NorthWestern Energy Group, Inc.
For the period ended Jun 30, 2025. Filed Jul 31, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 31, 2025
NWE$82.73+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-30.
0001993004-25-000084
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-31.
0001993004-25-000121
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 139 previous paragraphs and 172 current paragraphs.
101 unchanged; 30 reworded; 29 added; 8 removed; 0 previous and 12 current paragraphs rearranged.
Tables are not compared: 20 previous and 33 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (29)
Current report
Consolidated net income for the three months ended June 30, 2025 was $21.2 million as compared with $31.7 million for the same period in 2024. This decrease was primarily due to lower retail natural gas and electric usage primarily driven by weather, Montana property tax tracker collections, non-recoverable Montana electric supply costs, depreciation, operating, administrative and general costs, and interest expense. These were partly offset by higher retail rates, higher electric transmission, and natural gas transportation revenues.
Current report
The details of our filing request, as adjusted in rebuttal testimony are set forth below:
Current report
(1) These electric interim rates were effective December 1, 2024, through May 22, 2025. See further discussion on revised electric interim rates below.
Current report
(2) These natural gas interim rates were effective December 1, 2024, and are expected to remain in effect until the MPSC final order rates are effective.
Current report
(1) We implemented these electric rates on July 2, 2025, on an interim basis, subject to refund.
Current report
On May 23, 2025, as permitted by Montana statute, we implemented our initially requested electric rates, reflecting a base rate revenue increase of $156.5 million, on an interim basis, subject to refund with interest. Within our June 30, 2025 financial statements, we have deferred base rate revenues collected between May 23, 2025, and June 30, 2025, down to our requested revised electric interim rates of $110.3 million as shown within the above table. As of June 30, 2025, we have deferred approximately $3.5 million of base rate revenues collected. On June 20, 2025, we submitted the revised electric interim rates as shown within the above table to the MPSC for approval. The MPSC subsequently approved this request and the rates were implemented on July 2, 2025.
Current report
As discussed above, if the MPSC chooses to accept the intervenors positions on the remaining contested issues or does not accept the Settlement Agreements in its final order, losses related to excess interim revenues collected will be incurred. Additionally, any difference between interim and final approved rates will be refunded to customers with interest. However, if final approved rates are higher than interim rates, we will not recover the difference.
Current report
Nebraska Natural Gas Rate Review - In June 2025, the NPSC approved a settlement agreement increasing base rate annual revenue by $2.4 million and final rates were implemented on July 1, 2025.
Current report
Montana Data Centers
Current report
In July 2025, we entered into a nonbinding letter of intent with Quantica Infrastructure to evaluate the transmission infrastructure and generation resources needed to support their proposed Phase 1 need of 5 megawatts in 2026 with growth up to 500 megawatts by 2030. This is our third signed letter of intent for data center load growth. In December 2024, we announced two separate nonbinding letters of intent to provide electric supply services for data centers being developed in Montana with a combined energy service requirement expected to be 75 megawatts beginning in early 2026 with growth of up to 400 megawatts or more by 2030. We anticipate that service could be provided through our regulated business, pending further evaluation and regulatory considerations.
Current report
Montana Electric Transmission Construction
Current report
In May 2025, Senate Bill 301 was passed by the Montana Legislature with unanimous bipartisan support and signed into law. The intention of this bill is to expedite and streamline the process for a public utility to construct electric transmission lines to serve the increasing demand for electricity, enhance grid reliability, and address current transmission congestion within Montana. This bill allows a public utility to request a Certificate of Public Convenience & Necessity for electric transmission lines rated higher than 69 kilovolts from the MPSC and also provides a process for a public utility to apply for advanced cost approval of electric transmission lines and related facilities before actual construction begins.
Current report
Colstrip Acquisitions and Requests for Cost Recovery
Current report
As previously disclosed, we entered into definitive agreements with Avista Corporation (Avista) and Puget Sound Energy (Puget) to acquire their respective interests in Colstrip Units 3 and 4 for $0 and expect to complete these acquisitions on December 31, 2025. Accordingly, we will be responsible for associated operating costs on January 1, 2026. Puget and Avista will remain responsible for their respective pre-closing share of environmental and pension liabilities attributed to events or conditions existing prior to the closing of the transaction and for any future decommissioning and demolition costs associated with the existing facilities that comprise their interests. During the second half of 2025 we intend to make filings with the MPSC and FERC associated with these transactions, including recovery of incremental operating costs.
