Montanans don’t believe NorthWestern Energy’s claim that the best energy plan for the next 20 years is to bolster Colstrip’s coal-burning power plants and building natural gas generators.
On Monday afternoon, dozens of Montanans spent five hours telling the Public Service Commission they weren’t willing to support NorthWestern Energy’s resource procurement plan that would depend primarily on the addition of natural gas generators for the next 20 years.
They asked the three commissioners who attended – two were absent – to remember their duty is to strike a balance between the ratepayers’ burden and corporate requests.
“You consider yourselves to be fiscal conservatives who want to limit the taxes that Montanans have to pay. I am asserting that your rate increase and the costs involved in the 20-year-plan are taxes that you are leveling on your constituents,” said Sharon Griffon of Great Falls. “Your duty is to demand facts, use facts to make decisions and make decisions that protect your constituents from an out-of-state corporation that dissimulates, manipulates and threatens in order to increase its own power.”
The commission made it clear that they accept public comment and could submit their own comments on the plan nine months later, but they have no authority to reject or accept the plan.
Ben Fitch-Fleishmann, NorthWestern Energy supply planning manager, gave a brief justification of the utility’s procurement plan, saying NorthWestern Energy needed to add more energy to its system. He said the region was short on capacity during the times of peak load. Using the example of February’s cold snap when the ability to generate solar power was almost zero, Fitch-Fleishmann said the energy demand had held steady at more than 800 megawatts.
He added that the chance of blackouts would increase once coal-powered generators went offline.
But some of the commenters didn’t buy the argument of dwindling capacity. Helena resident Todd Harris pointed out that NorthWestern Energy sells and exports 50% of the energy it produces and suggested that practice should stop before investing in more fossil fuel generation.
“Twenty years. Where’s your imagination? This is a sham,” Harris said. “(NorthWestern Energy) should be ashamed of themselves for presenting a plan that is absolutely the lowest level.”
Fitch-Fleishmann tried to explain that the company inserts past costs and certain assumptions into a statistical model to allow the company to chose what’s best. Based upon hundreds of runs, the outcomes alternated between batteries or natural gas, but ultimately, the company’s models showed that natural gas came out on top more times than not.
“Does that conclusion, that the plan selects natural gas as the most cost effective way to meet our resource needs in the future, does that pass the smell test? I’ll submit that it’s not crazy,” Fitch-Fleishmann said. “Batteries and gas are close in cost right now. They are close, but the studies are showing that gas is cheaper than batteries to do that right now.”
Fitch-Fleishmann cited studies from the Bonneville Power Administration and the Northwest Power and Conservation Council that reached similar conclusions. He pointed to an Energy and Environmental Economics study that concluded some energy source needed to fill the gap between the decline of coal and sufficient renewable energy.
“While wind, solar, hydro, and battery storage could provide reliability benefits to the system, replacing all carbon-emitting firm resources with these alternatives was found to be impractical due to the large overbuild required,” the study said.
But most of the commenters either questioned NorthWestern Energy’s assumptions and data used in its model or accused the company of not including environmental costs.
Greg Findley of Bozeman said the model may have compared individual renewable energy sources to natural gas but hadn’t considered the combination of solar, wind and batteries. It also looked at current energy production, not all the wind and solar that will be added over the next 20 year.
“But one of the best ways to meet our energy needs is through conservation. If we pursued strong energy conservation, we wouldn’t need to build so much new infrastructure and power,” Findley said.
The cost of renewable energy has decreased markedly over the past 10 years and will no doubt continue to drop over the next 20. Conversely, the cost of natural gas will likely rise, according to Mark Juedeman, a Helena geophysicist.
Juedeman explained how fracked gas wells tend to peter out after about three years so NorthWestern Energy won’t be able to plan 20 year’s worth of natural gas from Williston, N.D.
“As gas prices rise, we’ll still be paying for obsolete facilities pipeline infrastructure. We’ll be paying for the high cost of fuel. Not NorthWestern. Us,” Juedeman said.
Anne Hedges, Montana Environmental Information Center director, said NorthWestern Energy, a for-profit utility, used its model to create the highest-profit plan it could come up with. She told the commission that, while they can’t reject the plan, they have the power to call out the flaws. If the company doesn’t fix them, the commission could reject future requests from the company based upon the lack of information.
In this case, some of that missing information can be found in the reports the utility submits to the U.S. Securities and Exchange Commission, Hedges said.
Hedges said NorthWestern Energy still has a lot of debt and could incur more if it stays with Colstrip. In its quarterly report to the SEC, NorthWestern Energy lists the risks and costs associated with Colstrip that it didn’t include in its resource plan.
Colstrip power costs more than $23 million a year, and NorthWestern Energy just signed a new contract with Colstrip that is rumored in increase prices by 30%.
When Colstrip’s units 1 and 2 close at the end of this year, the cost for units 3 and 4 will increase. The Colstrip coal-fired power plants already cost millions to run. Meanwhile, Colstrip’s coal-ash ponds could require between $400 million and $700 million to cleanup.
Other states are pulling out and that could leave Montana ratepayers holding the bag if NorthWestern keeps coal in the mix.
“They’re hiding the ball about the cost of Colstrip,” Hedges said. “Please, do what you did last time and tell them, ‘Go back to the drawing board. Don’t present us with a plan like this again. We’re not going to make any decisions based upon this inadequate plan.’ Because they forgot to include all the numbers.”
The PSC extended the public comment period on the NorthWestern Energy plan through January. It will hold another listening session in Missoula at the library on Dec. 17 from 7-8:30 p.m.
Contact reporter Laura Lundquist at email@example.com.