NorthWestern Q2 2025 Earnings Report

NorthWestern EPS Results

• Actual EPS: $0.40
• Consensus EPS: $0.38
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: $0.53

NorthWestern Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: +7.10%

NorthWestern Announcement Details

• Quarter: Q2 2025
• Date: 7/31/2025
• Time: Before Market Opens
• Conference Call Date: Wednesday, July 30, 2025
• Conference Call Time: 2:30AM ET

NorthWestern (NASDAQ:NWE), doing business as NorthWestern Energy, is a regulated electric and natural gas utility serving customers in Montana, South Dakota and Nebraska. The company provides essential energy services to residential, commercial, industrial and governmental customers across its service territories.

NorthWestern Energy’s operations include electricity generation, transmission and distribution, as well as natural gas transmission, storage and distribution. Its generation portfolio includes a mix of owned facilities and purchased power, with resources that include hydroelectric, coal, natural gas and renewable energy.

The company traces its roots to 1923 and is headquartered in Sioux Falls, South Dakota. NorthWestern Energy operates as a vertically integrated utility in portions of its service area, managing infrastructure and energy delivery systems intended to provide reliable service across the Upper Midwest and Northern Plains. Brian Bird serves as president and chief executive officer.

NorthWestern Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Q2 results and guidance: Reported GAAP EPS of $0.35 and non-GAAP EPS of $0.40, initiated 2025 earnings guidance of $3.53–$3.65, and reaffirmed long-term 4–6% EPS growth with a 5% dividend yield targeting 9–11% total return.
• Positive Sentiment: Acquisition completed: Closed on Energy West and Cutbank Gas facilities, adding 33,000 customers and 43 employees to expand service footprint and revenue base.
• Positive Sentiment: Data center pipeline: Executed a third LOI with Quantica for 500+ MW of capacity, bringing the total to three LOIs and nine high-level assessments, positioning for service agreements and growth by 2027.
• Positive Sentiment: Wildfire law enacted: Montana’s new legislation eliminates strict liability for utilities, shifts to a negligence standard with a rebuttable presumption when following approved mitigation plans, reducing legal and financial risks.
• Negative Sentiment: Regulatory headwinds: Q2 results were pressured by new Montana property tax legislation (-$0.05 EPS), PCAM detriment (-$0.02 EPS), and final rate review outcomes pending with retroactive impact expected in Q4.

Presentation

[Operator]

Thank you for standing by. My name is Rebecca, and I will be your conference operator today. At this time, I would like to welcome everyone to the NorthWestern Energy Second Quarter 2025 financial results webinar. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I will now turn the call over to Travis Meyer. Please go ahead.

[Travis Meyer, Corporate Development and Investor Relations Officer at NorthWestern Energy]

Thank you, Rebecca. Good afternoon, and thank you for joining NorthWestern Energy Group's Financial Results webcast for the quarter ended June 30, 2025. My name is Travis Meyer, and I'm the Director of Corporate Development and Investor Relations Officer for NorthWestern. Joining us on the call today are Brian Bird, President and Chief Executive Officer, and Crystal Lail, Chief Financial Officer. They'll walk you through our results for the quarter and provide an overall update on our progress. NorthWestern's results have been released, and the release is available on our website at northwesternenergy.com. We also released our 10-Q pre-market this morning. Please note that our company's press release, this presentation, comments by presenters, and responses to your questions may contain forward-looking statements. As such, I'll direct you to the disclosures contained within our SEC filings and the safe harbor provisions included on the second slide of this presentation.

[Travis Meyer, Corporate Development and Investor Relations Officer at NorthWestern Energy]

Also note that this presentation includes non-GAAP financial measures. Please see the non-GAAP disclosures, definitions, and reconciliations included in the presentation. The webcast is being recorded. The archived replay will be available shortly after the event and remain active for one year. Please visit the financial results section of our website to access the replay. With that, I'll hand the presentation over to Brian Bird for his opening remarks.

[Brian Bird, President and CEO at NorthWestern Energy]

Thanks, Travis. Recent highlights for the quarter. We have reported GAAP diluted EPS of $0.35. With some adjustments, the non-GAAP diluted EPS is $0.40 for the quarter. We're initiating our 2025 earnings guidance range of $3.53-$3.65. We're earning our long-term rate-based earnings per share growth rate targets of 4%-6%. We completed our acquisition of the Energy West and Cut Bank Gas facilities, adding 33,000 customers and 43 valued employees. We entered into our third letter of intent with Quantica, to a 500-plus megawatt data center developer. We declared a dividend of $0.66 per share payable September 30, 2025, to shareholders of record as of September 15, 2025. The NorthWestern value proposition continues. We continue to have a very strong dividend yield, right around 5%. That plus our 4%-6% EPS growth range based upon a five-year capital of about $2.75 billion.

