The following opinion column was authored by Liz Forster. Liz Forster is a Billings resident, attorney, and member of Yellowstone Valley Citizens Council, a grassroots organization that advocates for a healthy, inviting, and sustainable community.
Imagine your town has one car mechanic, and the mechanic just doubled the price for an oil change even though the mechanic’s costs have stayed the same. You have no choice but to use that mechanic, and you have to swallow the cost, even as more and more of your paycheck is swallowed by it.
That’s exactly what NorthWestern Energy, Montana’s monopoly utility, is attempting to accomplish with its most recent rate increase request to the Public Service Commission. It wants to jack up your energy bills so they can pocket what amounts to a 10.8% profit rate — far above the industry’s benchmark 6.28%. In plain terms, it is asking you to foot the bill for its, and its investors’, greed. Even worse, it is asking you to foot the bill for risky, expensive, and unreliable projects such as the Yellowstone County Generating Station in Laurel and the expansion of the Colstrip Power Plant. At the same time, NorthWestern lobbied to block affordable community solar to ensure that its monopoly profits are not interfered with.
Cumulatively, Billings customers would lose $8 million to NorthWestern’s proposed rate increases. Across the state, NorthWestern customers would lose about $88 million a year to the rate increases. This is money that unfairly goes to NorthWestern’s out-of-state shareholders instead of staying in our local economy.
What Montanans need now are cost decreases. According to a December 2024 report from Congress’s Joint Economic Committee, Montanans are paying $1,119 more per month to purchase the same basket of goods and services than in January 2021. Montanans have to spend $106 more per month to maintain the same standard of living as in 2023. And, according to a Montana Free Press-Eagleton poll, three in four Montanans were concerned about being able to afford housing in the state over the next five years.
Ratepayers should not absorb the costs of the risky and imprudent investments in the Laurel gas plant and Colstrip Power Plant. For the remaining generation assets, Montanans deserve a reduction — rather than a brazen increase. Lowering NorthWestern’s return on equity to the roughly 6% industry benchmark would save Billings households about $100 a year.
The Public Service Commission has the opportunity to stand up for Montanans by denying NorthWestern’s rate increase proposal. It did so in January when it denied a $42.4 million rate increase proposal from NorthWestern on the grounds that such an increase would not fairly balance the interests of the monopoly’s shareholders with the interests of Montana ratepayers. Importantly, it rejected NorthWestern’s claim that the proposed rate hike was necessary to maintain its financial integrity, attract capital, and compensate investors for the risks it assumed. Rather, the PSC saw through the smoke and mirrors and emphasized that NorthWestern has paid increasing dividends to shareholders every year since 2004.
NorthWestern’s most recent ask is no different than the proposal denied in January. Simply put, NorthWestern is again trying to pass off the costs of bad investments to Montana ratepayers because it is a monopoly selling to captive ratepayers. Instead of investing in innovative technologies to produce cheaper, cleaner energy, it has dug its heels into Colstrip despite researchers predicting it will be uneconomic to run existing coal plants by 2030. The Laurel gas plant, which will cost $320 million to construct and will accrue $2.3 billion in lifetime costs, is the same story.
Montana ratepayers are making their voices heard to the PSC and Northwestern. On Monday, June 9, the PSC began a hearing in Helena on the rate proposal, and anyone can testify in person or remotely through Friday, June 20. To sign up to testify remotely, call (800) 646-6450 or email pschelp@mt.gov by 5 p.m. the day before you testify. You can submit written comments to the PSC via its electronic submission system or by mail to PO Box 202601, Helena, MT 59620-2601.
Originally published here
