Council authorizes settlement agreement on Northwestern Energy natural-gas delivery rates

The City Council on April 1 adopted a resolution authorizing a settlement agreement with Northwestern Energy on new natural-gas delivery rates. The council’s action approves the negotiated settlement reached through direct talks between affected municipalities and Northwestern Energy and authorizes city staff to complete related steps and execute the settlement documents.

The city attorney summarized the negotiation: Northwestern initially filed to recover roughly $3.5 million in additional rate recovery. Direct municipal negotiations and the work of an outside rate expert reduced that request to just over $2.4 million, a net reduction of about $1.1 million from the utility’s initial filing. The city attorney said he could not find a precise percentage breakdown in the available documents; the original $3.5 million figure corresponded in Northwestern’s initial filing to an estimated 7.44% residential increase and a 3.66% commercial increase, and the negotiated amount will be lower than those percentages but the exact split between residential and commercial customers was not specified in the council packet.

The settlement also includes language to continue a separate economic-development incentive fund from Northwestern Energy, estimated in discussion at about $58,000 per year to the city. Council members emphasized that the negotiated recovery is for delivery and distribution charges — the fee for delivering gas to customers — and not the commodity cost of gas itself, which is priced as a separate, market-driven component on customers’ bills.

Councilmember Lucas moved adoption of the resolution; Councilmember Garrick seconded. The resolution passed, and staff was authorized to finalize any remaining settlement language and submit the agreement to the Nebraska Public Service Commission for its review and approval. The attorney noted the Public Service Commission retains final authority and has been involved in the process.

Council members praised the negotiation and the outside expert that reviewed the utility’s filings. "You reduced our cost by a third," one council member said in thanks to the attorney and negotiating team. The attorney said the negotiated result protected the city’s interest in maintaining the economic-development fund while lowering the company’s requested recovery.

The resolution does not itself change customer bills. Any rate changes will become final only after review and approval by the Nebraska Public Service Commission; the council’s vote authorizes the city to support and execute the municipal-level settlement reached in negotiations.