State Capitol Bureau
BISMARCK - Electricity customers in Kindred and Bismarck are helping make North Dakota history.
The state Public Service Commission approved two pacts Wednesday that signal the end of a decades-long battle between for-profit power companies and electric cooperatives over which gets to serve new areas of expanding cities.
The two agreements are the first under a 2005 state law that allows power providers to negotiate sharing areas of new customers without violating antitrust laws.
The PSC approved pacts between Otter Tail Power Co. and Cass County Electric Cooperative covering which will serve new parts of the city of Kindred and a surrounding township, and between Montana-Dakota Utilities and Capital Electric Cooperative for splitting up new housing developments in Bismarck.
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These and any future such agreements should mean savings to electric power customers, who will not have to help fund, through their monthly bills, ongoing lawsuits, legislative battles and duplicate equipment, said commissioners and a spokesman for the industry after Wednesday's vote.
"In this particular case, they've met the burden of public interest," said Commissioner Tony Clark, noting that in the future it will be more efficient for power providers and housing developers to know from the start who will serve new developments.
Future agreements could be made between Xcel Energy and the cooperatives it competes with around Fargo, Grand Forks and Minot, said Bob Graveline of the Utility Shareholders of North Dakota.
He called Wednesday's groundbreaking agreements "excellent."
If talks begin, Xcel could negotiate for areas around Fargo with Cass County Electric, around Grand Forks with Nodak Electric Cooperative and around Minot with Verendrye Electric Cooperative, Graveline said.
Mark Nisbet, North Dakota principle manager for Xcel Energy, said the company is not working on such territory-sharing agreements with cooperatives, though "some of those opportunities have been broached informally."
Of Wednesday's action, Nisbet said, "It certainly bodes well" for Xcel to work on such negotiations.
He also congratulated the companies "for working through a pretty controversial situation."
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Montana-Dakota and Capital Electric's disputes have come before the PSC, district courts and the state Supreme Court in the past several years, with Capital winning at the high court.
Those lawsuits, as well as legislative battles in nearly every session for at least the past 10 years, were rooted in a 1964 law known as Territorial Integrity Act.
Thereafter, investor-owned utilities were constrained by city limits as they existed in 1964. Customers in any new areas annexed by cities after 1964 went almost automatically into the rural cooperatives' customer base.
Cole works for Forum Communications Co., which owns The Forum. She can be reached
at (701) 224-0830 or forumcap@btinet.net
PSC approves pacts, ending energy battle Janell Cole 20080117
