NorthWestern Energy Calls for Large Rate Increases | New


Home utility bills for NorthWestern Energy customers are expected to rise by $170 a year, possibly more, as the utility seeks to raise general rates for electricity and natural gas.

Pending approval from the Montana Public Service Commission, the first rate increases would begin Oct. 1, with home electric bills rising by $14.18 per month for homes consuming 750 kilowatt hours. Base natural gas rates would increase by $1.60, with monthly rate adjustments to be determined which would add to the amount.

However, these rate increases are temporary and intended to hold the utility back while it argues over the coming year for more sustainable rate increases, which would be higher than the interim rates. Ultimately, the utility would like to raise rates by $273.12 per year for electricity sold to residential customers consuming 750 kilowatt hours per month and $90.84 for natural gas sold to residential customers consuming 65 therms per month. month. Monthly, these increases for electricity and gas are respectively $22.76 and $7.57.

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In its filing, NorthWestern acknowledges that the rate increases, 25.6% for residential electricity and 11.1% for residential natural gas, are substantial, although the utility says it currently does not collect enough from client. NorthWestern intends to prove that it has spent approximately $1 billion on infrastructure to serve its customers since its last requests for general rate increases. There are other categories of customers whose tariff increases are more significant, namely irrigators who face electricity tariff increases of nearly 30%.

The last time NorthWestern asked for a general electricity rate increase was in September 2018. Rate case proceedings last for months and play out like a civil lawsuit, with the utility making its case to regulators utilities as stakeholders, ranging from the Montana Consumer Council to large industrial customers, like Walmart, and public interest groups, are concerned about the impact of the utility’s plans on consumers and the environment. The PSC did not finalize the approval of the 2018 tariff case until the end of 2019. The resulting tariffs do not appear on customer bills until 2020.

Base natural gas tariffs were last applied in 2016.

Electricity and natural gas utility rates have seen some of the steepest inflationary increases among items tracked by the U.S. Bureau of Labor and Statistics. Through July, utility natural gas prices were up 30% over the previous 12 months. Utility electricity prices increased by 15%. These prices, second only to inflationary energy increases for oil and gasoline, were included in the consumer price index released on August 10.

The current Northwest rate case proceeding begins as the Montana PSC works to limit public intervention in utility cases. A twist in the PSC’s rulemaking would allow parties to object to other intervenors, a change that could open the door for NorthWestern and other utilities to object to certain parties participating. At a recent hearing, regular interveners in North West cases argued that reducing the number of participants in the cases would make it more difficult to argue a full range of issues. Intervening parties often have limited resources and coordinate their efforts, each of which has a particular issue to focus on.

Northwestern will host a public webinar the last week of August to walk through its brief and help the PSC, stakeholders and the public understand the content. Information on how to participate in this webinar will be posted on the Company’s website.

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