Mass Save residential VPP economics: ConnectedSolutions and the utilities

Most readers meet Mass Save through a rebate form or a ConnectedSolutions enrollment, so it is easy to assume Mass Save is the utility. It is a collaborative of Sponsors, also called Program Administrators: Berkshire Gas, Cape Light Compact, Eversource, Liberty, National Grid and Unitil (Mass Save). They file a joint three-year plan, the DPU approves it, and every electric and gas customer pays for it through the energy-efficiency charge. The DPU approved the 2025–2027 plan in February 2025 at about $4.5 billion, roughly $500 million below what the Sponsors asked for (DPU).

The distribution utility’s job is different. It owns the wires and the meter, sets the rate structure in DPU rate cases, credits solar exports under net metering, approves battery interconnection, and runs EV charging programs under its own DPU orders. Clean Peak certificates and SMART solar incentives come from state programs run by the Department of Energy Resources (DOER), and ISO New England runs the regional capacity market.

Thermostat ConnectedSolutions is the one offer every electric Sponsor runs: $50 at enrollment, $100 on the low-income R-2 rate, and $20 a year per thermostat on a central air conditioner or heat pump, with about 15 summer events of two to three hours (Mass Save). Batteries are different. Unitil customers cannot enroll a home battery at all, while Cape Cod and Martha’s Vineyard homes enroll through Cape Light Compact rather than Eversource (Cape Light Compact).

The local adders are where the utility side shows up most. National Grid pays enhanced ConnectedSolutions+ rates at 15 constrained locations (National Grid), and Eversource pilots pay $400 per kW in parts of Greater Boston (Greater Grid). Some manufacturers also take a cut: FranklinWH keeps 10% of incentives for enrollments after April 7, 2025 (FranklinWH). Cape Light Compact, a municipal aggregator for 21 towns, also runs its own low- and moderate-income electrification offer that bundles solar, storage and efficiency.

Every utility deep dive on this site follows the same template, but each program has one feature that changes how its economics should be read. For Mass Save, it is where the money sits. ConnectedSolutions is not a utility rate or a wholesale market product. It is a line in the energy-efficiency plan, so it has to pass the plan’s Total Resource Cost test, and the benefits are counted with the regional Avoided Energy Supply Costs (AESC) study (Synapse).

Three things follow. First, the $275 a home battery earns per kW is well above the roughly $146 per kW-year of regional capacity and transmission value, so the case depends on distribution, energy and emissions benefits the plan also counts. The plan does not publish a battery-only calculation. Second, the local adders come from a different pot: the Grid Services Compensation Fund in each utility’s grid modernization plan, aimed at specific feeders (MassCEC). Third, DOER’s own review is cautious about the thermostat side: the $20 payment has no metering or performance measurement, which it says risks shifting costs to non-participants, and it recommends that payments not exceed the value delivered (DOER).

Peak reductions are less than 10% of the plan’s counted benefits, so they are a small share of the $190 million of Sponsor performance incentives (DOER). That matters for a buyer because the battery rate is locked for five years from enrollment (Mass Save), while the budget that pays it is being argued over at the State House. A five-year lock covers half of a ten-year warranty.

Mass Save pays for the battery and thermostat. The utility side, through the heat pump rate and EV program, adds about $660 more. The heat pump water heater gets a $750 rebate but no event pay, because ConnectedSolutions does not yet enroll water heaters (Mass Save). Across 5,251 home batteries, Massachusetts paid about $5.4 million for the 2025 season, and those homes delivered about 28.9 MW, about 5.5 kW each because many have more than one battery (ESS News).

Batteries are the most valuable single asset in nearly every program we cover, but the next stage of VPP growth depends on several assets working together at one site. The obvious pairing is solar plus a battery. Solar on its own does little for a peak at 6 p.m. A battery charged from midday solar should, in principle, be charged for free.

Whether it is free depends on one number: what the utility would have paid for that solar kWh if it had been exported. If a kWh is stored, the household gives up the export credit, loses about 10% in the round trip, and avoids buying a kWh in the evening. The value of each stored kWh is the evening price minus the export credit divided by 0.9. Where the credit is close to retail, storing solar is worth little. Where exports earn a few cents, it is worth almost the full evening price.

Massachusetts homes sit near the break-even line. A home on National Grid keeps about 2.6¢ for each stored kWh. The credit excludes the efficiency and renewable charges, which is part of why there is a gap at all (Mass.gov). Credits are netted monthly, so moving solar from noon to 6 p.m. barely changes the bill. Solar still helps the battery in three ways. It refills the battery for back-to-back summer events: we estimate about $34 a year saved over grid charging across 45 events. It adds about $52 a year from everyday shifting. And it keeps the home powered through a multi-day outage, which has value but no program price.

The tipping point comes from rates, not hardware. Two changes would move Massachusetts to the right on the chart: a lower export credit for new solar, or a time-of-use rate after smart meters roll out. Either one would let the same battery earn from the PG&E-style gap between midday and evening prices. Until then, the battery’s value comes from ConnectedSolutions, and solar mostly lowers the cost of meeting it.

On these numbers a battery bought for ConnectedSolutions alone pays back in about 18.4 yr, longer than its warranty. Solar charging moves that to about 17.0 yr. The local adders and a future time-of-use rate help, but none of them makes the purchase pay off within ten years. For most buyers, the battery is about backup power, and ConnectedSolutions covers about half the cost.

The 0% HEAT Loan is the main financing nuance in Massachusetts. Because the loan carries no interest, borrowing costs the same as paying cash, spread over about $217 a month for seven years. That is still well above the roughly $82 a month that ConnectedSolutions pays. A lease or a hosted battery, where a company owns the battery and keeps the ConnectedSolutions pay, avoids the upfront cost but leaves the household with only backup value.

Related: the ConnectedSolutions case study, the National Grid residential and Eversource residential deep dives, Puget Sound Energy residential for a 1:1 net metering contrast, and the Mass Save C&I deep dive. To run other equipment, use the Residential VPP Calculator.