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Opponents: Colstrip Bill Allows MT Utility to Skirt Regulation

Senate Bill 331 would allow NorthWestern Energy to pass on $75 million to Montana ratepayers if it buys more energy from Colstrip. (Tonyglen14/Flickr)
Senate Bill 331 would allow NorthWestern Energy to pass on $75 million to Montana ratepayers if it buys more energy from Colstrip. (Tonyglen14/Flickr)
April 2, 2019

HELENA, Mont. — A controversial bill that would allow NorthWestern Energy to sidestep regulations to buy more power from the Colstrip coal plant continues to make its way through the Montana Legislature.

Senate Bill 331, now in the house, is touted as a good deal to meet Montanans' energy needs and a way to save jobs at Colstrip. It would allow the state's largest monopoly utility to pass on $75 million to ratepayers over the next decade if it chooses to buy more energy from the coal plant.

Travis Kavulla, a former Public Service Commissioner, said NorthWestern isn't obligated to keep the plant open if it buys more energy, meaning the bill doesn't necessarily secure jobs. He also noted the utility already is able to buy an additional share of the power plant.

"Which, I think, necessarily implies that the only reason for this piece of legislation is because NorthWestern wants special protection or favorable regulatory treatment for a business decision that we should expect it to make all on its own as a business,” Kavulla said.

Kavulla believes NorthWestern is outsourcing a business decision to the Montana Legislature. He also said sticking with coal without evaluating the cost of other energy options such as renewables could cost customers even more.

Jason Brown, attorney with the Montana Consumer Council, noted the bill also exempts NorthWestern from decommissioning and remediation costs for the share of Colstrip it owns and any additional shares it might buy. The Montana Department of Environmental Quality estimates cleanup costs at the power plant could be as much as $700 million dollars.

He said there's no guarantee this would be a good deal for Montanans if regulators step aside.

"A good deal can turn into a bad deal if there's a lack of oversight and planning,” Brown said. “So I think that's kind of the crux of our concern."

Kavulla said he also worries about the implications of subsidizing a utility company.

"It's generally not been the policy of the United States and certainly not the policy of a red state like Montana to subsidize uneconomic competition,” Kavulla said. “And I worry that that is, in essence, what this S.B. 331 could set up."

Utilities across the country have been stepping away from coal-based power as the cost of clean-energy sources such as wind and solar have decreased.

Eric Tegethoff, Public News Service - MT