Bill Could Allow NorthWestern To Pass Colstrip Costs Onto Ratepayers
The Montana Senate has approved a bill that could pass costs for the Colstrip coal-fired power plant onto NorthWestern Energy customers if the utility buys an added share in the plant.
Senate Bill 379, intended to continue the operating life of the Colstrip power plant, passed on the 27 to 21 vote and now heads to the House for debate.
The bill could allow an electric utility to pass costs of owning a power plant — including cleanup work and a rate of return — to customers, if approved by state regulators.
Republican Senator Steve Fitzpatrick of Great Falls sponsored the bill and says it will help the state tap into a needed energy source for Montana.
"What we’re doing is we’re providing here an incentive to purchase low-value, undervalued assets or enter into these power purchase agreements which should hopefully bring down rates for customers."
Other lawmakers read the bill differently, including the sole Republican legislator who voted against SB 379 at its second reading Tuesday.
Sen. Brad Molnar of Laurel worried the bill could end up forcing NorthWestern customers to pay for an inactive plant.
"And instead of lengthening the time that Colstrip will be open, it’s created an economic burden."
Democratic Sen. Mary McNally of Billings shared the concern.
"I can’t imagine why anybody would vote for a bill like this when you have no idea what you are obligating ratepayers to. Not a clue."
NorthWestern Energy lobbyist David Hoffman spoke in support of the bill at its committee hearing in late March.
"The bottom line is if you support Colstrip and coal-fired electricity generation, you will support this bill," Hoffman said.
An estimate from a March Public Service Commission staff memo says each NorthWestern customer would pay upwards of $700 a year if NorthWestern bought the remainder of Colstrip units 3 and 4. The PSC took an official position against the bill a few weeks ago over concerns about the costs it could pass on to utility customers.