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Colstrip purchase gets public listening session
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Colstrip purchase gets public listening session

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The public, starting Oct. 13, will have three chances to comment about NorthWestern Energy’s plans to increase its share in Colstrip Power Plant Unit 4.

Every Tuesday for three weeks in a row, Montana’s Public Service Commission will hold a four-hour listening session on Zoom to gather input about the proposed purchase. Participation is audio-only, and the event will be streamed live at the commission’s website: http://psc.mt.gov/livestream.

Power Plant co-owner Puget Sound Energy is interested in selling its 25% share in Unit 4. NorthWestern and Talen Energy, both of which have stakes in the power plant, each have an agreement to buy half of what Puget is selling. On the front end, the aggregate purchase price for NorthWestern is 50 cents. NorthWestern needs Public Service Commission approval so after the purchase it can bill customers for operating costs and capital expenditures post-sale. Those costs will be in the millions.

Energy production from Puget’s share is 185 megawatts. In Washington, regulators must also rule on the sale. Earlier this week, the investigative staff for the Washington Utility and Transportation Commission advised against the sale, stating that the terms weren’t beneficial to Puget’s 1.5 million customers. The state’s consumer advocate also recommended against the sale. Both concluded that Puget’s customers would be better off if the company kept its current level of ownership and worked to close the power plant entirely in the next five years.

For more than 40 years, Colstrip Power Plant has generated electricity for utilities in four northwestern states, with most of its coal power being consumed in Washington and Oregon. The power plant and nearby coal mine that fuels it are the economic backbone of a community of 2,300 people.

Puget has been the largest shareholder in the plant for the past 20 years. It owned half of Colstrip Units 1 and 2 and 25% of both Units 3 and 4.

But Puget is getting out of Colstrip. In January, the utility agreed with Talen Energy to close Units 1 and 2, which the two owned equally. The units were no longer economical to operate.

Now Puget and three other Colstrip utility owners doing business in Washington and Oregon are facing bans on coal power. Washington utilities must stop using coal power by the end of 2025. In Oregon, staggered coal power bans take hold in 2030 and 2035.

NorthWestern is the only Colstrip owner expressing long-term interest in coal power. Montana’s largest monopoly utility says it would like to keep Unit 4 operating through 2042, in which it bought a 30% share in 2007 for $187 million. In 2008, the PSC valued the asset at $403 million and committed customers to a 33-year debt schedule at 8.25% interest.

Anyone wanting to comment during a listening session must contact the Commission in advance. Commenters may email the commission at pschelp@mt.gov or call the commission’s toll-free number at 800-646-6150 and leave a message with the commenter’s name, phone number, email address, and the date of the session they plan to attend. A commission representative will respond with instructions for providing comments.

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