Energy Efficiency First Fuel Requirement (Gas and Electric)
Massachusetts utilities are required to offer cost-effective energy efficiency programs to help you reduce energy consumption and bills; these programs are funded through utility rates and administered by your local electric or gas utility, with details on available rebates and incentives available through your utility company or the Energy Efficiency Advisory Council website.
You can serve customers participating in utility-administered energy efficiency programs across Massachusetts, which collectively target over 106 million MMBtu in electric savings and 69 million MMBtu in gas savings during 2025-2027; programs are cost-tested using the Total Resource Cost test, and utilities recover program costs through ratepayer funding with performance incentives available up to 125% of agreed-upon goals.
The Massachusetts Energy Efficiency Advisory Council (EEAC) oversees three-year plans filed by investor-owned utilities and municipal cooperatives that must achieve statewide greenhouse gas reductions of at least 845,000 metric tons CO2e annually by 2030; utilities submit plans to the Department of Public Utilities by October 31, which are approved within 90 days, and implementation is funded through utility cost recovery mechanisms with performance incentives capped at 125% of targets, while large customers may self-direct their program contributions.
Program details
- Program ID
- 4500
- Last updated
- 8/19/2025
Eligibility
- Sectors
- investor-owned utility municipal utilities cooperative utilities
- Technologies
- yes; specific technologies not identified
Program summary
Note: The requirements below are from the 2025-2027 three-year plan.
Origin
In 2008, the Governor of Massachusetts signed a major energy reform bill, S.B. 2768, otherwise known as the Green Communities Act (GCA). This bill required electric and gas utilities to prioritize cost-effective energy efficiency and demand reduction resources oversupply resources and ordered that utilities submit three-year plans outlining how they would meet the requirement. The bill also created the Energy Efficiency Advisory Council (EEAC) to play a key role in designing and reviewing utility plans designed to meet the requirements of the Green Communities Act.
Electric and Natural Gas Sales Reduction Requirements
Highlights of the targets and other features of the most recently approved statewide three-year plan for the years 2025-2027 can be seen in the table below.
| Utility Type | Electric | Gas |
|---|---|---|
| 2030 Annual Emissions Reductions (MTCO2e; 2025-2027) | 556,621 | 465,280 |
| Proposed Net Annual Energy Savings (MMBtu; 2025-2027) | 106,947,852 | 69,835,865 |
| Performance Incentive (Total) | $106.9 million | $69.8 million |
| Equity Savings Component Threshold (% of Proposed Savings Goals) | 65% | 65% |
| Value Savings Component Threshold (% of Proposed Savings Goals) | 75% | 75% |
| Standard Savings Component Threshold (% of Proposed Savings Goals) | 60% | 60% |
| Performance Incentive Cap (% of Proposed Savings Goals) | 125% | 125% |
However, it is important to note that the plans are subject to "mid-term modifications" by each utility. To see the most recent plan and updates, as well as information on implementation to this point, please visit the EEAC's website. Funding to implement the plans comes from a variety of sources.
Program Administrator Type
Massachusetts' electric and gas utilities implement the programs required for meeting the statewide targets of the GCA.
Cost Effectiveness and Program Evaluation
Massachusetts uses the Total Resource Cost (TRC) test, one of the five "California tests" in the California Standard Practice Manual, as its primary cost-effectiveness test.
Utility Cost Recovery Provisions
As outlined in the Sales Reduction section above, investor-owned utilities in Massachusetts are permitted to receive a performance incentive capped at 125% achievement of their agreed-upon goals. The thresholds for the equity, electrification and standard component incentives under the 2022-2024 plan are the achievement of 85%, 60%, and 75% of the agreed-upon goals, respectively.
In addition, the GCA requires Massachusetts' investor-owned utilities to transition to full decoupling of their revenues from their sales. Until a decoupling mechanism is put into place, these utilities may recover lost base revenues from incremental efficiency savings.
Special Provisions
Large customers are permitted to "self-direct" the funds they would pay towards utility cost recovery for these programs for programs of their choosing.
Contact & resources
- Contact email
- MA-EEAC@mass.gov
- Additional resources
Please verify current program details with the administering agency before making any financial decisions.
