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The Hearing Officer Memorandum issued on June 26, 2026 (1) provides an update on the status of the Department’s Phase I review in this investigation, (2) sets forth some procedural next steps, and (3) requests further input from the Distribution Companies and stakeholders on the Department’s investigation into changes to existing processes to enable a more transparent and holistic understanding of each utility’s annual reconciling rate changes.

Procedural Update And Next Steps:

The Department anticipates issuing a Phase I Order encompassing issues related to objectives (1) and (3) outlined above as soon as practicable without the need for further process. The Department, however, has identified one topic requiring further input from the Distribution Companies and stakeholders before the Department addresses it in a Phase I Order, described below in Section III. In addition, there are certain issues that will likely require further consideration and process, as described further below.

“First, with respect to the Department’s objective to determine whether certain electric and gas reconciling mechanism costs should be collected from customers through fixed charges rather than volumetric charges, the Department received substantial feedback from a number of participants. In particular, the Distribution Companies in their reply comments recommended transitioning at least some portion of the costs recovered through the following factors from volumetric to fixed charge recovery: (1) the Residential Assistance Adjustment Factor (“RAAF”), the Energy Efficiency Reconciliation Factor (“EERF”), and the Solar Massachusetts Renewable Target (“SMART”) Factor for electric customers; and (2) the RAAF and the Energy Efficiency Surcharge (“EES”) for gas customers). The Distribution Companies further proposed a phased implementation schedule beginning with the RAAF, followed by the EERF and the EES, and the SMART Factor thereafter. The Distribution Companies noted that to the extent the Department anticipates transitioning some volumetric charges to fixed charges by November 1, 2026, they request that the Department convene a technical conference as soon as possible in the near term to discuss implementation concerns and timelines associated with their proposals.”

“While several commenters acknowledged potential benefits of making certain charges fixed instead of volumetric, the Distribution Companies as well as stakeholders also raised various concerns and considerations with respect to the impact and/or implementation of transitioning some volumetric charges to fixed or partially fixed charges. Given the complexities involved, the Department will continue to carefully evaluate this issue before coming to final decisions as to whether and which volumetric reconciling charges should be fixed or partially fixed. Therefore, the Department will not hold a technical conference on implementation of the Distribution Companies’ proposals at this time. Further guidance on next steps for this topic will be provided at a future date.”

“Second, with respect to the Department’s inquiry into the value of net metering credits and whether adjustments are appropriate, based on the variety of comments submitted on this topic, further investigation is necessary to better understand the broad impacts of any net metering-related changes contemplated by the Department in this proceeding. Accordingly, the Department will seek additional information and input on this issue, including holding one or more technical conferences. Additional details will be provided in the near term.

As to the final objective outlined above, the Department intends to further investigate the feasibility of creating a maximum threshold for the amount that charges assessed to customers may change from one month to another in a later phase of this proceeding.”

As previously reported the Distribution Companies and other interested stakeholders submitted initial comments on April 14, 2026 and reply comments on May 14, 2026 regarding specific questions posed by the Department in its Order.

III. Request For Proposals From The Distribution Companies Regarding Reporting Requirements Related To Rate Changes

“As part of the Department’s investigation into promoting more manageable, stable electric and gas bills, the Department is evaluating potential changes to existing processes to enable a more transparent and holistic understanding of changes to each utility’s annual reconciling rates, supply rates, and distribution rates, including cumulative bill impacts and cost trends.

To this end, the Department requests that the electric distribution companies, jointly, and the gas local distribution companies, jointly, submit proposals for a reporting template (including tables and graphs where possible). The proposed reporting templates shall show each rate change scheduled to take effect in the calendar year (electric) or by season (gas) using the parameters outlined below. The Distribution Companies shall submit these proposals and any comments regarding this request no later than July 15, 2026.”