Post Content

David Cash

David Cash

Commissioner, Department of Public Utilities (DPU)

View David's Complete Bio

Ever wonder what you’re paying for every month when you get your bill?  There are basically four parts of your electric bill. 

Average residential electric rates
1. The Commodity used to make the electricity (Blue).  The commodity – natural gas, coal, or oil – that is used in power plants to make your electricity. This is by far the biggest part of your bill, and here in Massachusetts, where we are at the end of the energy pipeline, we are at the mercy of global energy prices.  See in the graph how the blue part, the Commodity, is volatile?  In 2005, when Hurricane Katrina hit, knocking out natural gas pipelines, the price of natural gas shot up, and so did our electricity rates.  Since we don’t have any coal, oil, or natural gas in Massachusetts, we have two ways we can reduce that blue part. We can ramp up energy efficiency and develop more homegrown renewable energy like solar and wind.  Both of these efforts have been priorities of the Patrick-Murray Administration, and this year, for the first time, Massachusetts is #1 in the country in energy efficiency beating out California.

2. The Distribution charge (Purple):  This is what it costs for your electric company to deliver the electricity to your house – the wires, substations, repair trucks, etc.  This is the only portion of your bill that the state directly regulates.  The Department of Public Utilities closely regulates the utilities and makes sure that what it charges for this portion is fair and reasonable.  This is also the portion of the bill in which there are charges to invest in the state’s energy efficiency and renewable energy programs.  For every dollar that is invested in all these programs, we get two dollars in savings!   And remember, these are how we reduce our dependence on fossil fuels that come from outside of Massachusetts.  Notice that the graph shows that this part of the bill has been relatively stable in the last decade – even with new energy efficiency and renewable investments.  

3. Transmission charge (Green):  This portion of the bill pays for the big interstate transmission wires that make up the backbone of the electric grid.  This is regulated by the federal government.

4. Transition charge (Red):  This is a leftover charge from when the state’s electricity system was restructured in the late 1990’s.  This charge will soon disappear.

Written By:

Tags: , , , , , , , , , ,

Recent Posts

Solarize Mass – Big Scale Impact for Small Scale Solar posted on Aug 20

Solarize Mass – Big Scale Impact for Small Scale Solar

The results of the Solarize Mass 2013-2014 two rounds managed to surpass numbers from the previous two years. Close to 1,500 contracts were signed and a total of nearly 10 megawatts of solar installed. During 2013’s first round, ten communities participated, and for the second round that ended this past June, another fifteen communities were chosen.

Carbon Neutral? A Closer Look at University Claims posted on Aug 14

Carbon Neutral? A Closer Look at University Claims

The five UMass university campuses have made enormous progress towards carbon neutrality. In particular, UMass Amherst has demonstrated impressive environmental leadership and received an Energy and Environmental Affairs’ Leading by Example award for achieving a 26 percent reduction in greenhouse gas emissions three years ahead of its 2012 goal.

Door-to-Door Campaign Reaps Energy Efficiency Gains posted on Aug 1

Door-to-Door Campaign Reaps Energy Efficiency Gains

Greenfield sent program specialists from Energy Smart Homes door-to-door to answer questions, explain the energy auditing process, and plan retrofit projects. So far, home energy assessments in Greenfield have taken place at four times the statewide rate.