NorthWestern Energy has reached key settlement agreements with several major stakeholders in its ongoing regulatory rate review for electric and natural gas services in Montana. The agreements, if approved by the Montana Public Service Commission (PSC), would result in modest increases in residential utility bills, helping to fund continued investment in safe and reliable energy infrastructure.
The settlements were reached with the Montana Consumer Counsel, the Montana Large Customer Group—which includes prominent industrial companies such as Ash Grove Cement, Calumet Montana Refining, and Phillips 66—the Federal Executive Agencies including Malmstrom Air Force Base, and retail giant Walmart Inc., which operates 16 stores and employs nearly 5,000 people across the state.
Under the proposed terms, a typical residential natural gas customer using 65 therms per month would see their bill increase by $4.74, or 9.14%, starting July 1, 2024. Electric customers would experience a $4.63 monthly increase, or 4.21%, if both the settlement and NorthWestern’s additional proposals—such as for the Yellowstone County Generating Station, state property taxes, and supply costs—are approved.
“Our customers deserve the most reliable energy service available,” said Brian Bird, President and CEO of NorthWestern Energy. “These agreements reflect a constructive process that balances the need for infrastructure investment with the goal of keeping energy bills affordable.”
The settlement would raise NorthWestern’s annual base revenues by approximately $18 million for natural gas services and $66.4 million for electric services, not including costs related to the Yellowstone County Generating Station. The company’s proposals for that facility and the Power Cost and Credit Adjustment Mechanism (PCCAM) will be addressed in a separate PSC hearing beginning April 22, 2025.
Bird emphasized the ongoing benefits of the Yellowstone County Generating Station, noting that the facility has already helped reduce rates for Montana customers by more than 5% as of December 1, 2024. The plant is expected to deliver an annual rate benefit of $4.1 million.
If NorthWestern’s additional proposals are approved—including a $94.5 million reduction through the PCCAM and a $1.2 million adjustment for property taxes—customers would see a net electric base revenue increase of $14.6 million.
The settlements are based on a 9.60% return on equity for natural gas operations and 9.65% for electric operations, with a 47.8% equity component of the utility’s capital structure, consistent with existing standards.
The Montana Public Service Commission will now review the proposed agreements, with final decisions expected following the upcoming public hearing.
By: DNU staff