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Montana regulators refuse three projects due to bidding problems

Regulators in Montana have refused to approve three generating projects submitted for review by Northwestern Energy, including a controversial 150 MW project submitted by Montana Wind Harness (Windpower Monthly, June 2002), because of bidding and documentation problems. The Public Service Commission (PSC) says the utility was prudent in arranging power supply contracts for its default supply portfolio with PPL Montana and Duke Energy. However, when awarding contracts to three other projects, including a coal and a gas generator, along with the wind project, four of five PSC commissioners agreed the utility had failed to meet acceptable industry practices or lacked the documentation needed to show why one supplier was selected while another was not. In May, Minnesota wind developer Navitas Energy asked the PSC to void Northwestern's choice of wind developers and force the utility to reopen the bidding. But that is only one option the PSC is giving the utility. Northwestern can also go back to the commission once it fixes the contract problems, or it can buy the power without PSC approval and go back to the commission for another prudence review in July 2003. If it fails to win approval then, it may not be allowed to tuck all the costs of that power into customer rates. The utility had selected Montana Wind Harness to build a 150 MW wind project at a contract price of $31.65/MWh over 20 years.

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