NorthWestern Energy in the Legislature

NorthWestern Energy:

Again Trying to Shove Coal Down Our Throats

by Anne Hedges

Free market principles be damned. NorthWestern Energy and the Montana legislature are more concerned about overturning private contracts, interfering in private business decisions, making companies stay in business even if they lose money, and inhibiting future investments in Montana – all to force the continued use of fossil fuels. It seems that free market principles are just a talking point for most Republican legislators. Continued reliance on expensive fossil fuels seems to matter more than keeping utility bills low for average Montanans. And as for climate change, “them’s fightin’ words.” Even with stiff competition, perhaps the most troubling bill is SB 84 (Sen. Duane Ankney, R-Colstrip), supported by NorthWestern Energy. It would increase legislative interference with the independent and constitutionally-created Montana Consumer Counsel (MCC). The MCC protects consumers, such as NorthWestern Energy’s customers, before the Montana Public Service Commission (PSC) in order to ensure that utility customers are not overcharged. MCC is often the only entity looking out for consumers when utilities request a rate increase from the PSC. SB 84 would allow legislators overseeing the MCC to have financial conflicts of interest and would make it more difficult for MCC to hire the necessary experts to defend consumers against rate increase requests by NorthWestern and other monopoly utilities.

NorthWestern supports four other bills that are intended to overturn the 1982 private contract between the Colstrip owners (see below for descriptions of SB 265, SB 266, SB 176, and SB 88). NorthWestern knew the terms of the Colstrip ownership contract when it bought a small share of the plant in 2007. Now, NorthWestern is asking the legislature to overturn the 40-yearold agreement to benefit its shareholders at the expense of its customers and the owners of 70% of the plant. Unfortunately, at least so far, the legislature is going along with these shenanigans. SB 266 (Rep. Steve Fitzpatrick, R-Great Falls) would force the Colstrip plant owners to pay for expensive and questionable repairs or face penalties of $100,000 per day. The bill would require the other owners to pay for whatever repairs NorthWestern thinks are necessary even if the other owners will not be reimbursed by their customers through their allowed rates. SB 265 (also Rep. Fitzpatrick) would overturn the provision in the original ownership contract which rquires disputes among the owners to go to arbitration in Spokane, Washington, the state in which owners

of 50% of the plant are based. SB 265 would require arbitration over disputes between the owners to occur in Montana. Sen. Fitzpatrick is a chip off the old block. He’s the son of John Fitzpatrick, long-time lobbyist for the gold mining industry and NorthWestern Energy. The apple doesn’t fall far from the tree.

SB 176 (Sen. Brad Molnar, R-Laurel) is similar in that it would require the Colstrip owners to invest in the plant regardless of whether the investment is prudent. But it goes even further and requires any entity receiving money directly or indirectly from the Coal Tax Trust Fund (cities, towns, Tribes, schools, water districts, food and agriculture programs, small businesses, and more) to sign a statement swearing allegiance to coal.

SB 88 (Sen. Duane Ankney, R-Colstrip) also is intended to rewrite the Colstrip ownership contract, but this bill would require the owners to post a bond with DEQ to fund all maintenance at the plant regardless of whether it’s necessary. This puts DEQ, for the first time ever, in the role of a plant owner, an idea wholly contrary to free market ideology, as well as potentially exposing the State to liability for the extensive clean-up costs.

But Sen. Ankney — who is term-limited after this session — has other “over-the-top” bills. For example, SB 86 would force the plant owners to pay for all lost residential and commercial property values associated with Colstrip’s closure (again, as estimated by DEQ, an agency with no expertise in this arena), regardless of where in the state those properties may exist, their value, or the time of the investment. Sen. Ankney’s misguided SB 87 would require the owners of the plant to transfer water rights to the town of Colstrip and to forever pay to provide and pump water from the Yellowstone River, 30 miles north, regardless of whether the town already has sufficient water supplies for municipal purposes. What’s most troubling about all of these bills is the negative impact they could have on renewable energy investments in Montana. The out-of-state Colstrip owners also own part of the transmission system that transports electricity from Colstrip to West Coast markets. Those markets are demanding clean energy, which Montana has in abundance and could provide. But these same owners are hesitant to reinvest in Montana considering that all these hostile proposed bills would punish them and attempt to prevent them from meeting the demands of their regulators and their customers. A large, proposed wind farm north of Colstrip appears to have stalled out, potentially as a result of these bills. It would be a shame if Montana lost out on renewable energy investments because

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Left: The coal ash ponds at Colstrip.

Opposite: Colstrip at night by Colin Ruggiero.