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Montana Regulators Agree to Investigate Past Wholesale Deals

Montana Regulators Agree to Investigate Past Wholesale Deals

Montana's five-member, elected Public Service Commission Thursday voted unanimously to launch an investigation of past wholesale electricity and natural gas deals in its open-access energy market. Details of how the PSC will pursue possible market manipulation in the past will come in the next two weeks when a formal order is drafted, according to one of the PSC commissioners, Tom Schneider, in an interview with NGI.

All of Montana's major industrial customers buy their own energy supplies, and on electric side, they collectively represent about 30% of the state's load. About 20 suppliers are licensed by the state, and back in the 2000-2001 western power crisis time frame, eight were operating, Schneider said.

Montana Attorney General Mike McGrath originally urged the state regulatory commission to pursue a state investigation the mid part of last year. It was his persistent urging and revelation that have continued to come out of the ongoing Federal Energy Regulatory Commission probes that finally prompted the PSC to act, Schneider said.

The attorney general was quoted in an Associated Press wire service report saying that Montana energy consumers "have a right to know if they've been ripped off" in the process of urging the PSC to do its investigation. Schneider was unsure after Thursday's vote how long the probe might take, but he said the order should spell out those details.

He said the state intends to look at all of the past transactions during the period of skyrocketing wholesale energy prices between the licensed suppliers or utilities and the "customer choice" utility consumers.

None of Montana's specific energy distributors have been named in the FERC investigations, but many of the licensed suppliers or their affiliates have been Schneider said. He said the large industrial customers in the state are the ones who were hurt the worst by the wholesale price spikes in the past.

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