DPU’s Historic Ruling on the Commonwealth’s Future for Natural Gas (Docket 20-80)
February 21, 2024
Since fall 2020, the Massachusetts Department of Public Utilities (DPU) has considered arguments within Docket 20-80, otherwise known as the “Future of Natural Gas” investigation, to consider the future of the natural gas industry in Massachusetts. The investigation into Docket 20-80 was intended to encourage strategies for a clean energy future that achieves net zero emissions by 2050, while also ensuring the provision of safe, reliable, and cost-effective services to Massachusetts ratepayers. With Docket 20-80 framed as an investigation rather than adjudication, the Order is intended to be impartial and to provide forward-looking policy recommendations. The DPU released Order 20-80 on December 6th, 2023, after extensive stakeholder feedback in hearings, technical sessions, and public comment periods.
Many are calling DPU’s Order 20-80 one of the most transformative climate decisions in the agency’s history. The order will no longer allow cost recovery for gas infrastructure in Massachusetts, without proof of non-gas alternatives being considered, nor will they allow the expansion of natural gas. The new regulatory strategy signals DPU’s interest in helping the State achieve emissions reduction targets required through decarbonization, electrification, and adoption of pilot programs for new technologies—all while minimizing additional costs to ratepayers (note: the DPU will also be investigating solutions to energy burdens borne by low- and moderate-income ratepayers and environmental justice populations in a separate proceeding under DPU Docket 24-15).
Gas distribution companies are now required to file Climate Compliance Plans every 5 years, beginning in 2025, to demonstrate compliance with statutory emissions reduction targets. In their Climate Compliance Plans, gas distribution companies must provide a roadmap for how they intend to transition to clean energy, through details on pilot programs and other proposals for compliance metrics that will influence performance-based regulatory filings.
Within 20-80, DPU also investigated and rejected the use of so-called renewable natural gas, usually derived from methane captured from organic material found in landfills or livestock facilities. The DPU found “renewable” natural gas to be too costly, and in too short a supply. DPU does not think “renewable natural gas” is a climate solution as it still involves burning a fuel source that results in methane emissions, as well as negative health outcomes for local communities due to poor air quality. Renewable natural gas will be considered only for extremely hard-to-decarbonize uses.
Through Order 20-80, DPU is trying to provide a regulatory framework that is fair, equitable, flexible, and responsive to both current and future technologies that will enable Massachusetts to achieve its clean energy goals. In the requirement for gas distribution companies to consider non-gas alternatives, the State hopes to empower opportunities to expand electrification, networked geothermal energy, and targeted energy efficiency initiatives. In addition to the networked geothermal pilots already in progress in Framingham and Lowell, Order 20-80 also requires gas companies to deploy additional targeted electrification pilots. In response to significant stakeholder feedback suggesting more effective collaboration between gas distribution companies and electric distribution companies, the Order also requires “thoughtful coordination” between gas and electric distribution companies to implement a clean energy transition.
Next Steps
While the DPU 20-80 Order will not force a transition away from natural gas overnight, it represents a paradigm shift for Massachusetts in which new natural gas infrastructure is by no means a given, and gas utilities are obligated to keep the Commonwealth’s climate targets in mind across all infrastructure upgrades and expansion efforts. While the Order provides more of a framework for utilities to transition off natural gas, rather than a clear or prescriptive roadmap to getting there, legislators and advocates will need to push to get the Order’s policy goals into written policies and bills that get signed into law. One of the many hopes of the final ruling of Order 20-80 is that it will encourage the expansion of innovative solutions like networked geothermal energy pilots already underway by Eversource in Framingham and National Grid in Lowell and Boston (Franklin Field). However, a big question that remains is how electric and gas utilities will coordinate and effectively communicate throughout the pending transition to clean energy. A Better City will continue to monitor and track the progress of legislation in the Massachusetts State House that may seek to embed some of the regulatory framework of DPU Order 20-80 into a potential climate omnibus bill.
For more information, please contact Isabella Gambill.
