Massachusetts electric suppliers spend $80K lobbying against proposed utility restrictions

Competitive electric suppliers are facing possible new restrictions in Massachusetts, and their response has included a notable increase in lobbying.

Filings show $80,000 in spending by the two trade groups that chiefly represent the sector.

Here's what to know

While Beacon Hill works through major energy affordability legislation, the Retail Energy Supply Association and the Retail Energy Advancement League — whose members include Constellation, NRG, and Shell — have stepped up their lobbying efforts, according to the CommonWealth Beacon.

At that pace, the groups would spend about $160,000 in lobbying, their biggest annual total since REAL launched in 2022 and RESA began lobbying in Massachusetts in 2018. 

One of the most contested parts of the bill would let individual cities and towns decide whether competitive suppliers can keep selling electricity directly to residents. Supporters say the change could save customers several hundred million dollars over 10 years, while critics argue some companies use low introductory rates to sign people up and then charge more later.

Frank Caliva, national spokesperson for the Retail Energy Supply Association, said the industry can live with some reforms but not with that local option.

"We are certainly very concerned about this bill, and I think the risk here is pretty significant," Caliva said.

The industry is also leaning on polling to make its case. A survey of 500 Massachusetts ratepayers that it commissioned found that about 9 in 10 respondents support "maintaining the ability to choose their electric supplier."

More background

Massachusetts residents generally get electricity one of three ways: through their utility, through a municipal aggregation program, or from a third-party supplier.

As of March, nearly 500,000 customers were enrolled with third-party suppliers.

Customers lost a net $739 million over 10 years. State officials say those losses reflect misleading and irresponsible sales tactics used too often by suppliers.

Campbell's office says the impact has not been spread evenly. In Mission Hill, Roxbury, Dorchester, and Mattapan, more than 30% of low-income residents were enrolled with competitive suppliers.

With electricity in Massachusetts costing roughly twice the national average, Campbell said those losses only "exacerbate" already high bills and called the industry a "predatory industry."

The Department of Public Utilities has also intervened repeatedly. It settled with eight suppliers, resulting in refunds, restrictions on some marketing practices, and, in one case, a two-year market exit for a company.

What's being done?

The legislation is designed to curb the damage critics say the industry has caused without shutting it down completely.

Suppliers would still be able to serve businesses and compete for municipal aggregation contracts even if municipalities gain the power to block direct residential sales.

Municipal aggregation already reaches more than twice as many residential customers as competitive suppliers. Consumer advocates say those programs are usually steadier and face closer review from local officials and regulators.

Caliva said the industry also supports several other changes, including requiring customer approval for renewals, eliminating cancellation or early termination fees, and increasing the fees suppliers pay to operate in Massachusetts.

In his view, lawmakers should "use a saw instead of a wrecking ball."

For consumers trying to protect their budgets, the takeaway is fairly straightforward: Compare any outside electricity offer with your default utility rate or town aggregation plan, read the contract terms carefully, and be cautious of flashy sales pitches.

As Larry Chretien, executive director of Green Energy Consumers Alliance, put it: "We're not putting them out of business overall. We're just saying: Leave these poor residential consumers alone."

Get TCD's free newsletters for easy tips, smart advice, and a chance to earn $5,000 toward home upgrades. To see more stories like this one, change your Google preferences here.