Panel Orders NorthWestern to Credit Customers

By Beacon Staff

HELENA — The state Public Service Commission has ordered NorthWestern Energy to refund an estimated $2 million to $3 million to customers after the panel found the utility overestimated how much revenue it lost from energy-conservation programs.

The 5-0 decision on Tuesday focused on reported revenue lost from 2006 through 2011 by promoting the use of energy-saving light bulbs.

Customers’ electric rates cover the $11.9 million annual cost of the program, but NorthWestern also can recoup its fixed costs for unused electricity related to the conservation programs, the commission said.

It found that a study funded by the company overstated how much electricity was saved through the use of the bulbs and determined a portion of the reimbursements should be refunded to its 325,000 customers through a rate credit.

The commission order requires NorthWestern to refile its statements on how much revenue it lost, using a formula approved by the PSC. Once a final amount is approved, rates will be adjusted accordingly and credits given over a period of no more than a year, said Commissioner Travis Kavula of Great Falls.

NorthWestern Energy spokeswoman Claudia Rapkoch told Lee Newspapers of Montana the decision sends a mixed message about energy savings programs.

“It has a chilling effect on how we could potentially view these programs,” Rapkoch said.

Also Tuesday, the commission told NorthWestern it could not recoup from ratepayers about $1.4 million in costs related to a 2012 emergency shutdown of a 150-megawatt natural gas-fired generating station near Anaconda.

During the shutdown, NorthWestern had to buy power on the open market at rates higher than it would have cost the utility to produce the power itself, PSC spokesman Chris Shipp said Thursday.