Chapter 7 Step 2: Reduce the Bills/Spread the Payments Out

A. Introduction

After a customer asserts any protection that may be available—serious illness, winter moratorium, infant, elderly—the next step is to figure out whether their bills can be reduced by applying for discount rates that are available and whether the immediate payment obligation can be spread out over time so that their bills are more affordable. The following sections discuss discount rates, payment plans, budget plans, and “arrearage management programs” in detail.

B. Discount Rates

1. Generally

Every investor-owned utility (IOU) in Massachusetts is required to offer its customers discount rates on utility service. Until November 2026, most of the discounts will vary by company, but generally will result in the reduction of the utility bill in the range of 25–30%. A customer who has gas service for heating and also has an electric bill could save several hundred dollars each year by getting on the discount rates. Munis are not required to offer discount rates, although Belmont Municipal Light Department voluntarily offers low-income discounts.

As of this writing, Massachusetts is in the process of transitioning to more generous tiered discount rates. A tiered discount rate is a low-income utility discount program in which customers are assigned to tiers based on income, and those in lower income tiers receive a higher percent discount on their bills than those in higher income tiers. National Grid began to offer electricity customers a tiered discount rate in 2025. All eligible customers of the IOUs will be eligible for similar tiered discounts beginning on November 1, 2026.

2. Income Eligibility and How to Apply

Any family whose income is at or below 60% of median income is eligible for the discount. Customers can receive the discounts rates through three separate routes: applying for fuel assistance (HEAP or LIHEAP, the acronyms are interchangeable); receiving assistance from the Department of Transitional Assistance (DTA) and being enrolled through an electronic match between DTA and utility company files; or applying directly. Each of these routes is described below. 

It is very easy to determine whether a customer is already on the discount rates. (See Chapter 3, above.) If the customer is not on the discount rate, the customer should determine whether they need to submit an application to be put on the discount rates. 

Eligibility for the discount rates via HEAP: When a household applies for HEAP, the local agency that processes the HEAP application makes every effort to obtain the applicant’s gas and electric account numbers and to notify the utility that the household is getting HEAP. Receipt of HEAP assistance automatically qualifies the household for the discount. The utility will enroll the customer on the discount after hearing from the HEAP agency, and the customer need not submit a separate discount application. 

CAUTION: If the person who applies for HEAP assistance is different than the household member whose name appears on the utility bill, the household will likely NOT get on the discount rate simply by applying for HEAP. The household should ask their local HEAP office or community action agency for help. The household may need to change the name on the utility bill so that it is the same person who gets the HEAP assistance, and also submit a discount rate application.

PRACTICAL TIP

Even households that do not qualify for HEAP can still apply to HEAP in order to qualify for the discount rates. For example, many families who live in public housing do not pay their own heating bills and are not eligible for HEAP payments. But if they apply for HEAP and their household income is below 60% of median income, the HEAP agency will certify the household as income-eligible for HEAP but ineligible for actual HEAP payments. This certification of income eligibility qualifies the household for the discount rates.

Getting on the discount rate through computer matching: Every 1 to 3 months, each utility company shares with DTA computer records that include the names of all residential customers. DTA then sends back to the utility company a list of those customers who receive some form of DTA assistance and who therefore should be added onto the discount rates. The customer therefore does not need to send in a separate discount rate application. 

CAUTION: Because these computer matches occur only once every 1 to 3 months, many people who receive assistance from DTA will not be added onto the discount rates through the match because they happened not to be receiving DTA assistance in the month the match is run. Also, if one household member’s name is on the utility bill but another household member’s name is on the DTA account, the match also won’t work for that household. 

Submitting a direct application to get on the discount rate: Any customer who believes she or he is eligible for the discount, including those who may be uncertain whether they have been automatically enrolled onto the discount rates by applying for HEAP or by getting DTA assistance, can submit an application.⁴ 

Each utility company develops its own forms for applying for the discount rates. Customers who use those forms should be aware that they are not approved or closely reviewed by DPU, and the forms may therefore not fully comply with the law. In particular, many of the forms ask the household to check off which form of public assistance the household receives (such as TAFDC, SNAP/Food Stamps, etc.) to demonstrate eligibility for the discount rates. But some of the forms omit certain types of public assistance, simply because the utility companies are not familiar with every type of government assistance program that would qualify a household for the discount rates, and the names of those public assistance programs may have changed. 

