NorthWestern to acquire Colstrip coal-fired units as other states go green
(Missoula Current) Citing a need for reliable power, NorthWestern Energy on Monday night announced an agreement to secure ownership of Colstrip Units 3 and 4 while the owner, Avista, retains the responsibility of decommissioning and cleaning the plant when it eventually shutters.
According to NorthWestern, the deal comes with no purchase price, though the company will be on the hook for 15% shares of Units 3 and 4 when ownership is transferred. It also comes as Avista adheres to a state deadline to stop delivering coal power to its customers in Washington by 2025.
Montana has no such goal, but NorthWestern president and CEO Brian Bird said the coal-fired plant will provide his company the resources it needs to generate power on demand – and around the clock – from within Montana to avoid “an energy crisis.”
“This agreement addresses that risk and saves our Montana customers the significant cost of acquiring new generation,” said Bird. “It solidifies NorthWestern Energy’s path to achieve our Net Zero Emissions by 2050 commitment, ensuring we can continue to provide reliable energy service at the most affordable rates until other technology for on-demand, clean generation is cost effective.”
During December's deep freeze, NorthWestern said that 41% of Montana's peak energy load was met with power purchases from other states, costing consumers more. The company added that Montana's wind generation resources “could not provide much, if any, power.”
Sen. Steve Daines praised the announcement.
“The Colstrip power plant supports reliable, high-paying jobs while also contributing to Montana's all-of-the-above energy portfolio,” Daines said. “This is great news for made in Montana energy, Montana jobs, American energy dominance and our national security.”
But others blasted the announcement as little more than a status-quo move that comes as other states in the region turn away from coal and invest in future power sources.
Oregon lawmakers passed a Clean Energy For All law in 2021, requiring PGE and Pacific Power to move to 100% non-fossil fuel sources by 2040. It also banned the expansion of new fossil-fuel burning power plants.
Colorado lawmakers this month also announced a plan to decarbonize the state's economy by 2050 by shifting to clean energy. The vast majority of the state's emissions come from the combustion of fossil fuels, including coal-fired power plants.
Idaho and Washington have similar goals, as do the city and county of Missoula, which have both pledged a shift to 100% clean energy by 2035.
Critics of Monday's announcement said NorthWestern was out of step with the new economy and would leave Montana in the literal dark-ages of energy.
“NorthWestern seems oblivious to the fact that states and utilities across the Pacific Northwest are phasing out coal-generated electricity and will be “carbon-free” in the near future,” said the Montana Environmental Information Center.
Despite its fixation on coal, NorthWestern said it is moving toward cleaner energy. The company said it was adding 160 megawatts of solar generation to its portfolio. That would bring NorthWestern's clean-energy portfolio to roughly 1,100 megawatts, including wind, solar and hydro.
“We are committed to adding only clean generation to our portfolio after 2035 and because new, cost-effective technologies able to provide clean energy for multiple days at a time are anticipated, we may never need to build more carbon emitting resources,” NorthWestern said.
While NorthWestern hasn't put a price on its decision to take over Colstrip, it did say it would prorate Avista's share of the cost of capital expenses from now through Jan. 1, 2026.
Gov. Greg Gianforte praised the announcement.
“This is a good deal for Montana because it means we are going to have reliable, affordable energy for all Montanans,” Gianforte said. “If we didn’t have this power going forward this decade and beyond, our grid would no longer be stable. And it’s a good deal for Colstrip, because we want to see this plant operate through its useful life.”