Keila Szpaller
(Daily Montanan) The Montana Public Service Commission approved the Yellowstone County Generating Station at $246 million — less than the $289 million in additional rate base that NorthWestern Energy wanted.
Customers will pay for the plant.
How the amount will translate on customer bills is in the works, although NorthWestern already implemented increases associated with the rate case, to be adjusted based on a final decision.
Public Service Commission spokesperson Alana Lake said Friday she expects an estimate on customer bills to be available in the next couple of weeks.
This week, the Public Service Commission took action on the rate case, a complex and multipronged application that includes the controversial methane-fired plant outside Laurel.
In a report, staff analysts with the Public Service Commission said NorthWestern Energy built the plant without adequately evaluating more affordable options, it didn’t manage construction in a cost-effective manner, and it failed to show the plant was a prudent investment.
The staff report recommended disallowing nearly $60 million in recoverable costs compared to the amount NorthWestern requested.
However, the Public Service Commission opted to allow roughly $19 million of those costs related to litigation over the state issuing permits for the plant.
Commission Vice President Jennifer Fielder argued the substantial costs associated with litigation included halting construction, mothballing the work in progress and then ramping up again — all because the state failed to issue permits.
Meanwhile, Commissioner Brad Molnar said it would be important to confirm the cost estimate with actual receipts and other evidence.
And Commission President Jeff Welborn said he was torn on the matter, but those costs weren’t the utility’s fault, and it would be appropriate to adjust the final amount based on the evidence staff can find in the record.
Commissioners voted 4-0 to accept recommended staff reductions, except for the ones tied to permit litigation, with Commissioner Annie Bukacek abstaining.
Bukacek abstained from at least one other motion on the rate case, and did not respond to a message asking why.
However, Bukacek also proposed a motion to let NorthWestern recover $16.3 million for a portion of change orders, the ones associated with the utility switching contractors.
Bukacek argued NorthWestern had shown no evidence of “nefarious motives” nor had it “committed any crimes,” and she questioned whether it was reasonable to penalize the company for trying to do the best for customers.
Fielder joined Bukacek in support of the motion, but it failed, with PSC President Jeff Welborn joining Commissioners Molnar and Randy Pinocci in opposing it.
In a statement, Welborn said the outcome represents a balanced approach to regulation.
It means the Yellowstone County Generating Station will provide “critical capacity” in the winter, and it also represents savings for customers, the Public Service Commission said.
“The Commission’s responsibility is to strike the right balance — ensuring utilities remain capable of delivering safe and reliable service while protecting customers from paying more than what is just and reasonable,” Welborn said. “This decision, and the $43 million in savings for customers, demonstrates the value of a thorough public process and the dedication of our staff.”
A news release from the Public Service Commission said customers can expect reductions based on current rates — $111.58 for residential customers, according to the utility — because NorthWestern implemented its own “significantly higher rates” in May 2025.
The monopoly utility did so in a move that was legal but rare, according to the Public Service Commission; it took advantage of a statute that allows a utility to impose a new rate after an application has been pending for nine months.
The Public Service Commission staff will incorporate the decisions commissioners made at their meeting into a final order to be reviewed before Dec. 24, 2025, Lake said.
