Colstrip bill reminds many of Montana’s energy deregulation debacle
BY KEILA SZPALLER 4/20/21
It’s no wonder that people talk about the 1997 energy deregulation debacle in Montana in the same breath as Senate Bill 379.
This bill landed later in the session, just like the one more than 20 years ago pushed by then-Sen. Fred Thomas of Stevensville. Like that bill, it comes with a hope that Montana customers can keep flipping on their lights without worrying too much about the cost of electricity.
But deregulation bamboozled Montanans; at least it did the majority of lawmakers. The bill didn’t drive promised competition and lower rates in the Treasure State. Instead, owners parted out Montana Power Co. like an old truck.
Rates climbed. Montana consumers who paid $310 million before deregulation were slated to pay $492 million in 2002, an extra $200 for every person in the state, according to a University of Montana dissertation on deregulation (the fiasco inspired more than one thesis).
Montana reversed course. The state set the stage for the company that bought the lines, NorthWestern Energy, to purchase back dams and reassemble itself as a utility with some of its own generation.
“The pathetic part is we sold it for pennies on the dollar and bought it back for dollars,” said Gary Buchanan, the state’s first director of commerce, who warned against deregulation. “But I thought that (dams purchase) was a good move.”
Power customers in Montana are still paying off that $900 million.
Now, markets are changing, political tensions are fraught, and in this environment, the Montana Legislature is taking up another set of bills that address the energy industry.
With SB379, Sen. Steve Fitzpatrick wants NorthWestern to have more energy at its fingertips, and people across the political spectrum seem to agree the monopoly needs it.
They don’t agree the bill will open the doors its sponsor intends. SB379 would make it easier for the utility to own more of the coal-fired plants in Colstrip even as the market for coal drops and other owners view the exits at the Montana facilities.