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Going green with energy in Massachusetts: Costly mandates will hit consumers, business

(BOSTON ) – A new analysis by the Beacon Hill Institute (BHI) shows that the state’s green energy policies will cost Massachusetts ratepayers more than $9.8 billion over the next decade. These costs will be in addition to the market prices for energy, already among the highest in the nation.

The green energy policies, for renewable energy and energy efficiency, will raise electricity rates over 2.6 cents per kWh by 2020. These policies will cost an average household $1,582, the average commercial business $15,559 and the average industrial business $141,255 from 2010 through 2020. The total cost of the green energy mandates, programs and incentives will be $9.8 billion in 2010 dollars.

The Commonwealth of Massachusetts imposes 25 unique green energy mandates and programs upon consumers and businesses. BHI examined the costs of 11 of those 25 mandates and programs. It focused only on impacts to ratepayers, not to taxpayers. Thus, its estimates are considerably below what would be expected if costs of all mandates and programs were quantified for state ratepayers and taxpayers.

BHI found that, for the 11 green energy mandates and programs, more than 36% of the costs are unaccounted for by state regulators, and dumped into two general categories not subject to public scrutiny.

“All these costs on top of the regular prices for electricity are unsustainable for consumers,” said Paul Bachman, BHI’s Director of Research. “If we want businesses to stay in Massachusetts, policymakers must provide relief.”

BHI’s analysis also shows that Massachusetts imposes more green energy mandates on its business and homeowner communities than seven designated competitor states. “The fact that Massachusetts imposes more of these costly programs impairs our ability to compete over the long term. Firms such as manufacturers already face some of the highest energy costs in the nation,” said Bachman.

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