Montana Administrative Register Notice 38-5-254 No. 18   09/23/2022    
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In the matter of the adoption of New Rules I and II and the amendment of ARM 38.5.1901, 38.5.1902, 38.5.1903, 38.5.1904, 38.5.1905, 38.5.1907, 38.5.1908, 38.5.1909, and 38.5.1910 pertaining to Public Utility Regulatory Policies Act (PURPA)










TO: All Concerned Persons


1. On August 5, 2022, the Department of Public Service Regulation published MAR Notice No. 38-5-254 pertaining to the public hearing on the proposed adoption and amendment of the above-stated rules at page 1621 of the 2022 Montana Administrative Register, Issue Number 15.


2. The department has adopted New Rule I (38.5.1911) as proposed.


3. The department has amended ARM 38.5.1902, 38.5.1903, 38.5.1904, 38.5.1905, 38.5.1907, 38.5.1908, 38.5.1909, and 38.5.1910 as proposed.


4. The department has amended the following rules as proposed, but with the following changes from the original proposal, new matter underlined, deleted matter interlined:


            NEW RULE II (38.5.1912) VOLUNTARY MEDIATION (1) remains as proposed.

(2)  Upon receipt of a request for voluntary mediation, the Commission's presiding officer may appoint a mediator. The appointed mediator may not be a member of Commission staff.

(3) remains as proposed.

(4)  Unless the parties and appointed mediator otherwise agree, the voluntary mediation will proceed as follows:

(a) Within seven days of the filing of a request for voluntary mediation appointment of the mediator, each party must submit to the mediator an opening mediation statement, including a complete copy of each party's proposed power purchase agreement and a list identifying each disputed contract term.

(b) through (5) remain as proposed.


            38.5.1901   DEFINITIONS (1)  For purposes of these rules, the following definitions apply:

(a) through (e) remain as proposed.

           (f)  "Production profile" means the expected hourly generation output of a qualifying facility for a full year based on an engineering analysis of the qualifying facility's power production capabilities and fuel use or availability.

           (g) through (2) remain the same.


5. The department has thoroughly considered the comments and testimony received. A summary of the comments received and the department's responses are as follows:


COMMENT 1: One commenter believes the reference in NEW RULE I (38.5.1911) to "effective August 5, 2022" may cause confusion, as December 31, 2020 was the effective date of Federal Energy Regulatory Commission (FERC) Order 872, 85 Fed. Reg. 54733 (Sept. 2, 2020).


RESPONSE 1: The Commission appreciates the commenter's perspective; however, the Commission believes including a specific date in the rule will make it easier to identify which FERC rules have been incorporated in the Commission's rules.  All effective rules as of August 5, 2022, including Order 872, are incorporated in this rulemaking.


COMMENT 2: One commenter suggested NEW RULE II (38.5.1912) should be amended to provide that current Commission employees cannot be mediators, to ensure that information discovered in mediation will not be available to the Commission.


RESPONSE 2: The Commission agrees with this suggestion and has revised the rule accordingly.


COMMENT 3: One commenter suggested that the timing for filing opening statements in NEW RULE II (38.5.1912) should be seven days from the appointment of the mediator rather than from the request for mediation, to give the Commission time to appoint a mediator.


RESPONSE 3: The Commission agrees with this suggestion and has revised the rule accordingly.


COMMENT 4: One commenter said the new language in ARM 38.5.1903(1)(c) should not refer to an as-available sales requirement.  The commenter noted the language does not come from FERC regulation, but rather mirrors language found in Pioneer Wind, which has never been enforced by a court.  The commenter asserted that federal regulation allows for uncompensated curtailment if the purchase of qualifying facility (QF) energy or capacity due to operational circumstance would result in greater cost than if the utility had instead generated the power itself, and that the language in the proposed rule would limit the application of this regulation to QFs providing capacity or energy on an as-available basis, excluding QFs with established legally enforceable obligations (LEOs).


RESPONSE 4: The Commission agrees with the commenter that the additional limits imposed on the application of FERC regulation 18 CFR 292.304(f) appear only in FERC precedent, rather than rule. Regardless, the Commission declines to adopt the commenter's proposed revision because the rule as proposed accurately reflects FERC's current interpretation of the rule.


COMMENT 5: One commenter said language in ARM 38.5.1903(8)(e) was repetitive and unnecessary because (8)(b) requires the utility to provide a copy of a standard rate tariff power purchase agreement to the QF.


