Montana Groups Petition Against Data Center Expansion at Utility Commission

Concerns are mounting among nonprofit organizations in Montana regarding NorthWestern Energy’s proposed expansion to supply electricity to data centers. A coalition of nine groups is urging the Public Service Commission (PSC) to impose stricter regulations to protect existing customers from potential costs associated with this expansion.

Petition to the Public Service Commission

On Tuesday, the nonprofits filed a petition with the PSC. They argue that the utility’s plan could lead to increased costs for over 413,000 residential customers. The main focus is on ensuring that these customers do not bear the financial burden of new infrastructure, such as power plants and transmission lines, needed for the data centers.

Details of the Data Center Agreements

NorthWestern Energy is negotiating agreements to supply power to three data centers. The estimated demand is projected to reach 1,400 megawatts by 2030. This amount of power is sufficient to meet the annual electricity requirements of more than one million homes, exceeding the typical daily demand of 759 megawatts from current customers.

• Atlas Power: 75 megawatts starting in 2026, with another 75 megawatts by 2030, located in Butte.
• Sabey Data Center Properties: Initial requirement of 50 megawatts for a 600-acre site in Butte, expanding to 250 megawatts.
• Quantica Infrastructure: 175 megawatts for a project in Yellowstone County by late 2027, with plans to increase to 1,000 megawatts by 2030.

Concerns Over Regulatory Oversight

The petitioners express worry that NorthWestern is planning to finalize electricity service agreements without adequate regulatory oversight. They claim this approach undermines transparency and the public’s right to be informed. The PSC is tasked with ensuring that no additional financial burdens are imposed on customers who cannot choose alternative power suppliers.

Shannon James from the Montana Environmental Information Center highlighted the importance of proactive regulations. She stated the need for Montana to learn from other states that faced challenges when data centers negatively impacted their communities.

Proposed Actions from the PSC

The coalition of petitioners is advocating for the PSC to create a distinct customer category for data centers. This would involve implementing a separate tariff for their electricity usage. Such a measure would also require data centers to notify NorthWestern in advance of any changes in their power consumption, providing stability to the utility’s customer base.

State Regulatory Framework

The petition also references Montana law governing how large new customers can access electrical service from public utilities. Specifically, customers must demonstrate that their energy needs won’t adversely affect existing customers.

NorthWestern Energy’s Position

In response, NorthWestern Energy indicated that it plans to establish a specific tariff for its large-load customers, including data centers. The company emphasized that new customers will be responsible for their integration costs into the existing energy system.

Currently, the PSC is reviewing the petition and will facilitate a process in which various stakeholders can present their cases. Depending on the outcome, further hearings could be scheduled to assess the impacts of these data center agreements on Montana’s utility landscape.

The potential implications of this discourse are significant, not only for the utility’s operation but also for residential customers in Montana.