NorthWestern Energy seeking $10.9M customer rate increase in natural gas

Missoula Current

NorthWestern Energy is looking to boost its natural gas rates across the state by nearly $11 million – an increase now up to the Montana Public Service Commission to consider.

NorthWestern, which is also looking to recover costs associated with its new headquarters building in Butte, filed the $10.9 million rate increase with the PSC last week. It represents the company’s first rate increase since 2012.

“This increase would be a bitter pill to swallow for many NorthWestern customers, especially those on low and fixed incomes,” said PSC Commissioner Roger Koopman, R-Bozeman. “But commissioners must do their jobs, consistent with the requirements of law, so no one can predict the eventual outcome.”

According to NorthWestern, the average natural gas customer who uses roughly 100 therms per month would pay nearly $5 more each month, or a 6.67 increase.

The increase would effect roughly 190,000 natural gas customers across the state. The PSC has roughly nine months to consider the request.

“We will carefully weigh all aspects of the filing before rendering a decision, which we first and foremost hope will protect the long-term interest of Montana ratepayers, while at the same time being equitable to the utility,” said PSC Chairman Brad Johnson, R-East Helena.

Company officials say the increase is warranted to help cover improvements made to it’s electric and natural gas distribution system. The company has placed the value of the improvements, which began in 2011, at more than $300 million.

According to the filings, NorthWestern is also asking the PSC to evaluate its request to recover a portion of costs related to the company’s new $26 million headquarters building in Butte.

The company’s primary requests including the $10.9 million natural gas increase, and a $5.6 million rate increase to allow the company to recover costs prior to the conclusion of the full rate case.

It’s also seeking to include two gas production assets into the company’s rate base, and to increase NorthWestern’s return on equity for its natural gas consolidated utility, from the current 9.8 percent to 10.35 percent.