A Montana environmental group is suing the state’s largest utility company and its public regulators. It says they violated a law aimed at developing small renewable energy projects.
The Montana Environmental Information Center claims Montana’s Public Service Commission illegally gave NorthWestern Energy a pass on buying enough energy from what are known as Community Renewable Energy Projects, or CREPs.
Starting in 2012, a state law required public utilities, including NorthWestern Energy, to purchase a certain amount of renewable power from these small providers.
“They have never acquired the amount necessary,” says Brian Fadie with MEIC.
NorthWestern Energy has contracted with some small community providers since doing so became law, but it has never bought enough renewable energy to completely satisfy the requirement. So the utility company has routinely asked state regulators in the Public Service Commission to waive the obligation.
The PSC’s commissioners, who aren't fans of the law, have also made a routine of approving NorthWestern’s waiver requests, saying the utility did everything possible but came up short in buying the required amount of small renewable energy credits.
“We are dealing with a incredibly unworkable law, written by, frankly, short-sighted legislators that aren’t willing to correct their error,” says PSC Commissioner Roger Koopman speaking at a meeting of the utility regulators in September.
In that meeting, NorthWestern avoided a possible fine of over a million dollars and received their waiver. But commissioners were split on how to apply the law and whether the utility company was out in or out of compliance.
MEIC’s suit filed this week asks a state district court judge to overturn the PSC rule and approve fines against NorthWestern Energy.
Butch Larcombe with NorthWestern says the utility has had a hard time finding small Montana-owned renewable energy projects to get power from in order to meet the state’s CREP law requirements.
“You know the CREP is a small piece of the state’s broader renewable portfolio standard, and we’ve been in compliance with that for many years, and that’s the part of the law that says that at least 15 percent of the electric generation needs to come from renewable sources.”
Larcombe says the utility company is willing to work with legislators in the upcoming legislative session to make the law easier to comply with.
“Maybe at some point we decide that it doesn’t really accomplish what it is designed to.”
During the 2017 legislative session Republican lawmakers along with a couple Democrats approved a bill that would have repealed the requirement for utility to buy power from small community renewable energy providers. It was vetoed by Governor Steve Bullock. Bullock wrote that while the current law is not ideal, it would be better to amend it than repeal it entirely.
Lawmakers plan on debating the issue during the 2019 legislative session set to start in January.