RESPONSE 5: While ARM 38.5.1903(8)(b) applies to QFs that appear to be eligible for the standard rate tariff, (8)(e) applies to QFs for which a standard rate tariff is not provided under (8)(b).  If in the future the Commission approved a standard form power purchase agreement (PPA) for large QFs, the Commission anticipates that the utility would provide the same to QFs, as applicable.  The Commission therefore declines to strike (8)(e).


COMMENT 6: One commenter fully supported proposed changes to ARM 38.5.1905(2) and particularly the time-of-delivery pricing for both as-available purchases and purchases subject to an established LEO.  The commenter noted that FERC decided to allow states the flexibility to adopt time-of-delivery energy purchase rates after consideration of the potential detriment of long-term fixed energy purchase rates to utility customers, the impact of variable energy purchase rates on QF financing, the difference between cost-of-service recovery and avoided cost recovery, and the ability of QFs to obtain financing based on fixed, avoided capacity costs calculated at the time an LEO is incurred.


RESPONSE 6: The Commission appreciates the commenter's perspective and agrees with FERC's conclusions in Order 872 that QFs will be able to obtain financing based on a fixed avoided cost of capacity and variable avoided cost of energy.


COMMENT 7: One commenter provided a letter from KeyBank National Association evaluating how the shift from fixed to variable avoided cost of energy rates would impact QFs' financing options. In that letter, Ryan W. Pirnat, Managing Director of KeyBanc Capital Market Power, Utilities and Renewables group, said that variable revenue streams introduce uncertainty in an energy project's ability to service debt. According to Mr. Pirnat, lenders may take a more conservative view of a project's cash flow available to service debt, and a project with variable cash flows may not be able to leverage the project to the same extent that it would if it had fixed cash flows. Mr. Pirnat also observes that not all developers use leverage; many developers who leverage projects use debt to enhance returns and decrease equity holders' risk. Mr. Pirnat concludes that the shift to variable energy rates would impact the extent to which a project can be leveraged, but projects would still be financeable, and the overall impact of leverage may be negligible.


RESPONSE 7: The Commission appreciates the information provided by the commenter. This information generally mirrors FERC's findings in Order 872, which recognized that utility customers bear more risk when energy prices are fixed, and QF developers bear more risk when energy prices are variable. In either case, FERC found QFs could be successfully financed and developed. The Commission agrees.


COMMENT 8: One commenter supported the amendments to ARM 38.5.1905(2) in order to better ensure ratepayer indifference between QF and non-QF sources of energy.  The commenter noted that in Order 872, FERC considered the risk of overpayments inherent in long-term fixed-rate energy purchases and found that states should be given the flexibility to rely on more accurate variable avoided energy purchase rates. The commenter further observed that Congress did not intend to guarantee a rate of return or recovery of a QF developers' costs.  The commenter noted that eliminating forecasting in energy pricing will avoid subjective forecasts of inputs such as electricity and natural gas prices.


RESPONSE 8: The Commission appreciates the commenter's perspective, agrees, and concludes that it is in the public interest to reduce the risk to utility customers and calculate avoided energy costs at time-of-delivery, which best reflects the utility's avoided costs. The Commission further observes that this change will substantially expedite proceedings before the Commission, which will reduce costs and delays that can discourage QF development.


COMMENT 9: One commenter said variable energy rates are fair because fixed energy rates are not generally required to finance electric generation facilities, and most renewable resources no longer need to rely on PURPA avoided cost rates to sell energy economically. The commenter highlighted several projects under development in Montana, including a 750-megawatt (MW) wind farm built by NextEra Energy Resources, LLC; a 335-MW wind farm developed by Haymaker Wind, LLC; and Clenera's 150-MW Cabin Creek solar farm. The commenter noted that Renewable Northwest has identified 30 wind and solar projects currently under development in Montana and about half of those projects are larger than PURPA's 80-MW threshold. The commenter concludes that these projects demonstrate that there is ample renewable energy development under way to compete with utility-owned resources.


RESPONSE 9: The Commission thanks the commenter for providing this information. The Commission agrees that this information shows thriving competition and renewable energy development in Montana, often without a guaranteed energy price under PURPA.


