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NorthWestern, Missoula ink agreement on street light conversion; ongoing costs still an issue

NorthWestern, Missoula ink agreement on street light conversion; ongoing costs still an issue
Posted at 2:33 PM, May 14, 2020
and last updated 2020-05-14 16:33:32-04

NorthWestern Energy will begin converting its street lights in Missoula with energy efficient LEDs under an agreement approved Wednesday by members of the City Council.

While the conversion will save the city nearly $80,000 annually in electrical costs, issues over recurring payments and uncertain rate adjustments remain a concern.

Jeremy Keene, director of Public Works for the city, said Missoula’s 59 active street lighting districts were created between 1912 and 1995. They’ve seen little change over the years and no new districts have been created in more than 20 years.

In the past, members of the City Council have expressed concerns over the districts and the lights within them, including lighting quality and location. In some cases, the street lights aren’t compliant with Missoula’s dark skies ordinance and they don’t improve public safety.

“There’s also a lot of concern that we’re paying too much,” Keene said Wednesday. “These districts have been around for a long time. We’ve paid the same rates for many, many years and most likely, we’ve paid back the capital costs of those districts many times over.”

While that issue must be corrected at the legislative level, Keene said, the LED conversion marked a good starting point, and the city’s agreement with NorthWestern sets the groundwork.

The utility has begun changing out street lights across the state as part of a larger $24 million project. It plans to retrofit 43,000 high-pressure sodium lights with LEDs.

The new lights use 50% less electricity and last longer than their sodium predecessors. NorthWestern owns 1,800 street lights in Missoula and roughly 600 lights in Missoula County.

“All of this is done with no up front costs,” said Keene. “We’ll see the immediate savings from those more efficient fixtures. They’ve given us estimates that the districts within the city and county could save as much $96,000 a year.”

NorthWestern’s capital investment will likely be recovered in future rate adjustments.

While the changeover helps meet the city’s goals to reduce energy consumption, it doesn’t address lingering concerns about paying for the street lights in perpetuity.

“It’s been an ongoing topic on City Council for many years now, that we basically rent the lights and have paid for them many times over,” said council member Gwen Jones.

Keene said that’s a state issue that would require changes at the Legislature. The city has offered to purchase the local system from NorthWestern, though the utility declined to sell it.

“Our takeaway from this is that we’d be better off doing our own lighting, and owning and maintaining it ourselves,” said Keene. “That way we can recapture the cost to install lighting and we don’t have to pay it back multiple times over time. The trouble with that is that its hard to do, and we’re not in a position right now where we can go relight the whole city. That’s a major lift.”