[Brian Bird, President and CEO at NorthWestern Energy]

I'd argue in about 80% of that is in certainly non-controversial transmission and distribution investment. On a combined basis, that gets us to a 9%-11% total return. We do have some incremental opportunities to invest incremental capital and grow our earnings, things like data centers and new large load opportunities that we'll discuss, plus per regional transmission. Also any incremental generating capacity or gas transmission, for instance, anything like that to get us over 11% total return. With that, I'm going to hand it back over to Crystal for the second quarter financial review.

[Crystal Lail, CFO at NorthWestern Energy]

Thank you, Brian. Coming to you from sunny Bozeman here. In my comments today, I will cover our second quarter 2025 results, update you on some key regulatory proceedings. I think you all know we've been busy here in the second quarter on that front. I will also provide you our 2025 outlook, which we had indicated we would provide following the Montana rate review hearing. Starting on slide seven, you will see that our earnings for the second quarter were $0.35 on a GAAP basis, and that's compared with $0.52 in the prior period. On an adjusted non-GAAP basis, earnings were $0.40 as compared with $0.53 in the prior period. Obviously, a notable decline there in our second quarter results when you think about and compare them to the prior year, certainly impacted by the lack of interim rates and timing of those decisions.

[Crystal Lail, CFO at NorthWestern Energy]

I would point out that these results are in line with our expectations and start the year where we think we need to be. I'll provide more color on that in our outlook as I get to those slides. Moving to slide eight, just to remind you then what does that look like from a year-to-date results perspective, you'll see we're pretty flat against the prior period. Our earning results for the first half with net income and EPS in line with 2024. You'll recall that we started out the year with a solid first quarter, and our year-to-date results reflect that. Moving to slide nine to give you a bit more detail on what happened during the quarter. You'll see the bar charts here of what are the significant drivers. Quarterly earnings were driven primarily by the key topics of rate recovery.

[Crystal Lail, CFO at NorthWestern Energy]

You'll see that in the first part of the left here, offset by in the second quarter a bit of unfavorable weather, and certainly pressures at the operating cost, depreciation, and interest lines. Again, all in line with our expectations of where we thought we'd be here in the second quarter. To give you a bit more detail on the margin portion of that, slide 10, you'll see that the impact of rates, both interim rates and final rates, drove $0.24 of margin improvement in the quarter. That reflects the impact of the Montana rate review moving from the amount of interim results that were in there from up till late May to the adjusted interim rates that were put in at that point, and also gas rates in both South Dakota and Nebraska. $0.24 from the impacts of those two buckets.

[Crystal Lail, CFO at NorthWestern Energy]

In addition, I think Brian mentioned lots around transmission, but you'll see both electric and gas transmission show improved results for us. That's $0.07 on the electric transmission side and $0.02 on the gas transportation side, respectively. Those are offset by unfavorable weather and usage of $0.09 for the quarter. There are also impacts of Montana property tax legislation. You'll see that's a $0.05 detriment for the quarter. We do expect that detriment to have some continuance throughout the back part of the year. There was new property tax legislation enacted in the state of Montana, adjusting the amount that is collected through our bills. In addition, the PCAM was a detriment of $0.02 in the quarter. We talked about that last quarter that we would expect to see some continued headwinds there throughout 2025. Moving to slide 11 to discuss our adjusted items.

[Crystal Lail, CFO at NorthWestern Energy]

I've already just mentioned on the margin slide that weather unfavorably impacted us. You'll see here that was $0.03 in the second quarter, and that compares to a $0.01 unfavorable add-back in the second quarter of 2024. You can see a $0.02 swing there versus the prior period. In addition, we have adjusted out the impact of a CREP penalty, and that is consistent with prior treatment of that item, that when we've recorded amounts related to that, we have adjusted that out. That results in adjusted earnings, as I have reflected earlier, of $0.40 for the second quarter compared to $0.53 in the second quarter of 2024. Moving to slide 12, we talked about on our first quarter call, our financing plans remain unchanged from that. We'd also discussed that we'd already executed upon any financing needs through the year, so our debt financing needs were taken care of.

