rate increase, including changes to
80 delivery fees or other charges.
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81(b) The department shall provide notice of such hearings in a manner that ensures
82 accessibility, including publication on the department’s website, written notifications to affected
83 municipalities, and public service announcements."
84And moves to further amend the bill as written by striking in lines 626-627 the following
85 words "at a reasonable cost to ratepayers" and inserting in place thereof the following:- "with no
86 or minimal cost to ratepayers"; and
87By inserting at the end of line 640 the following:- "Any program so developed shall be
88 filed in a report with the Clerks of the House and Senate, and the Joint Committee on
89 Telecommunications Utilities and Energy, not later than 120 days before its implementation."
90And moves to further amend the bill as written by inserting at the end of line 119 the
91 following:- "; provided further that no ratepayer funds shall be contributed to the fund".
92And moves to further amend the bill as written by inserting after clause (16) the
93 following paragraph:- “Prior to initiating any solicitation or entering into any contract pursuant
94 to section 22, the department shall certify, in consultation with the department of public utilities
95 and the attorney general, that the intended procurement cannot be reasonably achieved through
96 existing competitive market mechanisms or private sector procurement. Such certification shall
97 include a written determination that private entities are unable or unwilling to procure the
98 resource at a scale, price, or timeline necessary to meet the commonwealth’s statutory energy or
99 emissions requirements. The department shall further certify that no contract executed pursuant
100 section 22 shall require the commonwealth or any ratepayer funded entity to pay a price for clean
101 energy generation or energy services that exceeds the lowest price paid for a substantially similar
102 product or service by a private entity in the New England wholesale or retail energy markets
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103 during the preceding 24 months. All certifications issued under this paragraph shall be filed with
104 the clerks of the house and senate and the joint committee on telecommunications, utilities and
105 energy not less than 30 days prior to the issuance of any solicitation.”
106
107And moves to further amend the bill as written by striking in line 455 the word "and" and
108 by inserting, in line 460, after the word "level" the following:- "; and (vi) a division of ratepayer
109 relief and affordability, which shall monitor, analyze and report on the impacts of energy
110 policies, programs and procurement activities on residential, commercial and industrial
111 ratepayers; evaluate the affordability of electric and gas service across income groups and
112 regions; identify opportunities to reduce or avoid ratepayer costs; review proposed actions of the
113 department and the department of public utilities for their effects on customer bills; and
114 recommend strategies to minimize energy burdens and prevent the imposition of new charges or
115 surcharges on ratepayers. The division shall serve as the principal point of contact within the
116 department for matters relating to ratepayer affordability and shall coordinate with other
117 divisions, state agencies and stakeholders to ensure that ratepayer impacts are fully considered in
118 all departmental actions."
119
120And moves to further amend the bill as written by inserting after section 86 the following
121 3 sections:-
122SECTION __. There shall be a special commission to study and provide
123 recommendations on reducing the costs and ratepayer impacts of building decarbonization,
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124 energy efficiency, load management and demand reduction programs established pursuant to
125 sections 19, 21 and 22 of chapter 25 of the General Laws.
126The commission shall examine the administration, financing, contracting, performance
127 and cost-effectiveness of said programs and identify reforms that would reduce program costs
128 and charges assessed to ratepayers. The study shall include, but not be limited to: (1) reviewing
129 administrative, marketing and overhead expenses; (2) evaluating payments to program
130 administrators, vendors, contractors and consultants; (3) examining performance incentives and
131 the methods used to calculate such incentives; (4) identifying duplicative, inefficient or
132 underperforming programs; (5) comparing claimed energy savings with independently verified
133 savings; (6) examining the geographic distribution of program costs and benefits; (7) comparing
134 the cost and performance of the programs with similar programs in other states; (8) estimating
135 the savings that could result from consolidating, reducing or eliminating programs or expenses;
136 and (9) recommending legislative, regulatory or administrative reforms to reduce charges
137 assessed to ratepayers and return any resulting savings to ratepayers.
138SECTION __. The commission shall consist of the commissioner of energy resources or
139 a designee, who shall serve as chair; the chair of the department of public utilities or a designee;
140 the state auditor or a designee; the attorney general or a designee; the inspector general or a
141 designee; the senate and house chairs of the joint committee on telecommunications, utilities and
142 energy or their designees; the house minority leader or a designee; the senate minority leader or a
143 designee; 1 person representing residential ratepayers, appointed by the attorney general; 1
144 person representing small businesses, appointed by the inspector general; 1 member with
145 expertise in financial auditing or program evaluation, appointed by the state auditor; and 1
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146 member with expertise in utility regulation or energy economics, appointed by the senate
147 minority leader.
148The commission shall hold not fewer than 3 public hearings in geographically diverse
149 regions of the commonwealth to gather input from ratepayers, municipalities, businesses,
150 program participants and other interested parties.
151SECTION __. The commission shall submit its findings, estimated savings and
152 recommendations, including any proposed legislation or regulations, to the governor, the clerks
153 of the house of representatives and the senate, the joint committee on telecommunications,
154 utilities and energy and the house and senate committees on ways and means not later than 12
155 months after the effective date of this act. The report shall be made publicly available.”
