Press Release: NorthWestern Energy announces murky plan for new acquisitions one day after public hearing about future procurements
FOR IMMEDIATE RELEASE: December 10, 2019
BILLINGS, Mont – NorthWestern Energy (NWE) issued a press release today announcing plans to acquire a larger ownership stake in Unit 4 of the Colstrip Power Plant, only one day after a public hearing about their 20-year plans for future energy procurement. The resource procurement plan made no mention of a proposal to buy a larger share of Unit 4.
According to the press release, NWE seeks to acquire Puget Sound Energy’s current 25% interest which, combined with NWE’s current 30% interest, would increase their total ownership of Unit 4 to 55%. NorthWestern said it will seek an application for pre-approval to increase their Unit 4 ownership from the Montana Public Service Commission (PSC) in late January or early February.
NorthWestern also announced plans to acquire a portion of Puget Sound Energy’s interest in the Colstrip Transmission System for an estimated price of up to $3.75 million.
“The timing of this announcement, only one day after a public hearing about their future plans, shows a lack of respect for the public by NorthWestern,” said Ed Gulick, a member of Northern Plains Resource Council.
A public hearing was held in Helena yesterday regarding NorthWestern’s plans for energy acquisition for the next 20 years. Public commenters were uniformly critical of NorthWestern’s 20-year plan, noting a lack of renewable energy procurement and concerns over unaddressed debt related to cleanup costs for Colstrip’s leaking ash ponds.
“Why did NorthWestern fail to mention these purchase plans in time for the public to voice concerns?” continued Gulick. “The public hearing was yesterday. Had NorthWestern been transparent about these plans, Montanans would have had a chance to evaluate the proposed acquisition. This may be a very bad deal for ratepayers.”
“If this sale were approved, customers would have to cover the costs for a facility in need of major repairs, with enormous operating costs, for a fuel source that continues to be more and more expensive with each passing year. Because NorthWestern is granted a profit on the value of their assets, they have incentive to acquire more assets at ratepayer expense. This is nothing more than a sweetheart deal for NorthWestern Energy’s shareholders that would result in higher electricity costs for all NorthWestern customers. The PSC better not get hoodwinked into thinking this benefits anyone but NorthWestern shareholders and executives,” said Gulick about forthcoming decisions regarding this proposal.
Multiple questions remain about the full costs associated with this potential acquisition. Filings in Washington state, where part of Colstrip’s power is currently sent, reported that Unit 4 is in need of a $20 million repair to its generator. That figure is above and beyond the $15 million annual costs estimated by NorthWestern for operations, maintenance, and property taxes. Meanwhile, ratepayers are still paying off $407 million from the purchase of NorthWestern’s current ownership stake in Unit 4.
“The PSC cannot simply rubber stamp this rush-job deal with a ‘pre-approval’ status,” concluded Gulick. “The public made clear yesterday that we demand a greater say in the future plans of this monopoly utility. Allowing this acquisition to go through without the scrutiny it deserves would be a stick in the eye to everyday Montanans.”