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Montana PSC Adopts Rules Implementing HB 55, Requiring an IE for Resource Procurements

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On June 19, 2026, the Montana Public Service Commission (MPSC) adopted rules related to the procurement of resources by regulated electric utilities in Montana.  The rulemaking in Docket No. 2025.08.058 implemented House Bill 55 (HB 55) from the 2025 legislative session and amended the Administrative Rules of Montana (ARM) 38.5.2020 through 38.5.2025 pertaining to utility least cost planning and competitive solicitations, and implemented three new rules (ARM 38.5.2026 through 38.5.2028) pertaining to an independent evaluator for the competitive solicitation process.

HB 55 developed out of the Select Committee on Energy Resource Planning and Acquisition (SCERPA) during the 2023-2024 interim legislative session and builds upon the competitive procurement requirements from House Bill 597 (2019).  The subsequent rulemaking, which was required to be completed by July 1, 2026, and made several updates to the rules.  First, as required in HB 55, the new rules require the use of an independent evaluator to provide feedback to the MPSC on the draft request for proposal (RFP) and scoring of bids in response to the final RFP.  Second, the rules require the use of a third-party administrator when a utility owned resource is a possible outcome of the competitive solicitation.  Third, the rules establish the mechanism for the selection of the independent evaluator, the independent evaluator’s scope of work, and the utility’s obligations in working with the independent evaluator.  The MPSC will maintain a list of qualified independent evaluators, and require the selection of the independent evaluator within 30 days after the utility files its intent to issue a competitive solicitation.  The utility’s notice of intent to issue a competitive solicitation must occur no less than 90 days prior to the release of the final RFP. 

Sanger Greene (Irion Sanger and Diego Rivas) represented the Northwest & Intermountain Power Producers Coalition (NIPPC) through the rulemaking process.  NIPPC represents electricity market participants in the Pacific Northwest, including independent power producers, electricity service suppliers, and transmission companies.  NIPPC is committed to facilitating cost-effective electricity sales, offering consumers choices in their energy supply, and advancing fair, competitive power markets.

The Montana Supreme Court Rules Against the Montana Commission’s Approval of Shorter Contract Terms and Lower Avoided Cost Prices

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On August 24, 2020, the Montana Supreme Court ruled against the Montana Public Service Commission’s (Montana Commission) actions to reduce avoided cost rates and shorten contract terms for power purchase agreements between the utilities and solar Qualifying Facilities (QFs). The ruling is a victory for renewable energy developers and advocates, as it upheld an integral piece of the Public Utility Regulatory Policy Act of 1978’s (PURPA) that encourages QF development.

Montana District Court Reverses Public Service Commission on PURPA

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On June 18, 2019, a Montana State District Court reversed the Montana Public Service Commission (Commission or MPSC), finding that MTSUN, a qualifying facility under the Public Utility Regulatory Policies Act (PURPA), was entitled to a 25-year contract to sell its energy and capacity to NorthWestern Energy. The case was heard before the same Judge that decided the QF-1 docket on April 2, 2019 and to a large degree the decision is the same. 

Montana District Court Finds that Public Service Commission Acted Arbitrarily and Unreasonably

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On April 3, 2019, a Montana District Court Judge, Judge Manley, issued an order reversing the Montana Public Service Commission’s (“Montana Commission”) orders 7500c and 7500d that cut Public Utility Regulatory Policies Act (“PURPA”) standard avoided cost prices and contract lengths for qualifying facilities (“QFs”) offered by Montana utility NorthWestern Energy (“NorthWestern”).