COMMENT 10: One commenter urged the Commission to revise ARM 38.5.1905(2) to retain the fixed energy purchase rate option, at least for QFs 5 MW or smaller in size.  The commenter said the proposed rule would severely undermine the ability of small renewable energy projects to develop and operate.  The commenter said developers need certainty in return on investment, but time-of-delivery energy purchase rates fail to meet that need.  The commenter recommended the Commission retain the fixed energy rate option for all QFs.  If the Commission does not retain this option for all years in the term, the commenter said it should be available for part of the term as it is in Oregon, with 15 years of fixed energy rates in a 20-year term.  The commenter asserted that QFs 5 MW and smaller tend to be less sophisticated and have less capital to manage financial uncertainty.


RESPONSE 10: The Commission appreciates the commenter's perspective, but declines to revise the proposed rule. As discussed above and in FERC's Order 872, it was not the purpose of PURPA to guarantee developers a certain return on investment. Regarding the commenter's suggestion to combine fixed and variable energy rates over the term of a power purchase agreement, the Commission believes that this will not achieve the Commission's goal of simplifying proceedings under PURPA. The Commission further notes that FERC did not distinguish between large and small QFs when it allowed time-of-delivery energy pricing in Order 872. The Commission therefore declines to revise the rule.


COMMENT 11: One commenter requested a revision to ARM 38.5.1908(2)(b), which requires utilities to file with the Commission by July 1 of each even-numbered year the utility's latest resource plan with any supplements.  The commenter noted resource plans are not necessarily filed in even-numbered years or by July 1, and when they are filed, they are publicly available on the Commission's website.  The commenter suggested that the rule should refer to the publicly available plans, rather than requiring utilities to file their plans.


RESPONSE 11: Under 18 CFR 292.302(b)(2), utilities are required to "provide" their plans for the addition of capacity to state regulators every two years.  The Commission does not believe a reference to another filing would satisfy this requirement. Further, since most filings with the Commission are made electronically, the Commission does not anticipate the burden of submitting the plans will be substantial. The Commission acknowledges that resource plans are currently prepared every three years under Montana law. The timing of those plans, however, does not relieve utilities of the federal rule's requirement to "provide" the resource plan every two years. The Commission therefore declines to revise the rule.


COMMENT 12: One commenter supported proposed changes to the LEO rule in ARM 38.5.1909.  The commenter said the revisions align with FERC's guidance regarding establishment of LEOs.  The commenter notes that (1)(e) requires that QFs seeking payment for avoided capacity be studied for interconnection as a network resource. The commenter requests that this requirement be extended to avoided energy rates if the Commission does not adopt variable energy pricing.


RESPONSE 12: The Commission thanks the commenter for their support. Because the Commission adopts time-of-delivery energy pricing in this rulemaking, it declines to revise ARM 38.5.1909(1)(e).


COMMENT 13: One commenter requested additional language in ARM 38.5.1910(2) to ensure that the section applies only to QFs not eligible for tariffed rates. The commenter further asked that "avoided cost calculation" be changed to "avoided capacity cost calculation" if the Commission requires variable avoided energy costs.


RESPONSE 13: The adoption of time-of-delivery energy rates will eliminate the need for proprietary modeling and forecasts of energy prices.  Because a utility will not be modeling avoided energy prices for the QF, there will nothing to provide under the rule. The Commission also notes that its current rule is not limited to QFs not eligible for tariffed rates. The Commission has not heard any complaints that the current rule is burdensome or unworkable due to the lack of that limitation. The Commission therefore declines to revise the rule as requested.


COMMENT 14: One commenter requested additional language in ARM 38.5.1910(3), inserting "within its sole possession and control" after "additional data and information" to ensure that the parties' obligations are clear.


RESPONSE 14: The Commission does not believe the requested amendment is necessary. The sentence at issue requires utilities to provide additional information that may be necessary for a QF to calculate avoided costs with the QF's preferred methodology. The Commission anticipates this information will typically concern the operating characteristics of the utility's system. It is unclear how a QF could invoke this sentence to ask a utility for information that the utility does not already possess. Instead of revising the rule at this time, the Commission will consider complaints under this rule as they may arise.


COMMENT 15: One commenter expressed support for the adoption of NEW RULE I (38.5.1911) and NEW RULE II (38.5.1912), and the proposed amendments to ARM 38.5.1901, 38.5.1902, 38.5.1903, 38.5.1904, 38.5.1905, 38.5.1907, 38.5.1908, 38.5.1909, and 38.5.1910.


RESPONSE 15: The Commission thanks the commenter for their support.


