There’s a debate playing out in Massachusetts that might change the way Bay Staters get their electricity. You may not have thought about the issue, because most people don’t think about their electric utility beyond paying a bill every month. But Massachusetts has a “deregulated” energy market, which allows customers to choose where their power comes from and how much they pay for it. Now political leaders are questioning whether that setup actually serves consumers’ best interests. The movement stems from reports of deceptive marketing practices and bills that end up dramatically higher than they would’ve been if the customer stayed with the standard offer. Now-Gov. Maura Healey repeatedly documented higher-than-expected bills and other consumer protection concerns when she was the state’s attorney general.
The Massachusetts legislature faces dueling plans to address the issue: One proposal would prohibit energy suppliers from signing up new customers — essentially ending a decades-long experiment with a competitive energy market in Massachusetts. Another measure would keep the competitive market but add more regulations intended to rein in bad actors. So what does this all mean for residential energy customers in Massachusetts? Here’s what you need to know.
Critics of the competitive energy market in Massachusetts point to a pattern of problems with energy suppliers scamming or misleading customers into switching suppliers and ultimately paying higher electricity rates. “Competition in the sale of electricity and gas sounds like it should lead to lower prices and better deals, but in the market for electricity the opposite is commonly true,” said a 2018 report by the National Consumer Law Center, which has testified in favor of the bill to end the competitive energy market. NCLC reported the current system led to customers paying more for energy, with unfair and deceptive sales practices specifically targeting low-income communities, older consumers, and those who speak English as a second language. While there certainly are deceptive sales tactics at play in many cases, “scam” isn’t always the right term for what’s happening here.
- We’ll help you find the best electricity rates in your area with our partner Choose Energy
- Research shows there’s a strong bias toward the “incumbent” utility company, leading many to ignore the potential of retail choice in their state altogether.
- Competitive markets, where possible, are better than the alternative,” Hanger said.