[Crystal Lail, CFO at NorthWestern Energy]

No changes to our view on financing for the year. You'll see from a credit and cash flow perspective, a little bit of a dip in our cash flows for the quarter, again reflecting the timing of that rate recovery and release, but we expect to conclude the year above our downside threshold. We are making good progress there. Moving to slide 13 to discuss regulatory updates, I'll comment on our Montana rate review proceedings. We had previously announced a full settlement on our gas case and a partial settlement in the electric case. The remaining contested items are primarily related to the recovery of our Yellowstone generating facility and the PCAM base.

[Crystal Lail, CFO at NorthWestern Energy]

We were pleased to be able to, you know, the tremendous work it took to narrow the focus of that proceeding and having a solid hearing where, I would say largely, really impressive group of about 30 employees who represented the company and how we serve our customers very well in front of the commission. With that hearing concluded, we moved on and filed opening briefs, and we expect an outcome in the ultimate proceeding sometime in the fourth quarter. With that hearing concluded, moving to slide 15, I'll discuss our outlook for 2025. We are pleased with our start to the year and introducing our 2025, as Brian alluded to, our non-GAAP guidance of $3.53-$3.65. I would note that this includes some significant assumptions, and one of those is with regard to the outcome in our Montana rate review.

[Crystal Lail, CFO at NorthWestern Energy]

While we await an outcome, we are recording revenue consistent with our settlement position, and we expect to record ultimately a final adjustment to whatever that's applicable, whatever the outcome is in the proceeding. I would note that that final decision when received, and again, likely in the fourth quarter of this year, will be retroactive back to May 23rd. This guidance is consistent with our commitment to deliver on a 4%-6% long-term earnings growth off of our base of 2024, which is $3.40. Additional key and important details are available on slide 16 for your review. Moving to slide 17 and concluding my comments, you'll see our five-year regulated capital investment expectations remain unchanged, and our execution in the first half of the year is on track. With that, I will turn it back to Brian.

[Brian Bird, President and CEO at NorthWestern Energy]

Thanks, Crystal. On page 19, I mentioned the Montana wildfire bill. I should say, we should not call that Montana wildfire law. 490's now been passed, as you're probably all well aware, had nearly unanimous support in the state. I would argue, and I think ChatGPT would agree with me, I think the Montana and Utah bills are seen as the best protection for utilities in the industry. The nice thing about the law itself, the very, you know, half the battle is the fact that we no longer have to deal with strict liability in the state for any utility operations related to wildfire. Strict liability cannot be applied to utility operations related to wildfire. Incrementally, we do need to get our wildfire mitigation plan ultimately approved. With that approval, we will receive a negligence standard that's based on Montana-specific circumstances, not California, for instance.

[Brian Bird, President and CEO at NorthWestern Energy]

More importantly to me, there'd be a rebuttable presumption that the utility acted reasonably if it substantially followed the approved wildfire plan. In other words, that burden of proof now would rest on the plaintiffs, not on the utility. Damages associated with that, as we'd expect, we should be responsible for economic damages to property, always have been. The protections we receive on non-economic damages would only be if bodily injury or death occurs. From a punitive perspective, only would come into play with clear and convincing evidence of gross negligent intent. We feel very, very good about this. Obviously, we'd like to get our wildfire plan approved in front of the commission, and we will be making that filing here shortly, sometime in August. That was our number one priority from a bill perspective during the legislative session. That was a great outcome.

[Brian Bird, President and CEO at NorthWestern Energy]

Our second most important bill was Senate Bill 301, which is the transmission bill that's also law. Effectively, it's given us a CPCN associated with our regional transmission investment. In essence, giving us better certainty or greater certainty, we can prudently invest in our utilities and get fair treatment upon receiving our CPCN. In essence, once the project's done, we could argue if we spent more than we invested more than we initially planned. Obviously, that prudency comes into place, but this gives us much greater certainty as we continue to think about how we invest from a regional transmission perspective in large projects. I'll talk more about those projects in a moment. Great legislative outcome. I know we talked about it in the first quarter, but the second quarter is when these things became law. I want to reiterate those two great outcomes, in 2025.

