How we pay for solar subsidies – Comparing recent electric bills from Florida and Massachusetts
Summary
Comparing recent electric bills from Eversource in Massachusetts with those from Florida Power and Light (see the chart below) reveals many large hidden charges and shows that Massachusetts state-mandated policies almost triple the cost of electricity. The federal government ended tax credits for renewables last year, which would have cost taxpayers 288 billion dollars over the next 10 years. However, state mandates for more renewable power generation continue to increase, shifting the massive cost of expiring federal subsidies to electric customers through higher electricity rates. Most of this shift is yet to come.
This chart shows that the total rates for Florida are 14.1 cents/kWh (kilowatt-hour) versus 36.1 cents/kWh for Massachusetts in October 2025.
Roughly two-thirds of the electric bill in Massachusetts has little to do with the generation and delivery of electricity; rather, it reflects the state’s expensive policies, including clean energy credits, net metering, costly large-scale battery storage projects, and unnecessary transmission and distribution improvements. Even more concerning is that these charges are hidden on our bills, making it seem as though other costs are responsible for our skyrocketing rates.
Over half of the MA electric bill goes toward solar and wind power generation, which provides less than 20% of the electricity while reducing power grid reliability and affordability.
Both Florida and Massachusetts have a similar power-generation mix (mostly dispatchable gas and some baseload nuclear), and the cost of generating electricity in both states is typically about 5-7 cents per kWh (kilowatt-hour), except during peak summer and winter periods. Benchmarks for utility expenditures to operate and maintain transmission and distribution systems are about 2 and 4 cents/kWr, respectively. So the actual cost of producing and delivering electricity in these states should normally be about 11-13 cents per kWh. FP&L offers solar incentives that add about 2 cents/kWh, bringing the total rate to 14.1 cents/kWh, plus taxes and fees. Massachusetts has several policy-related costs totaling about 23.1 cents per kWh, bringing the total rate to 37.1 cents per kWh.
Clean energy credits account for 1/3 of policy-mandated costs in Massachusetts. Over a third of those policy-mandated costs are for rebuilding distribution systems to accommodate distributed generation, adding expensive grid-scale battery storage installations, and expanding transmission to access remote renewable generation sites, including offshore wind systems.
Approach
Electric bills for Florida and Massachusetts are compared for September 2025. September is a time of year with no unusually high electricity demand and without natural gas supply shortages in New England. Since very little detail is provided in either bill, a comparison requires making some assumptions and allowances based on other published information. The costs of generation, transmission, and distribution are normalized using industry benchmarks to isolate policy-mandated costs. This analysis is a preliminary estimate of the basis for our electric rates and should be reviewed more rigorously to support legislative initiatives.
Electric bills October 2025
Electric bills from Florida and Massachusetts are shown below. Note that electricity consumption varies widely across bills, and the intent is to compare rates.
Eversource
The Eversource bill lists separate rates for several charges and programs, including the net meter recovery surcharge of 1.6 cents per kWh and small charges for distributed solar and renewable energy. Separate rates are provided for energy efficiency and electric-vehicle programs, as well as for transmission and distribution. The overall impression is that generation charges from a competitive supplier account for most of the electricity costs. This is very misleading, since the generation service charge consists mostly of clean energy credits, and the transmission and distribution charges include costs that are not typically required to deliver electricity from our power grid.
Florida Power & Light
The Florida Power and Light (FP&L) bill breaks down generation into non-fuel and fuel categories, with the fuel category increasing slightly as total usage rises. There is no breakdown of transmission and distribution costs, nor any identification of policy-mandated costs.
Generation charge
Generation costs include recovery of capital, operating, and fuel costs for producing electricity at power plants.
FPL is a large, regulated, investor-owned utility that is allowed to recover actual power plant capital, operating, and fuel costs through consumer electricity rates approved by the Florida Public Utilities Commission. These costs are presented as fuel (2.4 cents/kWh), which is passed through to customers without profit, and as non-fuel charges (9.7 cents/kWh), which cover all other costs, including transmission, distribution, and policy-mandated costs. Using this total of 12.1 cents/kWh, deducting 6 cents/kWh for transmission and distribution costs and 2 cents/kWh for net metering and other policy mandates, leaves an estimated generation cost of 5.1 cents/kWh. Florida is experiencing rapid growth in its transmission and distribution systems and is investing to preserve reliability amid hurricanes and associated wind and flooding damage.
