Energy Incentive Programs, Massachusetts

Updated October 2012

What public-purpose-funded energy efficiency programs are available in my state?

Massachusetts' comprehensive legislation on electricity restructuring includes a non-bypassable systems benefit charge of roughly 2.5 mills/kWh for energy efficiency programs. Over $500 million was budgeted across all program types (including low-income and residential) in 2011, up from roughly $200 million in 2009. The public benefit funding was augmented, starting in 2009, by Massachusetts' portion of proceeds from both the ISO-New England Forward Capacity Market (see below in the load management/demand response section) and the northeastern states' Regional Greenhouse Gas Initiative (RGGI). The energy efficiency programs are administered by Mass Save, an entity contracted by the state's utilities, including The Berkshire Gas Company, Cape Light Compact, Columbia Gas of Massachusetts, National Grid, New England Gas Company, NSTAR, Unitil, and Western Massachusetts Electric Company. Mass Save is intended to serve as a "one stop shop" for electric and gas efficiency programs offered by these utilities. The range of rebates and technical assistance through the initiatives is broad. For information on offerings for your area, visit the Mass Save website, where you can search for programs by location. A sampling of the offerings is shown below:

  • The Cool Choice provides rebates for high-efficiency HVAC equipment, including packaged air conditioners, air- and water-source heat pumps. Dual enthalpy economizer controls, demand-controlled ventilation, and electronically commutated motors (ECMs) for supply fans are also included.

  • The Mass Save Financing Program matches businesses with interest-free loans of up to $100,000 and seven years for energy efficiency projects such as lighting, motors and VFDs, compressed air, and customer measures.

The Building Operator Training and Certification Program, sponsored by several utilities including National Grid, NSTAR, Bay State Gas, Berkshire Gas, Cape Light Compact, Unitil, and Western Massachusetts Electric, trains and certifies building operators to optimize the operations of their facilities.

In addition to these statewide programs, several utilities have their own programs:

National Grid offers a variety of electric efficiency services outside of the statewide programs. These are organized under two initiatives:

  • The Large Business Programs include:

    • Rebates for energy-efficient lighting, VSDs, HVAC equipment, compressed air systems, and other custom measures for new construction and existing facilities.

    • Technical assistance in identifying, implementing, and evaluating energy efficiency opportunities for new construction, renovations, and equipment replacement.

    • Assistance with finding competitive financing of energy-efficient equipment and projects.

    • Building commissioning to verify that newly installed systems are operating according to specifications.

    • Fixed low prices, through the Buyers' Alliance, for lighting materials such as electronic ballasts, high-efficiency fixtures, and energy-efficient lamps, and recycling of old lamps and ballasts.

  • The Small Business Program pays 70% of the cost of the installation of the company's energy-saving improvements and finances the remaining 30% interest-free, for up to 24 months. Efficient equipment, including lighting upgrades, time clocks, outdoor lighting photo cells, occupancy sensors, programmable thermostats, and walk-in cooler measures are available. The program is open to business customers with an average demand of 300 kW or less. Free energy audits are also offered.

NSTAR provides a number of energy efficiency programs and services:

  • The New Construction Program program provides commercial and industrial customers with rebates of up to 75% of the cost difference between standard and high-efficiency equipment, as well as 90% of the incremental cost of comprehensive design services. Commissioning and cost sharing for engineering services are also available. Pre-approval is required for participating in this program.

  • The Retrofit Program provides medium and large commercial and industrial customers up to 50% of total project costs in existing buildings, and up to 75% when comprehensive efficiency projects are implemented. Design and commissioning services, as well as cost-sharing of engineering services, are also provided through the program. Preapproval is required for participating in this program.

  • The Direct Install for Small Businesses program is available to customers whose average monthly demand is 300 kW or less. It offers a free energy audit to identify energy-saving opportunities, and may also pay up to 70% of the total cost for retrofitting qualifying lighting and mechanical systems. Energy-saving measures include upgrades to energy-efficient lighting fixtures, electronic controls, and efficient HVAC and refrigeration systems.

  • In addition to the Gas Networks rebates described below, NSTAR offers a custom program that provides up to 50% of the project costs for unusual technology options such as desiccant dehumidification and direct contact water heaters.

  • Vending machine occupancy sensors are eligible for $30 (non-refrigerated machine) to $75 (refrigerated) rebates through NSTAR's Vending Machine program.

Western Massachusetts Electric (WMECO) offers a variety of programs and services, including the following:

  • The Small Business Program provides technical assistance, incentives (up to 70% of costs), and zero-interest financing for energy efficiency upgrades to lighting, cooling and small refrigeration to customers with average demand below 300 kW.

  • The Retrofit Program offers technical assistance and incentives for energy efficiency upgrades in existing buildings. Incentives are available for lighting, motor controls, HVAC, chillers, energy management systems, vending machine controls and custom projects.

  • The New Construction/Failed Equipment Program provides technical assistance and incentives for energy efficiency upgrades in new buildings or when replacing failed equipment. Incentives are available for lighting, motor controls, HVAC, chillers, compressed air, and custom projects. The Advanced Building/Core Performance Program is for building design professionals to achieve significant energy savings in new buildings.

Unitil also offers a number of energy efficiency services, including:

  • The Small Business Energy Efficiency Services program, which provides small commercial customers (average demand less than 300 kW) with a free energy audit, an energy efficiency project proposal, and incentives for equipment such as lighting, occupancy sensors, refrigeration and customized projects.

