Montana PSC Approves Interim Electricity Rate cut for NorthWestern Energy customers of $7.96 per month
Earlier today, the Montana Public Service Commission (PSC) voted to approve an interim rate reduction of 7.24% for NorthWestern Energy’s residential electric customers. The electricity rate reduction translates into a reduction of $7.96 for the typical residential customer using 750 kilowatt-hours (kWh) per month. The bulk of the electricity rate reduction was due to a reduction over time to costs related to procuring energy sufficient to meet NWE customer demand which is reflected in the Power Costs and Credits Adjustment Mechanism (PCCAM) base rates.
In July, NorthWestern applied to the PSC to increase rates for its combined electric and natural gas service. With its application, NorthWestern asked for an interim electricity rate increase of 1.27% or $1.40 for the typical residential customer. Contrary to the utilities request, the Commission’s decision today results in a rate decrease.
One major component of NorthWestern’s interim request was approval by the PSC of a “bridge rate” to offset its costs associated with the Yellowstone County Generating Station, a natural gas-fired electric power plant located near Laurel, Montana. The Commission denied the bridge rate because the Commission has not yet determined whether NorthWestern’s decision to build the plant was and is a prudent investment. The Commission will review the prudency of the plant through the remainder of the rate case proceeding, which are projected to conclude in 2025.
NorthWestern also requested an interim increase in natural gas rates. The Commission agreed to allow NorthWestern to raise its natural gas rates by roughly 8.44%, or $4.38 per month for the typical residential customer using 65 therms of gas per month.
PSC President James Brown said of the Commission’s decision, “With today’s outcome, the Commission has once again satisfied its obligation to customers of NorthWestern Energy to ensure utility rates are fair and justified. The entire Commission recognizes that Montanans have been facing historically high prices for everything from housing to health care, food to insurance, diesel fuel and gasoline for the last four years. Going into the holiday season this year, electricity bills will be going down for NorthWestern’s electricity customers in the interim period, more than offsetting a smaller increase in their natural gas bills.”
Most of the approved rate adjustments will take effect as of December 1, 2024.
The Commission regulates private investor-owned natural gas, electric, telephone, water, and sewer companies, certain motor carriers, and oversees natural gas pipeline safety and intrastate railroad safety. The Commission works to ensure that Montanans receive safe and reliable service from regulated public utilities while paying reasonable rates.
For more information, visit psc.mt.gov or contact the Commission at 1-800-646-6150. Follow the Commission at Twitter.com/@MT_PSC or visit Facebook.com/MontanaPSC.
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