Article published Apr 10, 2007

Open letter to PSC Commissioner Raney, from city official

By JORDAN LOVE

My name is Jordan Love and I work as the administrative officer for the city of Great Falls with a great deal of my time spent working on the city's energy activities.

I have heard your talks in Great Falls over the past few months — most recently on March 28 at the MSU-Great Falls campus. I thought your discussion on both the potential for and complexity of wind generation in Montana was very informative, and I thought you gave a good account of the post-deregulation environment in Montana.

However, this was the also the second time I have heard you speak about both the activities of the City of Great Falls and its objectives. Your statements about the city's activities are untrue, and it causes concern.

First, you consistently draw a connection between the city's role as an electricity supplier and our interest in the proposed Highwood Generating Station.

We began our venture to provide Great Falls with a choice for stably priced, affordable electricity in July 2002, well before we joined SME in October 2003. The first public meeting related to the possibility of constructing a generation facility took place in Great Falls in September 2004.

We will continue our work to supply choice for customers irrespective of whether Highwood materializes, and we have not wavered in that position. Our main focus has always been supplying stably priced, affordable electricity to the Great Falls community. While we did not ask for deregulation, we have worked hard to make the best of a bad situation.

Twice I have heard you use this first incorrect statement to advance a second false statement.

Your audience hears that the City of Great Falls wants to "carve out" all of the customers in Great Falls "to pay for Highwood."

You then say that the Public Service Commission would have no role in looking out for Great Falls consumers. What is the basis for that statement? As you know, we supported House Bill 346, which would have allowed local governments to petition the Montana Public Service Commission for the opportunity to serve residential and small commercial customers in their jurisdictions. It would have required an applicant to demonstrate to the PSC that:

An adequate and reliable supply service would be provided;

Terms, conditions and prices would be at least as favorable as those of other customers of the default supplier (NorthWestern Energy);

Default supply rates of other customers of the default supplier would not increase as a result of a transfer of customers to a local government supply entity;

Renewable resources would constitute a portion of the electricity supply; and

Regulation of rates and service conditions would be accomplished by the governing body of the local government supplier.

If any one of these conditions were not met, the PSC would have to deny the petition.

A second reason your "carve out to pay for Highwood" statement is false is that even if this bill were passed, and the PSC approved our petition, we could not use our role as a supplier of small customers to finance our portion of Highwood Station.

We have consistently said that our long-term contracts with large customers will be used to back our portion of financing for Highwood Station and that taxpayers will assume zero risk for construction of the project.

Not once have I heard you mention the positive impact our role as an electricity supplier has had on Great Falls.

Our locally controlled electricity supplier, Electric City Power, Inc., has saved our customers more than $500,000 in just two years of operation.

Our efforts represent a unique perspective in Montana's energy discussions: using new ideas to benefit Montanans with affordable electricity, local control and accountability.

The energy rates that are charged to our customers require the explicit approval of the customer to enter into a supply contract. The decision to do so is a business decision of the customer.

In addition, the rates to those customers are approved by the Great Falls City Commission through a process of a public hearing, published notices in the Great Falls Tribune, mailed notices to each of the customers and commission action to adopt the rates.

In light of the continually escalating electricity rates experienced by Montana ratepayers, it's my guess that customers in Great Falls would prefer to be close to their rate makers and have easy access to them.

Public power and customer choice work. Curiously, Montana is the only state in the West without the presence of public power.

You and the other commissioners have not missed an opportunity to oppose any policy shift away from our monolithic, monopolistic system, and have, in tandem with NorthWestern Energy, supported virtually every bill this session that would strengthen NWE's role as the only player in the game for Montana's everyday customers.

What has been Montana's intrepid roadmap out of Montana's dark energy hole? More of the same.

I appreciate the work of the PSC and the other state officials in tackling the tough energy issues that we face in Montana. While I'm puzzled about the strong, institutionalized opposition to local innovation and new ideas, I certainly realize there are no easy answers.

When you are here or anywhere in Montana, please do not misrepresent what we're doing in Great Falls. If you're unclear, please ask.

Finally, I would like to extend an invitation for you and the other commissioners to sit down with us (in Great Falls or in Helena) to learn about what we're doing.

We have extended three such invitations prior to this that have not been answered. I truly believe you would be interested in what we're doing in Great Falls with our cogeneration plant, international wind developers, carbon capture and sequestration, and more.