January 3, 2013
Montana

New 5-0 Republican majority on PSC may bring new direction

By MIKE DENNISON, State Bureau | The Montana Standard | January 3, 2013 | mtstandard.com

HELENA – When the new, all-Republican state Public Service Commission convenes next Monday, the regulatory body will chart a different path, members say – and likely choose a new chairman.

“I think we need a little bit of a change of direction in the PSC,” says Commissioner-elect Bob Lake, R-Hamilton. “If I didn’t, I wouldn’t have run for it.”

Incoming and current members say those changes will be a PSC that presses hard for the lowest-cost energy, regardless of whether it’s “green” or not, that scrutinizes whether ratepayers should fund certain energy-conservation measures, and that lobbies against laws or governmental actions they believe lead to higher utility rates.

Commissioner-elect Roger Koopman, R-Bozeman, notes that utility taxes are automatically passed on to ratepayers: “We need to let ratepayers know that … when (an) administration is raising taxes (on utilities), they’re pointing that gun right at the head of the ratepayer, and nobody else. …

“You’re going to notice a commission that is going to aggressively fight for the Montana ratepayer.”

The PSC regulates electric, gas, telephone and water utilities in Montana. Koopman and Lake knocked off Democratic commissioners in the Nov. 6 election, creating a 5-0 Republican majority for the first time since the five-member PSC was created almost 40 years ago.

Republican Kirk Bushman of Billings also won an open seat representing southeast Montana, to succeed outgoing Republican Commissioner Brad Molnar of Laurel.

The new commissioners, who will be sworn in on Monday, also will choose the body’s new chairman, who is likely to be Commissioner Bill Gallagher, R-Helena.

Gallagher says he’s asked the new members for their support to become chairman, and the current chairman, Republican Travis Kavulla of Great Falls, says he’ll be supporting Gallagher, too.

“They’ve indicated that they would like me to be the chair,” Gallagher said of the new members. “They’ve indicated they want to turn the page and start a new chapter at the commission.”

The 28-year-old Kavulla became chairman in 2011 with the support of the commission’s two Democrats, Gail Gutsche of Missoula and John Vincent of Gallatin Gateway. During the last year, Kavulla, Gutsche and Vincent sometimes formed 3-2 majorities on key votes, with Gallagher and Molnar in the minority.

In the Nov. 6 election, Lake defeated Gutsche in the PSC’s western Montana district and Koopman defeated Vincent in the southwestern Montana district.

Kavulla says the new members will have “a steep learning curve,” as they’ll be diving into two major natural-gas rate cases, where Montana-Dakota Utilities and NorthWestern Energy are asking for increases.

He says he hopes the new commissioners will ask tough questions of the utilities, to scrutinize the rationale behind the rate-increase requests.

Gallagher said he’s “very excited” to see the new makeup of the PSC, as it’s joined by two experienced businessmen – Koopman and Lake – and Bushman, who has an engineering degree.

“I’m looking forward to seeing that commission develop and (the new members) using their real-world talents to represent their district,” he said.

Lake, a state senator, used to own a feed business, and Koopman owns a personnel agency.

One significant change for the new PSC may be a body less sympathetic to development of renewable or “green” energy, such as wind power.

Both Koopman and Lake said they don’t like the state mandate that utilities buy a minimum amount of green power for their customers. They said the mandate is costing ratepayers money.

“My belief, and I think it will be a belief of the majority of the (new) commission and will be a major policy shift, is that green energy needs to stand on its own merits,” Koopman says. “We’re not going to ask the ratepayers to pay more because some people prefer one energy form over another.”

The green-energy mandate is in law, however, and the PSC can’t ignore it. Koopman said he’s willing to lobby for its repeal.

Gallagher also says he’d like to examine whether PSC rules can be amended to make regulatory costs lower for small utilities, such as water systems for small subdivisions.

Finally, Gallagher and other members indicated they may re-evaluate the PSC’s top staffers, who serve at the pleasure of the commission.

Koopman says he has no reason to think any staffers need to be replaced, but perhaps they should re-apply for their jobs and compete against other potential applicants.

“It’s always good to cast a net to see if there are any stars out there who want to come work for the PSC,” he said.

The four staffers who serve at the pleasure of the commission are Chief Legal Counsel Dennis Lopach, Regulatory Division Administrator Kate Whitney, Centralized Services Division Administrator Staci Litschauer and PSC spokesman Justin Post.