Montana Power Rates Fall, but Could Climb in '25

You don't hear this every day. Montana power prices are actually going to drop by $7.96 cents a month after the Public Service Commission approves an interim rate reduction for Northwestern Energy customers.

However, that's just an "interim" rate and could be replaced by a higher rate, depending on what the panel finds as it continues to investigate details of a larger rate package proposed by the utility this past summer.

And if you're also a Northwestern natural gas customer, you'll still be paying more in the coming cold winter, although at least that will be offset by the electricity rates being trimmed.

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How did we get here?

Last summer, Northwestern Energy had asked for a rate hike of $1.40 saying the increase was needed to offset higher operating costs, specifically the work that has gone into bringing new generation online.

However, the PSC commissioners didn't immediately approve of a "bridge rate" tied to the gas-fired Yellowstone County Generating Station, wanting time to decide if it was a "prudent investment." So, instead, the commissioners ordered the interim rate adjustment, to give the state more time to explore details of the proposed rate package.

That means the analysis could still change power rates next year.

Higher prices for Montana natural gas

As part of that proposed rate package, Northwestern had asked the state to approve an increase in natural gas prices, and the PSC approved that change. In effect, that means the savings from the power rate reduction is offset by the 8.44% jump in natural gas for customers that use both services.

That works out to $4.38 per month for the average gas customer.

PSC President James Brown says the commission has "satisfied its obligation to customers to ensure rates are fair and justified." He says the panel recognizes Montanans are struggling with high prices, but says the power cut will "more than offset" the increase in gas prices.