BUTTE, Mont., Sept. 4, 2014 /PRNewswire/ -- The Montana Public Service Commission voted today to prepare an order approving NorthWestern Corporation's d/b/a NorthWestern Energy (NWE) application to purchase 11 hydroelectric facilities from PPL Montana, a wholly-owned subsidiary of PPL Corporation (PPL) with several conditions on a 4-1 vote.
"Today, the Montana Public Service Commission (MPSC) took historic action to dedicate Montana hydroelectric assets to serve Montana customers. Today is the Commission's day," said Bob Rowe, NorthWestern CEO. "Almost one year ago, we first announced the potential acquisition of Montana hydroelectric facilities that would be dedicated to serve our Montana customers, with power priced at the cost of production, under the supervision of the Montana Public Service Commission, not priced based on what happens in the western power market.
"That announcement was the result of several years of hard work and also began a year of extraordinary effort by dedicated people at NorthWestern Energy, intervening parties, and especially by the Montana Public Service Commissioners and staff, all of whom have devoted much of their personal and professional lives over the past year to reach this historic point. I sincerely thank them for their dedication, thoughtfulness and commitment to a process that has resulted in this historic decision," Rowe added.
"Montana law requires that we plan long-term both to manage the price of power and the risks associated with various supply options. The Commission's farsighted decision allows us to do just that," said Supply Vice President John Hines. "We look forward to seeing the written order and, based on that confirmation, moving ahead with closing the transaction."
Nearly a dozen conditions adopted today during the work session include a Return on Equity of 9.8 percent compared to the company's requested 10.0 percent; the expectation that the company secure long term debt at an effective rate no higher than 4.25 percent; and conditions related to the transfer of Kerr Dam to the Confederated Salish and Kootenai Tribes.
Upon receipt of the final necessary approval from the Federal Energy Regulatory Commission (FERC) to issue securities in connection with the transaction, NorthWestern plans to fund the transaction with permanent financing of $450 million of debt, $400 million of equity and the remainder funded with free cash flows.
The company anticipates a FERC decision within 30-60 days after the MPSC issues its final order in the docket with closing to take place before the end of 2014.
About NorthWestern Energy (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.
- Utility Industry
- NorthWestern Corporation
- PPL Montana