[Brian Bird, President and CEO at NorthWestern Energy]

Large load customers on slide 21, those are primarily data centers. As you saw the announcement today regarding Quantica, we now have our third letter of intent in Montana. I think what I would say here on Montana is, on 1/1/2026, we will go from a short position to a long position with the 592 megawatts associated with Colstrip. I'll speak to Colstrip specifically in a moment. Being in that long position has given us an opportunity to serve large load customers. What we need to do ultimately is go arm in arm with these large load customers to go into the MPSC a tariff that protects customers, but also certainly something that they want to, they can live with as a data center. We intend to do just that. We have some time. These large load data centers aren't really coming into play until 2027.

[Brian Bird, President and CEO at NorthWestern Energy]

We have some time, and we plan to file in probably 2026, tariffs with them, to get service as a state-regulated resource, if you will. If in fact we are turned down from the commission for whatever reason, we intend to serve these customers on a FERC-regulated basis. We intend to serve these customers regardless. We certainly intend and would like to, with the support of the Montana Public Service Commission, serve them in a state-regulated basis. In South Dakota, we continue to have significant interest there as well. I'll acknowledge that the lack of a sales tax certainly helps prospects or hurts prospects in South Dakota, but we still have quite a bit of interest, and we continue to work with hyperscalers and others there. We're excited about what opportunities that we're seeing in front of us on data centers. We need to capture those.

[Brian Bird, President and CEO at NorthWestern Energy]

From a letter of intent perspective, I think by the time we have this next call in October, we expect to have at least one of these LOIs in place at that point in time. Moving forward on the data center process on page 22, as a matter of fact, I'd argue we have increasing interest in data center requests and high-level assessments. Continue to move through those processes. Letter of intent, we mentioned our third, and I'm sure you saw the press release separately on Quantica. Excited we're working with them. These are folks that have worked in Montana in the past, with talent and at the Colstrip plant and many of their employees. We know them well, and we're excited to work with them to move their projects forward. I mentioned the energy service agreements.

[Brian Bird, President and CEO at NorthWestern Energy]

We'd like to, next time we talk, at least I want to see one or two in that queue count in that particular item. I mentioned regional transmission opportunities on slide 23. We continue to stay very active with Grid United on North Plains Connector and our own project we're working with them on. I call the Montana, the Idaho project through the southwest of Montana into Idaho and thus elsewhere from there, of course. We continue to look at other opportunities on our paths and also with the Colstrip transmission line itself to increase capacity. Excited about transmission opportunities, and I'd argue even more so now that we have our CPCN. Regarding incremental Colstrip capacity, a little bit of a history on Colstrip for a second. You might recall when we acquired the Avista piece, we were definitely short from a resource adequacy perspective.

[Brian Bird, President and CEO at NorthWestern Energy]

That incremental 222 megawatts fits perfectly into our portfolio to serve our existing customers and actually helped us achieve resource adequacy on 1/1/2026. In addition, we bought the 370 MW from Puget, and we will be buying on 1/1/2026. That incremental 370 really helped us achieve a 55% ownership at Colstrip as a whole. I think many of you are well aware, many of those owners didn't intend to be in Colstrip long term. We believe that 55% ownership actually protected the plant from being shut down. Having said that, when we made those decisions, a couple of things weren't necessarily well known at the time. We didn't know the federal actions that have been taken that have certainly helped Colstrip from a viability standpoint and a cost perspective on it going forward. That has certainly been a tailwind.

[Brian Bird, President and CEO at NorthWestern Energy]

Obviously, the ability to serve large load customers at data centers weren't much of a thing when we were negotiating this. This is just a great opportunity for us to continue to stay engaged in Colstrip. Ultimately, as we've mentioned before, we see Colstrip as an energy hub and a great opportunity for us to continue to operate that plant until we can find something that's cleaner and provides the same dispatch characteristics sometime in the future. We're excited to work with the Colstrip community and the state of Montana to ultimately see that come to fruition. From a conclusion standpoint, I think it's a pretty good quarter. I think we're in pretty good shape on a year-to-date basis and feel good about where we are from a year-end guidance perspective.

[Brian Bird, President and CEO at NorthWestern Energy]

I think, as Crystal pointed out, we've been working on a lot of things for the quarter and continue to move the ball in terms of improving shareholder value for our shareholders. Thank you very much. We'll go to Mr. Meyer to ask about the questions.

[Brian Bird, President and CEO at NorthWestern Energy]

I think we'll open the queue up for questions.

[Operator]

At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Jeremy Tonet with JPMorgan.

[Aidan Kelly, Equity Research Associate at JPMorgan]

Hey, good afternoon. This is actually Aidan Kelly in for Jeremy.

[Brian Bird, President and CEO at NorthWestern Energy]

Hey, Aiden.