Therefore, a customer should always complete the form and send it in, even if it appears from the form that the household cannot check the right boxes or fill in the correct lines. If the company raises any questions about how the customer completed the form or if there is any problem actually getting onto the discount rate, the customer should contact the DPU. 

3. National Grid Electric Discount Eligibility and Tiers 

Any National Grid Massachusetts electric customer with income at or below 60% of the state median income (SMI) will be eligible for the appropriate level of discount. The discount changes based on a sliding scale, and will depend on a family’s household income and which corresponding income tier applies to the household. The tiers follow those used for distributing HEAP benefits (a summary of the tiers is in the table below). In the new structure, households whose income falls between 0–100% of the federal poverty level (FPL) (tier 5) will receive the deepest discounts and will receive a 71% discount on their electric bill each month. With each income tier above that, the percentage of discount gets smaller, with customers between 200% of FPL and 60% of SMI (tier 1) receiving 32% off their electric bills.

Enrollments will be the same as for other utility company discount programs, except that customers will need to be matched to the correct income tier. Where income information is not readily available, the customer may receive the Tier 1 (or smallest) discount. If a customer should be receiving a larger discount, the customer or advocate can contact National Grid for assistance. 

As of November 1, 2026, the DPU has ordered that all utilities use the following 6-tiered discount rate structure. New discount percentages are still being determined as of this writing, and more information will be available for the DPU on its website. 

4. Getting on the Discount Promptly/Applying the Discount Retroactively

Customers can face delays in getting on the discount rates. Since the discounts can be worth $100 per month or more during the winter months for those who heat with gas, it is important for customers to get onto the rates as quickly as possible. This section addresses how to do so, as well as how to get the discounts applied retroactively in some cases. 

For customers who fill out a discount rate application, the best way to get onto the rate quickly is to email or fax the completed form to the company and to include documentation that demonstrates the customer is income-eligible for the discount, along with the application itself. 

Companies are required by law (M.G.L. ch. 164, § 1F(4)(ii)) to place customers who apply onto the discount rate “on demand,” meaning promptly after application is made. A customer can start the process of requesting the discount rate with a phone call to the utility customer service number or other request to the utility company. However, the customer is required to submit proof of eligibility either with or shortly after making the application. If the customer does not send in the proof, the customer will often be removed from the discount rate within a few months, and possibly back-billed at the full rate.

PRACTICAL TIP

Some of the discount rate application forms do not provide an email address or fax number and may not suggest that the customer should include any documentation that demonstrates the customer’s eligibility for the discount. Therefore, the customer or advocate should call up the company and say, “I have a completed discount rate application form and already have the documentation that shows I’m eligible. Can you give me a secure email address or fax number where I can send this information?”

Under the discount rate law, M.G.L. ch. 164, § 1F(4), a household is eligible for the discount if it receives “any means tested public benefit [including] … the low-income home energy assistance program [HEAP/fuel assistance] for which eligibility does not exceed” 60% of state median income (during Fiscal Year 2026, up to $99,573 for a family of 4). In practice, this language means that any household that receives help from an income-tested government assistance program—whether SNAP (Food Stamps), public housing, Medicaid (MassHealth), free school lunch, etc.—and whose income is at or below 60% of median income qualifies for the discount rates. Therefore, there should be sufficient documentation for a customer to submit a letter or other document from the Department of Transitional Assistance (DTA) or some other relevant state agency that the customer is receiving, for example, Food Stamps or Medicaid or Temporary Assistance for Needy Families (TANF). In the case of public housing tenants, it is useful to have the letter also state that the household’s income is at or below 60% of median income because some families with incomes higher than 60% of median income are still eligible for public housing. These higher-income public housing households would not be eligible for the discounts. 

Some customers will be able to get on the discount rates retroactively, meaning that the bills will be recalculated as if the customer had been on the discount rate even before the date he or she applied. Each utility company in the state has voluntarily agreed to do so, on a case-by-case basis, but only if contacted by an advocate working on behalf of the customer. Customers who call the utility company on their own will not be able to get the discount applied retroactively. Each company has generally designated an email address or one customer service representative (CSR) who handles these requests. As a result of D.P.U. Docket 23-150, National Grid has a formal retroactive discount policy, which designates [email protected] as the contact for advocates seeking retroactive application of the discount on behalf of their clients (policy found here: https://www.nclc.org/wp-content/uploads/2025/06/National-Grid-Retroactive-Discount-Policy.pdf). Eversource has a similar written process as well, which designates [email protected] as the contact for advocates (policy found here: https://www.nclc.org/wp-content/uploads/2025/06/Eversource-Retroactive-Discount-Policy.pdf). Contact the National Consumer Law Center, a local community action agency, or another organization that helps consumers with problems with their utility bills for help with retroactive application of the discount rate. Retroactive application of the discount can often result in a credit to the customer’s bill of $100 to several hundred dollars, and it is worth pursuing. 

