Tag: resource economics

BOSTON — Hundreds of thousands of low-income Massachusetts residents will be getting an “automatic” break on their utility bills under a deal between the Healey administration and the state’s power companies.

The agreement, announced on Wednesday, is aimed at making it easier for people who are on MassHealth, receiving food stamps and other welfare benefits for the poor, elderly or disabled, to get discounts on bills that have been offered by utility companies for years but are not reaching everyone who qualifies, officials say.

Healey said the deal, which won’t cost the state money, will benefit hundreds of thousands of consumers who will save an average of up to $460 a year on their gas bills and up to $1,058 per year on electric charges.

“Far too many Massachusetts residents struggle to cover the high costs of gas and electric bills, especially as we head into the winter months,” Healey said in a statement. “We are proud to deliver this landmark agreement that will automatically deliver significant savings for hundreds of thousands of households across the state.”

To be sure, the state’s largest utilities — Berkshire Gas, Eversource, Liberty Gas, National Grid, and Unitil — have for years provided discounts on utility bills for individuals and families receiving state and federal cash assistance.

But agreement with the five companies is expected to expand the number of people who receive the benefits by making them automatic on customers’ bills and streamlining the process of determining who might be eligible.

Those who qualify as MassHealth recipients or through welfare programs won’t have to provide documentation such as income and assets, as those are already reviewed by the state agencies that provide the assistance, Healey administration officials said.

MassHealth recipients and those receiving aid from the Department of Transitional Assistance will automatically get discounts of up to 25% on gas bills and 42% on electric bills unless they opt out of the benefits, according to the Healey administration.

MassHealth members that are eligible and are electric customers of National Grid could expect discounts of up to 71% after implementation of a new tiered discount program expected to go into effect later this year, officials said.

But Energy and Environmental Affairs Secretary Rebecca Tepper said the tiered discounts and automatic enrollment “will be transformational for residents who are most in need.”

“We’re using every tool we have to cut energy costs for our residents,” said in a statement. “We’re at a critical moment in the clean energy transition, and we are seizing this opportunity to rethink how we promote affordability.”

Massachusetts has some of the highest energy costs in this nation, which consumer advocates say have an outsized impact on low- and even some middle-income households that have trouble keeping up with expenses. They cite data showing record numbers of consumers are behind on their energy bills.

Last winter was expensive for energy consumers, with the combination of record-high inflation, constrained supplies, and the impact of Russia’s war against Ukraine on global oil markets all driving up the cost for natural gas and home heating oil. Many people have gotten far behind on their bills and remain underwater, advocates say.

“There are hundreds of thousands of people in the state who are deeply in the hole to their utilities,” said Charlie Harak, a senior attorney at the Boston-based National Consumer Law Center. “Hopefully these changes will make it easier to find people who may benefit from the discount.”

Harak said many low-income energy consumers who qualify for the benefits often face barriers, such as filling out applications and providing documentation to get discounts from their utility companies. He said some people who are receiving only medical benefits aren’t getting the utility discounts, even though they would otherwise qualify.

The state has a number of other programs on the books aimed at reducing energy costs for low-income, elderly and disabled consumers struggling to pay their bills.

That includes the federally funded Low Income Home Energy Assistance Program, known as LIHEAP, which provides homeowners who earn 60% of the state median income assistance paying for fuel, electricity and weatherization upgrades.

Meanwhile, demand for food stamps and other public assistance has risen amid the economic fallout of the COVID-19 pandemic, and has remained high due to inflation.

As of August, more than 115,000 people in Massachusetts were receiving basic welfare benefits from the state’s main cash assistance program, known as Transitional Aid to Families with Dependent Children, according to the latest state data.

More than 1.1 million people were getting food stamps as of September, according to the latest federal data. That’s more than double the pre-pandemic average of about 450,000 recipients.

Under current law, a recipient is limited to receiving welfare for two years in any five-year period. A family of three in the program collects roughly $593 per month.

In the fiscal year that gets underway July 1, the state plans to spend more than $300 million on cash assistance programs for welfare recipients.

Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com.