MPSC Asks NorthWestern Energy To Comply With Minimum Filing Requirements

Published: 19-Nov-2009

NorthWestern Energy has said that the Montana Public Service Commission (MPSC) determined that the company's general rate case filing on October 16, 2009, did not meet the MPSC's applicable minimum filing requirements, primarily related to allocated cost of service and rate design.

In its rate case filing, NorthWestern proposed a revenue requirement increase of approximately $1.96m for its natural gas utility and approximately $15.5m for its electric utility.

NorthWestern's proposed filing also included new cost allocation between rate classes and rate designs. The proposals introduced an inclining block residential rate structure that would assign more costs to residential customers that use more energy within each rate class.

Under this methodology, some customers would see higher increases than the average residential customer while other residential customers may experience lower than average rates.

In response to the MPSC's action, NorthWestern submitted a motion for reconsideration or in the alternative, if it is denied, a motion to bifurcate the general rate case into a revenue requirement proceeding and an allocated cost of service and rate design proceeding. The company believes the motion to reconsider bears merit because the filing does comply with the MPSC's filing requirements.

In addition, should the MPSC deny the motion for reconsideration, the motion to bifurcate would allow a separation of the overall revenue requirement from the allocated cost of service and rate design rules, allowing a proceeding on the revenue requirement to continue.

If the MPSC's initial determination stands, NorthWestern expects to correct the deficiencies and re-file the rate case. If a re-filing is required, the rate case decision likely would be delayed from the third quarter of 2010, as previously anticipated, to the fourth quarter of 2010.