PRACTICAL TIP

To get someone onto the discount rate retroactively, you will need to document how long that person has been on the particular form of public assistance that qualifies the household for the discount rate (e.g., TAFDC, SNAP, etc.). The easiest way to get proof of receipt of public assistance provided by the Massachusetts DTA is to set up a “My Account Page” if you already have an EBT card. Instructions for how to do so, and for other ways to access a DTA client’s benefits information, see the Food Stamps Advocacy Guide available at www.masslegalservices.org.

C. Arrearage Management Programs (AMP)

As of 2005, each electric and gas company has been required to offer an arrearage management program or AMP, under section 17 of chapter 140 of the Massachusetts Acts of 2005. Under that law, an arrearage management program is defined as “a plan under which companies work with eligible low-income customers to establish affordable payment plans and provide credits to those customers toward the accumulated arrears where such customers comply with the terms of the program.” In practical terms, this means that the company will make an arrangement with the customer to pay monthly bills as they come due over a long period of time, generally 12 months. If the customer keeps up with the arrangement, the company provides credits towards the customer’s arrearage. 

For example, a customer may have typical monthly bills of $100, and also owe $480 at the time she sets up the AMP. The company will offer, “If you pay $100 each month for your current usage for each of the next 12 months, we’ll provide you a $20 credit each month, or $240 for the whole year as a credit on your bill.” 

Each company has its own variation of the AMP, including the maximum amount the company is willing to write off, how the credits are provided (generally, a monthly credit, for every month the customer makes the required payment), and the terms under which a customer can be reinstated if one or more AMP payments are missed. 

To find out how to enroll on your utility company’s AMP, call the customer service number on the monthly bill.

D. Payment Plans

1. For Customers Who Are Not Yet Shut Off from Service

“Payment plans” are arrangements that customers make to pay an overdue bill over a period of time. Under the Department’s regulations, 220 C.M.R. § 25.01(2), a “payment plan” is a “deferred payment arrangement applied to an amount of past due charges [which] … shall extend over a minimum of four months.” In the past, there have been instances of companies not complying with this rule. Therefore, it is important to understand the following: 

A customer who has not yet been terminated has the absolute right to a payment plan of no less than four months. Therefore, a customer who has not yet been terminated and who has 25% of the overdue amount available can make the first payment on the four-monthly payment plan (25% a month for each of four months), thus making sure that the termination does not occur.

Many customer service representatives (CSRs) are not well-trained on this rule and may insist that the customer pay 50%, 75%, or an even larger percentage of the bill to avoid a termination. This is illegal. While the company has every right to be paid, and can ask the customer to pay the entire bill, it would be illegal for the company to go ahead with a termination if the customer was willing to pay 25% or more of the bill. If you encounter a CSR who is unwilling to stop the termination, even when the customer has offered to pay 25% or more of the overdue bill, contact the DPU Consumer Division immediately, and try to contact an advocate in your area familiar with utility issues.

2. For Customers Who Are Already Shut Off from Service

The “minimum-of-four-months” payment plan rule described in the preceding section does not apply to customers who are already shut off. The one exception is for customers who receive HEAP (fuel assistance). For HEAP customers, the utility companies have agreed to restore service with a 25% payment. 

For other customers, there is no formal rule that specifies how much of an overdue bill a customer has to pay to get terminated service restored. Companies will often ask for 100% of the overdue bill. But even a terminated customer has the right to a “reasonable” payment plan under the DPU’s rules, 220 C.M.R. § 25.02(6). Customers may need to be very assertive in order to overcome the company’s desire to have 100% of the bill paid before restoring service. The customer should certainly consider asking the DPU’s Consumer Division for assistance if the company insists on getting 100% paid as a condition of restoring service. 

The Consumer Division often considers the time of year in deciding how much the customer has to pay. If, for example, the customer is seeking to restore service in October or November, even the Consumer Division may insist that the customer pay 75% to 100% of the bill, because once November 15 arrives, the customer will likely be protected from termination by the winter moratorium for the next 4 or 5 months and will not have to make further payments in order to avoid termination of service during those months. On the other hand, if the customer is trying to get service restored in April or May, the Consumer Division might order the company to accept as little as 25% or less of the overdue bill and restore service because the company will have 6 months or so until November 15 to either collect the remaining amount of the bill, or terminate the customer for failing to comply with the payment plan. 