In Massachusetts, electric customers can competitively select a retail supplier or accept the default generation rate offered by the distribution company (Eversource). The retail supplier procures electricity from the New England wholesale power market administered by ISO-NE and must pay market rates for electric energy, capacity, and ancillary services, as well as transmission and distribution charges. However, state energy policy requires distribution companies and retail suppliers to procure clean energy credits and to pay a regional carbon tax, with these additional costs included in consumer generation rates. The category shown as generation service charge on the Eversource bill represents both the cost of buying power from the wholesale market and a regional carbon tax, plus the cost of clean energy credits applied to a fraction of the energy consumed. This fraction increases by 1% each year to mandate increased use of renewable power generation under state energy policy.
The default Eversource generation rate was 14.88 cents/kWh in September 2025, when available retail supplier contracts ranged from about 13 to 16.5 cents/kWh for various contract durations. Some retail suppliers offer lower rates to attract new customers and higher rates to lock in costs farther into the future.
This range of 13 to 16.5 cents/kWh suggests an average rate of 15 cents/kWh for the total of generation costs and clean energy credits. In September 2025, the ISO-NE wholesale price was about 3.3 cents/kWh, as reported on the ISO-NE website.
Massachusetts utilities must repair and upgrade aging transmission and distribution facilities and address reliability issues stemming from wind and flooding damage caused by major seasonal storms.
The Energy Information Administration reports the 2025 annual average wholesale cost for ISO-NE was 5.5 cents/kWh. The average 2025 total cost of generation in Massachusetts is estimated at 7 cents/kWh, including additional capacity charges and ancillary services. Deducting that from the estimated total generation cost of $0.15 per kWh offered by retail suppliers leaves about 8 cents/kWh as the estimate for policy-mandated costs, including clean energy credits and the RGGI carbon tax.
More data on the cost of generation and the history of electric rate charges are available on the US Energy Information Administration website.
Transmission and Distribution
Capital and operating costs for transmission and distribution equipment between power plants and customers are usually included as separate charges. The average transmission and distribution costs of 2 and 4 cents/kWh, respectively, are used as benchmarks, based on published data derived from the US EIA.
In Massachusetts, Eversource and other regulated electric distribution companies may charge customers for additional distribution investments made to support the installation of renewable generation, electrification, and battery storage facilities as authorized by the state Department of Public Utilities (DPU). These additional charges cover improvements to distribution systems required to support electric vehicle charging stations and to provide safe integration of distributed generators, such as rooftop solar systems. In Florida, FPL charges owners of generating facilities, including rooftop solar systems, directly for grid interconnection and integration through interconnection fees, rather than including all of these costs in consumer electricity rates.
An average monthly distribution charge of 4 cents/kWh is derived from US EIA data, as described above. The difference between the 10 cents/kWh shown on the Eversource bill for distribution costs and the benchmark of 4 cents/kWh is considered a policy-mandated additional distribution cost of 6 cents/kWh, as discussed below. It is assumed that FPL has no policy-mandated distribution costs since owners and users of electric vehicle charging stations pay for their installation and grid integration.
Regulated utilities like FP&L and Eversource charge consumers for the actual costs of managing transmission facilities and for using transmission facilities owned by others. The FP&L bill does not break out transmission and distribution charges. A benchmark transmission charge of 2 cents/kWh, derived from EIA data (as described above), is assumed. FPL has additional policy-mandated transmission charges for installing battery storage facilities, which are included in its rates. By 2025, Florida had installed 561 MW of grid-scale battery storage, compared to 267 MW in Massachusetts.
Cost of policy mandates
Massachusetts state energy policies provide large subsidies for solar and wind generation that are difficult to recognize in the Eversource bill. FPL appears to include costs for battery facility installations and net metering credits, which are represented, for purposes of this comparison, with an assumed allowance of 1 cent/kWh. Massachusetts, however, breaks out several additional charges that are clearly related to policy mandates. The chart below illustrates policy mandates identified in the Eversource bill, the estimated cost of clean energy certificates discussed above, and estimated policy-mandated additional distribution and transmission costs.
As shown above, clean energy credits account for the largest share of policy-related costs, followed by distribution system subsidies, the energy efficiency charge, and transmission system subsidies.