Current report
Consolidated net income for the three months ended June 30, 2025 was $21.2 million as compared with $31.7 million for the same period in 2024. This decrease was primarily due to lower retail natural gas and electric usage primarily driven by weather, Montana property tax tracker collections, non-recoverable Montana electric supply costs, depreciation, operating, administrative and general costs, and interest expense. These were partly offset by higher retail rates, and higher electric transmission and natural gas transportation revenues.
Current report
Consolidated other income was $0.1 million for the three months ended June 30, 2025 as compared with $6.2 million for the same period of 2024. This decrease was primarily due to lower capitalization of AFUDC, a decrease in the value of deferred shares held in trust for deferred compensation, higher non-service component pension expense, and a $1.0 million expense accrual related to an estimated penalty for the previously disclosed Community Renewable Energy Project (CREP) informed by a recent MPSC ruling.
Current report
Consolidated net income for the six months ended June 30, 2025 was $98.2 million as compared with $96.7 million for the same period in 2024. This increase was primarily due to higher retail rates, higher electric transmission, higher retail electric usage primarily driven by weather, and Montana natural gas transportation. These were offset in part by Montana property tax collections, non-recoverable Montana electric supply costs, depreciation, operating, and administrative and general costs, and interest expense.
Current report
Consolidated gross margin for the six months ended June 30, 2025 was $260.9 million as compared with $235.4 million in 2024, an increase of $25.5 million, or 10.8 percent. This increase was primarily due to higher retail rates, higher electric transmission, higher retail electric usage primarily driven by weather, and Montana natural gas transportation. These were offset in part by Montana property tax tracker collections, non-recoverable Montana electric supply costs, depreciation, and operating and maintenance expenses.
Current report
Consolidated utility margin for the six months ended June 30, 2025 was $595.9 million as compared with $544.1 million for the same period in 2024, an increase of $51.8 million, or 9.5 percent. Primary components of the change in utility margin include the following (in millions):
Current report
Electric retail volume impact was due to higher residential usage in all jurisdictions due to favorable weather, higher commercial demand in Montana, and customer growth in all jurisdictions, partly offset by lower commercial demand in South Dakota, and lower industrial demand. Natural gas retail volumes were impacted by favorable weather in all jurisdictions and customer growth in all jurisdictions.
Current report
Under the PCCAM, net supply costs higher or lower than the PCCAM Base (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the six months ended June 30, 2025, we under-collected supply costs of $31.6 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $3.5 million (10 percent of the PCCAM Base cost variance). For the six months ended June 30, 2024, we under-collected supply costs of $16.1 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $1.8 million (10 percent of the PCCAM Base cost variance).
Current report
Consolidated operating income for the six months ended June 30, 2025 was $185.5 million as compared with $163.7 million in the same period of 2024. This increase was primarily due to higher retail rates, higher electric transmission, higher retail electric usage primarily driven by weather, and Montana natural gas transportation. These were offset in part by Montana property tax collections, non-recoverable Montana electric supply costs, depreciation, and operating, administrative and general costs.
Current report
Consolidated income tax expense for the six months ended June 30, 2025 was $18.6 million as compared to $14.6 million in the same period of 2024. Our effective tax rate for the six months ended June 30, 2025 was 15.9% as compared with 13.1% for the same period in 2024.
Current report
Electric retail volume impact was favorable due to higher residential usage in all jurisdictions due to favorable weather, higher commercial demand in Montana, and customer growth in all jurisdictions, partly offset by lower commercial demand in South Dakota, and lower industrial demand.
Current report
Under the PCCAM, net supply costs higher or lower than the PCCAM Base (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the six months ended June 30, 2025, we under-collected supply costs of $31.6 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $3.5 million (10 percent of the PCCAM Base cost variance). For the six months ended June 30, 2024, we under-collected supply costs of $16.1 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $1.8 million (10 percent of the PCCAM Base cost variance).
Current report
(1) Exclusive of depreciation and depletion.
Current report
Lower retail volumes were driven by unfavorable weather in all jurisdictions, partly offset by customer growth in all jurisdictions.
Current report
(1) Exclusive of depreciation and depletion.
Current report
Higher retail volumes were driven by favorable weather in all jurisdictions and customer growth in all jurisdictions.
Removed paragraphs (8)
Previous report
Consolidated net income for the three months ended March 31, 2025 was $76.9 million as compared with $65.1 million for the same period in 2024. This increase was primarily due to rates, electric retail volumes, natural gas retail volumes, electric transmission revenues, and natural gas transportation revenues. These were offset in part by Montana property tax tracker collections, depreciation, interest expense, and operating, administrative and general costs.
