NorthWestern customers to see increases, but lower ones, after PSC gives nod to utility authority

NorthWestern Energy’s residential customers are getting less of a hit to their electricity bills than expected — $122.50 a month compared to an anticipated $128 a month, according to the Public Service Commission.

In May, NorthWestern Energy implemented its own increase without approval by the Public Service Commission, arguing it had the right by law to do so given a prolonged wait on a substantial rate case it had filed last year.

The PSC agreed the action was legal. However, NorthWestern subsequently asserted a lower increase, one based on a pending settlement in the case, was appropriate.

In a 3-2 decision this month, the PSC agreed the monopoly utility had the authority to revise the rate itself, but a couple of commissioners vigorously debated the influence NorthWestern has on the agency.

Ultimately, commissioners decided it would be an “absurd result,” in the words of their legal counsel, to fight a lower increase for customers, despite some concerns about the extent of authority state statute grants the utility.

During the July 1 meeting, PSC President Brad Molnar criticized the move by NorthWestern to pursue the lower rate increase, after seeking multiple higher increases, as “illusory,” and a “communication tool.”

“They’re getting beat up for what they’ve done. Now, suddenly they’re good guys,” said Molnar, who along with commissioner Randy Pinocci, voted no, disputing NorthWestern’s authority.

Molnar also argued the PSC has been “a second office to NorthWestern,” an assertion Vice President Jennifer Fielder described as “inappropriate.” Fielder said the relationship between the PSC and NorthWestern remains professional.

The Public Service Commission has yet to rule on the larger application from NorthWestern Energy. The PSC heard the case last month, and NorthWestern is expected to file a brief in the case by July 21, according to the PSC.

The case involves numerous issues and parties, including the Montana Consumer Counsel; the “Montana Large Customer Group,” a coalition of large businesses including refineries; Walmart; the Northern Cheyenne Tribe; and the University of Montana.

The case includes a partial settlement on electricity rates among some, albeit not all, parties.

The new rate that takes effect this month replaces the nearly 17% increase on residential electricity bills NorthWestern enacted in May with a more modest one.

The May increase was done using a rarely-used statute allowing the company to enact its own rate increases without approval, if the PSC has not acted on a requested increase for nine months.

The new rate of $122.50 on average for residential customers includes the recent quarterly adjustment that increased bills based on market supply, according to the PSC.