Flathead Electric Rates among Lowest in Region

Excerpts from a Missoulian review of electric rates for regional utilities
From June 27, 2010
By MIKE DENNISON, Lee Newspaper State Bureau

HELENA – NorthWestern Energy, the state’s dominant utility, still charges its Montana residential customers some of the highest electric rates in the region – but, unlike many others, its rates have actually declined since two years ago.

NorthWestern, which serves 330,000 Montana customers, will be charging homeowners about 9.3 cents per kilowatt hour (kwh) for July bills, translating to about $900 a year for an average household, or just under $75 a month.

Elsewhere in the region and Montana, the major electric utilities and cooperatives are charging anywhere from 5.2 cents to 10.35 cents per kwh.

Claudia Rapkoch, spokeswoman for NorthWestern Energy in Butte, says the company’s overall electric rates have declined because market rates for electricity have dropped with the recession – and NorthWestern, unlike most utilities in the region, buys large amounts of power on the open market.

In the wake of utility deregulation in the late 1990s, NorthWestern (then the Montana Power Co.) sold off its power plants and began buying electricity on the open market to supply its customers.

That change left the company and its customers at the mercy of market prices. Most other utilities in the Northwest retained ownership of their plants, enabling them to provide power at the cost of production, plus a slight profit – or, no profit, if they’re a publicly owned utility or cooperative.

Some of the lowest electric prices in the region continue to be those of municipal utilities and cooperatives, like Seattle City Light, Tacoma Public Power and Flathead Electric Cooperative in northwest Montana. These public entities are nonprofit and own their own power plants, buy power from low-cost federal hydroelectric projects or both.

Below is a summary of the current monthly cost and per-kWh rate for residential customers of major utilities in the Pacific Northwest and neighboring states.

Text: The calculations are for a monthly bill, based on consumption of 800 kilowatt hours (kWh).  Average monthly consumption for homeowners served by utilities in the region ranges from 750 kWh to 1,200 kWh.  A homeowner’s bill is the per-kWh charge times the amount of energy consumed and, in most cases, a monthly flat fee, which varies from utility to utility (Rocky Mountain Power in Wyoming has the highest at $20; NorthWestern Energy customers pay $4.85).  Some utilities also have “tiered” rates, where the per-kWh charge increases with higher consumption, or seasonal rates, with different rates in the winter.  In these cases, the per-kWh rate listed above is a weighted average based on 800 kWh per month.
Source: Individual utilities, co-ops, public utility districts.

Insulation “Alert”

A member of Flathead Electric Co-op rues the day she accepted a postcard invitation to a “free” dinner and demonstration on an insulation product; and she wants to help others avoid her costly mistake.  Seventy-eight year old “Mary” wishes to remain anonymous for fear she may be harassed by those who she says “duped”  her into installing a thin aluminum material in her home that, according to some industry experts, will offer little, if any, insulating effect and may even lead to harmful humidity levels.

In March, Mary attended the “no obligation” presentation at a local hotel and says she enjoyed a nice dinner and “visit” with representatives of an out-of-state company.  Mary says she was told that by purchasing an “energy package”, she would not only save on her heating bills and receive a federal tax refund, but would also collect a sizable rebate from her local electric utility.  In fact, Mary says, she was led to believe that she would receive almost a complete return on her $2,800 investment.

Unfortunately, Mary didn’t check with Flathead Electric in advance of the transaction.  Had she taken that step, she would have learned that preapproval of an insulation product is needed for a rebate; that the company she was working with was not on the Co-op’s approved installer list and that the product she was considering didn’t qualify.  In other words, a simple phone call could have prevented the entire ordeal.  “I want others to learn from my situation”, Mary says.  “Talk to local folks first; don’t make hasty decisions and don’t sign anything until you’ve checked it out thoroughly.”

Mary is not alone, however, and that is her concern.  She says there were 30 or more people at the demonstration and fears some of them may have fallen for the sales pitch as well; “These guys are pros at what they do.  I should have seen the red flag when I was basically offered something for nothing.”