Previous report
The details of our rebuttal request are set forth below:
Previous report
Revised interim filing rates are requested to be effective May 1, 2025. If the revised interim rates are not approved, and a final order is not received by May 23, 2025, which is 270 days from acceptance of our filing, we intend to implement, as permitted by Montana statute, our rebuttal rates, which will be subject to refund, until a final order is received.
Previous report
Nebraska Natural Gas Rate Review - In April 2025, we reached a settlement agreement with certain parties for a base rate annual revenue increase of $2.4 million. This settlement agreement is subject to approval by the NPSC. Interim rates, which have reflected an annual revenue increase of $2.3 million, will remain in effect on a refundable basis until the NPSC issues a final order.
Previous report
Consolidated net income for the three months ended March 31, 2025 was $76.9 million as compared with $65.1 million for the same period in 2024. This increase was primarily due to rates, electric retail volumes, natural gas retail volumes, electric transmission revenues, and natural gas transportation revenues. These were offset in part by Montana property tax tracker collections, depreciation, interest expense, and operating, administrative and general costs.
Previous report
(1) Montana electric and natural gas heating degree days may differ due to differences in service territory.
Previous report
(1) Montana electric and natural gas heating degree days may differ due to differences in service territory.
Previous report
Higher retail volumes were driven by favorable weather and customer growth in all jurisdictions.
Reworded paragraphs (30)
Previous wording
NorthWestern Energy Group, doing business as NorthWestern Energy, provides electricity and/or natural gas to approximately 809,000 customers in Montana, South Dakota, Nebraska and Yellowstone National Park. Our operations in Montana and Yellowstone National Park are conducted through our subsidiary, NW Corp, and our operations in South Dakota and Nebraska are conducted through our subsidiary, NWE Public Service. For a discussion of NorthWestern’s business strategy, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in the NorthWestern Energy Group Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
NorthWestern Energy Group, doing business as NorthWestern Energy, provides electricity and/or natural gas to approximately 842,100 customers in Montana, South Dakota, Nebraska and Yellowstone National Park. Our operations in Montana and Yellowstone National Park are conducted through our subsidiary, NW Corp, and our operations in South Dakota and Nebraska are conducted through our subsidiary, NWE Public Service. For a discussion of NorthWestern’s business strategy, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in the NorthWestern Energy Group Annual Report on Form 10-K for the year ended December 31, 2024.
Previous wording
As you read this discussion and analysis, refer to our Condensed Consolidated Statements of Income, which present the results of our operations for the three months ended March 31, 2025 and 2024.
Current wording
As you read this discussion and analysis, refer to our Condensed Consolidated Statements of Income, which present the results of our operations for the three and six months ended June 30, 2025 and 2024.
Previous wording
HOW WE PERFORMED AGAINST OUR FIRST QUARTER 2024 RESULTS
Current wording
HOW WE PERFORMED AGAINST OUR SECOND QUARTER 2024 RESULTS
Previous wording
Montana Rate Review - In July 2024, we filed a Montana electric and natural gas rate review with the Montana Public Service Commission (MPSC). In November 2024, the MPSC partially approved our requested interim rates effective December 1, 2024, subject to refund. Subsequently, we modified our request through rebuttal testimony. In March 2025, we filed a natural gas settlement with certain parties and a motion for revised interim natural gas rates. In April 2025, we filed a partial electric settlement with certain other parties and a motion for revised interim electric rates. Both settlements and motions for revised interim rates are subject to approval by the MPSC.
Current wording
Montana Rate Review - In July 2024, we filed a Montana electric and natural gas rate review with the MPSC. In November 2024, the MPSC partially approved our requested interim rates effective December 1, 2024, subject to refund. Subsequently, we modified our request through rebuttal testimony. In March 2025, we filed a natural gas settlement with certain parties. In April 2025, we filed a partial electric settlement with certain other parties. Both settlements are subject to approval by the MPSC.
Previous wording
The partial electric settlement includes, among other things, agreement on base revenue increases (excluding base revenues associated with YCGS), allocated cost of service, rate design, updates to the amount of revenues associated with property taxes (excluding property taxes associated with YCGS), regulatory policy issues related to requested changes in regulatory mechanisms, and agreement to support a separate motion for revised electric interim rates. The partial electric settlement provides for the deferral and annual recovery of incremental operating costs related to wildfire mitigation and insurance expenses through the Wildfire Mitigation Balancing Account.
Current wording
(excluding property taxes associated with YCGS), regulatory policy issues related to requested changes in regulatory mechanisms, and agreement to support a separate motion for revised electric interim rates. The partial electric settlement provides for the deferral and annual recovery of incremental operating costs related to wildfire mitigation and insurance expenses through the Wildfire Mitigation Balancing Account.
