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Northwestern Energy ordered to give money back to customers

By Grace Ditzler, KTVM Reporter, gditzler@ktvm.com
Published On: Oct 24 2013 05:37:28 PM MDT
Northwestern Energy ordered to give money back to customers
BUTTE, Mont. -

The state Public Service Commission tells Northwestern Energy they've been taking too much money from customers' pocketbooks.

The PSC has ordered the company to pay back between $2 and $3 million.

Northwestern Energy promotes energy-conservation to their customers, then it charges a flat rate that helps to off-set some of the costs they lose when you save.

That money is put toward infrastructure, like power and gas lines.

The PSC said Northwestern Energy over-estimated how much money they were losing.

We asked where customers might see that money.

"It's possible they could see some lower bills but it's probably not going to be dramatic," said Northwestern Energy Spokesperson Butch Larcombe. "Spread $2-3 million over more than 300,000 customers, it's not going to have a real noticeable affect on peoples' pocketbooks."

The Public Service Commission explained there are two rates you are charged for when you get your bill.

The first is the Delivery Service. That's the one that changes based on how much energy you use. If you use CFL bulbs, this is where you'll save.

The other category is the Supply Service. This is the fixed rate cost charged to all Northwestern Energy customers. This category is where the PSC says Northwestern Energy was charging too much.

"That portion of the energy charged is actually related not to energy, but to the fixed cost investments like poles and wires that need to be paid for regardless of how much energy is used," explained Public Service Commissioner Travis Kavulla. "That's what Northwestern Energy gets back in these so called lost revenues. They don't get back the cost of energy that have been avoided due to energy efficiency."

Northwestern Energy said they're still working with the Public Service Commission to hammer out the exact amount.

According to the PSC, the money will be paid back within a year.