The Massachusetts House of Representatives is moving forward once again with an energy bill that could impact affordability and climate progress for years to come. The House Ways and Means Committee is working on a new draft, picking up where the Energy Committee left off in November with House Bill 4744, a truly awful piece of legislation. We believe that Ways and Means will come out with a new version by the second week of February.

Recently, we have heard that the new version will be less likely to include direct attacks on mandates to reduce emissions. Instead, we’re hearing that the bill will make it much, much harder to meet those mandates by attacking a key concept, the “social cost of carbon,” as it applies to our state’s energy efficiency program, Mass Save.

The Social Cost of Carbon

The social cost of carbon is a calculation of the actual societal costs of emitting one more ton of carbon emissions. It is calculated by economists and serves to internalize costs that would otherwise be externalities - costs caused by the action of burning fossil fuels that are not borne by the entities doing the burning, but by all of us.

Stripping the social cost of carbon from Mass Save’s evaluation system reminds one of the 2021 satirical movie, “Don’t Look Up.” In the film, we are faced with two problems: first, that there is a comet on a collision course to Earth, and second, that people in high places just won’t look up to see the truth.

The “Don’t Look Up” Provisions of House Bill 4744

As we and many others have reported, the Mass Save program has been saving consumers money and reducing fossil fuel consumption more than cost-effectively. In fact, evaluations of the program show that energy savings benefits and non-energy benefits exceed all costs by a factor of 3 to 1. In other words, for every dollar we put into the program, we get more than $3 back in benefits. The energy savings benefits are tied to reduced consumption of oil, propane, natural gas, and electricity. A significant portion of the non-energy benefits has to do with the program’s avoidance of the “social cost of carbon.” House Bill 4744 would stop the practice of incorporating the social cost of carbon in most cases – emphasis on most.

Sections 5, 6, and 8 of H.4744 would STRIKE long-standing language that states that, “when determining cost-effectiveness, the calculation of program benefits shall include calculations of the social value of greenhouse gas (GHG) emissions reductions.

In other words, if this bill were passed as currently drafted, Massachusetts would stop valuing the full GHG reduction value of insulation or switching a home from inefficient electric resistance heat to much more efficient heat pumps. Insulation and heat pumps are GHG killers that also save people money.

These sections effectively say that when Mass Save spends money on something that does not burn, the adverse effects of global warming are to be ignored. What kinds of effects? Flooding, more intense storms, infectious disease, asthma, higher health care expenses, wildfires, lower worker productivity, higher insurance premiums, etc.

Section 38 of H.4744 puts the final nail in the coffin of accounting for any benefits relating to GHG reduction. It lists all the usual economic benefits related to energy efficiency measures, but ends with “the calculation of benefits shall not include the social value of GHG emissions reductions.” It all seems straight out of Project 2025.

Why does this matter?

The budget for Mass Save is proposed by the program administrators (investor-owned utilities and the Cape Light Compact), reviewed by the Energy Efficiency Advisory Council (EEAC), and ultimately determined by the Department of Public Utilities (DPU). To pass muster, program benefits must be greater than their costs. By stripping the social value of GHG reduction from the benefits, a likely result will be that Mass Save’s budget would be severely cut. It’s another way to slash Mass Save’s budget, alongside the more straightforward budget cuts that would be required by Sections 97 and 98. Taken together, by inevitably resulting in a reduction of Mass Save’s budget, these sections would ensure lower energy savings as well, making us even more dependent upon increasingly expensive methane, oil, and propane.

There’s no question about it; House Bill 4744 is pro-fossil fuel, anti-insulation, and anti-heat pump.

As long as we retain the mandate to be net zero by 2050 with emission reductions by a certain amount every five years until then, there is another huge downside to ignoring the social value of GHG reduction. The point of applying the social cost of carbon to every Mass Save program is to reveal which measures give us the greatest bang for our buck in terms of GHG reduction. One measure might have a benefit-cost ratio (BCR) of 4:1 while another might be 1.5:1. If our goal is to reach net zero in the most cost-effective manner for ratepayers, we should allocate resources to those measures with high BCRs. By eliminating the social value of carbon from the equation, the DPU will be forced to have blinders on, and that would cost ratepayers and taxpayers dearly over time. Crippling Mass Save would just put unnecessary pressure on every aspect of the Commonwealth’s economy.

If all this upsets you, join us to take action.

Steps to Take Action

1. Find your State Representative's number here.

2. Call their number. A staff person will answer (don't worry, they are friendly), or you'll be directed to a voicemail box. Either way, you can use this script:

Hello, I’m [your name]. I live in [town], and I am calling to ask you to push to ensure that the House’s energy bill, H.4744 is focused on reducing energy costs by going after utility overspending and predatory third-party electric suppliers, not the state’s clean energy program, particularly Mass Save. Specifically, I am concerned by the bills’ removal of the social cost of carbon from calculating the benefits of our energy efficiency programs. The costs of not acting on climate change are high and should be incorporated into any benefit-cost analysis.

3. Follow up with an email. You can use the same script as above.

4. Share this information with three friends and urge them to do the same.