156And moves to further amend the bill as written by inserting after section _ the following 8
157 sections:-
158“SECTION __. Chapter 25 of the General Laws is hereby amended by adding the
159 following section:-
160Section __. (a) The department shall hold not fewer than 1 public hearing and provide a
161 public comment period of not fewer than 30 days before approving an increase in an electric or
162 gas rate, delivery charge, surcharge, assessment or other charge assessed to ratepayers.
163(b) The department shall provide notice of a hearing and public comment period required
164 pursuant to subsection (a) by publication on its website, written notice to each affected
165 municipality and such other means as the department considers necessary to provide reasonable
166 notice to affected ratepayers.
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167SECTION __. Chapter 164 of the General Laws is hereby amended by adding the
168 following section:-
169Section __. (a) Notwithstanding any general or special law to the contrary, an investor-
170 owned electric company, gas company or distribution company shall not increase rates, delivery
171 charges, surcharges, assessments or other charges assessed to ratepayers by more than 3 per cent
172 in a calendar year; provided, however, that the maximum annual increase shall be adjusted by the
173 percentage increase, if any, in the consumer price index for all urban consumers in the Northeast
174 region, as published by the United States Bureau of Labor Statistics.
175(b) The department shall promulgate regulations to implement this section, including
176 regulations governing transparency, notice to customers and the calculation of the maximum
177 annual increase.
178SECTION __. Said chapter 164 is hereby further amended by adding the following
179 section:-
180Section __. (a) The department shall establish a veteran utility rate reduction program for
181 veterans, as defined in section 1 of chapter 115, including veterans receiving disability
182 compensation from the United States Department of Veterans Affairs.
183(b) An eligible veteran shall receive a discount on electric and gas distribution charges
184 consistent with the discount rate applicable to similarly situated low-income or moderate-income
185 customers. Eligibility shall be determined using the income thresholds applicable to existing
186 discount-rate programs.
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187(c) The department shall promulgate regulations to implement this section, including
188 regulations governing verification of eligibility through records of the United States Department
189 of Veterans Affairs or other appropriate documentation. The department shall conduct outreach
190 to eligible veterans regarding the availability of the program.
191SECTION __. Said chapter 164 is hereby further amended by adding the following
192 section:-
193Section __. The department shall establish a utility rate reduction program for residents of
194 the commonwealth who are 65 years of age or older. The department shall promulgate
195 regulations establishing eligibility criteria, discount rates, application procedures and verification
196 requirements for the program.
197SECTION __. Sections 4, 5, 10, 11, 16, 17, 23, 39, 40, 41, 48, 49, 60 to 77, inclusive, 81,
198 86, 93, 98, 103, 106, 107, 112 and 134 of chapter 239 of the acts of 2024 are hereby repealed.
199SECTION __. There shall be a special commission to study and provide
200 recommendations on utility delivery-charge structures, industry practices and cost-reduction
201 measures for ratepayers. The commission shall examine: (1) the impact of delivery charges on
202 residential, commercial and industrial ratepayers; (2) the principal costs recovered through
203 delivery charges; (3) historical changes in delivery charges and the relationship between delivery
204 charges and utility capital expenditures; (4) delivery-charge structures and regulatory practices in
205 other states; (5) opportunities to improve the transparency and efficiency of charges; (6)
206 regulatory or market-based reforms that could reduce charges while maintaining safe and reliable
207 service; and (7) the estimated savings to ratepayers resulting from each recommended reform.
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208SECTION __. The commission shall consist of the house and senate chairs of the joint
209 committee on telecommunications, utilities and energy, who shall serve as co-chairs; the speaker
210 of the house of representatives or a designee; the president of the senate or a designee; the house
211 minority leader or a designee; the senate minority leader or a designee; the chair of the
212 department of public utilities or a designee; the attorney general or a designee; 1 representative
213 of the Massachusetts Municipal Association; 1 representative of competitive energy suppliers;
214 and 2 members with expertise in utility regulation, energy pricing or economic analysis,
215 appointed by the governor.
216The commission shall hold not fewer than 4 public hearings in geographically diverse
217 regions of the commonwealth to solicit input from ratepayers, consumer advocates,
218 municipalities, businesses, utility companies and regulatory agencies.
219SECTION __. The commission shall submit its findings, estimated savings and
220 recommendations, including any proposed legislation or regulations, to the clerks of the house of
221 representatives and the senate, the house and senate committees on ways and means and the joint
222 committee on telecommunications, utilities and energy not later than 12 months after the
223 effective date of this act. The report shall be made publicly available.”
224
225And moves to further amend the bill as written by inserting after section 86 the following
226 section:-
227“SECTION __. The inspector general shall procure an independent forensic audit of all
228 energy efficiency, demand reduction, load management and building decarbonization programs
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229 funded or administered pursuant to sections 19 and 21 of chapter 25 of the General Laws,
230 including any predecessor programs administered pursuant to said sections.