Previous wording
The details of our settlement agreement and requested revised interim rates are set forth below:
Current wording
The details of our settlement agreement are set forth below:
Previous wording
(2) Intervenor positions propose up to an $11.6 million reduction to the base rate revenue request and an additional $38.4 million decrease to the PCCAM base.
Current wording
(3) Intervenor positions on YCGS propose up to an $11.6 million reduction to the base rate revenue request and an additional $38.4 million decrease to the PCCAM base.
Previous wording
A hearing on the electric and natural gas rate review is scheduled to commence on June 9, 2025. Interim rates will remain in effect on a refundable basis until the MPSC issues a final order.
Current wording
A hearing on the electric and natural gas rate review was held in June 2025, and final briefs are due in August 2025. Interim rates will remain in effect on a refundable basis, with interest, until the MPSC issues a final order.
Previous wording
In April 2024, the EPA released GHG Rules for existing coal-fired facilities and new coal and natural gas-fired facilities as well as MATS Rules. Compliance with the rules will require expensive upgrades at Colstrip Units 3 and 4 with proposed compliance dates that may not be achievable and / or require technology that is unproven, resulting in significant impacts to costs of the facilities. The final MATS and GHG Rules require compliance as early as 2027 and 2032, respectively. On April 8, 2025, President Trump issued a proclamation, "Regulatory Relief for Certain Stationary Sources to Promote American Energy," exempting certain coal plants, including Colstrip Units 3 and 4, Big Stone Plant, and Coyote Plant, from compliance with the MATS Rule through July 8, 2029. See Note 10 - Commitments and Contingencies to the Condensed Consolidated Financial Statements included herein for additional information regarding these rules.
Current wording
In April 2024, the EPA released GHG Rules for existing coal-fired facilities and new coal and natural gas-fired facilities as well as MATS Rules. Compliance with the rules would require expensive upgrades at Colstrip Units 3 and 4 with proposed compliance dates that may not be achievable and / or require technology that is unproven, resulting in significant impacts to costs of the facilities. The final MATS and GHG Rules require compliance as early as 2027 and 2032, respectively. On April 8, 2025, President Trump issued a proclamation, "Regulatory Relief for Certain Stationary Sources to Promote American Energy," exempting certain coal plants, including Colstrip Units 3 and 4, Big Stone Plant, and Coyote Plant, from compliance with the MATS Rule through July 8, 2029. On June 11, 2025, the EPA issued Notices of Proposed Rulemaking to, among other things, rescind the 2024 MATS Rule. See Note 11 - Commitments and Contingencies to the Condensed Consolidated Financial Statements included herein for additional information regarding these rules.
Previous wording
In July 2024, we entered into an Asset Purchase Agreement with Hope Utilities to acquire its Energy West natural gas utility distribution system and operations serving approximately 33,000 customers located near Great Falls, Cut Bank, and West Yellowstone, Montana for approximately $39.0 million, subject to certain working capital and other agreed upon closing adjustments. The transaction is subject to a number of customary closing conditions, including MPSC approval, and we expect the acquisition to be completed in the second or third quarter of 2025.
Current wording
In July 2024, NW Corp entered into an Asset Purchase Agreement with Hope Utilities to acquire its Energy West natural gas distribution and system operations serving approximately 33,000 customers located in Great Falls, Cut Bank, and West Yellowstone, Montana. In May 2025, the MPSC approved this acquisition and on July 1, 2025, NW Corp completed this acquisition for approximately $36.5 million in cash, which is subject to certain post-close working capital adjustments that we expect to finalize in the second half of 2025.
Previous wording
In addition to the Colstrip Transmission System Upgrade, in December 2024, we signed a nonbinding memorandum of understanding (MOU) with North Plains Connector LLC, a wholly owned subsidiary of Grid United, to own 10 percent (300 megawatts) of the NPC Consortium project. The project is entering the permitting phase and initiating regulatory filings with approvals targeted in 2026. Construction is expected to commence in 2028, with the project expected to be operational by 2032. Under the terms of the MOU, Grid United will continue to fund the development of the NPC and we will invest when the regulatory approvals and permits are in place. The project is a critical infrastructure investment that aligns with our commitment to providing reliable and affordable energy to our customers while also supporting broader grid resilience efforts in the region.
