Mass. ranks in top 10 for high energy costs

Experts offer tips on how to save money, including air-drying your laundry even when it's cold outside. ... That's right. What's a good fabric softener for February in New England?

In WalletHub's energy rankings, Massachusetts was named the sixth priciest state for home heating oil costs, but second for electricity prices. Mario Rabadi

By Eileen Woods

July 12, 2024

Forbes may have ranked Massachusetts the most environmentally friendly state in the nation back in May, but that doesn’t mean our energy costs are anything to celebrate.

Solar panels, proper insulation, and heat pumps can help you save money, but when we do pay for energy, we’re shelling out a lot. The state ranks sixth in the nation for energy costs, according to a study WalletHub released July 1.

Source: WalletHub

The methodology

“In order to determine the most and least energy-expensive states, WalletHub compared the average monthly energy bills in each of the 50 states using the following equation: (Average Monthly Consumption of Electricity * Average Retail Price of Electricity) + (Average Monthly Consumption of Natural Gas * Average Residential Price of Natural Gas) + (Average Monthly Consumption of Home Heating Oil * Average Residential Price of Home Heating Oil) + (Average Motor-Fuel Price * (Miles Traveled/Average Motor-Fuel Consumption/Number of Drivers in the State)) = Average Monthly Energy Bill in the State.” Got all that? They used data from the Census Bureau, US Energy Information Administration, Federal Highway Administration, American Automobile Association, National Highway Traffic Safety Administration, and the US Environmental Protection Agency.

The rankings

They also broke it down by energy source. Here’s where Massachusetts ranked:

No. 2 — price of electricity (Monthly cost: $158)
No. 5 — price of natural gas (Monthly cost: $157)
No. 17 — Natural gas consumption per consumer
No. 27 — Price of motor fuel (Monthly cost: $148)
No. 6 — Price of home heating oil (Monthly cost: $309)
No. 10 — Home heating oil consumption per consumer

Source: WalletHub

Here are the overall state rankings:

OVERALL RANK	STATE	TOTAL ENERGY COST	OVERALL RANK	STATE	TOTAL ENERGY COST
1.	Wyoming	$1,591	26.	Oregon	$591
2.	North Dakota	$840	27.	Idaho	$591
3.	Iowa	$798	28.	New York	$589
4.	Montana	$787	29.	Hawaii	$583
5.	Minnesota	$782	30.	Michigan	$583
6.	Massachusetts	$759	31.	Missouri	$578
7.	Connecticut	$750	32.	Delaware	$564
8.	Alaska	$716	33.	North Carolina	$557
9.	South Dakota	$709	34.	Kentucky	$556
10.	Virginia	$694	35.	Arkansas	$541
11.	Rhode Island	$690	36.	Nevada	$538
12.	Utah	$684	37.	Georgia	$533
13.	Alabama	$677	38.	South Carolina	$533
14.	Pennsylvania	$669	39.	Tennessee	$524
15.	Maryland	$665	40.	Oklahoma	$477
16.	New Hampshire	$662	41.	California	$476
17.	Wisconsin	$659	42.	Louisiana	$474
18.	West Virginia	$659	43.	Colorado	$470
19.	Maine	$645	44.	Florida	$462
20	Indiana	$645	45.	Mississippi	$457
21.	Vermont	$644	46.	Nebraska	$453
22.	New Jersey	$643	47.	Texas	$437
23.	Ohio	$630	48.	Kansas	$436
24	Illinois	$622	49.	Arizona	$400
25.	Washington	$618	50.	New Mexico	$376

Source: WalletHub

Elsewhere in New England

As for the other New England states, they are consuming less but paying more, it seems:

New Hampshire ranked No. 4 for electricity prices, just ahead of Connecticut.
Rhode Island ranked No. 46 for energy consumption. (The best states were Hawaii, California, New York, Massachusetts, and Rhode Island.)
Maine ranked No. 3 for natural gas prices, just ahead of New Hampshire and Massachusetts, in that order.
Rhode Island ranked No. 48 for motor-fuel consumption per driver.
New Hampshire ranked No. 5 for home heating oil prices.

Why is New England paying more for energy than Michigan? The Wolverine State gets hit with arctic blasts and heatwaves, too.

According to Seven Hegedus, a professor of electrical and computer engineering and a senior scientist at the Institute of Energy Conversion at the University of Delaware, there are a variety of factors at play. “States have different sources of generation available, and many import from other states,” Hegedus told WalletHub. “There can be three parts to the electric bill: one relates to how much kW of energy you actually use, one is a transmission/distribution charge, and finally, a fixed charge per customer to cover various programs and fees that are not dependent on how much energy you use. These vary from state to state. It also depends if you have a regulated or unregulated utility or a coop.”

Justin Perryman, an adjunct law professor at the Washington University School of Law, said a big difference lies in whether the a state regulates pricing. “States such as Texas have a deregulated electricity marketplace. Missouri and 17 other states have a regulated energy market,” Perryman said. “In deregulated markets there are typically more energy providers which often leads to more competition and lower prices; however, other factors can contribute to energy prices. In regulated markets, the state energy regulatory authority sets the prices of energy. It can be politically unpopular to raise energy costs, so those states may benefit from lower energy costs. Factors such as the state’s commitment to renewable energy may also factor into energy costs. Proximity to less expensive energy sources can lower energy costs.”

According to a 2023 National Grid bill insert that explains its rates, some electric utility bills include charges for solar, electric vehicle, and renewable energy programs. Massachusetts regulates energy prices.

How to save energy, money

Hegedus advised ratepayers to:

Hang their laundry on a clothesline, even in the winter. “Surprisingly, you can dry clothes even when it is cold as long as they are in the sun. You can save $20-50 per year depending on your electric rates and how often you do laundry.”
Lower your thermostat in the winter and raise it in the summer.
Get a home energy audit.
Take advantage of local tax rebates for insulation, window replacement, solar panels, electric ranges, and heat pump installation.