COMMENT 16: One commenter stated that the Commission's notice of proposed rulemaking inaccurately concluded that the proposed rules would not significantly and directly impact small businesses. Specifically, the commenter said the Commission's proposal to calculate the avoided cost of energy at the time of delivery will "create barriers to financing, fail to foster and encourage the development of small business QFs as there is no certainty for price forecasts over a long-term contract, and it would violate Montana law for failing to comply with 69-3-604, MCA."


RESPONSE 16: The Commission disagrees with the commenter.  In this case, the Commission determined that there would be no significant and direct impact on small businesses, which would trigger the requirement for a further small business impact analysis. A reasonably accurate forecast of market prices, by definition, would not differ substantially from actual market prices over the term of a power purchase agreement. The shift from forecasted avoided costs to rates based on time-of-delivery avoided costs should not significantly and directly affect the amounts paid to a QF over the term of a contract. 


The Commission further notes that FERC considered arguments that variable energy pricing would impact financing for QFs, and concluded that ample opportunities for financing still exist. The Commission further notes that other comments submitted support the Commission's determination, as discussed in this notice.


COMMENT 17: One commenter proposed an amendment to the definition of "interconnection costs" in ARM 38.5.1901.  In addition to incorporating FERC's definition of the term, the commenter asked the Commission to clarify that interconnection costs do not include costs related to "any alterations, modifications, or enhancements that are necessitated by a change in the utility's system voltage and occur at or beyond the point of interconnection." The commenter states that this addition would be "consistent with longstanding, foundational Commission PURPA policy" and the Montana Supreme Court's Opinion in CED Wheatland Wind v. Mont. PSC, 2022 MT 87.


RESPONSE 17: The Commission declines to make this revision.  The Commission disagrees with the commenter's interpretation of the Commission's prior decisions regarding interconnection costs.  The Commission has consistently held that upgrades required for interconnection to the utility grid system at the time that the QF interconnects are the cost burden of the QF. The Commission also disagrees with the commenter's interpretation of CED Wheatland Wind.  The CED Wheatland Wind opinion cited the FERC definition the Commission adopts here as authority for its conclusion.  The Commission therefore believes incorporating the rule by reference matches the direction the Montana Supreme Court gave in CED Wheatland Wind.


COMMENT 18:  One commenter asked the Commission to define the terms "interconnection facilities" and "site control" in ARM 38.5.1901 by restating the current definitions of those terms in FERC's large generator interconnection procedures.


RESPONSE 18: Throughout this rulemaking, the Commission has attempted to move away from repeating the language of other statutes or rules, which may change over time and lead to discrepancies that require further rulemaking to resolve. The Commission therefore declines to incorporate the definitions as proposed by the commenter.


COMMENT 19: One commenter asked the Commission to revise the definition of standard rates to raise the threshold for qualifying for such rates from 3 MW to 10 MW. The commenter said that QFs of 3 MW or lower are "very difficult to finance."  The commenter also said raising the threshold would reduce transaction costs for facilities between 3 MW and 10 MW in size.


RESPONSE 19: The Commission appreciates the commenter's perspective; however, the Commission declines to make this change at this time. The Commission believes more information is needed to evaluate the effect of the change and encourages the commenter to petition for rulemaking with additional information.


COMMENT 20:  One commenter stated that the Commission lacks legal authority to eliminate the option for an avoided cost of energy fixed at the time of the QF's LEO date. The commenter notes that FERC's decision to allow variable pricing for energy in Order 872 did not supersede the anti-discrimination requirement of PURPA.


RESPONSE 20:  The Commission appreciates the commenter's perspective, but disagrees.  The anti-discrimination provision of PURPA is satisfied as a matter of law when the rates paid to QFs are equal to the utility's avoided cost. The shift from forecasted rates, which may deviate substantially from the utility's avoided cost, to a rate calculated based on observed market prices should substantially improve the correlation between the utility's actual avoided cost and the rate paid to QFs.  The Commission believes the rule as adopted improves overall compliance with PURPA, including the law's anti-discrimination requirement.


COMMENT 21: One commenter further argued that Montana's "mini-PURPA" at 69-3-601, MCA, prohibits variable energy pricing.  The commenter noted that statute requires the Commission to set rates using avoided cost over the term of the contract.