Current wording
In addition to the Colstrip Transmission System Upgrade, in December 2024, we signed a nonbinding memorandum of understanding (MOU) with North Plains Connector LLC, a wholly owned subsidiary of Grid United, to own 10 percent (300 megawatts) of the NPC Consortium project. The project is entering the permitting phase and initiating regulatory filings with approvals targeted in 2026. Construction is expected to commence in 2028, with the project expected to be operational by 2032. Under the terms of the MOU, Grid United will continue to fund the development of the NPC and we will make our investment decision when the regulatory approvals and permits are in place. The project is a critical infrastructure investment that aligns with our commitment to providing reliable and affordable energy to our customers while also supporting broader grid resilience efforts in the region.
Previous wording
The Montana Legislature approved House Bill 490 in April 2025, with broad bipartisan support. The bill awaits the Governor's signature to become law. The legislation requires development, approval, and implementation of electric facilities providers' wildfire mitigation plans. Importantly, House Bill 490 helps address some preexisting liability risks facing electric facilities providers in Montana. It changes Montana law, recognizing utilities' obligation to provide a public service for customers that is different from typical businesses; circumscribes certain damages; and enacts liability protections related to wildfire and wildfire prevention efforts involving providers. More specifically, House Bill 490 precludes common law strict liability claims for damages related to wildfire and electric activities or wildfire mitigation activities; establishes a statutory standard of care, supplanting common law causes of action and other theories of recovery; and creates a rebuttable presumption that an electric facilities provider acted reasonably if it substantially followed an approved wildfire mitigation plan. The legislation also defines the availability of damages by allowing noneconomic personal injury damages only when there is bodily injury and punitive damages only when an injured party proves by clear and convincing evidence that an electric facilities provider's actions were grossly negligent or intentional.
Current wording
The Montana Legislature approved House Bill 490 in April 2025, with broad bipartisan support in both the House (90-0) and Senate (40-8), and the Governor signed this bill into law in May 2025. This bill requires development, approval, and implementation of electric facilities providers' wildfire mitigation plans. Importantly, House Bill 490 helps address some preexisting liability risks facing electric facilities providers in Montana. It changes Montana law, recognizing utilities' obligation to provide a public service for customers that is different from typical businesses; circumscribes certain damages; and enacts liability protections related to wildfire and wildfire prevention efforts involving providers. More specifically, House Bill 490 precludes common law strict liability claims for damages related to wildfire and electric activities or wildfire mitigation activities; establishes a statutory standard of care, supplanting common law causes of action and other theories of recovery; and creates a rebuttable presumption that an electric facilities provider acted reasonably if it substantially followed an approved wildfire mitigation plan. The legislation also defines the availability of damages by allowing noneconomic personal injury damages only when there is bodily injury and punitive damages only when an injured party proves by clear and convincing evidence that an electric facilities provider's actions were grossly negligent or intentional. We expect to file our wildfire mitigation plan with the MPSC in the third quarter of 2025 for review and approval.
Previous wording
Consolidated gross margin for the three months ended March 31, 2025 was $166.2 million as compared with $142.5 million in 2024, an increase of $23.7 million, or 16.6 percent. This increase was primarily due to rates, electric retail volumes, natural gas retail volumes, electric transmission revenues, and natural gas transportation revenues. These were offset in part by Montana property tax tracker collections, depreciation, and operating and maintenance expenses.
Current wording
Consolidated gross margin for the three months ended June 30, 2025 was $94.5 million as compared with $92.8 million in 2024, an increase of $1.7 million, or 1.8 percent. This increase was primarily due to higher retail rates, higher electric transmission, and natural gas transportation revenues. These were partly offset by lower retail natural gas and electric usage primarily driven by weather, Montana property tax tracker collections, non-recoverable Montana electric supply costs, depreciation, and operating and maintenance costs.
Previous wording
Consolidated utility margin for the three months ended March 31, 2025 was $328.4 million as compared with $300.6 million for the same period in 2024, an increase of $27.8 million, or 9.2 percent. Primary components of the change in utility margin include the following (in millions):
Current wording
Consolidated utility margin for the three months ended June 30, 2025 was $267.4 million as compared with $243.4 million for the same period in 2024, an increase of $24.0 million, or 9.9 percent. Primary components of the change in utility margin include the following (in millions):
Previous wording
Higher electric retail volumes were driven by favorable weather in all jurisdictions impacting residential demand, higher commercial demand, and customer growth in all jurisdictions, partly offset by lower industrial demand. Higher natural gas retail volumes were driven by favorable weather and customer growth in all jurisdictions.
Current wording
Lower electric retail volumes were driven by unfavorable spring weather in all jurisdictions impacting residential demand, and lower commercial and industrial demand, partly offset by customer growth in all jurisdictions. Lower natural gas retail volumes were driven by unfavorable weather in all jurisdictions, partly offset by customer growth in all jurisdictions.
