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Wellesley teed up a bold move on climate action. Then came an offer it couldn’t refuse.

How $1.5 million in incentives from National Grid nearly derailed the town’s net-zero plans

A rendering of the town of Wellesley's plans for the new Hunnewell Elementary School call for an all-electric, net-zero ready building.The town of Wellesley

It took five years of painstaking work and delicate negotiations, but finally this summer town officials in Wellesley were on the cusp of a bold step to a climate-friendly future. Two new schools and a renovated town hall were to be completely free of fossil fuels. Officials hoped the projects would be an inspiration for residents and even for other communities.

Then came a wrinkle as leaders were finalizing the plans this summer. National Grid, the gas and electric giant, offered nearly $1.5 million to help with the cost of cutting-edge electric heating and cooling equipment.

But there was a catch. To get the money, the town would have to install gas lines to each of the new buildings.

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The offer was a small fraction of the $105 million price tag on the projects, but it quickly sowed doubt, dividing town leaders and undercutting the community’s resolve to break with fossil fuel.

“In town government, we don’t ever like to say no to money,” said Lise Olney, chair of the Select Board, who said she wasn’t tempted by National Grid’s offer and its condition.

But others were. Some argued that turning down the money would be irresponsible and unfair to taxpayers. Some talked of possible uses for gas in the buildings.

Steve Gagosian, the town’s design and construction manager, sent a terse letter to National Grid on Aug. 12, in hopes of convincing the utility to offer the money without requiring gas lines.

“It would appear that the incentive to electrify and then maintain a fossil fuel service are at odds with each other and sustainable climate goals,” Gagosian wrote.

National Grid replied that it was looking into his request, but Gagosian said months passed without hearing back.

By late August, some members of the School Committee and Select Board seemed “ready and willing to drop their commitment to Net Zero Energy Ready buildings” in order to ensure Wellesley got the National Grid money, a volunteer involved with the town’s climate effort claimed in an e-mail to Gagosian.

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Then, on Oct. 18, the Globe interviewed a National Grid official for this story, who verified the company’s position and confirmed details of the offer. Three days later, on Friday, Gagosian said he received an unexpected message from National Grid on his office voicemail. The company said it had decided to rescind the requirement for gas connections.

A National Grid spokesman, Robert Kievra, contacted the Globe a short time later.

“Upon a thorough review, we are pleased to be able to provide almost $1.5 million in incentives to this important project, a pragmatic and expeditious solution that advances our shared goal of reducing greenhouse gas emissions from public buildings,” Kievra said in an email.

Even with Wellesley’s situation seemingly resolved, climate advocates said the offer and its terms underscore how the business interests of gas utilities put climate efforts at risk. They noted that National Grid’s offer came via Mass Save, the state’s energy efficiency program, which offers rebates for equipment such as electric heat pumps. While Mass Save is funded by ratepayers, the program itself is run by gas and electric utilities including National Grid. The program is meant to encourage reductions in harmful climate emissions, and yet in this case, it appeared to be aimed at ensuring those Wellesley buildings remained tied to fossil fuels.

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“The investor-owned utilities should never have had control over these incentives,” said Logan Malik, interim executive director of the Massachusetts Climate Action Network, a climate advocacy group. The arrangement “is not designed in a way that can ensure we are electrifying as quickly as we need to be.”

Gas utilities in Massachusetts make most of their profit by installing new pipes, the cost of which is passed on to customers as a surcharge on their gas bills. And while state climate plans call for widespread conversion to electric heat powered by a clean grid, the gas industry has been pushing for climate policies that would allow it to pump new fuels through its pipes, another potential motivation to install more, climate advocates say.

“The utility is incentivized to keep expanding its territory and adding new customers,” said Amy Boyd, vice president of climate and clean energy policy for Acadia Center, a clean-energy advocacy group.

The National Grid official who spoke to the Globe last week, Chris Porter, director of customer energy management, said the company’s requirement that Wellesley accept gas connections was mandated by a Mass Save rule that rebates be given only to paying customers. In Wellesley, he said, National Grid provides natural gas service, but the town gets its electricity from a municipally owned light company, not from a Mass Save utility. Therefore, it can’t get rebates for an electric project from Mass Save without being a gas customer since “access to the program is only available to customers who have or will pay into the fund.”

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The seeming contradiction of the rule — that rebates to curb the use of fossil fuels can only be received by those who commit to using more — has renewed calls to remove the Mass Save program from the utilities’ control and reform the way rebates are offered in Massachusetts.

State Senator Michael Barrett, one of the lead authors of Massachusetts’ 2021 and 2022 climate laws, has introduced legislation that would take control of Mass Save away from the utilities.

He said National Grid’s offer to Wellesley embodies what he said is a broad effort by the gas industry.

“This whole issue of the survival strategies by natural gas utilities is framed here,” he said. “They are pursuing a number of stratagems, and imposing these kinds of conditions.”

The high stakes for communities trying to make headway on climate reforms are underscored by the slow path to get there. In Wellesley, it meant demonstrating for the town that all-electric, net-zero buildings were not only technically viable, but not overly expensive, said Marybeth Martello, the town’s sustainability director.

“These buildings are important exemplars of the kind of path we have to take if we’re going to be successful in addressing climate change,” she said.

But leaders of the effort had to convince residents as well as people within their own government to go along. So in 2017, they began developing sustainable guidelines for municipal buildings that prioritized electrification, and concurrently began laying plans for new schools, hoping they would eventually be built in accordance with them. They compiled their research into a white paper and launched a road show to present it at boards across town.

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It took three years just to adopt the building guidelines and, for the schools, ongoing community outreach. The two nonfossil-fuel schools finally got the green light in a special election last year. Final approval for the Town Hall project didn’t come until Monday, at Wellesley Town Meeting.

National Grid’s offer came after a town board member, Jeff Levitan, raised the prospect in a meeting in May. He said he was a consultant for National Grid, working to encourage towns to take advantage of rebates for heat pumps and other equipment through the Mass Save program. Levitan declined to speak on the record.

Gagosian, the construction manager, submitted an application to Mass Save the next month, in June 2022. The offer that came back from National Grid included a boiler plate notation: To qualify for the money, the applicant needed to have a natural gas account. In an e-mail a few weeks later, National Grid confirmed that meant each property would have to have an active gas line.

In August, with no agreement about whether to take the money, Levitan spoke up at a meeting of Wellesley’s Permanent Building Committee, seeming to ratchet up pressure.

“This offer has a burning fuse,” Levitan said in a recording of the meeting, urging members to take the money or risk losing it.

But there was no resolution. And in its interview with the Globe on Oct. 18, as well as written follow-up responses two days later, National Grid reaffirmed the conditions of its offer. It said Wellesley’s rebate offer represented an “opportunity to evolve how rebates and associated costs are structured,” but stressed that a condition of Wellesley receiving the money would be a gas connection for each building.

By Friday afternoon, that had changed.

Even with a good outcome for Wellesley, the episode cast a pall.

“It’s not supposed to be like this,” said the Acadia Center’s Boyd. “A progressive town deciding to build from the ground up an all-electric school. That should be a slam dunk — easy. ... If this is hard, then it does make everything else seem much harder.”


Sabrina Shankman can be reached at sabrina.shankman@globe.com. Follow her @shankman.