231The audit shall examine fiscal years 2021 through 2026, inclusive, and shall include, but
232 not be limited to: (1) all contracts, subcontracts and payments to program administrators,
233 vendors, contractors and consultants; (2) administrative, marketing and overhead expenses; (3)
234 executive compensation and performance incentives funded directly or indirectly by ratepayers;
235 (4) the accuracy of reported energy savings, benefit-cost calculations and greenhouse gas
236 emissions reductions; (5) payments made for services not delivered, duplicative services or
237 services lacking adequate documentation; (6) conflicts of interest, related-party transactions and
238 procurement deficiencies; (7) the geographic distribution of program costs and benefits; and (8)
239 opportunities to recover improperly expended funds and reduce future charges assessed to
240 ratepayers.
241The department of public utilities, the department of energy resources, the energy
242 efficiency advisory council, each program administrator and each electric or gas company shall
243 provide to the inspector general and the independent auditor all records, contracts, invoices,
244 payment information and other data reasonably necessary to conduct the audit, notwithstanding
245 any general or special law to the contrary.
246The inspector general may expend not more than $1,000,000 to conduct the audit. The
247 department of public utilities shall require the program administrators to transfer the amount
248 necessary to conduct the audit from existing administrative funds collected pursuant to section
249 19 of said chapter 25. No new surcharge, assessment or charge shall be imposed on ratepayers to
250 fund the audit.
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251The inspector general shall submit the audit and any recommendations to the clerks of the
252 house of representatives and the senate, the house and senate committees on ways and means and
253 the joint committee on telecommunications, utilities and energy not later than December 31,
254 2027. The audit shall be made publicly available.”
255And moves to further amend the bill as written by adding the following section:-
256“SECTION __. (a) There shall be a special commission to review charges imposed on
257 customers for the transmission, distribution and delivery of gas and electricity and to recommend
258 reforms to reduce those charges.
259(b) The commission shall consist of the senate and house chairs of the joint committee on
260 telecommunications, utilities and energy, who shall serve as co-chairs; the ranking minority
261 members of the joint committee on telecommunications, utilities and energy; the secretary of
262 energy and environmental affairs or a designee; the chair of the department of public utilities or a
263 designee; the attorney general or a designee; the state auditor or a designee; 1 member appointed
264 by the president of the senate; 1 member appointed by the speaker of the house of
265 representatives; 1 member appointed by the minority leader of the senate to represent residential
266 ratepayers; and 1 member appointed by the minority leader of the house of representatives to
267 represent small commercial customers.
268(c) The commission shall review: (1) each statutory, regulatory and tariff-based charge
269 imposed for the transmission, distribution or delivery of gas or electricity; (2) the legal authority
270 for each charge and the program, obligation or expenditure supported by the charge; (3) the
271 annual revenue collected through each charge; (4) the administrative costs, utility earnings and
272 authorized rates of return included in each charge; (5) whether each charge may be repealed,
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273 reduced, consolidated or funded through an appropriation; (6) the extent to which each charge
274 shifts costs among residential, small commercial, large commercial and industrial customers; (7)
275 reforms to reduce customer charges, distribution charges and other delivery-related charges; (8)
276 whether a gas company or distribution company should earn a rate of return on expenditures
277 required by statute, regulation or order of the department of public utilities; and (9) statutory and
278 regulatory changes that may be implemented immediately to reduce customer bills.
279(d) The department of public utilities, each gas company and each distribution company
280 shall provide the commission with information and records reasonably necessary to complete its
281 work.
282(e) The commission shall submit a report of its findings and recommendations, together
283 with draft legislation necessary to implement its recommendations, to the clerks of the senate and
284 house of representatives, the joint committee on telecommunications, utilities and energy and the
285 senate and house committees on ways and means not later than December 31, 2027.”
286
287And moves to further amend the bill as written by inserting after section__ the following
288 sections:-
289"SECTION _. Notwithstanding any general or special law to the contrary, no gas or
290 electric distribution company, municipal aggregator, municipal light plant, or state agency shall
291 impose, collect, or seek approval for any new charge, surcharge, fee, rider, or reconciling charge
292 on residential, commercial, or industrial ratepayers for a period of three years from the effective
293 date of this act, nor shall any law, rule, or regulation require such charges. During this
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294 moratorium period, no new line item charge shall be added to customer bills, and no existing
295 charge shall be expanded to recover new categories of costs.
296SECTION _. Following the expiration of the three year moratorium established in
297 Section XX, any proposal to impose a new charge, surcharge, fee, rider, or reconciling charge on
298 ratepayers shall require: (i) a public hearing conducted by the department of public utilities; (ii)
299 public notice of such hearing not less than 30 days in advance; and (iii) a written determination
300 by the department that the proposed charge is necessary, minimizes costs to ratepayers, and does
301 not impose an unreasonable energy burden on residential, commercial, or industrial customers."
302And moves to further amend the bill as written by striking out subsection (d) of section
303 14 lines 114-119.
304And moves to further amend the bill as written by adding, in line 3061, after the words
305 "finances," the following:- "reduce cost burdens to ratepayers,".
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