You have a choice in where your electricity comes from in the Bay State. Here's how to use it wisely.
Chi Odogwu is a digital consultant, professor, and writer with over a decade of experience in finance and management consulting. He has a strong background in the private equity sector, having worked as a consultant at PwC and a research analyst at Renaissance Capital. Additionally, he has bylines in well-known publications, including Entrepreneur, Forbes, NextAdvisor, and CNET. He has also leveraged his writing talent to create educational email courses for his clients and ghostwritten op-eds published in top-tier publications such as Forbes, CoinDesk, CoinTelegraph, Insider, Decrypt, and Blockworks. In addition to his writing, education, and business pursuits, Chi hosts the top-rated Bulletproof Entrepreneur Podcast. Through this podcast, he engages in insightful conversations with talented individuals from various fields, allowing him to share a wealth of knowledge and inspiration with his listeners.
ExpertisePersonal Finance, Decentralized Finance, Energy, and Online Entrepreneurship.
If you live in Massachusetts, you've likely seen your power bill rise significantly in recent years
The Bay State has one of the country's highest average residential electricity prices, with rates hovering around 32.29 cents per kilowatt-hour as of March 2023, according to the Energy Information Administration, That's up from 25.4 cents per kWh a year earlier.
The table below shows the current price to compare -- the standard rate available from your utility company -- and the price range of options available through Choose Energy, which is owned by the same parent company as CNET.
All rates displayed are accurate as of June 23, 2023, for the ZIP codes listed with each utility. CNET staff regularly update these rates but they may have changed since the last update. For the most current rate information in your area, enter your ZIP code at choosenergy.com. These rates only represent the supply charges, not the utility's delivery charges or any taxes.
Deregulation in Massachusetts: What does that mean?
The electricity market in Massachusetts has changed a lot because of deregulation. It means you can choose your electricity supplier, offering more control and flexibility. You can explore different options, compare rates and select a supplier that caters to your specific requirements.
While some areas of Massachusetts are served by electric cooperatives, where you won't be able to choose your supplier, most people are able to choose. In Massachusetts, the state requires suppliers to adhere to specific regulations that transparently disclose terms and conditions and provide standardized billing. This is designed to protect consumers and ensure you can make informed decisions about your energy consumption.
Massachusetts utility vs. electric supplier
Utility or TDU
An electricity distributor, most commonly known as your utility or TDU (transmission distribution utility), is a company that manages the network of power lines and transformers needed to deliver electricity from the transmission system to your home or business. This company issues your monthly electric bill and charges for supply (the actual electricity used) and delivery (the electricity transport to your home).
Your geographic location typically determines your distributor. However, while your distributor remains the same, you can switch your electricity supplier or generating company.
Simply put, an electricity supplier -- or generating company -- produces electricity. Companies might use fossil fuels like coal or natural gas. Or they could use alternative technologies such as wind, hydroelectric, nuclear or solar energy.
When choosing an energy supplier or retailer, you can compare companies based on pricing plans, contract terms, renewable energy options and customer service. These suppliers collaborate with the utility companies to ensure a reliable energy supply. This freedom of choice promotes competition, encourages innovation and allows you to make an informed decision about your energy supply.
What types of electricity plans are offered in Massachusetts?
Here are the types of electricity plans commonly offered in Massachusetts.
These plans offer a fixed electricity rate for a specific period, usually from a few months to a few years. They guarantee price stability and predictability even when market prices fluctuate due to changes in commodity prices, interest rates or other market-driven forces.
Variable-rate plans offer more flexibility but are more risky for certain people. Your electricity rate varies monthly due to market forces such as wholesale energy prices and demand and supply changes.
Renewable energy plans
These plans primarily rely on renewable sources including wind, solar and hydropower. The rates for renewable energy plans may differ based on the supplier and the proportion of renewable energy in the plan.
For businesses looking to switch their electricity providers, there's often more to consider beyond the price and source of electricity, Ciavardini said. Electricity suppliers can work directly with commercial clients or their energy consultants to develop particular solutions to match the needs of the business.
How do you find the best electricity rates in Massachusetts?
Generally, shop around for the best price per kilowatt-hour. Although there's more to it than that.
Residential customers generally focus on the cost of a kilowatt-hour of electricity and key terms and conditions when choosing an energy supplier, Ciavardini said. They should also make sure no surprise costs boost the fixed price they're signing up for.
Residential customers in Massachusetts can visit the state's official Department of Public Utilities and the state's official electricity supplier shopping site to find information on how to compare energy supplier rates. You should explore your options, assess the market conditions and understand your risk tolerance, Ciavardini said. Ensure that contracts don't have features like early termination fees or automatic rollover triggers when the initial contract expires.
For businesses, customization of prices based on a company's exact load profile can be a game-changer, Ciavardini said. Generalized costs may work for residential or small commercial clients, but larger companies should seek a custom price.
What should you look for when choosing an electricity plan in Massachusetts?
There are several factors to consider when choosing an electricity plan in Massachusetts. They include:
Electricity plan options: It's important to compare various electricity plans offered by different suppliers. It's not just about the price; you should also examine the contract terms, customer feedback, renewable energy options and additional features.
The Electricity Facts Label: The EFL contains important information about the electricity plan, such as the price per kilowatt-hour, contract duration, usage tiers and possible additional fees. Go through the EFL for each plan you're interested in to avoid any unexpected fees or charges.
The supplier's reputation: When researching a potential electricity supplier, you should check out the company to ensure they're licensed to operate in the state. The Massachusetts Department of Public Utilities is a valuable resource to verify and investigate electricity suppliers to ensure they're legitimate.
How to make the switch in Massachusetts
For residential customers switching to a new electricity provider, the process is quite streamlined and can be done online or over the phone. Here's how the process might go:
Review your current contract: Before switching your electricity provider in Massachusetts, it's essential to review and understand the terms of your current contract. Note the cost per kilowatt-hour you're paying the cost per kilowatt-hour, the average monthly bill, any fees associated with your current contract and what those charges cover.
Reach out to a supplier: Call each supplier about their rates, terms and conditions. Compare each supplier's offers and see if there's wiggle room during the negotiation to get a better price or additional benefits.
Sign the contract with your new supplier: After you've found a deal that suits your needs, sign the contract with the new electricity provider. They will then take over the switching process.
The supplier's responsibilities: After the contract is signed, the new supplier will send a copy of the agreement to the utility company and notify you of the service's start.
Continuous assessment: Regularly assess the performance of your chosen supplier. Consider factors such as customer service, reliability and value for money. If you're not satisfied, consider switching again in the future.
Who has the cheapest electricity rates in Massachusetts?
A simple online search is enough to help most residential customers find and compare the rates of different suppliers. Larger companies have many factors to consider, such as payment terms and specific business needs.
What is the best energy plan in Massachusetts?
The best energy plan depends on how well it matches a customer's needs, Ciavardini said. Different suppliers are better at supplying residential customers while others better serve large clients, so the best supplier will vary customer to customer and even day to day, she said.
Correction Aug. 20: This story originally presented some statements as direct quotations that were actually paraphrases of what the individual cited had said. Those passages have now been rendered appropriately as paraphrases.