RESPONSE 21: The Commission disagrees with the commenter's interpretation of 69-3-601, MCA.  The Commission interprets "set" to mean that the rate paid to the QF is based on the avoided cost to the utility over the term of the contract. The Commission concludes that the avoided cost over the term of the contract is best represented by time-of-delivery pricing. The rate for QFs under the Commission's rule will therefore continue to be set based on the utility's avoided cost. The Commission further notes that a QF and a utility may agree to a fixed energy price term without the Commission's involvement.


COMMENT 22: One commenter said 69-3-604(2), MCA, requires the Commission to enhance the economic feasibility of QFs, which would not happen if the Commission allows energy rates to be calculated at the time of delivery.


RESPONSE 22: The Commission disagrees with the commenter's interpretation of 69-3-604(2), MCA.  That statute requires the Commission to encourage "long-term contracts" to enhance the economic feasibility of QFs. The Commission's proposed rules do not address the length of contracts. The Commission intends to continue resolving disputes over contract length on a case-by-case basis, based on evidence presented by the parties and the policy established in the statute. Because the switch to time-of-delivery energy pricing does not affect contract length, 69-3-604(2), MCA, does not prevent the Commission from adopting this rule. In addition, the Commission notes that all QFs will still receive a fixed capacity payment through the term of the contract, which encourages QF development.


COMMENT 23:  One commenter argues that utility-owned assets must also be valued at time-of-delivery rates before QFs can receive avoided energy payments calculated at time-of-delivery. The commenter states that this is required by PURPA's anti-discrimination provision. The commenter cites a recent Montana Supreme Court opinion (Vote Solar v. Mont. Dep't of Pub. Serv. Reg., 2020 MT 213A) for the proposition that a utility's own resources and contracted resources receive a "guaranteed cost-recovery or rate of return." The commenter likewise argues that utilities must not be permitted to receive a so-called "reliability rider," which NorthWestern Energy has requested in its most recent general rate case.


RESPONSE 23:  The Commission notes that the "reliability rider" proposed by NorthWestern is currently the subject of a contested case proceeding, and it is inappropriate for the Commission to pass judgment on the request in this rulemaking. The Commission disagrees that Vote Solar requires the Commission to apply cost-of-service ratemaking principles to QFs and thereby guarantee those facilities cost recovery or a rate of return. 


In Order 872, FERC observed that "the incremental energy costs that an electric utility will recover from its retail customers at an incremental level would be the same energy costs that are used in determining the electric utilities' avoided costs that will, in turn, set the as-available avoided cost rates to be charged by QFs." FERC concluded that "[g]uaranteeing QFs cost recovery is fundamentally inconsistent with PURPA, which sets the rate the QF is paid at the purchasing electric utility's avoided cost, not at the QF's cost. Such a rate structure is not discriminatory." The Commission agrees with FERC. While utilities are paid on a cost-of-service basis, QFs are paid on an avoided cost basis. PURPA does not allow QFs to be paid on a cost-of-service basis.


COMMENT 24: One commenter requested an amendment to ARM 38.5.1909(1)(b)(ii) to clarify that the estimate provided to a utility is "non-binding" and made in "good faith."


RESPONSE 24: The Commission does not believe the requested revision is required. An estimate is, by definition, not a binding, final statement. The Commission also believes that a QF's "good faith" should be assumed, and not stated as a requirement of Commission rules.


COMMENT 25: One commenter requested that the Commission remove ARM 38.5.1909(1)(e). According to the commenter, that requirement does not demonstrate commercial viability or financial commitment on the part of the QF.


RESPONSE 25: A request to be studied as a network resource is necessary to identify and estimate all interconnection costs associated with the delivery of firm energy with firm transmission rights. A QF that has not requested such a study has not demonstrated a financial commitment for its share of the costs associated with the delivery of firm energy. Likewise, the Commission is not convinced that a QF that has not requested such a study has demonstrated that its siting decision is commercially viable. The Commission therefore declines to revise the rule.


COMMENT 26: One commenter opposed the proposed amendments to ARM 38.5.1910(2), arguing that they would make avoided cost calculations less transparent.


RESPONSE 26: The Commission appreciates the commenter's perspective; however, the Commission believes the proposed revisions to the rule improve transparency. Under the prior Commission rule, the utility only needed to provide information used in the last Commission contested case to calculate avoided costs. The utility had no obligation to provide information that the utility intended to use when calculating avoided costs for the requesting QF. The rule as adopted fills that gap, while still allowing the QF to request additional information that may be required to calculate avoided costs under a different methodology, including the method last approved in a contested case.