[Aidan Kelly, Equity Research Associate at JPMorgan]

Hey.

[Aidan Kelly, Equity Research Associate at JPMorgan]

On the data center front, could you offer an updated sense on the potential timing to sign energy service agreements for the three data centers that are currently under letters of intent? Are you waiting on a transmission service agreement study to wrap up at this point, or are there any other gating items here to move these projects forward?

[Brian Bird, President and CEO at NorthWestern Energy]

Yeah. We're wrapping up on the transmission service issue side in the first two. I'd argue those are certainly in earlier stages from an LOI since we just signed Quantica here recently. As I mentioned earlier, I think by the time we have this call in October, I'd like to think at least one of either Atlas or Saby will be an ESA, have a signed ESA by that point in time. I'd like to think both of them will. Very confident that at least one of them will.

[Aidan Kelly, Equity Research Associate at JPMorgan]

Understood. That's good to hear. I guess just, you know, with this pipeline kind of expanding today, could you speak to how you are thinking about addressing load requirements, like in the scenario that this data center interest develops beyond existing capacity? I know you mentioned you would also look to work with regulators to kind of structure tariffs in 2026. Maybe just curious on that end. Also, like, you know, the thoughts on the possibility to integrate more utility-owned generation in the scenario of excess demand in Montana.

[Brian Bird, President and CEO at NorthWestern Energy]

Yeah. I think because of the need, obviously, for speed of deliverability here, we're working with these data centers. In fact, they are planning to build some of their own generation to serve these data centers. We want to work with them on that. Ultimately, from our ability to put those into rates, we have been talking to them potentially about build-transfer capabilities. That allows us to demonstrate that those resources from a pre-approval perspective give us time to ultimately get approval from the Montana Public Service Commission to actually own them. If, for whatever reason, if the MPSC doesn't support that, we will find a means and a FERC-regulated basis to do the same.

[Aidan Kelly, Equity Research Associate at JPMorgan]

Understood. Maybe just one last one, if I could. Just looking at the queue count of nine customers in the data center request stage, could you just kind of quantify, if you could, how many are in Montana versus South Dakota?

[Brian Bird, President and CEO at NorthWestern Energy]

That's a good question. I would say, I think it's about the same. You could say, geez, Brian, you can't divide 9.5 to get 4.5, but I'd argue they're relatively the same.

[Aidan Kelly, Equity Research Associate at JPMorgan]

Okay. That's good to know. Thanks. I'll leave it there.

[Operator]

Your next question comes from the line of Ross Fowler with Bank of America.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Afternoon, Brian, Crystal. Congrats on a good quarter and a good update here. Maybe following on Jeremy's question a little bit. Obviously, these data centers coming in by the end of the next decade, that keeps the tariff under the right tariff, which helps affordability. When do we flip over to that new generation needed capital being deployed? When do we drive to that sort of what you're talking about on slide four there, that 6% or higher growth? Is there a transmission component to that as well?

[Brian Bird, President and CEO at NorthWestern Energy]

I would say this, in essence, to serve them, there's going to be a necessary investment on our system, I'd argue, from an interconnection standpoint, from a transmission perspective. That capital being deployed relatively quickly during this process. If in fact, from a build-transfer perspective, we'd like to do that as soon as the generation is available to serve those customers. That would be, you know, relatively soon.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Okay, I'm sorry.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Go ahead.

[Brian Bird, President and CEO at NorthWestern Energy]

Sorry, Ross, just to be more clear on that point. You're seeing a 2027 timetable, and that is a bit of a ramp-up. You'll notice that much of the build, particularly, I'll pick on Quantica here for a minute to get to that 500 MW. It's going to be 2030 for them. This is going to be, over time, a relatively build. We want to be, and talking particularly with Saby and Quantica because these are large data center plans. We've had very, very good conversations about the build-transfer aspects here.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

If I understand Quantica correctly, I mean, it was created three days ago, but this is backed by private equity, right? It's backed by NCAP Investments. This has been around since like 1996.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

I'm pretty firm in that customer.

[Brian Bird, President and CEO at NorthWestern Energy]

Yeah, Ross. I know when they rolled out their plan, but we've been talking to Quantica for some time now. It's been at least six months, and we know these folks well from their talent days. We met with all the Quantica and the NCAP folks early on in this process, and we feel good about who they are and what they're going to bring to the table to Montana. Fantastic. I apologize for the feedback on this end of the line. We're having a thunderstorm roll through New York right now, so there you go. Have a great afternoon.