PRACTICAL TIP

Special rules apply to fuel assistance customers. Under contracts that utility companies sign with the fuel assistance agencies, the companies agree that they will restore service to a terminated customer if the fuel agency or customer can pay at least 25% of the overdue bill, regardless of the size of the bill. Ask your local fuel agency for assistance if the company will not agree to restore the utility service in these circumstances.

3. Payment Plans for Bills From a Prior Address

Companies have the right to refuse service to someone applying for service at a new address, if that person already owes that same company for service provided at a prior address. Under a rule announced by the DPU in Cromwell v. Boston Edison Company, D.P.U. 18123 (1974), a company cannot shut off service at a new address even if, after the customer moves in, the company learns that the person owes them money from a prior address. Companies are therefore very careful to screen prospective customers to determine if they already owe money from a prior address. The companies often ask the prospective customer to pay 100% of the prior bill as a condition of having service turned on at the new address. 

However, companies can be required to enter into a so-called “Cromwell waiver” with the prospective customer. When the customer signs a Cromwell waiver, this waives the rule announced in the Cromwell case. The customer is basically saying to the company, “You can add that bill from my prior address onto the bills I’ll be getting at my new address, and if I don’t pay my bill (including the bill from my prior address), you can shut off the service at my new address.” This protects the company and makes it more likely that the company will collect the old bill. If the company and the customer sign the Cromwell waiver, the customer then can try to negotiate a payment plan on the old bill, rather than having to pay 100% of the bill as a condition of getting service. The payment plan principles discussed in the preceding section would apply, since the customer is negotiating payments on an account that has already been terminated. 

However, many individual CSRs are not trained about Cromwell waivers and will simply insist on receiving 100% payment of the bill from the prior address, before agreeing to start the new account. In that situation, ask to speak to the CSR’s supervisor, or call the DPU’s Consumer Division for assistance. 

4. How to Negotiate Successful Payment Plans

The customer’s goals when negotiating a payment plan are to have the company agree to a plan that the customer can truly afford and to strongly resist agreeing to plans the company may propose that require monthly payments that are too large. Company personnel routinely ask customers to pay 50%, 75%, or even more of an overdue bill to avoid termination. Demanding that much of the bill from a customer who is still connected to service is illegal and is usually more than the customer can afford. But customers who are facing termination are in desperate circumstances and will too readily agree to anything that appears likely to stave off a termination. It is best for an advocate to get involved whenever payment plans are being negotiated. 

Whether a customer or an advocate is trying to set up the payment plan, the first step is to review the customer’s income and basic, unavoidable expenses, including rent, food, and utilities (and medical, if there are recurring medical expenses). While it is worthwhile to do a more thorough budget work-up for the family, a budget review should at least include the following: 

INCOME AVAILABLE EACH MONTH

Earned income:                 

Government cash assistance (TAFDC, SSI, etc.):                  

Value of SNAP/Food Stamps:                  

TOTAL INCOME (sum of prior 3 lines):                  

BASIC EXPENSES EACH MONTH

Rent:                  

Food:                  

Utility customer is having a problem with (gas or elect.):                  

(NOTE: include only monthly average bill, not the arrearage/overdue bills)

Other utility (if any):                  

(Medical expenses, if large/recurring monthly):                  

TOTAL EXPENSES:                  

TOTAL INCOME LESS EXPENSES:                  

If total expenses exceed the income, it is almost impossible to make a payment plan, without first asserting one of the four protections against termination (see Chapter 6), getting retroactive application of the discount rates (see Chapter 7, ¶ B.4) and/or finding sources that can help pay some of the amount owed. If a customer can assert a protection and/or reduce the size of the overdue bill through use of the discount rates and by obtaining outside assistance in paying the bills, then the customer can follow the concepts described immediately below and try to negotiate a payment plan. 

If their monthly income exceeds expenses, even by a small amount, a customer’s goal is to get the company to agree to a monthly payment no larger than that amount. The customer or advocate should stress that the proposed payment plan reflects careful consideration of the household’s actual income and expenses, and that asking the customer to pay more each month simply means that the payment plan will fail. When payment plans fail, companies do not collect what they are owed, and customers could lose their utility service. It is therefore in the interests of the company, not just the customer, to accept payment plans that may spread their payments over many months but that are more likely to succeed. 

