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ISO New England has released materials from its summer settlements forum, covering capacity scarcity conditions and the Pay-for-Performance program that directly impact how power plants are compensated during peak demand periods. These changes could affect electricity bills across Massachusetts, Rhode Island, New Hampshire, and Maine this summer and beyond.

Last updated: 2026-06-15

TL;DR: ISO-NE's new summer settlement procedures will change how power plants get paid during high-demand periods, potentially increasing electricity costs when the grid is stressed. Northeast consumers should review their electricity plans now before peak cooling season drives up rates further.

How ISO-NE Summer Settlements Work

ISO-NE summer settlements determine how much power plants get paid when electricity demand peaks during hot weather. The capacity market ensures enough power plants are available when air conditioning usage spikes, but these costs ultimately flow through to consumer bills.

The Pay-for-Performance program rewards power plants that deliver electricity when the grid needs it most and penalizes those that don't. During capacity scarcity conditions—when available power supply gets tight—these payments can increase significantly. According to ISO New England's latest data, summer peak demand typically occurs between 2-6 PM on weekdays when temperatures exceed 85°F.

These capacity costs represent roughly 15-20% of your total electricity supply charges, making them a significant factor in your monthly bill. When capacity payments increase due to scarcity conditions, competitive suppliers and utility default service rates both rise to cover these costs.

What Changes Mean for Massachusetts Residents

Massachusetts electricity customers face the highest exposure to capacity cost increases among New England states. With current Eversource basic service rates at $0.15629 per kWh and National Grid at $0.15372 per kWh as of February 2026, any capacity market increases will push these rates higher during summer rate adjustments.

The Massachusetts Department of Public Utilities typically adjusts basic service rates twice yearly, with summer rates taking effect in July. If ISO-NE's new settlement procedures result in higher capacity costs, these will be reflected in the next rate adjustment.

Massachusetts uses a competitive electricity market where residents can choose their supplier. During periods of high capacity costs, the spread between basic service and competitive offers may widen, creating more opportunities for savings. However, some competitive suppliers may also raise their rates to reflect higher wholesale costs.

For a typical Massachusetts household using 600 kWh monthly, a $0.01 per kWh increase due to capacity costs would add $6 to monthly bills. Over a full summer cooling season (June through September), this represents an additional $24 in electricity costs.

New Hampshire and Maine Bill Impacts

New Hampshire residents served by Eversource currently pay $0.11303 per kWh for default service, while Liberty Utilities customers pay $0.13735 per kWh. These rates are generally lower than Massachusetts, but capacity cost increases will still flow through proportionally.

The New Hampshire Public Utilities Commission adjusts default service rates annually, typically in July. Maine's capacity market exposure affects both Central Maine Power customers (current rate: $0.12721 per kWh) and Versant Power customers ($0.12954 per kWh). The Maine Public Utilities Commission sets standard offer rates that include capacity costs.

Both states have competitive electricity markets, though participation rates are lower than Massachusetts. The new settlement procedures may make competitive offers more attractive if suppliers can hedge capacity costs more effectively than utility procurement.

New Hampshire and Maine also have significant seasonal rate variations due to winter heating demand. While summer capacity costs are increasing, these states typically see their highest electricity bills during winter months when electric heating supplements other sources.

Rhode Island Electricity Rate Effects

Rhode Island Energy customers currently pay among the highest electricity rates in New England, making them particularly sensitive to capacity cost increases. With basic service rates not publicly updated in the available data, Rhode Island residents should monitor rate announcements from the Rhode Island Public Utilities Commission.

Rhode Island's small size means the state has limited local generation and relies heavily on imports from other New England states. This makes Rhode Island particularly exposed to regional capacity market changes, as the state must pay for capacity resources located throughout the ISO-NE system.

The state's aggressive renewable energy goals also mean Rhode Island is adding intermittent resources that may increase reliance on the capacity market to ensure reliability. As more solar and wind come online, the need for backup capacity during peak periods becomes more critical and potentially more expensive.

