Towards Technological Development

Bob Rowe | President, NorthWestern Energy 

To really understand Montana you have to understand the physical geography, the diversity of the place we live and our spirit of idealism.

But you also have to understand the people who founded Montana, who created its communities, its culture, and its economy. Obviously starting with the First Nations people from whom we still benefit so much today. Add to that the immigrants from Northern European countries such as Yugoslavia, Germany, Ireland (one of my own grandfathers came from Cornwall). Add to that the Southern Europeans from Italy and elsewhere. The Chinese who came here, free slaves, former soldiers from both the Union and Confederate army, everyone coming here to pursue their own dream, to pursue opportunity, and creating the rich, diverse, culture that we see in so many of our towns. What we’ve inherited from them is just a tremendously rich culture and a diverse economy.

To understand Montana, you can’t focus on one slice; you have to think about all parts of the state.

Providing utility service is a very complicated undertaking. You can think of it starting from the generation of energy, whether it is in the gas fields or at a power plant, down through transmission and distribution, to the important customer service aspects as well.

Starting on the electrical generation component, we’ve been in the process at NorthWestern Energy of rebuilding a diversified portfolio intended to provide stable, adequate, and diverse energy services to our customers for years to come. To some extent we’re trying to reverse some of what we would consider to be challenges of the past going through the supply deregulation era. We’re bringing in not just traditional resources such as our ownership at one of the cleanest coal plants in the U.S. at Colstrip 4, but also large amounts of renewables. In fact we’re bringing on roughly the same amount of renewable energy as what we own at Colstrip. We’re also incorporating energy efficiency into what we offer. On an annual basis we achieve, each year, the equivalent electricity to power about 8,000 homes. If you think about that, we’re working with our customers to save what would be the equivalent of a new, pretty good sized town being developed in Montana each year. That is a good energy resource. Just as importantly, though, it is an opportunity to work with our customers whether residential, public sector, or private sector, to help them achieve higher quality, better energy services and manage their overall costs.

That is the first piece, the energy itself.

Secondly, we have our transmission system. That is the high powered electric lines and also high pressure gas lines. In Montana, because we are a very dispersed state, we operate about 7,000 miles of electric transmission and around 2,000 miles of natural gas transmission connecting most of the state. We interconnect with five other major utilities and we have responsibility in keeping that entire system in balance. We have experts, engineers, linemen, and gasmen focused on maintaining that system.

Next we have the distribution system. That is the low pressure gas lines, the low voltage electric lines, and again in Montana, an especially rural state, it is pretty challenging territory to build and maintain a system. We actually have on the electric side right around 18,000 miles of distribution lines. There is no challenge, no commitment more important to us than investing in all of those local systems, the systems that connect most of you, both gas and electricity. That is a commitment we take very seriously.

We are planning long term to ensure that the service you receive is not only as safe as possible, but will be robust and reliable for years to come as our communities continue to grow and diversify.

One of the exciting things we’ve been working on for a number of years is creating a vision for our distribution system to match the vision on the supply side or the focus on energy efficiency. In doing that we’ve engaged most all of the employees in our distribution system. We’ve also met in a very in depth basis with our customers in communities all across our Montana service territory to ask them what kinds of service do you expect from your utility? What are the kinds of activities you expect to engage in? What are your needs, either as a family or as a business?

Just as important as supply, transmission, and distribution, though, are our investments in technology. We’re probably one of the largest technology companies in Montana. There is technology embedded in basically every part of our operation, and we’re very actively exploring what new investments make the most sense for our customers.

At NorthWestern we’ve been serving Montana for over a century. I came on board in 2008, and early in my tenure I asked our employees, who’d been through quite a lot over the years, to come together to help us design a vision for our future as a company. This is what our employees helped to write. This is our vision:

“Enriching lives through a safe, sustainable energy future.”

And this is our mission that we developed based on that vision:

“Working together to deliver safe, reliable, and innovative energy solutions that create value for customers, communities, employees, and investors.”

Every word in that mission is important. The idea of working together is vital. We do complicated work, and no one person can do it by themselves. We do work that is technical and requires a tremendous focus on safety. Together this mission represents the focus of NorthWestern.

When I read our vision and mission statement, you heard the word sustainability. Our vision is to be a sustainable company. Often when you think of sustainability you’re thinking of how much you put into the waste stream or whether you’re environmentally minded in your daily practices. For a utility you think about the diversity of its supply portfolio, the robustness of its energy efficiency programs. All of these are part of it. When we use the term sustainability at NorthWestern we include that definition and we also include whether or not we are walking the talk in our own facilities across the state. But particularly we’re asking ourselves whether or not we have a sustainable business model, whether or not we have a sustainable culture. Are we, as a company, focused on making the right decisions, taking the right actions now, to ensure that we’re still able to provide great service decades into the future? That involves financial discipline, good corporate governance, engagement with our customers and our stakeholders, and the commitment that we make to our employees day in and day out.

You may have heard of the expression of the triple bottom line. That is the notion that a company really does its best when it is focused on economic sustainability, environmental responsibility, and on commitment to community. That is going to look different for every company, and it is an area where that can be plenty of room for respectful disagreement about what the right direction and right balances are. But the idea of bringing together those three things—focused on service to our customer, being rigorous in what we do from a corporate control and finance perspective, and serious about our commitment to the environment—is exactly where we want to be.

We think about sustainability at NorthWestern every day. As you think about sustainability there are a couple of questions to consider:

Most fundamentally, what are your expectations of NorthWestern Energy as your utility?

What role do you expect NorthWestern to play in your local community?

And ultimately, what are your definitions of sustainability, in particular your definition of sustainable utility service, looking not just over the next several years but looking decades into the future?