NorthWestern Energy : 2023 Propane Annual Report

YEAR ENDING 2023

ANNUAL REPORT

OF

NorthWestern Energy

(Townsend Propane)

GAS UTILITY

Docket 2024.01.001

TO THE

PUBLIC SERVICE COMMISSION

STATE OF MONTANA

1701 PROSPECT AVENUE

P.O. BOX 202601

HELENA, MT 59620-2601

Propane Annual Report
Table of Contents
Description	Schedule
Instructions
Identification	1
Board of Directors	2
Officers	3
Corporate Structure	4
Corporate Allocations	5
Affiliate Transactions - To the Utility	6
Affiliate Transactions - By the Utility	7
Montana Utility Income Statement	8
Montana Revenues	9
Montana Operation and Maintenance Expenses	10
Montana Taxes Other Than Income	11
Payments for Services	12
Political Action Committees/Political Contributions	13
Pension Costs	14
Other Post Employment Benefits	15
Top Ten Montana Compensated Employees	16
Top Five Corporate Compensated Employees	17
Balance Sheet	18

continued on next page

Description		Schedule
Montana Plant in Service		19
Montana Depreciation Summary		20
Montana Materials and Supplies	not applicable	21
Montana Regulatory Capital Structure		22
Statement of Cash Flows		23
Long Term Debt		24
Preferred Stock		25
Common Stock		26
Montana Earned Rate of Return		27
Montana Composite Statistics		28
Montana Customer Information		29
Montana Employee Counts		30
Montana Construction Budget		31
Transmission, Distribution and Storage Systems	not applicable	32
Sources of Gas Supply		33
MT Conservation and Demand Side Mgmt. Programs	not applicable	34
Montana Consumption and Revenues		35
Natural Gas Universal System Benefits Programs	not applicable	36a
Montana Conservation and Demand Side Mgmt. Programs	not applicable	36b

Sch. 1	IDENTIFICATION
1
2	Legal Name of Respondent:	NorthWestern Corporation
3
4	Name Under Which Respondent Does Business:	NorthWestern Energy
5
6	Date Utility Service First Offered in Montana:	Electricity	- Dec 12, 1912
7		Natural Gas - Jan	01, 1933
8		Propane	- Oct	13, 1995
9
10	Person Responsible for Report:	Jeff B. Berzina
11
12	Telephone Number for Report Inquiries:	[phone]
13
14	Address for Correspondence Concerning Report:	11 East Park Street
15		Butte, MT 59701
16
17
18

If direct control over respondent is held by another entity, provide below the name, address, means by which control is held and percent ownership of controlling entity:

Respondent is a wholly-owned, direct subsidiary of NorthWestern Energy Group, Inc. At December 31, 2023, NorthWestern Energy Group, Inc. owned 100% of the common stock of respondent.

Schedule 1

Sch. 2	BOARD OF DIRECTORS
	Director's Name & Address (City, State)	Remuneration
1	See NorthWestern Corporation's Annual Report FERC Form 1 page 105 for our
2
3	Corporate Board of Directors.
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

Schedule 2

Sch. 3			OFFICERS
	Title		Department Supervised	Name
1				Brian Bird
2	President and Chief Executive Officer		Executive
3
4	Vice President,		Legal Services	Shannon Heim
5	General Counsel and Federal		Corporate Secretary
6	Government Affairs		Risk Management
7			Contracts
8			Federal Governmental Affairs
9
10	Vice President,		Regulatory Affairs	Cyndee Fang
11	Regulatory Affairs		DSM and Energy Efficiency
12			Sustainability
13			Governmental Affairs - Nebraska and South Dakota
14
15	Vice President,		Asset and Project Management	Bleau LaFave
16	Asset Management & Business Development		Business Development and Strategic Support
17
18	Vice President,		Distribution Operations - MT/SD/NE	Jason Merkel
19	Distribution		Construction
20
21	Vice President,		Transmission Planning, Engineering, Construction,	Michael Cashell
22	Transmission		and Operations
23			Gas Transmission & Storage
24			Substation Operations
25			Transmission Policy, Services, and Operations
26			Transmission Market Strategy
27			Grid Real Time and Scada Operations
28			FERC and NERC Compliance
29			Support Services
30
31	Vice President,		Thermal and Wind Generation	John Hines
32	Supply and Montana Government Affairs		Hydro Operations
33			Environmental and Lands Permitting & Compliance
34			Long Term Resources
35			Energy Supply Marketing Operations
36			Montana Government Affairs
37
38			Brand, Advertising, and	Bobbi Schroeppel
39	Vice President,		Customer Communications
40	Customer Care, Communications and		Customer Experience and Support
41	Human Resources		Customer Interaction
42			Community Connections
43			Revenue Cycle Management
44			Human Resources
45			Safety/Health/Environmental Services
46
47	Chief Audit & Compliance Officer		Internal Audit	Michael Nieman
48			Enterprise Risk and Business Continuity
49	Vice President & Chief Financial Officer		Tax, Internal Audit and Compliance	Crystal Lail
50
51			Financial Planning & Analysis
52			Controller and Treasury Functions
53			Investory Relations and Corporate Finance
54			Flight Services
55
56	Vice President, Technology		Business Technology	Jeanne Vold
57			Customer Systems & Solutions
58			Data & Analytics
59			Operation Technology
60			Security
61
	Reflects active officers as of December 31, 2023