Previous wording
Under the PCCAM, net supply costs higher or lower than the PCCAM base rate (PCCAM Base) (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the three months ended March 31, 2025, we under-collected supply costs of $24.3 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $2.7 million (10 percent of the PCCAM Base cost variance). For the three months ended March 31, 2024, we under-collected supply costs of $27.1 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $3.0 million.
Current wording
Under the PCCAM, net supply costs higher or lower than the PCCAM base rate (PCCAM Base) (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the three months ended June 30, 2025, we under-collected supply costs of $7.6 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $0.8 million (10 percent of the PCCAM Base cost variance). For the three months ended June 30, 2024, we over-collected supply costs of $11.0 million resulting in a reduction to our under collection of costs, and recorded an increase in pre-tax earnings of $1.2 million (10 percent of the PCCAM Base cost variance).
Previous wording
Consolidated operating expenses, excluding fuel, purchased supply and direct transmission expense, were $203.7 million for the three months ended March 31, 2025, as compared with $198.5 million for the three months ended March 31, 2024. Primary components of the change include the following (in millions):
Current wording
Consolidated operating expenses, excluding fuel, purchased supply and direct transmission expense, were $206.7 million for the three months ended June 30, 2025, as compared with $181.9 million for the three months ended June 30, 2024. Primary components of the change include the following (in millions):
Previous wording
Consolidated operating income for the three months ended March 31, 2025 was $124.7 million as compared with $102.1 million in the same period of 2024. This increase was primarily due to rates, electric retail volumes, natural gas retail volumes, electric transmission revenues, and natural gas transportation revenues. These were offset in part by Montana property tax tracker collections, depreciation, operating, administrative and general costs.
Current wording
Consolidated operating income for the three months ended June 30, 2025 was $60.8 million as compared with $61.6 million in the same period of 2024. This decrease was primarily due to lower retail natural gas and electric usage primarily driven by weather, Montana property tax tracker collections, non-recoverable Montana electric supply costs, depreciation, and operating, administrative and general costs. These were partly offset by higher retail rates, higher electric transmission, and natural gas transportation revenues.
Previous wording
Consolidated interest expense was $36.5 million for the three months ended March 31, 2025 as compared with $31.0 million for the same period of 2024. This increase was due to higher borrowings and interest rates and lower capitalization of Allowance for Funds Used During Construction (AFUDC).
Current wording
Consolidated interest expense was $36.3 million for the three months ended June 30, 2025 as compared with $31.9 million for the same period of 2024. This increase was due to higher borrowings and interest rates and lower capitalization of Allowance for Funds Used During Construction (AFUDC).
Previous wording
Consolidated income tax expense was $15.2 million for the three months ended March 31, 2025 as compared to $10.3 million for the same period of 2024. Our effective tax rate for the three months ended March 31, 2025 was 16.5% as compared with 13.7% for the same period in 2024.
Current wording
Consolidated income tax expense was $3.4 million for the three months ended June 30, 2025 as compared to $4.2 million for the same period of 2024. Our effective tax rate for the three months ended June 30, 2025 was 13.7% as compared with 11.8% for the same period in 2024.
Previous wording
Consolidated other income was $3.9 million for the three months ended March 31, 2025 as compared with $4.3 million for the same period of 2024. This decrease was primarily due to lower capitalization of AFUDC and a prior year reversal of $2.3 million from a previously expensed Community Renewable Energy Project penalty due to a favorable legal ruling. This was partly offset by an increase of $2.5 million driven by a prior year non-cash impairment of an alternative energy storage equity investment and an increase in the value of deferred shares held in trust for deferred compensation.
Current wording
Consolidated other income was $4.0 million for the six months ended June 30, 2025 as compared to $10.5 million during the same period of 2024. This decrease was primarily due to lower capitalization of AFUDC, a prior year reversal of $2.3 million from a previously disclosed CREP penalty due to a favorable legal ruling, and a $1.0 million expense accrual related to an estimated penalty for the CREP informed by a recent MPSC ruling, partly offset by an increase of $2.5 million driven by a prior year non-cash impairment of an alternative energy storage equity investment.
Previous wording
Higher electric retail volumes were driven by favorable weather in all jurisdictions impacting residential demand, higher commercial demand, and customer growth in all jurisdictions, partly offset by lower industrial demand.
Current wording
Lower electric retail volumes were driven by unfavorable spring weather in all jurisdictions impacting residential demand, and lower commercial and industrial demand, partly offset by customer growth in all jurisdictions.
