NorthWestern Energy submits rate adjustment request to the South Dakota Public Utilities Commission
HURON, S.D., Dec. 19, 2014 /PRNewswire/ -- NorthWestern Corporation d/b/a NorthWestern Energy (NYSE: NWE) today filed a request to the South Dakota Public Utilities Commission (SDPUC) to increase electric rates later in 2015.
The company's request to increase revenues by approximately $26.5 million dollars equates to an increase of about $16.76 dollars per month for a typical residential electric customer or about 56 cents per day. However, the actual impact of the requested rate increase on individual customer bills will vary depending on the customer's rate class and amount of energy used.
The SDPUC will determine the actual amount of any rate adjustments, which could be greater or less than initially requested and it will determine the date that new rates will go into effect. However, rates are not expected to change earlier than July 1, 2015.
"This increase is largely the result of recent investments to meet federal environmental and infrastructure regulatory mandates as well as the investments that we've made to improve our infrastructure to maintain the high-level of reliability that our customers expect and deserve," said Bob Rowe, CEO. "We've managed the business well over the years and have avoided the need to increase rates for 34 years. It's amazing to think that the last general electric rate increase was in 1980. Now, current rates simply don't cover the costs associated with these significant investments." Rowe added that approximately 95-percent of the requested increase is the result of costs associated with federally required and critical infrastructure investments.
The most significant of the large projects are the upgrades of our jointly owned Big Stone and Neal power plants to meet federal regulations that limit pollutants linked to regional haze. Our portion of the cost to upgrade the Neal Unit 4 plant in western Iowa was $23 million and the work was completed last year. Our portion of the cost to upgrade the Big Stone plant is estimated to be in the range of $95-105 million and is due to be completed in 2015. Other partner utilities are either in the process or have recently completed the process to increase rates as a result of these federally-mandated projects.
In addition, the rate filing request includes recently or soon-to-be completed new transmission lines, upgraded substations and the new 60 megawatt Aberdeen peaking plant that has been serving our South Dakota customers since May 2013.
"No one, including us, likes to increase rates, but it's necessary for all of us who own and benefit from these plants and systems to share the costs fairly and equitably with the other regional utilities and their customers," said Rowe. "It's also important to note that these upgrades don't address the Environmental Protection Agency's recently announced carbon reduction plan. We are very concerned about the possibility of further costs that all South Dakotans may be facing in the future."
The rate filing only applies to electric customers in South Dakota and, as previously mentioned, rates should not increase until mid-summer at the earliest. This allows customers time to learn more about our new E-Plus energy efficiency programs and services that can help offset the cost impact of this filing by providing low and no-cost ways to reduce energy consumption.
There are many options available to participate in the electric rate review process. You can view the actual rate case filing online at www.northwesternenergy.com and/or at www.puc.sd.gov.
A copy of the filing will also be made available at each of our office locations where you can request a copy to review. As a NorthWestern Energy South Dakota customer, you can also directly participate in the public process that is undertaken by the SDPUC. According to state law, a customer has a right to join with 24 other customers to file a written objection to a rate increase, request that the SDPUC suspend the rate increase, and hold a public hearing to determine if the rate increase should be allowed (SDCL 49-43A-12).
About NorthWestern Energy (NYSE: NWE)
NorthWestern Energy provides electricity and natural gas in the Upper Midwest and Northwest, serving approximately 678,200 customers in Montana, South Dakota and Nebraska. More information on NorthWestern Energy is available on the company's website at www.northwesternenergy.com.
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SOURCE NorthWestern Corporation
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