Montana Public Service Commission approves NorthWestern Energy, Black Hills Corp. merger

The Montana Public Service Commission approved the $15.4 billion NorthWestern Energy and Black Hills Corp. merger on Tuesday.

The new company, once merged, will serve 2.1 million electric and natural gas customers in Montana, Arkansas, Colorado, Iowa, Kansas, South Dakota, Nebraska and Wyoming.

In a split vote, the PSC supported the deal, with Commissioner Randy Pinocci in opposition and PSC President Jeff Welborn a “reluctant” no.

Commissioners Jennifer Fielder, Annie Bukacek and Kirk Bushman voted yes.

Montana is the last state that needed to vote on the deal, announced in August 2025. South Dakota and Nebraska regulators already approved it, and NorthWestern said it has secured federal regulatory approvals.

In a statement, Northwestern spokesperson Jo Dee Black said company officials will review the order, and they continue to believe the merger is in the interest of customers.

“If completed, the merger will position us to successfully continue delivering safe, reliable and affordable energy to the communities we serve with expanded scale, strong local roots and a shared commitment to service,” Black said.

Once the deal closes, Black Hills will be called Bright Horizon Energy, and NorthWestern Energy will be its wholly owned subsidiary.

Bukacek said staff had addressed every conceivable argument against the merger — legal, regulatory and emotional.

“If we disregard the joint applicants’ satisfaction of the legal standards, the PSC will not have a legal leg to stand on,” Bukacek said.

But Pinocci said he’s worried Black Hills, based in South Dakota, has more to gain from the merger than Montanans, and the deal didn’t address people’s top concern.

“What are we going to do about lowering the rates for the people?” Pinocci said.

Fielder, who made the motion to approve the merger, said evidence shows the merger will mean “tens of millions of dollars in savings” for the companies.

“Those savings are savings that get passed onto the customers,” Fielder said. “Those are costs the customers will not have to pay.”

The approved order said rates will not increase as a result of the merger.

Most members of the public voiced opposition to the merger prior to the decision, citing concerns about increases in power bills, loss of utility oversight, and subsidizing energy and infrastructure for data centers.

Jan Hoem, of Missoula, said if the merger goes forward, the PSC should support a fixed rate for two years to protect customers from price volatility, as Nebraska had done.

Hoem said the costs of data centers also should be isolated from residents and small businesses.

“Your job is to see that we, the captive customers, get a fair shake,” Hoem said. “We’re counting on you.”

Patrick Sheehy, of Billings, said he’s a senior citizen and lives on a fixed income.

Sheehy said he lives in a condo and can’t put up solar panels to try to mitigate rate increases, and he asked for protections for consumers.

“I am very concerned that in the long run, this merger is going to result in ratepayers like me paying exorbitant sums of money to NorthWestern Energy,” Sheehy said.

But representatives from the business community said Montana’s economy needs power, and the merger was important to economic growth.

“It’s going to be critical for increased investment in this state and for recruiting businesses into the state of Montana,” said Todd O’Hair, of the Montana Chamber of Commerce. “It’s also going to be critical for the businesses that are currently operating in the state of Montana.”

In defending the deal, Fielder said pushback against data centers in relation to the merger was misplaced, and the PSC would deal with large loads in a separate case.

The order said the commission determined “ring-fencing,” or safeguards that separate the utility from its parent company, were adequate to insulate NorthWestern’s customers from financial risks of the parent company and affiliates.

Fielder said the Montana Consumer Counsel and Large Customer Group, a participant in the case representing industrial customers, negotiated even stronger safeguards for consumers as part of the merger.

On Oct. 27, the Public Service Commission voted 3-2 to delay a decision on the merger after Fielder said she had an amendment to propose.

Tuesday, Fielder proposed two conditions to the merger, and the PSC voted 3-2 to approve them, with Bukacek and Welborn in opposition.

One condition directs NorthWestern to submit a plan to the PSC by June 2027 to evaluate whether a portion of generation the utility acquired at the Colstrip Power Plant could be available to Montana customers as “a potential least cost electricity supply resource.”

In 2024, NorthWestern announced it would acquire Puget Sound Energy’s 370 megawatts at Colstrip, and the additional power would benefit customers. But NorthWestern later said the shares would be placed into a subsidiary outside the control of regulators.

The second condition directs NorthWestern to analyze adding the Puget shares to its energy portfolio as part of the 2026 Integrated Resource Plan. The plan is a roadmap for meeting future energy demand.

The order said the Public Service Commission found the merger will benefit customers because the new company will be more resilient in the face of volatility.

“Doubling of scale will make the combined companies financially stronger and enable the merged company to procure goods and services at lower cost,” the order said.

It said credit agencies had a positive response to news of the possible merger.

In explaining his vote against the merger, Welborn said he didn’t see evidence the merger would create an advantage or disadvantage for Montana.

“I don’t see where there’s a clear benefit to advance the public’s interest here,” Welborn said.

Some members of the public likened the merger to the deregulation of Montana Power Company in 1997, which resulted in a broken up company, lost pensions and higher costs to consumers.

But Bushman said the deregulation argument confused him.

“Montana Power was the breakup of a regulated utility sold off to the public or to private companies,” Bushman said. “This is quite the opposite. It’s putting Humpty-Dumpty back together again.”

In the discussion about conditions, the PSC closed the meeting temporarily for legal counsel to respond to a question from Pinocci about potential litigation.