New report reveals New England electricity customers on basic service overpaid by $3.4 billion

At a time when electricity prices in New England are high and rising, a new study by Cambridge, Massachusetts-based consulting firm Synapse Energy Economics finds Basic Service ratepayers in Massachusetts are paying $22 per month, on average, in hidden fees on their electric bill.

Their report, “Overcharged: Suppliers’ Retail Premiums are Inflating Massachusetts Electric Bills” identifies how these fees can be more than halved with commonsense, achievable regulatory reforms in Massachusetts. 

“These hidden “retail premiums” represent the difference between what consumers pay on their electricity bill, and what electricity actually costs in the ISO New England electricity market. These premiums are meant to act as a market hedge—by paying more for electricity, consumers are ostensibly being protected against even more volatile market prices. However, a detailed month-by-month analysis of supply components, including energy, capacity, renewable portfolio standard compliance, and other smaller, miscellaneous costs, shows that consumers routinely lose money.”

The analysis found that:

• Over the past ten years, for residential customers on the “Basic Service” default option for electricity supply, this premium has translated into a markup of 43 percent. Between 2015 and 2024, customers paid $3.4 billion more than ISO New England’s market cost, translating into concealed premiums of $22 per month.
• This premium has grown over time, with consumers paying $47 per month in premiums in 2023 and 2024, compared to $23 per month in the preceding eight years.
• In 88 percent of the months from January 2015 to December 2024, consumers paid more than the market price of supply. In 12 percent of months (14 months), retail customers paid at least double the actual cost of supply.

For more on the specific Massachusetts results, read their technical report, accompanying slide deck, or factsheet!

For our more recent New England-wide results, read their detailed slide deck here. 

Massachusetts Governor Maura Healey released the following statement in response too the report:

“It is unacceptable that customers are left paying billions of dollars in additional costs because of the way the current system is set up – especially at a time when so many people are already struggling to pay their bills,” said Governor Healey. “As President Trump continues driving up energy prices with his wars and attacks on American-made clean energy supply, we need to be laser-focused on lowering costs here in Massachusetts. That’s why I filed energy affordability legislation to change how utilities buy electricity, getting customers a better deal so we can bring down energy bills in Massachusetts. It is so important that we move quickly to get this legislation passed so my administration can implement these critical reforms, and we will keep working with the Legislature to get this done.”