Previous wording
Under the PCCAM, net supply costs higher or lower than the PCCAM base rate (PCCAM Base) (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the three months ended March 31, 2025, we under-collected supply costs of $24.3 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $2.7 million (10 percent of the PCCAM Base cost variance). For the three months ended March 31, 2024, we under-collected supply costs of $27.1 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $3.0 million.
Current wording
Under the PCCAM, net supply costs higher or lower than the PCCAM base rate (PCCAM Base) (excluding qualifying facility (QF) costs) are allocated 90 percent to Montana customers and 10 percent to shareholders. For the three months ended June 30, 2025, we under-collected supply costs of $7.6 million resulting in an increase to our under collection of costs, and recorded a decrease in pre-tax earnings of $0.8 million (10 percent of the PCCAM Base cost variance). For the three months ended June 30, 2024, we over-collected supply costs of $11.0 million resulting in a reduction to our under collection of costs, and recorded an increase in pre-tax earnings of $1.2 million (10 percent of the PCCAM Base cost variance).
Previous wording
As of March 31, 2025, our total net liquidity was approximately $630.0 million, including $56.0 million of cash and cash equivalents and $574.0 million of revolving credit facility availability with no letters of credit outstanding.
Current wording
As of June 30, 2025, our total net liquidity was approximately $317.9 million, including $2.9 million of cash and cash equivalents and $315.0 million of revolving credit facility availability with no letters of credit outstanding.
Previous wording
As of March 31, 2025, cash, cash equivalents, and restricted cash were $80.1 million as compared with $29.0 million as of December 31, 2024 and $20.4 million as of March 31, 2024. Cash provided by operating activities totaled $153.4 million for the three months ended March 31, 2025 as compared with $161.7 million during the three months ended March 31, 2024. The changes in cash flows from operating activities generally follow the results of operations, as discussed above in the consolidated results of operations for the three months ended March 31, 2025, and are affected by changes in working capital. The decrease in cash provided by operating activities is primarily due to lower collections of accounts receivable balances due to timing of colder weather and greater uses of cash in accrued expenses and other due to timing of interest payments on long-term debt. This was partly offset by a decrease in our net cash outflows for energy supply costs, as shown in the table below.
Current wording
As of June 30, 2025, cash, cash equivalents, and restricted cash were $26.5 million as compared with $29.0 million as of December 31, 2024 and $31.0 million as of June 30, 2024. Cash provided by operating activities totaled $211.6 million for the six months ended June 30, 2025 as compared with $223.9 million during the six months ended June 30, 2024. The changes in cash flows from operating activities generally follow the results of operations, as discussed above in the consolidated results of operations for the six months ended June, 2025, and are affected by changes in working capital. The decrease in cash provided by operating activities is primarily due to lower collections of accounts receivable balances due to timing of colder weather and an increase in our net cash outflows for energy supply costs, as shown in the table below.
Previous wording
Cash used in investing activities totaled $96.7 million during the three months ended March 31, 2025, as compared with $109.0 million during the three months ended March 31, 2024. Plant additions during the first three months of 2025 include maintenance additions of approximately $55.6 million and capacity related capital expenditures of $36.5 million. Plant additions during the first three months of 2024 included maintenance additions of approximately $49.2 million and capacity related capital expenditures of approximately $59.6 million.
Current wording
Cash used in investing activities totaled $226.8 million during the six months ended June 30, 2025, as compared with $248.3 million during the six months ended June 30, 2024. Plant additions during the first six months of 2025 include maintenance additions of approximately $149.4 million and capacity related capital expenditures of $71.6 million. Plant additions during the first six months of 2024 included maintenance additions of approximately $130.5 million and capacity related capital expenditures of approximately $116.9 million.
Previous wording
Cash used in financing activities totaled $5.6 million during the three months ended March 31, 2025, as compared with $57.5 million during the three months ended March 31, 2024. During the three months ended March 31, 2025, cash used in financing activities reflects net repayments under our revolving lines of credit of $362.0 million and payment of dividends of $40.3 million, partly offset by proceeds from the issuance of debt of $400.0 million. During the three months ended March 31, 2024, cash used in financing activities reflects net repayments under our revolving lines of credit of $132.0 million, repayment of 1.00 percent, $100.0 million of Montana First Mortgage Bonds and payment of dividends of $39.6 million, partly offset by proceeds from the issuance of debt of $215.0 million.
