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Massachusetts has the third highest electricity cost in the US (after Hawaii and Connecticut). Why is this?

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To answer this I have to make some guesses because this is not an area of research for me, but having a spouse from there and having spent time there, I think I could make a somewhat educated guess. Especially because it uses a market system rather than a rate setting system for generation.

First, Massachusettes has the third highest population density of any state and it is concentrated mostly around Boston. Like rail, short distances are comparatively costly. Higher loads in small locations require greater infrastructure costs. Further, the variability will be harder to control because things that impact east Boston also impact west Boston, while things that impact eastern Montana do not at all impact western Montana. There is less independence for unplanned events in a small space. The covariance is high. A noreaster can be far more damaging, if it is damaging, in a small space. Repairs are costly.

Boston also has an old system. While I could be wrong, I wouldn't be surprised if it was aging and depending on the regulation on carrying power, it might not be worth the investment without a regulatory structure that guarantees cost recovery. Further, Massachusetts is growing and this means plugging costly new infrastructure onto old infrastructure. As I am guessing, I don't know this, but it wouldn't surprise me that the influx is straining the infrastructure and I wouldn't be surprised if the infrastructure is past its planned life. Boston was running electric cable cars in the 1880s.

The correct place to place this question would be with civil and electrical engineers. You will probably find there is a really long history of how the current state of affairs came to be in Massachusettes in general and Boston in particular. I would be surprised if Boston was not driving your costs. I have no knowledge about Connecticut's system and if I had to guess for Hawaii it is due to the intrinsic fragility of being on an island with lots of people and no grid to support local emergencies.

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