Montana Supreme Court directs DEQ to study gas plant’s greenhouse gas emissions
Justices allowed NorthWestern Energy’s permit for the controversial gas plant to stand
By Amanda Eggert for Montana Free Press
Two weeks after the Montana Supreme Court directed state agencies to consider climate impacts in environmental reviews of large projects, it hinted at what the energy-permitting implications of that ruling will look like in practice.
In an order issued January 3, the court directed the Montana Department of Environmental Quality to incorporate the greenhouse gas emissions associated with a recently constructed gas plant in the agency’s review of plant impacts.
In a trio of opinions, the court allowed the Yellowstone County Generating Station’s permit to stand, but directed the agency to analyze the climate impacts of the plant estimated to release more than 23 million tons of greenhouse gases over its 30-year operational life.
NorthWestern Energy, owner of the 175-megawatt plant, started feeding electricity from the plant onto the grid two months ago, after the plant survived a challenge environmentalists filed in district court challenging its permit in 2021.
Montana Environmental Information Center and Sierra Club had argued the court should invalidate the plant’s air quality permit because the Montana Department of Environmental Quality (DEQ) failed to adequately study its climate, noise and lighting impacts.
A lower court vacated the permit, but a law the Montana Legislature passed in 2023 in response to Judge Michael Moses’ ruling left the permit in limbo. In Friday’s ruling, the Montana Supreme Court officially reinstated the permit.
In filings the environmental groups submitted to the Montana Supreme Court in 2023, other developments in Montana’s legal landscape played a starring role, including Lewis and Clark District Court Judge Kathy Seeley’s ruling affirming Montanans’ right to “a stable climate system” for “present and future generations” in the Held v. Montana youth climate case. Last month, the Montana Supreme Court affirmed that ruling.
In the court’s majority opinion Friday, Justice Beth Baker cited sections of the Held ruling, including a line arguing that Montana doesn’t have “a free pass to pollute the Montana environment just because the rest of the world insist[s] on doing so.”
The court also considered whether an analysis of environmental impacts outlined in the Montana Environmental Policy Act (MEPA), sometimes described as the state’s “look before you leap” statute, gives agencies like DEQ the authority to deny a permit based on identified impacts. Here, the majority sided with DEQ and NorthWestern Energy.
“MEPA does not confer regulatory authority beyond what is explicitly provided for in an existing [permitting] statute,” Baker wrote. “We require only that DEQ follow its MEPA obligations to conduct an adequate analysis in an environmental assessment or environmental impact statement — which in this case, includes evaluating [greenhouse gases] in its analysis of the [Yellowstone County Generation Station’s] air quality permit.”
Baker wrote that given the hundreds of comments the agency received foregrounding climate impacts, “DEQ is obligated to identify impacts and acknowledge their significance even if there is no regulatory enforcement mechanism” restricting emissions of carbon dioxide and other greenhouse gases.
Anne Hedges, co-director for MEIC, described the ruling as leaving a lot of questions unanswered, including what kinds of remedies are available to those who challenge an agency’s permitting based on material incorporated in the agency’s reviewing documents.
“We’re really happy that DEQ and other state agencies are obligated to consider climate change in their decision-making and disclose the impacts of climate change before moving forward — most of the time — but [the decision] leaves a lot unsaid,” she said. “It basically invites us to come back and challenge the remedy provisions, which are truly a convoluted mess. That’s on the horizon.”
NorthWestern Energy spokesperson Jo Dee Black emphasized the plant’s importance to the utility’s goals, describing the ruling as “good news for Montanans already relying on the critical, cost-saving capacity of the 175-megawatt Yellowstone County Generating Station, including for power during this first winter storm of 2025.”
Black noted the utility, the largest operating in Montana, would work with DEQ to provide any additional information necessary to carry out the court’s directive.
DEQ Director Sonja Nowakowski’s emailed remarks to MTFP echoed NorthWestern Energy’s.
“I am grateful the court agreed that DEQ’s substantive review of this permit should not be thrown out,” Nowakowski said. “Today’s decision means that this important energy resource can stay online to serve Montana. We look forward to sharing further analysis of the potential impacts from lighting and greenhouse gas emissions.”
The justices fell along a three-way split in the decision. Outgoing Chief Justice Mike McGrath and James Shea concurred with Baker’s opinion. Justice Jim Rice authored a separate opinion agreeing with Baker and others regarding the state’s duty to study climate impacts, but differing on the question of further review for this particular project. That opinion was also signed by outgoing justice Dirk Sandefur.
Rice argued that facility emissions are available to interested members of the public and requiring DEQ to study something it doesn’t have the explicit ability to regulate under permitting statutes is ill-advised.
“Two weeks ago, MEPA was changed by a ruling of this court, but in the meantime, the facility became operational, is connected to the power grid, and is providing critical power resources,” Rice wrote. “While future permitting applications for the facility will be subject to new requirements, I do not believe the facility’s current permit should be subject to disapproval over the MEPA review issues that the court has now identified.”
“Questions remain regarding proper consideration of [greenhouse gas] emissions and the creation of a necessary regulatory structure to be applied to permit request, which will not be resolved by a remand for further review in this case,” Rice continued. “Therefore, I would reverse the vacatur of the permit and bring this particular permit matter to a close.”
Justices Laurie McKinnon and Ingrid Gustafson argued their colleagues didn’t go far enough in their findings, accusing them of issuing “hollow justice that skirts the hard issue at stake.”
“Alarmingly, and in contravention of clear precedent, the remedy the court chooses to do is nothing,” McKinnon wrote in her opinion, which pulled extensively from the Montana Constitution. “The court allows the [gas plant] to continue with its environmental harm and remands so that the public may be informed of what it already knew — the consequential impact on its community from [the plant’s] emissions.”
“I cannot endorse the court’s effort to minimize the role MEPA plays in protecting our substantive rights to a clean and healthful environment,” she continued. “When we fail to provide relief for the constitutional harm we have found to exist, we fundamentally subvert the purpose of the [MEPA] statute. Our decision is empty and will be meaningless to the Montanans who want and believe the plant should be evaluated for its [greenhouse gas] emissions before it becomes operational.”
The ruling, informed by an argument justices heard in May, is one of the last ones this particular court is anticipated to issue. Next week Cory Swanson and Katherine Bidgaray will assume the positions McGrath and Sandefur are retiring from.