COMMENT 27:  One commenter asked the Commission to revise ARM 38.5.1910 to require parties to provide modeling software and source code in response to a request. The commenter asserted production of the software and source code was necessary to "verify the accuracy, data, and outputs of the model."


RESPONSE 27: The Commission declines to make the requested change. A rule requiring parties to produce software and source code would force parties to divulge trade secrets of non-parties. Although the Commission can grant protective orders to prevent such disclosure in the context of a contested case, this rule is designed to be applied before a contested case proceeding begins. The Commission will instead evaluate the merits of requests for the production of modeling software and source code in the context of contested cases. Finally, the Commission notes that (4) of the rule provides a reasonable process for parties to verify the accuracy, data, and outputs of one another's models.


COMMENT 28: One commenter asked the Commission to clarify that monetary sanctions under ARM 38.5.1910(5) are only available against utilities.


RESPONSE 28: The Commission does not believe the clarification is necessary. The rule as adopted states that the Commission may impose fines "as applicable." Monetary fines under 69-3-206 and 69-3-209, MCA, would be levied only as those statutes allow.


COMMENT 29: One commenter said the rules as drafted are too "pro-utility," and without competition from QFs, utilities will have no competition.


RESPONSE 29: The Commission appreciates the commenter's perspective, but disagrees that the rules adopted today are "pro-utility." As discussed in response to prior comments, the decision between fixed and variable pricing is one of risk allocation between QF developers and utility customers. The utility passes the costs of QF energy on to customers and bears no risk of inaccurate forecasting. Adopting time-of-delivery energy pricing mitigates the risk to customers that they will substantially overpay for energy from QFs. And, as noted in prior comments, there is substantial renewable energy development underway in Montana, outside the context of PURPA.


COMMENT 30: One commenter said that, although there have been abuses of the PURPA framework, there were no examples of that in Montana. According to the commenter, the current system of forecasting energy prices can lead to disagreements, which may be "driven by the market."


RESPONSE 30: All forecasts will differ from actual avoided costs. Whether or not that difference is due to a party intentionally "abusing" PURPA is a question for individual contested cases. In this rulemaking, the Commission seeks to mitigate risks associated with forecasted avoided energy costs, regardless of their cause. The Commission also seeks to reduce the scope of disputed issues in PURPA proceedings through time-of-delivery energy rates, which may be "driven by the market," as the commenter suggested.


COMMENT 31: One commenter noted that the author of the dissenting opinion in FERC's Order 872 is now the FERC chairman.


RESPONSE 31: The Commission appreciates the commenter's observation; however, Order 872 remains the current guidance to states on PURPA implementation. The Commission believes its current rulemaking mirrors that guidance.


COMMENT 32: One commenter compared this rulemaking to a separate rulemaking process concerning utility resource planning and said the combination of the two rules would kill independent power production that can compete with utilities in Montana.


RESPONSE 32: The Commission appreciates the commenter's perspective. The Commission's rulemaking on resource planning is the subject of a separate notice published in the Montana Administrative Register. The Commission disagrees that the net effect of the rules as adopted will kill independent power production in Montana.


COMMENT 33: One commenter said that it is better to have QFs developed in Montana and provide jobs for Montanans than to have utilities purchasing energy from other states.


RESPONSE 33: The Commission appreciates the commenter's perspective. As demonstrated by information provided by other commenters, independent power projects continue to be developed in Montana, without a guaranteed energy price under PURPA. The Commission anticipates that developers of QFs and non-QFs will continue to build projects in Montana under the current rules. Finally, the Commission notes that job creation is not a factor the Commission is permitted to consider when calculating avoided costs under PURPA and FERC regulations.


COMMENT 34: One commenter said that, if these rules curtail independent energy development in Montana, the Commission will need to be prepared to take a closer look at each utility's costs. The commenter said this burden will be greater without competitive pressure from QFs.


RESPONSE 34: One of the Commission's duties is to thoroughly examine all costs involved in a utility's rates and evaluate whether the utility's management is making prudent decisions. The Commission does not agree that competition can relieve the Commission of its duties to conduct a full examination of a utility's costs and decisions. The Commission intends to continue fulfilling this duty in all cases.  



/s/ LUCAS HAMILTON                                        /s/ JAMES BROWN                            

Lucas Hamilton                                                   James Brown

Rule Reviewer                                                     President

                                                                            Public Service Commission



Certified to the Secretary of State September 13, 2022.


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