Ipswich Electric Light Department (ELD) in Ipswich, MA joins a growing list of utilities that are adopting inclusive utility investment programs to help homeowners and renters alike equitably access building upgrades. Ipswich ELD launched ReInvest Ipswich in September 2023, piloting this innovative approach to clean energy upgrades prior to a full-scale launch expected in late spring or early summer 2024.
ReInvest Ipswich is the first program of its kind for a utility in Massachusetts. It’s an important step to help Massachusetts achieve its decarbonization goals as it is a model that other municipal utilities can now readily adopt—helping customers overcome upfront cost barriers to home decarbonization.
The program is a collaborative effort between Ipswich ELD and Center for EcoTechnology (CET), a nonprofit organization and program implementer whose mission is “to innovate, implement, and scale the environmental solutions that communities need to thrive.” In 2022, they completed a feasibility study together with funding support from the Massachusetts Clean Energy Center. This study surveyed 325 Ipswich ELD customers and found that 75.1% were interested in enrolling in an inclusive utility investment program.
“The interest in inclusive utility investment among Ipswich customers has been tremendous, and of course it has—this program makes heat pumps and other home decarbonization measures accessible and affordable for all.”
Clean Energy Works’ Dr. Anthony Kinslow II contributed financial analysis, modeling an inclusive utility investment program’s potential reach, customer savings, and utility benefits. The analysis estimated that participating customers will see an average of $2,300 annual energy cost reductions (with 80% of these savings going to cost recovery charges during the utility’s cost recovery term; and all savings going to participants thereafter). The analysis also estimated a 29% internal rate of return for the utility’s investments with an average utility net present value of almost $10,000 per upgraded home (thanks to a combination of avoided demand costs and increased contribution margin (i.e., revenue less the cost of power)).
The compelling results of the feasibility study led Ipswich ELD to launch its pilot utilizing funding from the Massachusetts Clean Energy Center. During this small-scale learning phase, ReInvest Ipswich has completed three projects, seeking to test implementation with different home types and heating sources. The projects include whole-home and partial air-source heat pump installations, heat pump water heater conversion, and weatherization. Ipswich ELD has applied for the U.S. Department of Agriculture’s Rural Energy Savings Program to secure a low-cost capital source for ReInvest Ipswich.
When it comes to whole-home retrofits, inclusive utility investment programs can yield even greater impact when braided with other available funding sources. For instance, Ipswich ELD hopes to leverage state-administered home energy rebates made available through the Inflation Reduction Act as well as incentives from the state’s utility energy efficiency program, Mass Save, which customers who heat homes with gas have access to via their gas utility. Longer term, Ipswich ELD has expressed interest in expanding the program to include electric vehicle chargers, rooftop solar panels, and more.
CET is supporting due diligence for several additional programs and has even developed an Inclusive Utility Investment Municipal Toolkit to assist interested utilities. “We’re focused on harnessing the enormous potential to bring this model to municipal utilities across Massachusetts and the region,” said Muspratt.
The progress in Massachusetts is part of the momentum building across the country for inclusive utility investments in money-saving home energy upgrades that can also improve home comfort, air quality, and resilience. Following approval from the North Carolina Public Service Commission in 2023, Duke Energy is set to launch its new inclusive utility investment program, Improve and Save, while seeking program expansion into South Carolina. Regulatory proceedings underway in California and Illinois are also poised to advance new investor-owned utility programs with widespread reach. Together, these developments reflect growing recognition of inclusive utility investment as an important tool to open the clean energy economy to all.
