If you've gone looking for a cheaper electricity plan in Montana, you've probably found nothing to compare. That's not a broken search — Montana is a regulated electricity state, and it actually knows what the alternative looks like: the state deregulated in the late 1990s and repealed it in 2007 after the restructured market failed. Here's why there's no provider to choose today, what your rate actually reflects, and what a homeowner can do instead of shopping around.
The straight answer
No, you cannot choose your electricity provider in Montana. Whichever utility serves your address — NorthWestern Energy, a rural electric cooperative, or a municipal utility — is your only option. There is no marketplace of competing suppliers and no plan comparison to run, because Montana does not currently allow retail electricity competition.
This is the part of Montana's story that makes it different from most regulated states: it isn't that Montana never tried competition — it tried it and walked it back. In the late 1990s, Montana restructured its electricity industry to separate generation from delivery and open the door to competing suppliers, the same basic model Texas and Ohio still run today. It didn't work out. The promised competition and savings didn't materialize the way lawmakers expected, and by 2007 Montana had repealed retail choice and moved back to a fully regulated structure.
That history matters for how you should read today's rate. Montana isn't regulated because it never considered the alternative — it's regulated because it tried the alternative and chose to reverse course. One utility per territory now sets your rate through public oversight rather than a competitive market, and every rate change has to survive a public case in front of regulators before it takes effect. The rest of this guide is about what a homeowner can actually control inside that system.
What power costs in Montana
Montana's average residential electricity rate was about 13 cents per kWh in 2025, per EIA's preliminary data. That's up 60 percent since 2005, and the pace over just the last decade has run about 1.8 percent a year — not a spike, but a steady, compounding climb. The chart below shows the full federal price history for Montana, with a dashed projection of where the rate goes if the last decade's pace simply continues. Drag across it, or compare Montana against another state.
Full Montana electricity price data (1990–2025)
| Year | Montana (¢/kWh) | US avg (¢/kWh) |
|---|---|---|
| 1990 | 5.5 | 7.8 |
| 1991 | 5.8 | 8.0 |
| 1992 | 5.8 | 8.2 |
| 1993 | 5.8 | 8.3 |
| 1994 | 6.0 | 8.4 |
| 1995 | 6.1 | 8.4 |
| 1996 | 6.2 | 8.4 |
| 1997 | 6.4 | 8.4 |
| 1998 | 6.5 | 8.3 |
| 1999 | 6.8 | 8.2 |
| 2000 | 6.5 | 8.2 |
| 2001 | 6.9 | 8.6 |
| 2002 | 7.2 | 8.4 |
| 2003 | 7.6 | 8.7 |
| 2004 | 7.9 | 9.0 |
| 2005 | 8.1 | 9.5 |
| 2006 | 8.3 | 10.4 |
| 2007 | 8.8 | 10.7 |
| 2008 | 9.1 | 11.3 |
| 2009 | 8.9 | 11.5 |
| 2010 | 9.2 | 11.5 |
| 2011 | 9.8 | 11.7 |
| 2012 | 10.1 | 11.9 |
| 2013 | 10.3 | 12.1 |
| 2014 | 10.2 | 12.5 |
| 2015 | 10.9 | 12.7 |
| 2016 | 10.9 | 12.6 |
| 2017 | 11.0 | 12.9 |
| 2018 | 11.0 | 12.9 |
| 2019 | 11.1 | 13.0 |
| 2020 | 11.2 | 13.2 |
| 2021 | 11.2 | 13.7 |
| 2022 | 11.3 | 15.0 |
| 2023 | 12.5 | 16.0 |
| 2024 | 12.7 | 16.5 |
| 2025 * | 13.0 | 17.3 |
Source: US EIA, average residential retail electricity price. Values in cents per kWh. * 2025 is preliminary.