  • Unitil's large business programs, the Large Business Retrofit and Commercial and Industrial New Equipment & Construction programs, offer financial and technical services to commercial, industrial, and institutional customers building new facilities, undergoing major renovations, or replacing old, inefficient equipment. Prescriptive and custom incentives are available to cover either a one-year payback or a percent of the installed cost of the project (35% for retrofits, 75% of new equipment and construction). Prescriptive measures include HVAC systems, lighting conversions and controls, VFDs and air compressors. (Pre-approval is required.) Design assistance, audits, and project development are also available through the program.

National Grid, NSTAR, Berkshire Gas, New England Gas, Columbia Gas and Unitil all participate in the Gas Networks consortium, which sponsors rebate programs for high efficiency natural gas furnaces, boilers, water heaters, infrared heating, and commercial food service equipment.

In addition to the Gas Networks incentives, National Grid offers the Energy Efficiency Engineering Co-Funding Program, which provides cost sharing of up to 50% (limited to $10,000 per project) for engineering studies aimed at improving efficiency of gas.

What utility energy efficiency programs are available to me?

For energy efficiency programs offered by Massachusetts' utilities, see the previous section. Also check the Mass Save website for other utility programs in your area.

What load management/demand response options are available to me?

The Independent System Operator New England Inc. (ISO-NE) offers its Demand Response programs, which provide payments to electricity users for load reductions (of as little as 100 kW), either by reducing usage or operating on-site generation during periods of high demand. Customers may participate in the program through any participating member ("Market Participant") of the New England Power Pool, such as a utility company, power marketer, competitive energy supplier, or independent curtailment service provider (CSP). The Market Participant is allowed to aggregate load to reach the quantity qualification limit, so customers interested in these programs with less than 100 kW to offer may want to contact their utility or other eligible party.

ISO-NE's Forward Capacity Market (FCM) allows customers to bid their load reduction capabilities – whether constant (such as an indoor lighting retrofit project), seasonal (such as a new energy-efficient chiller plant), or dispatchable (such as a back-up generator or demand management actions) – into a forward capacity auction that permits demand-side resources to compete with supply-side ones. Bids that are accepted are paid the auction clearing price. These auctions take place annually for commitment periods three years in the future (though the qualification process begins roughly a year in advance). Interested facilities should contact a market participant regarding the auction schedule; in addition, market participants may have unfilled capacity commitments ahead of the next auction.

Market participation includes both active (conventional demand response, including real-time emergency generation) and passive (energy efficiency and distributed generation, including renewables) options. Active DR opportunities include:

  • Real-Time Demand Response, which provides an opportunity for customers to receive payments for responding to system emergencies. Participants are paid a capacity payment (through the FCM) and for actual load reductions based on the real-time locational marginal price. Customers must respond within 30 minutes and must be able to receive dispatch instructions through a market participant or their agent ("demand-designated entity"). Participating customers must also have interval metering installed at their facility.

  • Price-Responsive Demand, a real-time demand response option that allows participants to offer reductions into the day-ahead energy market. These customers are paid for cleared reductions in the market and are expected to interrupt in real time (according to their offers).

Real-Time Emergency Generation, which is for generators whose federal, state, and local permitting limits operation to actual or imminent loss of external power. Calls to participate are restricted to times when ISO-NE has instituted manual 5% voltage reductions. Real-Time Emergency Generation resources must be capable of curtailing end-use electric consumption from the New England grid within 30 minutes of receiving a dispatch instruction, and maintaining that curtailment until notified. For an emergency generator that does not operate in parallel with the grid, the participating customer must have an interval meter installed on the generator (or entire facility). Otherwise, interval metering of both are required.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewables and Efficiency (DSIRE) website provides information on programs that offer incentives for renewable distributed generation.

Massachusetts' renewable portfolio standard includes a solar set-aside that requires electricity providers to cover a portion of their sales with SRECs. The alternative compliance payment for 2013 is $550/MWh ($0.55/kWh).

The Massachusetts Clean Energy Center, the state's development agency for clean energy, offers renewable energy programs formerly administered by the Renewable Energy Trust. These include:

  • Commonwealth Solar Hot Water, an initiative that provides up to $5,000 for feasibility studies and $50,000 for the development of commercial-scale solar hot water installations.

  • Micro Wind , for commercial customers of any Massachusetts investor-owned utility or municipal light plant that pays into the Renewable Energy Trust (National Grid, NSTAR, Western Massachusetts Electric, or Fitchburg Gas and Electric) and hosts wind installations of at least 1 kW and up to 99 kW. Rebate payments are based either on rated capacity or verified estimate of energy produced by the system. Ninety percent of the rebate is paid upon completion of the project, with the remaining 10 percent paid after a year of operation.

  • Commonwealth Wind – Community Scale, for wind installations 100 kW or greater. This program offers grants for siting support, technical and feasibility studies, and design and construction. To qualify, applicants must be a customer of a Massachusetts investor-owned utility or municipal light plant that pays into the Renewable Energy Trust (National Grid, NSTAR, Western Massachusetts Electric, or Fitchburg Gas and Electric).

  • Commonwealth Hydropower offers up to $40,000 for feasibility studies and $600,000 for design and construction of small (up to 25 MW) hydro installations. Check the website for the timing of their periodic solicitations.

Through its Custom Projects program, National Grid offers gas customers a rebate (based on review of application) for solar thermal space or water heating installations and other custom projects.

Are there energy efficiency programs sponsored by the state government?

Massachusetts currently has no state-sponsored energy efficiency programs available to federal facilities. For more information, contact the Department of Energy Resources (DOER).

What additional opportunities are available to me?

Federal customers whose utilities have area-wide supply contracts through GSA (e.g., National Grid and NSTAR Electric), may be able to take advantage of 3rd-party financed energy efficiency projects called utility energy services contracts (UESCs). Information is available on GSA's Energy Center of Expertise Library Page. Federal facilities should contact their account executive to determine the level of each utility's participation.