Utility companies target heat pump incentives for cuts to pare back Mass Save budget

by Bhaamati Borkhetaria, CommonWealth Beacon
April 29, 2025

After state officials reduced Mass Save’s proposed budget by $500 million in February, the utility companies that run the energy efficiency program have proposed a new pared down compliance plan with the largest cuts coming to incentives for heat pumps and a program that provides a one-stop shop for residents looking to weatherize and invest in electrification upgrades. 

Six utility companies, including Eversource and National Grid, run the Mass Save program with the guidance of the Energy Efficiency Advisory Council. The utility companies presented their compliance plan with cuts on Monday to the council. 

The Mass Save program – which helps homes and businesses become more energy efficient and reduces greenhouse gas emissions – is funded through a surcharge on electricity and gas bills. After gas bills spiked across the state due to an unusually cold winter and the increase in the Mass Save surcharge, the DPU decreased the budget for the program from the proposed $5 million to $4.5 million. The DPU directed that the cut come from programming for the residential sector. 

Environmentalist advocates including Kyle Murray, a member of the council and the Massachusetts program director at the Acadia Center, a non-profit research and advocacy organization dedicated to combating climate change., called the move “short-sighted,” saying that the cut will result in increased costs for residents in the long run. 

The new plan cuts $220 million from heat pump rebates and a loan program that offers zero percent financing for qualifying energy-efficiency upgrades that include heat pump projects for residents. The plan also cuts $207 million from a “residential turnkey” program which is a streamlined solution that coordinates weatherization, barrier mitigation, and electrification upgrade projects through a single vendor that manages all steps of the process.

There are also smaller cuts of $43 million to the sales, technical assistance, and training budget, $12 million to the Massachusetts Clean Energy Center for economic development for green jobs, and $2 million to a program offering that translates program materials into different languages.

Generally, the cuts come from programs targeted towards residents in market-rate housing and to a lesser degree moderate income housing. The Department of Public Utilities directed the utility companies not to cut funding from programs targeted towards lower-income residents.  

“It has been a trying and challenging time going back and fundamentally revisiting a lot of what we planned over the last year and a half,” said Brian Greenfield, a supervisor of energy efficiency regulatory and planning at Eversource, who presented the plan to the council. “Faced with this order and dissecting what was in the plan and where we could make adjustments to comply with the required $500 million reduction to the residential budgets, the [utility companies] prioritized maintaining our program design and we are eager to get into and focus on implementing these plans over the course of the term.”

The council voted to support the compliance plan. The utility companies will submit the revised compliance filing to the DPU for approval by April 30.

Mass Save estimates it has provided $31 billion in total energy cost savings since it launched in 2013. The initial proposed budget projected that the program would save another $13.7 billion between 2025 and 2027. According to Greenfield, the cuts to the program will result in an 11 percent decrease in the total benefits in the next three years, bringing the total benefits down to $12.2 billion.

“These cuts represent some of the best options of bad options,” said Murray.

The energy efficiency program is key to the state’s decarbonization efforts. Massachusetts aims to convert 500,000 households to heat pumps by 2030, but even that target – which was set before Mass Save saw its budget pared back – would fall short of what the state needs to do to meet its climate goals of being carbon neutral by 2050. 

This article first appeared on CommonWealth Beacon and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.

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