Transmission and distribution subsidies include transmission improvements to enable connection to remote renewable power systems, installation of grid-scale battery systems, and improvements needed to support the deployment of electric car charging systems and other electrification initiatives, such as increasing power supply to support new heat pump installations.
Clean energy certificates
The Massachusetts Department of Energy Resources (DOER) issued a draft annual report that describes the basis for setting the value and quantity of clean energy certificates. According to this report, Massachusetts has an estimated installed capacity of 5,556 MW of solar PV, leaving a need for approximately 2,804 MW, or 468 MW per year, to be installed between now and 2030 to achieve state Net Zero targets. The value of clean energy certificates is set annually through an auction process. It rises as a new wave of mandated construction drives up costs and as subsidies from other sources decline.
Net metering payments
Owners of rooftop solar power systems in both Florida and Massachusetts can sell power back to the grid at retail rates when not needed by the owner.
Massachusetts net metering benefits for distributed solar power systems are very generous. For example, the owner of a new rooftop solar system could receive 28 cents per kWh for clean energy credits, plus the 37 cents per kWh retail value, for a total of 65 cents per kWh for power sold back to the utility, compared to a wholesale value of 7 cents per kWh. Many states are phasing out net metering payments because they are too generous to owners and too expensive to ratepayers.
Expected increases in policy-related charges
Policy-mandated costs are expected to increase substantially in the next few years.
The elimination of federal tax credits will increase installation costs of solar systems by about 30%, requiring higher renewable energy credits to compensate. Massachusetts requires retail electricity suppliers to purchase a growing amount of clean energy credits each year in accordance with the state’s rising renewable portfolio standards. The size of clean energy credits in Massachusetts is adjusted annually through auctions, driven by rising costs and the need to subsidize new projects. The cost of these credits is expected to rise substantially as federal tax credits expire, as import duties and inflation push costs up, and as less efficient installations (i.e., less effective building and site orientations and locations) are built. Further analysis is recommended to understand the implications of these changes on future electric rates.
Massachusetts has authorized its regulated utilities to add 5,000 megawatts of large battery energy storage facilities, for $10-20 billion, including additional grid modifications. This represents a tenfold increase and will proportionately impact transmission and distribution costs.
Installation of smart meters is underway, and those costs will be passed along to consumers in distribution charges.
The proposed Massachusetts Grid Modernization initiative includes not only investments to update aging transmission and distribution equipment, but also to integrate and coordinate distributed resources. Its benefits and impacts on electricity rates need to be carefully evaluated and closely monitored.
Import tariffs will raise the cost of solar and other electrical equipment imported from China and other countries, further increasing the need for higher clean energy credits.
Inflation is driving up the cost of copper and other materials as demand rises and supply shortages persist.
Many renewable power systems were installed decades ago and are degrading and reaching the end of their lives. Repowering or replacing these older facilities will be expensive and require additional subsidies.
Offshore wind projects have contracts with public utilities that will result in consumers paying more than twice the current market cost of that electricity.
No benefits for policy mandates
Current Massachusetts state energy policies are based on achieving Net-Zero targets and replacing fossil-fuel-based power generation with renewable energy and battery storage.
The Department of Energy has questioned the potential benefits of reducing carbon emissions. Among the key findings, the report highlights the absence of scientific evidence that carbon dioxide (CO2)-induced warming is linked, by long-term climate data, to damaging meteorological events. It warns that aggressive mitigation (decarbonization) strategies could be much more harmful economically than the potential benefits of reducing extreme climate-related damage. Seeking expensive decarbonization pathways that replace fossil-fuel generation with renewables and batteries is neither justified by potential climate-related benefits nor affordable for electric consumers.
Replacing fossil fuels with renewable energy has been deemed technically and economically infeasible by the New England power grid operator. The impact of deploying large-scale renewable power generation and battery storage on the New England power grid was carefully evaluated by ISO New England. This study concludes that adding large-scale solar wind and battery storage will be extremely expensive and will fall short of meeting grid affordability and reliability requirements. It also concludes that electrification of transportation and buildings will require a large expansion of dispatchable gas-fired generating capacity, which is not planned and will be difficult to implement. This study also provides a detailed evaluation of battery energy storage facilities, concluding that they are ineffective at compensating for the seasonal intermittency of renewable power and do not effectively replace dispatchable fossil generation. Battery storage systems consume roughly 20% of the energy stored and charging them usually increases dispatchable gas-fired generation. The benefit of injecting power from renewable systems directly into the grid is reduced by up to 20% if discharged into batteries.
