FOR ALL THE back and forth over whether Massachusetts needs to pare down its climate ambitions in the name of ratepayer relief, it’s another provision with virtually nothing to do with that debate that’s embedded in a sweeping energy package passed by the House last month that might make the biggest and most immediate difference in Beacon Hill’s quest to slash utility bills.

A yearslong push for Massachusetts to crack down on what state officials and consumer advocates contend is a shady industry that promises too-good-to-be-true electricity rates finally cleared an elusive hurdle when House Democrats passed the energy bill with stronger-than-expected guardrails on competitive electric suppliers.

These are third-party companies that purchase electricity through the wholesale market but sell it directly to consumers at rates different than those charged by a utility or municipal plan.

The overall energy legislation set off intense debate about controversial cuts to the state’s Mass Save energy efficiency program and the cost-benefit tradeoffs associated with such a move intended to lower utility bills.

Yet as officials wrestle with an affordability crisis gripping the state during a cold winter in an election year, it’s a policy choice around something far removed from Mass Save that may actually make the biggest difference for some Bay Staters. The House’s provisions to severely restrict the competitive electric supply market is a move that the chamber has resisted in recent years but is largely acknowledged as one that will deliver real savings for those customers.

“This is the most tangible piece of this bill,” said Larry Chretien, executive director of the Green Energy Consumers Alliance and longtime advocate for rooting out the competitive or third-party supply industry. “There’s no other provision that’s going to save a consumer this much money in one year.”

A concerted effort from Boston City Hall, among other advocates, may have helped break the logjam.

Brian Swett, Boston’s first climate chief officer, said he helped orchestrate compromise language that House leaders found “compelling” that would allow individual communities to ban competitive electric suppliers, as opposed to a full statewide prohibition of the industry.

“This is a massive win for ratepayers in Massachusetts to have that choice,” Swett said.

One key leader who found the idea promising over the course of multiple conversations, Swett said, was Rep. Aaron Michlewitz, the powerful House budget committee chairman who also happens to represent Boston’s North End in the State House.

To Chretien, the stars aligned for Swett’s efforts to pay off, given Mayor Michelle Wu’s solid relationship with Michlewitz.

“It was like the bridge over troubled waters,” Chretien said. “If the chairman was from another community, maybe it wouldn’t have happened.”

Electricity is provided through one of three ways in Massachusetts: through a utility company; a municipal aggregator, if a resident lives in one of the more than 200 communities with such an option; or a third-party competitive supplier.

The competitive supply market was birthed in the state in the 1990s via deregulation to allow consumers the choice to shop around for the best electric rates. Contrary to its consumer-friendly-sounding name, however, the industry has been anything but that — leading to rampant predatory practices, ripping off unsuspecting customers by locking them into higher rates, making it hard to cancel contracts, and targeting vulnerable populations.

Massachusetts competitive supply customers shelled out more than $650 million in excess payments compared to basic service rates since 2018, according to Attorney General Andrea Campbell’s most recent report. The market, according to the report, “causes significant harm to most consumers, where any savings that consumers may experience are typically short-lived and canceled out by much bigger losses.”

The impacts are disproportionately felt by the state’s lower-income residents, who may be more susceptible to the industry’s aggressive marketing tactics. While 16 percent of Massachusetts households purchased energy from competitive suppliers on an average month over the course of the year examined in the most recent report, that number jumps to 26 percent for low-income households.

“As ratepayers continue to struggle with high energy costs, this bill will provide relief to people harmed by this predatory industry,” Campbell said in a statement about the pending legislation. “In this broken market, suppliers profit at the expense of consumers — especially low-income families and communities of color. While our office has investigated and litigated against several of these companies, consumers cannot be fully protected without a legislative solution.”

CommonWealth Beacon reached out to two trade groups representing competitive suppliers, the Retail Energy Supply Association and the Retail Energy Advancement League, along with CleanChoice, a supplier that recently faced penalties from state regulators and is the subject of a class action lawsuit. None responded to multiple requests for comment about the legislation.

Michlewitz also declined to comment.

In the past, the House has been the roadblock to efforts to tighten the screws on competitive suppliers. The most recent effort collapsed in spectacular fashion at the end of 2024 after a protracted legislative battle between the two chambers over a larger climate and energy package and an intense lobbying blitz from the industry.

In that case, the Senate, led by Sen. Michael Barrett, who co-chairs the joint energy committee, proposed an outright ban on the industry directly selling to residents, a measure that failed to survive the final version of the bill due to House opposition.

Now that the House took concrete steps to rein in competitive suppliers through the current legislation under debate, Barrett sees a path forward this year to finally taking action.

Gov. Maura Healey initially proposed eliminating automatic renewals and variable rate contracts that can keep customers on the hook for bad deals. Her plan would also establish new licensing requirements for the industry in the energy bill she filed last May.

The House, though, went further and strengthened those provisions in its version of the legislation by allowing municipalities to vote to ban the industry from entering into new contracts or renewing existing ones within that community.

Those changes would help save ratepayers $880 million over 10 years, according to a fact sheet on the House bill.

“I’m impressed with where the House is going on competitive supply,” Barrett said in an interview. “Without doubt, the Senate is going to want to contribute some ideas of its own. But at the end of the day, you could see a nice hybrid emerge.”

In stark reversal from last session, the competitive supply provisions could be “one of the least-dramatic pieces” of the bill, said Chretien, who called the House proposal a “big breakthrough.”

Swett said that the municipal opt-out provision was a compromise floated for the first time this year that avoided an all-out ban on competitive suppliers while preserving local choice, something that resonated with legislative leaders.

And, he added, getting buy-in on the change from the House makes him hopeful that the reform will make it to the finish line this time.

“The folks who are inundated by these suppliers and who have been roped in, many of them have the least ability to pay,” Swett said. “This is a really big deal.”