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The following commentary was written by Todd Olinsky-Paul, senior project director at the Clean Energy Group in Montpelier, Vermont. See our commentary guidelines for more information.
During the past decade, Massachusetts became a national leader in energy storage policy and programs, adopting an ambitious energy storage procurement target and launching several groundbreaking programs designed to provide incentives and revenue opportunities for energy storage owners. Concurrently, Massachusetts has also adopted strong clean energy equity commitments: for example, the 2016 Affordable Access to Clean and Efficient Energy Initiative and the 2022 Massachusetts Clean Energy and Climate Plan for 2025 and 2030, which states, “Thoughtful policies and careful program design are essential to ensure that all Massachusetts residents can fully access and participate in the transition to a low-carbon economy…. Differences in income-level, location, English proficiency, and previous marginalization must not hinder equitable access to and distribution of benefits of the transition.”
A new report by Clean Energy Group (CEG) asks the question: are Massachusetts’ energy storage programs, advanced as they are, living up to the Commonwealth’s clean energy equity commitments?
It is an opportune moment to ask such a question. At this writing, the Commonwealth’s three key energy storage-supporting programs – the SMART solar incentive, ConnectedSolutions, and the Clean Peak Standard – are entering a period of internal review, as recommended in the December 2023 report, Charging Forward: Energy Storage in a Net Zero Commonwealth. As part of this review, we felt it was important to review equity provisions and participation levels in these programs, and assess their effectiveness in providing energy storage access to the Commonwealth’s income-eligible and underserved communities – those that need its benefits the most.
To conduct this program review, CEG contracted the Applied Economics Clinic (AEC). AEC’s assessment reveals that two of the Commonwealth’s energy storage programs (ConnectedSolutions and the Clean Peak Standard) lack specific equity provisions and do not report on equity participation. The third program, SMART, despite revisions aimed at improving low-income participation, continues to see very low enrollment by income-eligible customers – a category that is narrowly defined in a way that excludes other types of underserved communities that might benefit from participation.
In short, this report finds that the current energy storage-incentivizing programs in Massachusetts, while they are innovative and successful in many ways, do not live up to the Commonwealth’s clean energy equity commitments.
Fortunately, there are comparable programs in other states that demonstrate how it is possible to do better; there are even pilot programs in Massachusetts that provide good examples, such as the Cape & Vineyard Electrification Offering from Cape Light Compact. These programs, which are summarized in the report, include model equity provisions that could be adapted and applied to the statewide programs in Massachusetts.
It is not too late to take action! Equity provisions that should have been in place from the outset can still be added in the current round of program revisions. Such equity provisions could include best practices modeled by other programs, such as equity incentive adders and low- or no-cost financing, to help overcome cost barriers; participation targets or carve-outs for low-income and underserved communities (the federal Justice40 standard provides one model); and public reporting requirements, so that progress can be tracked and measured.
The Commonwealth of Massachusetts has set a high bar for itself in committing to clean energy equity. It now needs to live up to that high bar. Not only because it is the right thing to do, but also because full decarbonization requires full participation. In 2022, approximately 10.4 percent of Massachusetts’ population lived below the poverty line, and 50 percent – 3.5 million people – lived in environmental justice communities. It is not possible for Massachusetts to reach its decarbonization and clean energy goals while leaving these communities behind.
In comparing Massachusetts’ energy storage programs with those of other states such as California, New York and Connecticut, one thing seems clear: little progress on equity will be made if the state does not require it. Utilities may be well-positioned to administer these programs, but legislators, policymakers and regulators are tasked with defining the goals, establishing the rules and overseeing progress through public reporting. The other states mentioned here have taken concrete steps in their energy storage programs to establish clear equity goals, overcome barriers to equitable participation, and measure outcomes. When necessary, course corrections have been made.
Massachusetts now has an opportunity to do the same.
Clean Energy Group’s new report, Energy Storage Equity: An Assessment of Three Massachusetts Programs, can be downloaded here. A free webinar on this report will be held on October 8; register here.
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