Current wording
Cash provided by financing activities totaled $12.7 million during the six months ended June 30, 2025, as compared with $30.2 million during the six months ended June 30, 2024. During the six months ended June 30, 2025, cash provided by financing activities reflects proceeds from the issuance of debt of $500.0 million, partly offset by repayment of $300.0 million of Montana and South Dakota First Mortgage bonds, net repayments under our revolving lines of credit of $103.0 million, and payment of dividends of $80.7 million. During the six months ended June 30, 2024, cash provided by financing activities reflects proceeds from the issuance of debt of $215.0 million and short-term borrowings of $100.0 million, partly offset by net repayments under our revolving lines of credit of $105.0 million, repayment of $100.0 million of Montana First Mortgage Bonds and payment of dividends of $79.3 million.
Previous wording
As of March 31, 2025 and 2024, the outstanding balances of our credit facilities were $51.0 million and $186.0 million, respectively. As of April 25, 2025, the availability under our credit facilities was approximately $500.0 million, and there were no letters of credit outstanding.
Current wording
As of June 30, 2025 and 2024, the outstanding balances of our credit facilities were $310.0 million and $213.0 million, respectively. As of July 25, 2025, the availability under our credit facilities was approximately $265.0 million, and there were no letters of credit outstanding.
Previous wording
(3)Certain QFs require us to purchase minimum amounts of energy at prices ranging from $118 to $130 per MWH through 2029. Ourestimated gross contractual obligation related to these QFs is approximately $213.9 million. A portion of the costs incurred to purchase this energy is recoverable through rates authorized by the MPSC, totaling approximately $192.6 million.
Current wording
(3)Certain QFs require us to purchase minimum amounts of energy at prices ranging from $124 to $130 per MWH through 2029. Ourestimated gross contractual obligation related to these QFs is approximately $198.8 million. A portion of the costs incurred to purchase this energy is recoverable through rates authorized by the MPSC, totaling approximately $179.3 million.
Previous wording
(5)Contractual interest payments include our revolving credit facilities, which have a variable interest rate. We have assumed an average interest rate of 5.67 percent on the outstanding balance through maturity of the facilities.
Current wording
(5)Contractual interest payments include our revolving credit facilities, which have a variable interest rate. We have assumed an average interest rate of 5.68 percent on the outstanding balance through maturity of the facilities.
Rearranged current paragraphs (12)
Current report — wording carried from elsewhere
The partial electric settlement includes, among other things, agreement on base revenue increases (excluding base revenues associated with YCGS), allocated cost of service, rate design, updates to the amount of revenues associated with property taxes
Current report — wording carried from elsewhere
(3) These items are flow-through costs. PCCAM reflects our fuel and purchased power costs.
Current report — wording carried from elsewhere
(4) These items are flow-through costs. PCCAM reflects our fuel and purchased power costs.
Current report — wording carried from elsewhere
Consolidated operating expenses, excluding fuel, purchased supply and direct transmission expense, were $410.3 million for the six months ended June 30, 2025, as compared with $380.3 million for the six months ended June 30, 2024. Primary components of the change include the following (in millions):
Current report — wording carried from elsewhere
(1) In order to present the total change in labor and benefits, we have included the change in the non-service cost component of our pension and other postretirement benefits, which is recorded within other income on our Condensed Consolidated Statements of Income. This change is offset within this table as it does not affect our operating expenses.
Current report — wording carried from elsewhere
Consolidated interest expense was $72.8 million for the six months ended June 30, 2025 as compared with $62.9 million for the same period of 2024. This increase was due to higher borrowings and interest rates and lower capitalization of AFUDC.
Current report — wording carried from elsewhere
The following table summarizes the differences between our effective tax rate and the federal statutory rate (in millions):
Current report — wording carried from elsewhere
We compute income tax expense for each quarter based on the estimated annual effective tax rate for the year, adjusted for certain discrete items. Our effective tax rate typically differs from the federal statutory tax rate primarily due to the regulatory impact of flowing through federal and state tax benefits of repairs deductions, state tax benefit of accelerated tax depreciation deductions (including bonus depreciation when applicable) and production tax credits.
Current report — wording carried from elsewhere
(1) Included within this line is our lighting customer class, which we have historically counted each lighting district as one customer. We have retroactively modified our customer counts to now reflect each lighting service as a customer as that better aligns with the MWH usage of this customer class.
Current report — wording carried from elsewhere
The following summarizes the components of the changes in electric utility margin for the six months ended June 30, 2025 and 2024 (in millions):
Current report — wording carried from elsewhere
The change in regulatory amortization revenue is due to timing differences between when we incur electric supply costs and when we recover these costs in rates from our customers, which has a minimal impact on utility margin. Our wholesale and other revenues are largely utility margin neutral as they are offset by changes in fuel, purchased supply and direct transmission expenses.
Current report — wording carried from elsewhere
The following summarizes the components of the changes in natural gas utility margin for the six months ended June 30, 2025 and 2024: