Saying it’s time to rein in NorthWestern Energy, Montana legislator Tom Woods announced his candidacy for Public Service Commission on Friday.
Woods, a Bozeman Democrat who has served in the state House since 2013, said the state’s largest monopoly utility is no longer acting in the best interest of its customers. Woods has been particularly outspoken about the $407 million burden of debt NorthWestern customers shoulder for the company's 30 percent interest in Colstrip Unit 4.
“I’m just appalled by the behavior of this company,” Woods said. “I don’t want to see them in bankruptcy, but they need to be regulated. We need to put the public service back in the Public Service Commission.”
By law the Public Service Commission’s sole purpose is to balance customers' right to a fair price with NorthWestern's opportunity to earn an authorized cost of capital set by the PSC. Its low-profile elections are short on funds and media coverage, but big on consequence for anyone not receiving electricity from a cooperative. Other public services like gas and private water service are also affected.
PSC District 3 is a 14-county district stretching from Dillon to Park City, and includes Butte, Bozeman and Livingston.
In the past few months, NorthWestern has sought to bypass regulatory review while committing customers to more than $75 million in costs associated with Colstrip Power Plant. Additionally, the utility is seeking to increase rates on customers with solar panels who net meter, and raising transmission rates by $40 million. At every step, the company has insisted that these measures are necessary for it to cover costs, turn a reasonable profit and secure energy supply for its customers, which number 370,000 in Montana.
But the company has also retreated from earlier estimates of ‘must have’ rates, which has raised the eyebrows of the regulators. Earlier this month, NorthWestern offered to shave $28 million from a requested $34.8 million rate increase, settling instead for the $6.5 million.
The company had initially argued that the $34.8 million — an increase of $76.44 per year for an average residential customer — was needed and fair. It convinced Montana’s five member Public Service Commission to give it a $10 million interim rate hike while it negotiated the remainder of the price in rate case proceedings.
The $6.5 million cut into the $10 million, as well. After agreeing to dial its rate increase back to $6.5 million, the utility suggested that it was really proposing a rate decrease, given the $10 million had been approved by commissioners. That left some commissioners wondering exactly how much of what NorthWestern sought in the first place was truly necessary and fair to customers. Several commissioners, including Bozeman’s Roger Koopman scoffed at NorthWestern’s suggestion that rates were actually going down. The $6.5 million, still not settled, was a 2% increase from what customers were paying when NorthWestern first asked that rates go up.
"To be perfectly clear, this stipulation does not reduce customer rates over the existing tariff," Koopman said. "It reduces obviously the rates over the interim that we've got. And the interim is just that. It's an interim, sort of a temporary condition that we agree to,” Koopman said in proceedings earlier in May.
Term limits prevent Koopman, a Republican, from seeking re-election. Woods’ primary opponent is unknown in the district, which includes Bozeman, Livingston and Butte, where NorthWestern’s Montana office is located. There will likely be more candidates. In 2016, the Democratic primary drew two candidates.
Republican James Brown, of Dillon, is listed as a candidate for the district, as well. Brown was a candidate for the PSC 2012, but was defeated in the four-candidate primary by Koopman. In that year, Brown acknowledged not campaigning. Once an employee for Sen. Conrad Burns, Brown may be known best for being the attorney of American Tradition Partnership, a political “dark money” group that in 2008 committed multiple campaign violations in Montana, including illegally coordinating with candidates. ATP was later the subject of a documentary.
In 2017, Brown was a lobbyist for the Montana Independent Bankers, Montana Funeral Directors Association and the Montana Wool Growers Association.