According to Mark Fopp of Lilienthal Insulation Co.  in Kalispell, mobile sales schemes are not uncommon.  “Unscrupulous individuals come into an area and pass themselves off as energy saving specialists.  They take advantage of an unsuspecting public and sell them a bill of goods, usually targeting those least able to afford it, like the elderly. People really need to think twice before giving their hard earned monies to an unknown.”

DOE selects NW for $178M smart grid demo

Kalispell, MT – The $178 million Pacific Northwest Smart Grid Demonstration Project was one of 16 regional smart grid demonstration awards announced by the Department of Energy (DOE).  DOE will provide 50% of the funding through the American Recovery and Reinvestment Act.  The project’s participants, primarily utilities and technology companies, will provide the remaining funds.

The project team combines energy providers, utilities, vendors and research organizations and will be managed by Battelle, the managing company over the Pacific Northwest National Lab, PNNL, in Richland, WA.  In addition to Flathead Electric Cooperative, the demonstration team includes a dozen other participating utilities, ranging from investor-owned utilities to municipals, rural electric cooperatives, public utility districts and the Bonneville Power Administration (BPA).

Flathead Electric Cooperative’s piece of the regional project involves a voluntary residential smart grid pilot project. Flathead joined with the BPA, Battelle, and others aimed at demonstrating how improvements in Smart Grid technology can potentially save money and increase efficiency for utilities and their customers.

The Flathead demonstration project has a total cost of approximately $3.5 million, half of which will be matched with expenditures planned in concert with current capital budgets. The demonstration is planned to dovetail with some of the smart grid advances Flathead Electric is already deploying. FEC has been gradually replacing standard meters with two-way meters, which are capable of transmitting usage rates back to the Co-op.

As part of the demonstration project, communication between the Co-op and the end user (member) would be improved to four different levels, from advanced meters with real-time outage management and demand-response enabled waters heaters, to smart appliance and home energy networks. Participation in the project will be completely voluntary; will include appliance incentives; and will provide participating members with an opportunity to reduce costs for themselves and the general membership. Flathead hopes to have installed some equipment in homes by October of next year, and plans to collect at least two years of data for the regional project.  

For further information contact:
Russ Schneider
FEC Senior Data Analyst
751-1828

Co-op Receives Funding for Geothermal Exploration

Flathead Electric Co-op could begin exploratory drilling for a geothermal development project in Hot Springs as early as 2010 if funds arrive as expected. In July, Montana’s Congressman Denny Rehberg announced that the Co-op would receive $491,000 for the project, which was included in the Energy and Water Appropriations Subcommittee bill for Fiscal Year 2010. Rehberg, a member of the subcommittee, says the funding represents an investment in an “All of the Above” energy solution, which is the balanced approach he supports to meet America’s energy needs. In addition, Rehberg says that research is imperative in developing alternative energy sources and he’s proud to support a project that could lead to jobs in Northwest Montana. In applying for the funding, Director of Energy Services for the Co-op, Cheryl Talley, noted that almost every strategic energy plan in the U.S. calls for more renewable energy, adding that “geothermal fits the bill.”

Ken Sugden, Flathead Electric General Manager, says the geothermal project makes sense for the Co-op on a number of fronts: “It produces a steady supply of energy (as opposed to variable sources like solar and wind) so there is not a problem integrating the output into the electric system and the Hot Springs area in Lake County appears to be a good source of geothermal energy.” Experts project that adequate water and heat is available in the area for electric generation, especially when coupled with advancing technology.

Eventually, Flathead Electric Cooperative hopes to use the resource to partially supply its load growth and the geothermal activity in neighboring Lake County is well situated for distribution. FEC hopes to collaborate with the Confederated Salish and Kootenai Tribal Council and Mission Valley Power since the site is on the Flathead Reservation and in Mission’s service area.

Under the American Recovery and Reinvestment Act, the Co-op has applied for additional funding to continue exploring the feasibility of geothermal development in Western Montana.

For more news please check
Light Reading