Massachusetts’ New 3-Year Energy Efficiency Plan and What it Means for your Municipality

An unlit light bulb rests on a chalkboard. Around the bulb is drawn a thought bubble.

For the last eight years, Massachusetts has ranked as the national leader in energy efficiency - but there is still much to do. With the State Legislature’s passage of the Act to Advance Clean Energy in August and a new three-year plan for statewide energy efficiency programs in the works, Massachusetts is preparing to keep building on its successes.

First, some background: Under the Green Communities Act of 2008, the administrators of Mass Save, the state’s energy efficiency program, are required to write new energy efficiency plans every three years. Mass Save is administered by the state’s natural gas and electric utilities and energy efficiency service providers. Each plan describes their budgets and programs for implementing energy efficiency in all sectors statewide.

The Green Communities Act also established the Massachusetts Energy Efficiency Advisory Council, or EEAC, which reviews the plan and works with Mass Save’s program administrators (PAs) to ensure that it maximizes net economic benefits and meets energy, capacity, climate, and environmental goals (M.G.L. ch.25 §22). MAPC has a seat on the EEAC representing Commonwealth cities and towns.

After more than a year of stakeholder meetings, working sessions, and multiple drafts, the PAs filed the latest version of their new plan, the 2019-2021 Three-Year Energy Efficiency Plan, with the Department of Public Utilities (DPU) on Oct. 31. MAPC provided input and guidance to the PAs throughout the process. With the plan now under review by the DPU, here’s what we’re excited about in the plan and what it could mean for municipalities in Metro Boston and across the Commonwealth.

Partnering with Municipalities a "Critical Pathway"

Throughout the planning process, MAPC gathered input from municipal energy stakeholders from around the region to ensure that municipal priorities were reflected in the plan. Earlier this year, we brought community leaders together with utility representatives to discuss the barriers to energy efficiency for cities and towns and brainstorm opportunities for municipalities and utilities to work together to move the needle on energy efficiency. The municipal staff we engaged prioritized the importance of ensuring that programs align with local, regional, and state climate goals; they asked that programs be better structured to meet the needs of municipalities and their facilities; and they encouraged utilities to partner with them to improve outreach efforts and make their programs more accessible to all residents and small businesses.

Based on these discussions and in response to MAPC’s advocacy, the PAs included a Municipal and Community Partnership Strategy in the final draft of the plan. In it they acknowledge the crucial role that municipalities can play:

“Partnering with municipalities and communities is a critical pathway, particularly to gain insights on reaching renters/landlords and multilingual populations. Program administrators are focused on developing a statewide Municipal and Community Partnership strategy to target communities identified as having lower participation. The new statewide Partnership strategy will include a stronger connection to municipal governments, whose local knowledge and trusted relationships can be a valuable connection point for increasing awareness and participation in the Program Administrators’ efficiency offerings. The Partnership strategy will support municipally-led outreach for cities and towns of all sizes to enroll local participants."

2019-2021 Three-Year Energy Efficiency Plan, page 55

This was a big win. MAPC is very much looking forward to helping design the partnership strategy with the Program Administrators in 2019 and connecting our cities and towns to the new opportunities that emerge.

An air source heat pump attached to a building.

The Three-Year Plan allows utilities to focus more on helping customers adopt efficient technologies like air-source heat pumps. Photo credit: MassCEC

Energy Optimization - A New Approach to Efficiency

Another major development in the new Three-Year Plan is a novel approach to energy efficiency that the PAs define as “Energy Optimization.” Energy Optimization broadens the focus of energy efficiency programs to include reducing overall energy use as well as active and passive demand management strategies (reducing power use at times of high demand on the electric grid). Instead of focusing exclusively on kilowatt-hour savings, Energy Optimization will open up opportunities for strategic electrification of heating and cooling through technologies like air-source heat pumps. This kind of fuel switching wasn’t supported in the previous plan because incentive programs were limited to specific fuel types, meaning, for example, that gas systems could only be upgraded to more efficient gas systems. This shift will also help utilities and customers reduce summer and winter peak demand and lower their energy bills through efforts like those stimulated by MAPC’s Peak Demand Notification program and through demand response programs like those piloted recently by Eversource and National Grid. For more on these programs or to sign up for our Peak Demand Management Notification program, visit our website and check out our recent webinar.

MAPC's Peak Demand Notification Program

Each morning from June to mid-September, MAPC sends out an email that assesses the risk that the annual peak could occur that day and, if so, at what time. The notifications also include an outlook for the next week so municipalities have time to plan ahead. MAPC develops this assessment by analyzing data provided by the grid operator, ISO-NE.

Other Exciting Additions to the Plan

We were also pleased to see that the PAs included some other important changes in the Three-Year Plan. Notably, the PAs agreed to consider the avoided cost of complying with the Global Warming Solutions Act (GWSA) in their benefit-cost calculations. This allows the PAs to consider the greenhouse gas impact of energy efficiency measures in their benefit-cost calculations, improving the cost-effectiveness of existing measures and potentially enabling them to add new measures into their programs.

The PAs also committed to amplify their efforts to reach underserved populations – including moderate-income households, renters, and non-English-speaking families – through active engagement with municipalities and community partners. For new construction, the plan includes new offerings that support Passive House and Zero-Net Energy Ready construction.

Finally, the plan also includes a commitment from the Program Administrators to share more data through the MassSaveData portal. This data reporting will include monthly energy consumption for the residential, commercial, and industrial sectors within a municipality and will be provided on yearly basis.

What's Next?

With the DPU reviewing the Three-Year Plan and each utility’s individual program designs and budgets, the final decision on the plan should come in early 2019. From there, the Program Administrators will start to roll out their new and redesigned programs and incentives. Stay tuned for more information on energy efficiency opportunities for your municipality and sign up for our Clean Energy newsletter to stay up to date on all the latest.