Article published Dec 8, 2007

Agreement slashes energy rate hike NorthWestern was seeking

The Associated Press

HELENA — NorthWestern Energy said Friday it has agreed to a much smaller rate increase than the $42 million it sought earlier this year.

The company said the agreement with the Montana Consumer Counsel calls for an increase of less than 2 percent for the transportation and delivery of both electricity and natural gas.

The increase in the electricity delivery rates will raise $10 million a year while the natural gas delivery rate increase will raise $5 million, said NorthWestern spokeswoman Claudia Rapkoch.

The Montana Consumer Counsel signed on the joint agreement filed late Friday with the Montana Public Service Commission. The PSC has the final say on the rate increase.

The agreement is not binding if any parts of it are changed.

NorthWestern, which serves 320,000 electric and natural-gas customers in Montana, says the money will be used for infrastructure and service improvements.

It says the money is needed in those areas and noted this would be the first increase requested by the utility since 1998 to cover the cost of delivering power and fuel to customers.

Delivery rates account for approximately 42 percent of an average electric and natural gas residential bill. The remaining 58 percent is paid to energy suppliers for the electricity and natural gas itself.