Plugging In/ Economy/ Energy

​​Here are some ways to lower your electric bill

With prices heading sky-high, it’s time to shop around

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MASSACHUSETTS RESIDENTS HAVE some options to avoid – or at least sidestep for awhile — the sky-high electricity rates coming this winter.

National Grid provided a glimpse of what’s coming last week, when it announced its basic service rate would jump to a record 33.9 cents a kilowatt hour starting November 1. That’s about three  times the current 11.5-cent rate and more than twice last winter’s 14.8-cent rate. The new winter rate, if approved by state regulators, will increase the typical customer’s utility bill by $114 a month, or 64 percent, for the next six months. (CORRECTION: The original version of this story incorrectly misstated the size of the new rate.)

Utilities like National Grid make their money delivering power to customers. But many customers also have their utility buy power on their behalf; the utility runs a bidding process, contracts for electricity, and passes it along to customers with no markup. That means the astonishingly high price National Grid announced last week is likely a harbinger of what’s to come for electricity customers across the state in the coming months.

Eversource, the state’s biggest utility, is on a slightly different timetable, with its winter basic service rate kicking in on January 1. Its current basic service rate is 17.8 cents a kilowatt hour, but, due to the unsettled world energy markets, it will probably move into the same range as National Grid’s this winter.

Fortunately, customers can shop around for a better deal, either on their own or together with their neighbors if their hometown is what is called a municipal aggregator. (To see if your community aggregates, click here.) Either way, the state makes it easy to shop, with websites listing all the various rates. (Keep in mind, customers are just shopping for electricity; they remain customers of their local utility for delivery and customer service.)

In deciding which deal is the best, there are two major factors to consider – the price and the length of the contract. Prices are easy to compare, but choosing how long a contract you want to sign is more complicated. Do you believe energy markets will return to normal in six months, a year, or much longer?

For customers buying power on their own, plug in your zip code and start checking out the deals. In National Grid’s territory, the options aren’t that great. 

Worcester, for example, is currently offering its residents prices ranging from 11.4 cents to 14 cents per kilowatt hour, with the higher price providing 100 percent renewable energy. But those rates are due to expire at the end of November, when National Grid’s new 33.9-cent basic service rate kicks in. Worcester’s rates will probably head into the same range.

Buying power on your own is an option, with price offerings ranging from 18 cents to 27.3 cents a kilowatt hour, all well below National Grid’s basic service rate. But those rates come with contracts lasting 12 to 36 months, with lower rates for the longer contracts. That’s where the risk comes in, because National Grid’s basic service rate changes every six months. Rates will come down sometime in the future, but when?

Also keep in mind that Attorney General Maura Healey is advising customers not to buy power on their own. “Our research continues to show that vulnerable residents across our state are losing millions of dollars to these companies each year,” a Healey spokeswoman said. “We continue to urge customers to beware of deceptive suppliers taking advantage of these record high winter rates by promising cheaper electricity, only to stick them with higher rates and a contract they can’t get out of.”

Healey’s office has no concerns with municipalities that buy power on behalf of their residents. In the National Grid service territory, Attleboro and Fall River are offering very attractive rates of 10.5 to 14 cents a kilowatt hour through December 2023. If you’re a resident and not signed up, it may be time to do so.

In the Eversouce territory, where you live can save you money. Somerville, for example, is currently offering its residents prices ranging from 10.2 to 13.2 cents a kilowatt hour, but they expire at the end of the year, at the same time Eversource’s basic service rate is going to change. Both rates are probably headed much higher.

But other communities, including Boston and Cambridge, have locked in rates until the end of 2023. Cambridge’s prices range from 10.2 to 13.78 cents a kilowatt hour, while Boston’s rates are 10.8 cents to 13.9 cents a kilowatt hour. Those rates are lower than Eversource’s current basic service rate and likely to be much lower than its winter rate that kicks in on January 1.

Boston has 200,000 residential customers signed up, but that leaves as many as 100,000 others who could sign up and save significant money. (Details are here.)

Meet the Author

Bruce Mohl

Editor, CommonWealth
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About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

Dave Musselman, director of Boston’s municipal energy unit, said the city’s current price was negotiated in late 2021, before the war in Ukraine, which destabilized energy markets and sent prices soaring.

The city’s price is very attractive now, but Musselman, in retrospect, wishes he had negotiated a longer-term deal. “You can’t predict exactly,” he said. “If you could predict it, I would have retired a long time ago.”

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