Schedule 3

Sch. 4		CORPORATE STRUCTURE
	Subsidiary/Company Name	Line of Business	Earnings (000)	% of Total
Regulated Operations (Jurisdictional & Non-Jurisdictional)	$	190,369	98.06%
	NorthWestern Corporation:
	Montana Utility Operations	Electric Utility
		Natural Gas Utility
		Natural Gas Pipeline
		(including Canadian Montana Pipeline Corp.,
		Havre Pipline Company, LLC
		Lodge Creek Pipelines, LLC
		and Willow Creek Gathering, LLC)
		Propane Utility
	South Dakota Utility Operations	Electric Utility
		Natural Gas Utility
	Nebraska Utility Operations	Natural Gas Utility
Unregulated Operations		$	3,763	1.94%
	Direct Subsidiaries:
	NorthWestern Services, LLC	Nonregulated natural gas marketing,
		property management
	Clark Fork and Blackfoot, LLC	Former Milltown hydroelectric facility
	Risk Partners Assurance, Ltd.	Captive insurance company
	NorthWestern Energy Solutions, In	Non-regulated customer services

Total Corporation

$ 194,132

100.00%

Schedule 4

Sch. 5		CORPORATE ALLOCATIONS
				$ to MT El &
	Departments Allocated	Description of Services	Allocation Method	Gas Utilities	MT %	$ to Other
1	Executive Department	Includes the following departments:	Overhead costs not charged directly are	4,957,856	77.87%	1,409,104
2
3		CEO and Board of Directors	typically allocated based on a 3-factor formula
4			consisting of gross plant, labor, and margin.
5	Legal Department	Includes the following departments:	Overhead costs not charged directly are	20,037,127	79.39%	5,201,808
6
7		Chief Legal and Risk Management	typically allocated based on a 3-factor formula
8			consisting of gross plant, labor, and margin.
9	Regulatory Affairs	Includes the following departments:	Overhead costs not charged directly are	1,885,733	73.82%	668,657
10
11		Regulatory Affairs MT, SD & NE Public and Regulatory Affairs	typically allocated based on a 3-factor formula
12		and Regulatory Support	consisting of gross plant, labor, and margin.
13	Finance	Includes the following departments: CFO, Treasury, FP&A	Overhead costs not charged directly are	17,730,875	79.84%	4,477,065
14
15		Tax , Investor Relations, Corporate Aircraft,	typically allocated based on a 3-factor formula
16		and Compensation & Benefits	consisting of gross plant, labor, and margin.
17	Controller	Includes the following departments: Controller, Accounting	Overhead costs not charged directly are	$5,321,177	80.01%	$1,329,365
18
19		Accounts Payable, Payroll, Financial Reporting & Regulatory Affairs Finance	typically allocated based on a 3-factor formula
20			consisting of gross plant, labor, and margin.
21	Audit & Controls	Includes the following departments:	Overhead costs not charged directly are	1,034,150	79.00%	274,901
22
23		Internal Audit and Enterprise Risk Management	typically allocated based on a 3-factor formula
24			consisting of gross plant, labor, and margin.
25	Business Technology	Includes the following departments:	Overhead costs not charged directly are	21,594,629	79.03%	5,728,518
26
27		Applications, Architecture, Governance	typically allocated based on a 3-factor formula
28			consisting of gross plant, labor, and margin.
29	Distribution	Includes the following departments:	Overhead costs not charged directly are	80,620	65.80%	41,911
30
31		Sioux Falls Facilities and Helena Building	typically allocated based on a 3-factor formula
32			consisting of gross plant, labor, and margin.
33	Customer Care	Includes the following departments: Customer Care Combined, Customer Care SD&NE	Overhead costs not charged directly are	25,453,138	74.82%	8,567,935
34
35		CC MT, CC - Assoc & Dispatch, Business Develop	typically allocated based on a 3-factor formula
36		Human Resources, Print Services and Charitable Contributions	consisting of gross plant, labor, and margin.
37
38
39
40	TOTAL			$98,095,303	77.98%	$27,699,263

Schedule 5

Sch. 6		AFFILIATE TRANSACTIONS - PRODUCTS & SERVICES PROVIDED TO UTILITY
			Products & Services			Charges	% of Total	Charges
	Affiliate Name		Method to Determine Price		to Utility	Affil. Rev.	to MT Utility
1	Nonutility Subsidiaries
2
3
4	Total Nonutility Subsidiaries					$0		$0
5	Total Nonutility Subsidiaries Revenues			$0
6
7
8	Utility Subsidiaries
9
10
11	Total Utility Subsidiaries					$0		$0
12	Havre Pipeline Company, LLC		Natural gas gathering,	Gathering rate based on cost,		2,608,256
13			transmission, & compression	transmission & compression
14				are at tariffed rates
15	Total Utility Subsidiaries Revenues					$2,608,256
16	TOTAL AFFILIATE TRANSACTIONS					$0		$0

Schedule 6

Sch. 7		AFFILIATE TRANSACTIONS - PRODUCTS & SERVICES PROVIDED BY UTILITY
					Charges	% of Total	Revenues
	Affiliate Name		Products & Services	Method to Determine Price	to Affiliate	Affil. Exp.	to MT Utility
1	Nonutility Subsidiaries
2
3
4
5
6	Total Nonutility Subsidiaries				$0		$0
7	Total Nonutility Subsidiaries Expenses		$0
8
9
10	Utility Subsidiaries
11
12	Havre Pipeline Company, LLC		Administration Fee	Negotiated Contract Rate	500,400	13.4%	500,400
13
14	Havre Pipeline Company, LLC		Labor Cost	Actual Expense	1,283,172	34.4%	$1,283,172
15
16	Total Utility Subsidiaries				1,783,572		$1,783,572
17	Total Utility Subsidiaries Expenses				$3,733,451
18	TOTAL AFFILIATE TRANSACTIONS				$1,783,572		$1,783,572

Schedule 7