Colstrip is neither cheap nor reliable
When your old car continues to break down, there comes a point when you decide to stop throwing money at it and invest in a newer, more reliable vehicle that will save you in the long run. Unit 4 at the aging Colstrip coal-fired power plant is now analogous to that old car that needed a valve job last year, a new exhaust system this year, and likely will need another expensive fix next year as well. Unfortunately, Montana’s electricity bill-payers aren’t in the driver’s seat on the financial decisions for the power plant.
The Montana Public Service Commission (PSC) recently imposed a $32 million rate increase on NorthWestern Energy customers. Over a third of that -- $11 million -- is to cover the costs of a breakdown at Colstrip Unit 4, which caused it to be shut down for over half a year starting last July. This is the second time since 2009 that NorthWestern Energy customers have been on the financial hook for breakdowns at Colstrip Unit 4. Yet, with little scrutiny, the PSC voted 4-1 to make NorthWestern Energy consumers foot the bill for Colstrip’s outage.
Even when it’s not broken down, Colstrip Unit 4 is already costly for bill-payers. Power from the plant has been among the most expensive electricity for NorthWestern Energy for several years now, according to data filed with the PSC. In fact, it’s twice as expensive as wind power NorthWestern Energy receives from the Judith Gap and Spion Kop wind farms. Given that our energy bills already reflect the high cost of coal operations, the move by the Montana PSC to heap another $32 million onto consumers’ bills because of Colstrip stings even more.
Other states’ energy regulators are taking a more responsible approach. Puget Sound Energy owns part of each of Colstrip’s four units. Recently, the Washington utility commission told Puget Sound Energy not to assume the utility will get reimbursed by consumers for any more expenditures at Colstrip. Montana’s utility regulators should do the same.
There’s also handwriting on the wall for Colstrip from the private sector. Last week, plant operator PPL announced that it is spinning off its share of the plant to a newly created company. Why? Owners like PPL and NorthWestern Energy realize that Colstrip isn’t necessarily a valuable asset. NorthWestern Energy’s own analysis submitted to the PSC earlier this year proved that fact with hard numbers. NorthWestern Energy told the PSC that its calculations show that PPL will lose about $28 million over the next 20 years at Colstrip.
It’s time for the PSC to stop making Montanans spend and spend again on an expensive, unreliable coal unit. Instead, regulators should push NorthWestern Energy to replace this power with cleaner, more efficient, dependable, and affordable energy for Montana consumers. Today, that means renewable energy and energy efficiency that both save customers money over the long run and create good-paying jobs here in our state.
Montana has the potential to create more than 4,000 jobs by 2030 using job factors from a new Synapse Energy Economics report. This incredible economic opportunity is good for our pocketbooks, our economy, and our environment -- but only if regulatory, political, and utility decision-makers seize it. The longer we wait, the more we risk missing the window on a vital economic engine for our state and letting too many others across the region get there first.
Here’s the bottom line: renewable energy and energy efficiency are more affordable and reliable than Colstrip. While Unit 4 at the coal plant sat broken in the garage for six months running up a $32 million tab without producing a single kilowatt of electricity, the Montana wind was blowing and our sun was shining.
The PSC needs to let Montana electricity bill-payers into the driver’s seat on energy costs in our state. The road we want to be on heads toward a clean, affordable, modern energy economy – not backwards again and again to an expensive coal power repair shop.
— Anne Hedges is deputy director of the Montana Environmental Information Center.