Read that 60 percent honestly: it isn't one bad year, it's two decades of rate cases each nudging the number up a little, at a pace that has actually slowed somewhat in the last ten years compared with the full 20-year run. A household paying $150 a month in 2005 dollars, adjusted only for that rate increase, is paying roughly $240 today for the same usage — before accounting for the fact that Montana winters and larger homes have likely pushed usage up too. That combination — a rate that reliably climbs and a state where heating runs half the year — is exactly why the "what can I control" section below matters as much in Montana as in a state with a much higher headline rate.
Why your rate is set this way
In a regulated state, your rate isn't a market price — it's the output of a legal process called a rate case. NorthWestern Energy and Montana's other regulated utilities periodically file requests with the Montana Public Service Commission laying out their costs: fuel and purchased power, grid maintenance and upgrades, and a regulator-approved return on infrastructure investment. Rural electric cooperatives work a little differently — many answer to their own member-elected boards rather than the PSC, though the underlying logic of cost recovery through approved rates is similar. Consumer advocates and the public can weigh in on PSC cases. Regulators then approve, trim, or reject the request, and the resulting rate applies to every residential customer in that utility's territory equally.
Two things drive the number up over time. First, fuel and purchased-power costs move with the broader energy market — Montana's generation mix includes hydroelectric, coal, natural gas, and a growing share of wind. Second, grid investment is real and ongoing: transmission across a large, sparsely populated state, substation upgrades, and weather-hardening spending all get folded into future rate cases. None of this is something an individual homeowner can negotiate — the rate case is public, but it isn't personal.
How to actually lower the bill
Since you can't shop for a cheaper provider, everything that moves the needle in Montana happens on your side of the meter or inside your rate plan's structure — not by switching companies.
Efficiency first. Heating is the dominant line item on almost every Montana winter bill. A programmable or smart thermostat, sealing drafts around doors and windows, attic and wall insulation, and a properly maintained furnace or heat pump do more for a Montana bill than anything else on this list. If your home has an older furnace or thin insulation, that's often the single highest-return fix in the state.
Ask about rate structure, not rate shopping. Whether NorthWestern Energy or your co-op offers time-of-use or budget billing varies by provider — it's worth one phone call to find out what your specific utility has on offer. Where a time-of-use plan exists, shifting laundry and other flexible usage away from peak hours can trim the bill without using less energy overall, just using it at a cheaper time.
Budget billing for volatility. If the problem isn't the annual total but the swing between a mild-month bill and a deep-winter bill, ask your utility about budget or levelized billing. It averages your estimated annual cost into equal monthly payments with a periodic true-up, which doesn't lower your total cost but makes it predictable — useful for anyone on a fixed monthly budget.
Solar, weighed honestly. A rate that's climbed 60 percent since 2005 with no sign of flattening is exactly the condition that improves rooftop solar economics: every future rate increase is a cost you avoid on the portion of usage you generate yourself. Montana gets meaningfully less peak sun than the Southwest, so the generation side of the math is more modest than in a state like Arizona. The payback period depends heavily on your utility's net metering terms, which vary by provider — work through the specifics in our solar panels guide before signing anything.
The practical checklist
- Confirm your utility and rate plan. Find your provider (NorthWestern Energy, a co-op, or a municipal utility) and your current rate plan on your last bill — you can't compare options until you know your baseline.
- Ask about time-of-use or budget billing. Request a usage-based comparison from your utility if either program is offered in your territory.
- Fix the heating system first. Insulation, draft sealing, and a smart thermostat typically outperform any rate-plan switch in dollar terms.
- Consider budget billing if your goal is a predictable monthly payment rather than a lower annual total.
- Check your home's broader electrical health. Our electrical guide covers panel capacity and wiring issues that can also affect efficiency and safety.
- Run the solar numbers against your actual utility's terms before committing — net metering rules vary by provider in Montana and materially change the payback period.
Sources
U.S. Energy Information Administration — Montana average residential electricity rate (13 cents per kWh, 2025 preliminary) and the historical price series shown in the chart.