Concern Expressed Over MDU Rate Hikes

A little over two dozen local residents concerned over the proposed rate increases from Montana-Dakota Utilities gathered at the Glendive Public Library on May 4 to learn more about what they could do to try and prevent the proposal from going through. The town hall-style meeting was hosted by the Dawson Resource Council, which has been advocating against the rate increases.

MDU proposed electrical rate increases to the Public Service Commission in December, requesting to increase rates for residential, small business and large business customers by 19.2%, 15.1% and 12.9%, respectively. By the company’s own calculation, these increases would result in a yearly bump of $200 on average to residential customers.

These rates would also be on top of rate increases that occurred in 2019 and 2020. With these increases combined, DRC Chairwoman Melissa Holt pointed out that MDU would be getting roughly $10.5 million out of eastern Montana annually. She also noted that these proposed increases are coming at a time when the company is seeing record profits, adding emphasis that the resource council’s frustration is with MDU’s corporate executives, not local employees.

“Based on the rate increases, you’d think that the company is barely making ends meet. However, while many of our country’s industries are feeling the blows of inflation, MDU is not one of them. Its parent company, MDU Resources, saw $1.2 billion in profits over the past four years, with the utility alone raking in record earnings of $103.5 million in 2021. If you combine the two recent rate increases, it will be more than double the national average rate increase in electricity prices over the same period,” Holt said.

In a statement, MDU explained the proposed rate increase as necessary to combat inflationary cost and the rising costs of doing business.

“The main reasons for the increase request are because of increased investments since 2018, including an 88-megawatt simple cycle combustion turbine, the associated depreciation with the increased investments, and increases in property taxes, labor, software maintenance expenses, insurance expenses and other recent inflationary increases,” the company’s statement reads.

Those who would likely be most affected by the increase are raising alarms that the increased price of utilities could have severe implications for their standard of living and well-being. Jen Hawkinson, local office manager of Living Independently for Tomorrow and Today (LIFTT), pointed out that the proposed increases could heavily impact the people they serve, making it more difficult to provide the aid those people need.

LIFTT works to assist people with disabilities live independently, with Hawkinson explaining that the organization defines a disability as anything that has a major impact on your life, physical or mental, diagnosed or not. Because of this, many of their clients are on low-income already, so seeing a significant increase in their utility bills could be detrimental to their ability to live independently.

Further, she noted that the increase will impact LIFTT itself directly, since it would be affected by the increase for small business. Since the organization is a non-profit that relies primarily on grant funding, its funding is already fairly limited, so an increase in expenses could make fulfilling its mission even more difficult.

“This increase would absolutely be devastating,” she said. “It is going to have a huge impact on not just our community, but the communities around us.” Another member of the audience, Tavri Ward, expressed her concern that people with young kids, like herself, who are already struggling to pay bills will be severely affected by the proposed rate increase. With her emotions on the brink of taking over her testimony, she laid all of the expenses parents face that will likely become more burdensome if the rate increases are approved.

“I think it’s going to be really hard with people with young kids. Formula is really expensive, it’s really hard paying for food for your kids and having to pay rent, it’s hard and it really sucks when you’re whole paycheck goes to everything,” Ward said.

Though the meeting was open to the public, no representatives for MDU were present to speak on behalf of the company, so the audience in attendance was overwhelmingly opposed to the rate increases. The meeting ended with the audience writing letters to the PSC and PSC Commissioner Randy Pinocci, who represents Eastern Montana, encouraging the commission to reject MDU’s proposal.

Prior to the town hall meeting in Glendive, the DRC hosted a similar meeting in Miles City on May 3. Over 50 people attended the Miles City meeting, again largely being against the proposed increases.