Electrification mandates increase the need for gas-fired generation and preclude more efficient use of gas for home heating and fuels for transportation.
Legislative and regulatory actions are needed to reduce electricity rates in Massachusetts.
Legislation to phase out Net Zero targets, Renewable Portfolio Standards, clean energy credits, battery storage, unnecessary transmission and distribution improvements, electrification, and net metering could cut electric rates in half by eliminating expensive policies that provide little benefit.
Several states are reconsidering renewable energy mandates due to their high costs. Arizona recently filed legislation to end its renewable portfolio standards, citing cost and reliability concerns.
Changes to the following state energy policies would reduce policy-related costs.
1. Massachusetts Renewable Portfolio Standards should be phased out by amending legislation and eliminating the requirement for clean energy credits, which account for the largest share of policy-driven costs in our electric bills. Clean energy credits increase each year through auctions to support the installation of additional distributed solar power systems as required by the clean energy standard.
2. The Massachusetts Department of Public Utilities must stop authorizing regulated utilities to recover through electric rates the costs of battery energy storage facilities and additional transmission and distribution work that only benefit renewable power generation. These costs currently account for about a third of all policy-mandated costs on our electric bill and should be carefully reviewed to assess their potential benefits. As in many other states, these costs should be charged to the projects that require these improvements and not distributed to all ratepayers. Canceling large battery projects will eliminate major increases in transmission and distribution costs that utilities pass on to consumers. The current Massachusetts target of adding 5,000 megawatts of battery storage is extremely expensive (over $10 billion) and offers very little benefit to our power grid, as shown in published ISO-NE studies.
3. Contracts to purchase power from future offshore wind projects should be cancelled if they require utilities to purchase expensive power.
4. Net metering payments for distributed solar electric systems represent 7% of policy-mandated costs and should be phased out.
5. Policies requiring the electrification of buildings and transportation should be discontinued, considering that our power grid is not projected to have sufficient capacity to provide this additional electricity and will need to add large amounts of new fossil generation to support these new loads and to maintain a reliable and affordable grid. Restrictions on the use of natural gas for building heating and gasoline for automobiles should be reconsidered, given the additional fossil fuels needed to generate the extra power required to support electrification.
6. The Massachusetts Department of Public Utilities should direct our regulated utilities to avoid investments in battery storage and in unnecessary transmission and distribution improvements intended to benefit renewable power generation that are otherwise not economically or technically justified. Proposed “grid modernization” projects should be closely reviewed to ensure that public benefits to power grid operations and reliability justify their costs. There is no technical or economic justification to rebuild our entire power distribution systems to allow distributed generation to feed large amounts of energy into the grid or to other customers. Users of renewables and EVs should pay for associated power distribution costs, as in Florida and other states.
Many states, including California, Connecticut, Arizona, Idaho, Hawaii, and Nevada, are transitioning away from traditional 1:1 net metering to lower-cost mechanisms. Virginia and Florida are actively seeking to eliminate or reduce current net metering credits. While these states are moving away from traditional net metering, many are grandfathering in existing customers for a set period, meaning these changes primarily impact new solar installations.
Conclusions and Recommendations
Massive subsidies needed to support the construction of new solar and wind power generation in Massachusetts are causing unreasonable increases in consumer electric rates. If Net Zero targets are pursued for 10 more years, the discontinuation of federal tax credits shifts this $288 billion subsidy burden from federal taxpayers to state ratepayers. Electric rates in Massachusetts are the third highest in the country and are expected to rise substantially over the next few years. The addition of expensive battery energy storage facilities and grid improvements for electric vehicle charging stations has already impacted transmission and distribution charges. Current plans to expand battery energy storage can increase these costs by an order of magnitude.
Almost 2/3 of Massachusetts’ current electricity bills are driven by state energy policies whose potential benefits need to be carefully examined to ensure that higher costs are justified. Legislation is needed to reverse state mandates and targets related to Net Zero targets, which are not compatible with a reliable and affordable power grid. Legislative changes should target cutting electric power rates in half by reducing policy-mandated costs. Further analysis of many of the points raised in this paper may be needed to support objective public information and legislative initiatives.