Members of the Montana Public Service Commission met with Northwestern Energy staff at a May 6th meeting where utility representatives talked more about their plans to decrease wildfire risk.
From installing technology for early detection to shutting down the power grid as a last resort, Northwestern Energy staff told regulators on the Montana Public Service Commission that the company has a range of protocols prepared for addressing wildfire.
“We've been dealing with wildfire for as long as we've been in business,” said NorthWestern Energy CEO Brian Bird.
But an aspect Bird told commissioners Northwestern Energy is struggling to navigate is liability insurance.
“Matter of fact, one of the issues for us too, from a rising cost perspective, is it's difficult to even get insurance coverage from a wildfire perspective and we continue to work with our carriers on this particular issue coming up in a renewal,” said Bird.
Liability insurance can help protect utility companies, like Northwestern Energy, if they are determined responsible for the outbreak of a wildfire. That happened in Texas when it was determined the state’s largest wildfire in history was sparked by equipment from Xcel Energy. Another example comes from California, where Pacific Gas & Electric has paid hundreds of millions of dollars for wildfires started from downed power lines and faulty infrastructure.
NorthWestern Energy too has been a defendant in lawsuits from residents in Fergus County who say the company’s power lines led to the wildfire that blazed through Denton in 2021 and burned their properties.
Bird told commissioners the cost of insurance is only increasing, and utility companies need help from the state and federal government to mitigate wildfire risk.
“I think insurance companies are looking at two things,” Bird said. “What's the risk of a wildfire in that particular state, and what are the policies from a legislative standpoint, and how is the judiciary treating such policies?”
Bird declined to say during the public meeting how much NorthWestern pays in premiums for liability insurance.
Yellowstone Public Radio emailed NorthWestern Energy to ask about how much insurance premiums have increased and impacts to customers. A spokesperson responded, “Insurance [rates] are among the costs included in regulatory rate reviews. NorthWestern Energy works to manage all costs.”
The entire meeting between NorthWestern Energy and Montana Public Radio is archived here. You can read NorthWestern Energy’s 2024 wildfire mitigation plan on the company’s website.
