Author: Municipal Finance Legal Guidance
This Ask DLS features frequently asked questions concerning Community Choice Aggregation Adder Fees. Please let us know if you have other areas of interest or send a question to cityandtown@dor.state.ma.us. We would like to hear from you.
What is Community Choice Aggregation?
Community Choice Aggregation refers to the process where municipalities purchase electrical supply in bulk on behalf of customers under G.L. c. 164, § 134. The purpose of this process is to aid municipalities in bundling their electricity demand in order to negotiate lower rates or supply more stable rates for their customers. Eligible customers are automatically opted into the program, but they do have the option to opt-out.
What is an Operational Adder Fee?
An Operational Adder Fee is a per-kWh fee added to a customer’s supply rate. It seems the goal of the Adder Fee is to reserve funds for future energy related projects.
Has a general or special law allowed special fund treatment of Operational Adder Fees?
No, no special fund treatment has been permitted.
How are Operational Adder Fees treated and accounted for?
Operational Adder Fees are a general receipt of the municipality and, therefore, would belong to the General Fund of the municipality. However, the municipality could vote to dedicate the same to a Stabilization Fund, per G.L. c. 40, § 5B.
A Revolving Fund is not a proper way to account for these Fees. A Revolving Fund is a special fund that permits a community to reserve certain fees, charges or other receipts to pay, without appropriation, for the cost of departmental programs or activities from which the fees, charges or other receipts were derived. The reason for this, among others, is that the underlying service is not a program or activity of the community and the related fees are not being used to provide that activity or program.
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Editor: Dan Bertrand
Editorial Board: Sean Cronin, Scott Ditto, Janie Dretler, Jessica Ferry, Christopher Ketchen, Paula King, Jen McAllister, Brianna Ortiz and Tony Rassias
| Date published: | August 13, 2026 |
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