It is also worth asking about the utility company’s arrearage management program (AMP) in which the company agrees to write off some of the amount the low-income customer owes if the customer simply pays each month’s current bill as it comes due (and sometimes a portion of the arrearage that the company is not writing off). Companies are generally pleased with the results of this program, which demonstrate that making payments more affordable for customers creates a win-win situation for the company and the customers. It is therefore worth pointing out to a CSR that high-level managers support the notion that low-income customers should be given plenty of time to pay back overdue bills, and that the company can actually collect more money if it offers customers reasonable payment plans.⁵

A customer who has just asserted a protection (serious illness, winter moratorium, infant or elderly) is in an excellent position to set up a payment plan of his or her choosing, as the company cannot terminate their service. The company has no choice but to accept any payments that the customer makes. For example, a low-income customer might have a two-month-old baby and a $300 overdue bill. If the customer calls up and asks for a payment plan before asserting the infant protection, the company would likely refuse a payment plan offer as low as $30/month (10 months to pay off the $300). However, once the customer asserts the protection, it makes good sense for the customer to put in writing that she intends to pay $30 per month on the arrearage, plus her current bills, because in fact the company cannot terminate service for 10 months.

Another example is worth considering. Suppose a low-income customer owes $640, has a seriously ill child in the house, and feels that she can pay $80 per month on the arrearage (8 months to pay back the $640 in full) plus her current bills as they come due. Were the customer to offer an $80 per month payment plan prior to asserting the serious illness, the company might well refuse and threaten to proceed with the termination. In this scenario, the customer should first assert the serious illness protection (send in a doctor’s letter and financial hardship form), and then put in writing, “I offer to pay back $80 each month of my arrearage of $640, along with paying my current bills.” If the child gets better in, say, two months, and the serious illness protection expires, the customer will have paid only $160 on the arrearage (2 x $80 = $160), and will still owe $480. However, if the company were once again threatening termination and refusing to accept a payment plan, the customer would be in a very strong position if she asked the DPU Consumer Division for assistance. She would be able to say to the DPU, “I offered a perfectly reasonable payment plan and actually made two payments of $80 each at a time when the company was refusing to enter into a reasonable payment plan and could not terminate me. I should be allowed to continue the payment plan I offered, $80 each month, even if it will still take another 6 months to complete that plan.” In most such cases, the DPU would likely agree. 

STEPS TO TAKE TO GET A REASONABLE PAYMENT PLAN

1. 1. If a customer’s service has not yet been shut off, the customer has the absolute right to a payment plan of at least 4 months’ duration. Do not accept anything shorter than that, unless the customer can easily afford a shorter plan.

2. 2. Whether or not service has been shut off, a customer should do a budget work-up to determine the amount of money available each month to pay towards the arrearage. If the customer’s monthly expenses are greater than the monthly income, the customer should: determine if any of the 4 termination protections apply (serious illness, winter moratorium, infant, and elderly); apply for discount rates and seek retroactive application of those rates; and seek out any available forms of assistance in paying the overdue bills.

3. 3. A customer should seek participation in the AMP program or a payment plan no greater than the amount determined as available each month from the budget work-up. If a company will not accept that amount, the customer should call upon the DPU for assistance.

E. Budget Plans

Budget plans differ from payment plans in that payment plans are arrangements made on past (overdue) bills, while budget plans are forward-looking arrangements. In a budget plan, a company estimates what the bills will likely be over the next 12 months, and then divides that total by 12. A customer is only obligated to pay that flat amount every month. For example, a gas company might estimate that the bills will total $2,400 over the next 12 months. Even though some of the monthly summer bills will be as low as $80 and some of the winter bills may be as high as $600, the customer need only pay $200 ($2,400 ÷ 12) each month. 

Budget plans can be a great help to low-income working families who simply cannot afford to pay very high winter heating bills, but who could afford to keep up with the bills if the total annual costs were spread out equally over 12 months. One caution, however, is that budget plans are by definition based on estimates of future bills.

Companies will “true-up” these plans every 6 or 12 months, meaning that the company could send a catch-up bill at some point, if the estimates prove to be lower than the actual bills, or provide the customer a credit, if the estimates were higher than the actual bills. Customers most frequently will get catch-up bills if prices rise faster than the company projected.

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⁴ Sample discount rate applications for Massachusetts electric and gas utility companies can be found online at www.nclc.org/stay-connected.

⁵ A customer should always first try to get on the AMP, but sometimes the customer will not meet the requirements of the AMP rules and will need to negotiate a payment plan.