Audit  Who Pays and Who Gains? Analyzing Contributors and Beneficiaries of the Mass Save Program

This report examines the municipal distribution of incentives¹ from Mass Save, a Commonwealth energy efficiency program. Data from 2019 to 2023 is examined (Mass Save has not released more recent data).² The Office of the State Auditor’s DLM reviewed the correlation of Mass Save incentive distribution with socioeconomic factors including income, population density, and owner-occupied housing rate. Furthermore, DLM assessed the impact of Mass Save incentives in environmental justice (EJ) municipalities³ and gateway cities (GCs).⁴

DLM finds significant disparities in the distribution of Mass Save incentives, where residents of some higher-income municipalities received more than they contributed and residents of many lower-income municipalities contributed more than they received. Residents of 48 of the 175 municipalities with per capita income under the state median contributed to Mass Save at more than the state’s average rate; of these, 15 have annual per capita incomes of less than $35,000.⁵ There is also evidence of disproportionate financial burden on residents of EJ municipalities and GCs. For example, residents living in municipalities with more than 90% of their population in EJ block groups contributed $90.67 per capita over the studied period (2019-2023), which is 151% (or $60.04 per capita) of the contribution of municipalities with no EJ block groups. Furthermore, the per capita contribution of residents of GCs was 24% higher than the state average outside GCs ($77.76 versus $62.96), but when considering the income differential, GC residents contribute to Mass Save at a rate that is 3.2 times higher than the average state resident.⁶

Below is a summary of our findings and recommendations, with hyperlinks to each page listed.

1.        Note that in this context, incentives refer to the money provided by Mass Save to participants for undertaking energy efficiency measures, while net benefits equal the difference between the received incentives and the contributions made by residents to the program.

2.     Mass Save is required to make public data on incentive distribution starting with fiscal year 2025—see MGL Chapter 25, Section 22(d) for more information—but it has not been under any legal obligation to share its data until the present moment. Note that all data references in this report refer to the 2019–2023 period.

3.     See the Commonwealth’s webpage on Environmental Justice policy for more information. For the purposes of this report, we define EJ municipalities as those municipalities containing at least 90% EJ block groups.

4.     MGL Chapter 23A, Section 3A defines a GC as “a municipality with a population greater than 35,000 and less than 250,000 with a median household income below the commonwealth’s average and a rate of educational attainment of a bachelor’s degree or above that is below the commonwealth’s average.”

5.     See Figure 4 for a full list.

6.     See Data Overview for more information regarding data limitations. The population of available GCs was 1,837,313, with an associated total net contribution for the period of $142,874,125 (or $77.76 per capita). The population of non-GCs was 4,980,677, with an associated total net contribution of $313,568,573 (or $62.96 per capita). But the average income per capita in GCs in 2021 was $28,867, whereas the average income per capita in non-GC municipalities was $74,955, for an income differential ratio of 2.6. Therefore, net contribution per capita represented .0027% of yearly income in GCs, but only .0008% of yearly income in non-GCs, a ratio of 3.2.