HELENA –The Washington state bill targeting two of Montana’s coal-fired Colstrip power plants is now law – but its true impact remains a subject of intense debate.

Washington Gov. Jay Inslee, who signed the bill Friday, and its environmental supporters insist it does not encourage or force the closure of Colstrip plants 1 and 2 in southeast Montana.

“This (law) has nothing to do with the closure of Colstrip,” Anne Hedges, deputy director of the Montana Environmental Information Center, told MTN News Monday. “This law has to do with the (owner) acting responsibly in setting up a fund to clean up its mess.”

The law enables Puget Sound Energy, a half-owner of Colstrip 1 and 2, to set aside certain funds to pay for costs of shutting down the two plants – and possibly shield their customers from those costs.

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Puget Sound officials have said no decision has been made on whether to close the Montana plants.

But a spokeswoman for coal and supporting business interests in Montana told MTN News Monday the law clearly a move by coal-power opponents to pressure Puget Sound Energy to close the two older Colstrip plants

“What the bill does most in Montana is make very uncertain whether or not Colstrip can continue to survive,” said Shelby DeMars of Count on Coal Montana, an industry and business group. “It puts all of those jobs and the economic opportunity that the plants provide in jeopardy. What it ultimately does is continue the hostile environment in which these coal companies have to operate.”

The new Washington law, barely longer than a single page, says the Washington commission that regulates utilities can allow Puget Sound Energy to set up a special “retirement account” to pay for the costs of shutting down and cleaning up the two older Colstrip plants.

Colstrip plants 3 and 4 would not be eligible, because they were built after 1980.

Puget Sound would have to request to set up that account – and the Washington Utilities and Transportation Commission would have to decide that the proposed closure costs are “prudent,” before allowing the account and whatever revenue flows into it.

A UTC spokeswoman said Monday that any request would be within a general rate case next January.

Colstrip 1 and 2 provide about 20 percent of the power that Puget Sound Energy uses to supply its 1.1 million customers in western Washington.

Hedges said Puget Sound realizes that coal-fired power has fallen out of favor and is doing the responsible thing, by planning for how to pay for possible closure costs.

“We wish that every owner at Colstrip was doing the same thing and setting aside the money to clean the site up,” she said. “And our politicians would be better-served if they figured out how to diversify the economy in Colstrip rather than just letting it continue to be a one-horse town that is solely reliant on coal-fired power plants.”

The owner of the other half of Colstrip 1 and 2 is Talen Energy, which sells electricity on the wholesale market, including large industrial customers in Montana.

Opponents of any closure have said those customers will be scrambling to buy power if Colstrip 1 and 2 are closed, and may end up paying more.

Hedges said she thinks the industrial customers will be able to find affordable sources of power.

Thor Nelson, a Denver attorney representing the large customers, said Monday he’s not aware that they’ve specifically analyzed the impact of a Colstrip closure.

But they do want as much competition as possible in the wholesale market, and the closure of Colstrip plants would reduce that competition, he said.

DeMars said it’s time for Montana policymakers to get “proactive,” rather than reactive, and take steps to help promote coal in Montana and protect the Colstrip plants, which provide hundreds of direct jobs and thousands more of indirect jobs.



Reporter: Mike Dennison