NorthWestern Energy Dam Purchase is a Bad Deal for Consumers, Says PSC Commissioner

"If the plant operates well, or badly, compared to the market... that's all on the shoulders of the consumers," Kavulla said. "Ironically, the actual owner of the property NorthWestern Energy makes a guaranteed profit of about $60 million annually regardless of how well the dams do compared to the open market or other energy alternatives."

Kavullah says the business plan laid out by NorthWestern Energy is based on overly optimistic projections.

"A lot of the value of these dams is tied up in what people think the cost of emitting  carbon is going to be: the higher the cost of carbon, the more its impact on electricity market prices, the higher the value of the dams," Kavulla said. "So, when NorthWestern went to value the dams, they used a carbon price forecast that is 73 percent higher than what other regulated utilities are predicting."

Kavullah says the cost of the dam purchase will start to appear in consumer rates by this October or November and that it could add up to about 50 to 60 dollars extra per year for residential consumers and hundreds for commercial energy consumers.

Travis Kavulla: