NorthWestern Energy announces settlement agreements in Montana

NorthWestern Energy (NWE) reached settlement agreements in its Montana electric and natural gas regulatory rate review with the Montana Consumer Counsel, which represents consumers in hearings before the Montana Public Service Commission, the Montana Large Customer Group, which includes Ash Grove Cement Company, Calumet Montana Refining, Enbridge Inc., GCC, Par Montana, Phillips 66, REC Silicon Inc., and Stillwater Mining Company, the Federal Executive Agencies, which includes Malmstrom Air Force Base and other federal agencies with offices in NorthWestern Energy’s Montana service area, and Walmart Inc., which has 16 retail stores and 4,900 employees in Montana. If approved, the settlement agreements are expected to increase annual natural gas base revenues by approximately $18M and increase annual electric base revenues, excluding Yellowstone County Generating Station, by approximately $66.4M. Including the unsettled request for the Yellowstone County Generating Station, NorthWestern’s base revenue request is $110.3M. When considering NorthWestern’s proposed reduction to the flow-through power cost and credit adjustment mechanism and its property tax tracker, customer electric bills will be impacted by the net $14.6M increase in revenues. The natural gas settlement is based on an authorized return on equity of 9.60% for natural gas operations, and a 47.8% equity component of the capital structure. The partial electric settlement is based on an authorized return on equity of 9.65% for electric operations, which is consistent with the current authorized ROE, and a 47.8% equity component of the capital structure. NorthWestern Energy and the University of Montana reached a settlement agreement for the proposed Standby Tariff. If approved by the Montana PSC, the settlement standby rates will be effective for customers that rely on NorthWestern Energy for backup power, but provide their own energy service most of the time. NorthWestern Energy and the Northern Cheyenne Tribe reached a settlement agreement that defines the Tribe’s involvement in transition planning for the Colstrip Plant, which is east of the Northern Cheyenne Reservation. The Northern Cheyenne Tribe recognizes NorthWestern Energy’s impending majority ownership of the Colstrip Plant as a commitment to responsible stewardship, long-term energy reliability and economic sustainability for the region. The settlement agreements were submitted to the Montana Public Service Commission for its consideration.