[Brian Bird, President and CEO at NorthWestern Energy]

Hey, Ross.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Thank you.

[Brian Bird, President and CEO at NorthWestern Energy]

Good to hear your voice, Ross.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Thanks, Ross.

[Crystal Lail, CFO at NorthWestern Energy]

Yeah, no worries.

[Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America]

Take care.

[Operator]

Your next question comes from the line of Nicholas Campanella with Barclays.

[Nicholas Campanella, Director at Barclays]

Hey, good afternoon. Thanks for all the updates.

[Brian Bird, President and CEO at NorthWestern Energy]

Hey, Nick. Only your mother calls you Nicholas, right? Sorry, Nick. Just kidding.

[Brian Bird, President and CEO at NorthWestern Energy]

Can you hear me?

[Nicholas Campanella, Director at Barclays]

Either/or. Either/or. Nicholas Campanella is more respectful, I guess.

[Brian Bird, President and CEO at NorthWestern Energy]

No worries.

[Nicholas Campanella, Director at Barclays]

Just on the DC ramp, thanks for clarifying on when you think you're going to get the ESAs in place. If you do get that by the third quarter, what is the ramp of the megawatts on the system? What year would it hit? Is it more 2027 and beyond? Could you see some uptake in 2026? How are you kind of thinking through that?

[Brian Bird, President and CEO at NorthWestern Energy]

Yeah. I would say that the stuff in 2026 is going to be relatively small, just in essence, from a construction standpoint, whatever megawatts are needed there. I would stay focused on 2027.

[Nicholas Campanella, Director at Barclays]

Appreciate it. How do you kind of anticipate handling the Colstrip cost, once you acquire the facility in 2026? I know that there's some pending processes, and we have some variability about how that would get kind of captured in the rates. If you were able to keep that merchant, is that an option? How do you feel about the growth rate in that scenario?

[Crystal Lail, CFO at NorthWestern Energy]

Yeah. Nick, I'll take a stab at it, and Brian will clean up on this one. Your question's excellent as to where we're headed with Colstrip. I would just say two things related to that. One, as you guys know, we've entered into two transactions, one to take a business portion and another to take Puget. The Avista portion, we believe, is needed to serve existing customers, at least a portion of that, and expect to make a filing here sometime in Q3 to propose a process to get us really to the next rate review to recover those costs. The Puget megawatts wouldn't be needed to, as you looked at our load today, to serve regulated load. This kind of goes back to what Brian was addressing with our ability to serve large load. We expect to serve large load, whether it's Montana regulated or FERC regulated.

[Crystal Lail, CFO at NorthWestern Energy]

We want to make sure we leave our options open. If the Montana Commission, and I think a comment earlier alluded to a tariff that can help affordability for others, we absolutely believe there's a path for that. If the commission doesn't want to go down that road, we're certainly keeping and working to have our FERC regulated approach open to be able to serve out of that what would be the Puget tranche. Again, to deliver from a data center perspective, whether it be Montana regulated or it be a Puget piece that might be FERC regulated. All that being said, I'd say we do expect to make a filing here in this quarter to address recovery of some of those Colstrip costs. Brian, anything you'd add there?

[Brian Bird, President and CEO at NorthWestern Energy]

No, that was great. Thanks.

[Nicholas Campanella, Director at Barclays]

All right. Thank you. Appreciate it.

[Brian Bird, President and CEO at NorthWestern Energy]

Thanks, Nick.

[Operator]

At this time, there are no further questions. I will now turn the call back over to Brian Bird for closing remarks.

[Brian Bird, President and CEO at NorthWestern Energy]

Closing remarks from my perspective: continued progress on a lot of fronts. What we've done from a wildfire perspective, both operationally and from a legislative standpoint, extremely proud of that. Extremely proud of the company's ability to address our capacity shortfall and put us in a long position, particularly in the generation front. Certain good movement on the data center. Ultimately, we need to get a good outcome on the rate review and continue to move forward and provide returns in line with your expectations. I appreciate your interest today and going forward. Thank you.

[Operator]

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Participants

Executives

• Crystal Lail, CFO
• Brian Bird, President and CEO
• Travis Meyer, Corporate Development and Investor Relations Officer

Analysts

• Aidan Kelly, Equity Research Associate at JPMorgan
• Ross Fowler, Head of North America Power and Utilities Equity Research at Bank of America
• Nicholas Campanella, Director at Barclays