Rhode Island residents have access to competitive electricity suppliers, and the state's high default rates often create significant savings opportunities. However, during periods of capacity market stress, both default service and competitive rates may rise together.

Timing Your Electricity Plan Decisions

Summer represents the most expensive time to start a new electricity contract in New England. Wholesale electricity prices typically peak during heat waves, and suppliers price their fixed-rate offers to account for these seasonal spikes.

The optimal time to lock in electricity rates is typically during spring shoulder months (April-May) or fall (October-November) when wholesale costs are lowest. However, if you're currently on an expensive month-to-month rate or your contract is expiring, switching now may still provide savings despite seasonal timing.

Current market conditions show:

• Fixed-rate plans starting in June-August carry summer premium pricing
• Variable-rate plans will fluctuate with real-time market conditions
• Default service rates will adjust to reflect capacity cost changes

For customers whose contracts expire during summer months, comparing options before auto-renewal is critical. Many suppliers roll customers onto higher month-to-month rates when contracts expire, which can be significantly more expensive than both default service and new competitive offers.

Comparing Your Options During Market Changes

With capacity market changes creating uncertainty, comparing electricity plans requires looking beyond headline rates. The total cost of a plan depends on your usage patterns, contract terms, and how well suppliers hedge against wholesale cost increases.

Gatby's platform automatically factors in these market dynamics when comparing plans across multiple suppliers. Rather than manually tracking rate changes and contract renewals, Gatby's Autopilot service continuously monitors your account and switches to better options as they become available.

Key factors to evaluate include:

• Fixed vs. variable rate structure
• Contract length and renewal terms
• Early termination fees if you need to switch
• How suppliers handle capacity cost fluctuations
• Customer service quality during billing issues

Comparing plans on Gatby is always free, and the platform includes current rates from multiple competitive suppliers in your utility territory. This eliminates the need to visit individual supplier websites or call sales representatives to understand your options.

Municipal Aggregation and Community Choice

Many Massachusetts communities offer municipal aggregation programs that leverage bulk purchasing power to negotiate better electricity rates for residents. These programs, also called Community Choice Aggregation (CCA), can provide an alternative to both default service and individual competitive contracts.

Municipal aggregation programs typically opt residents in automatically but allow opt-out if you prefer to choose your own supplier. During periods of capacity market volatility, these programs may provide more stable pricing due to their larger purchasing scale and professional energy management.

However, municipal aggregation rates aren't always the lowest available option. Some communities prioritize renewable energy content over lowest cost, which may result in slightly higher rates than the cheapest competitive alternatives. Residents should compare their municipal aggregation rate against other available options.

New Hampshire and Maine have more limited municipal aggregation programs, while Rhode Island has explored community choice options. The regulatory framework varies by state, affecting how these programs can operate and what benefits they can provide.

Taking Action Before Peak Summer Demand

Northeast electricity demand typically peaks in July and August when air conditioning usage combines with continued economic activity. Taking action on your electricity plan before peak season can help avoid the highest rates and ensure you're positioned for summer savings.

Steps to take now:

1. Check your current contract expiration date
2. Compare your current rate against available alternatives
3. Consider fixed-rate plans to lock in current pricing
4. Set up automatic monitoring to catch better deals
5. Review your utility bill to understand supply vs. delivery charges

If you're currently on default service, you have the flexibility to switch to a competitive supplier at any time. The switch typically takes effect on your next meter reading date, usually within 1-2 billing cycles.

For customers with expiring contracts, avoid auto-renewal onto potentially expensive month-to-month rates. Most suppliers send renewal notices 30-60 days before expiration, giving you time to shop for better options.

You can compare current electricity plans for your area to see how ISO-NE's settlement changes might affect your available options. Gatby has 4.8/5 stars from 500+ independent reviews and helps customers navigate these market changes automatically.

Written by Hash Manesia, Energy Market Analyst at Gatby. Hash Manesia covers deregulated electricity markets across Texas and the Northeast, helping consumers navigate plan selection, rate comparison, and energy policy changes.

Reviewed by the Gatby Editorial Team on 2026-06-15

Frequently Asked Questions

How will summer settlement changes affect my electricity bill in Massachusetts?

The new ISO-NE summer settlement procedures will increase capacity costs during peak demand periods, which flow through to both basic service and competitive supplier rates. Massachusetts customers currently paying $0.15629 per kWh (Eversource) or $0.15372 per kWh (National Grid) for basic service may see increases when summer rates take effect in July. The Massachusetts Department of Public Utilities adjusts these rates twice yearly to reflect wholesale cost changes. For a typical household using 600 kWh monthly, capacity cost increases could add $3-6 to monthly bills during peak summer months. Competitive suppliers will also adjust their pricing to reflect higher wholesale costs, though some may hedge these risks more effectively than others.

Should I switch electricity suppliers after the new settlement agreements?

Switching suppliers can provide savings, but timing and plan selection matter more than the settlement changes themselves. The new ISO-NE procedures affect all electricity providers equally, so both default service and competitive rates will reflect capacity cost increases. However, competitive suppliers may offer different rate structures or hedging strategies that could provide better value. Fixed-rate plans starting now will price in expected summer costs, while variable rates will fluctuate with real-time market conditions. Compare your current rate against available alternatives, considering contract terms and fees. If you're on default service or an expiring contract, switching to a well-priced competitive plan could provide savings despite the settlement changes.

Am I eligible for refunds from summer electricity settlement in New Hampshire?

The ISO-NE summer settlement changes are prospective market rule modifications, not corrections to past billing errors that would trigger customer refunds. New Hampshire customers will see the impact of these changes in future electricity rates, not retroactive adjustments to previous bills. If you believe you've been overcharged for electricity, contact your supplier or the New Hampshire Public Utilities Commission directly. The settlement forum materials address how power plants are compensated going forward, which affects future wholesale costs and retail rates. Current Eversource NH customers pay $0.11303 per kWh and Liberty customers pay $0.13735 per kWh for default service. These rates will be adjusted in future rate proceedings to reflect any wholesale cost changes from the new settlement procedures.

Which electricity plan is cheapest after Maine summer settlement changes?

The cheapest electricity plan depends on your usage patterns, current rate, and available competitive offers in your utility territory. Maine's current standard offer rates are $0.12721 per kWh for Central Maine Power and $0.12954 per kWh for Versant Power customers. Competitive suppliers offer various rate structures that may provide savings, but their pricing will also reflect the same wholesale cost changes affecting standard offer rates. Fixed-rate competitive plans typically offer price certainty but may include a premium for rate stability. Variable-rate plans fluctuate with market conditions and could be higher or lower than fixed alternatives. The Maine Public Utilities Commission maintains a list of competitive suppliers, but rates change frequently. Compare current offers against your standard offer rate, considering contract terms, fees, and your typical monthly usage.

How do I claim compensation from Rhode Island electricity summer settlement?

There is no customer compensation program related to the ISO-NE summer settlement changes. These are forward-looking market rule modifications that will affect future electricity pricing, not corrections to past overcharges. Rhode Island Energy customers should monitor rate announcements from the Rhode Island Public Utilities Commission for information about how settlement changes affect basic service rates. If you have billing disputes or believe you've been charged incorrectly, contact Rhode Island Energy or the RI PUC consumer division directly. The settlement forum addressed capacity market operations and power plant compensation mechanisms that influence wholesale electricity costs. These costs are passed through to retail customers via regulated rate adjustments and competitive supplier pricing. Rhode Island residents can choose competitive electricity suppliers that may offer different rate structures or pricing approaches than basic service.

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