Tom Schneider departs PSC

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HELENA (LEE) -- On his first job as a petroleum engineer in the Wyoming oilfields, Tom Schneider was told he was "irrational on environmental matters" -- but took it as a compliment.

"I didn't think I was irrational," recalled Schneider, whose boss at Amoco had put him in charge of cleaning up dirty water from oil fields in the Powder River Basin. "I thought I was constructive and progressive."

More than 30 years and several jobs later, the veteran state public service commissioner has made a career out of being a voice for energy policy that's not only kind to the environment but also good for consumers.

But his career in Montana is over, as he steps down today from the five-member PSC and prepares for a new job in Utah.

Schneider, 58, chose not to run for re-election last year for his PSC seat that represents six western Montana counties, including the cities of Helena, Kalispell and Polson.

That decision ended a 12-year career on the PSC that spanned three decades. Schneider helped guide some of the regulatory commission's biggest decisions, from the Colstrip power-plant wars of the 1970s and 1980s to the aftermath of the 2003 bankruptcy of NorthWestern Corp.

Those who know him best said Montanans will miss his expertise and passion on energy issues -- particularly when it comes to protecting consumers from the whims of energy markets and merchants.

"Anybody who cares about or works with low-income people (in Montana) owes Commissioner Schneider a profound thank you," said Jim Nolan, director of Montana's Low Income Energy Assistance Program. "He has a place in the pantheon of Montana heroes."

Commissioner Doug Mood, R-Seeley Lake, said he's a political opposite of Schneider and doesn't agree with Schneider's "political agenda of the left."

But Mood, who joined the commission in 2005, was surprised to find that he got along well with his Democratic counterpart, and often found himself following Schneider's lead on issues.

"He had spent the time and personal effort to do the background work that needed to be done," Mood said. "He appeared to me to be always prepared for the work sessions, and the hearings."

Schneider grew up in Philipsburg in the 1950s and 1960s, in what he describes as a Populist, Democratic household. His father was a hard-rock miner and his mother taught school, often in one-room schoolhouses in Granite County.

His family didn't have much money, but Schneider won a four-year scholarship to study petroleum engineering at Montana Tech. He said the dean of students told him later the deciding factor for winning the scholarship was the fact that Schneider and his brother had started their own business in Philipsburg -- a garbage-collection business that "paid for our beer money, for clothes and everything else."

Schneider's first job out of college was an engineer for Amoco in Wyoming, where, as the last person hired, he was put in charge of cleaning up an old oilfield. His boss liked the job he did, but also said Schneider was "irrational on environmental matters."

Schneider kept working in the oil business and eventually returned to Montana, ending up in Billings in 1976. That year, the sitting public service commissioner from Billings, Democrat Tom Monahan, decided to run for Congress, leaving the PSC seat up for grabs.

At 28 years old, Schneider ran as a Democrat for the PSC seat and won. He arrived on the commission just as it was taking up one of its most significant issues in its history: The Colstrip power plants.

"Colstrip was going to be a huge consumer issue, in terms of rates and environmental impacts," Schneider recalls. "It was right in the wheel room of the controversies that interested me."

Montana Power Co. and other utilities had begun building four huge coal-fired power plants at Colstrip, at the height of the Arab oil embargoes and when Americans worried about having enough power.

As Schneider joined the commission, it allowed MPC to charge ratepayers for the Colstrip 2 plant. But Schneider rewrote the rate structure, shifting more of the burden away from homeowners and onto industrial plants, which he thought had been getting an unfair break on their share of prior rates.

In 1983, during Schneider's second term, the commission refused to allow MPC to charge ratepayers for Colstrip 3, saying its power wasn't needed.

The company challenged the decision in court and won a reversal. The PSC declined to challenge that ruling, in exchange for Montana Power's promise to not seek ratepayer payment for Colstrip 4, whose power was then sold out of state, Schneider said.

While Schneider and the PSC had saved Montana utility customers from much higher rates, the price of energy still had increased greatly during his time on the commission. As he prepared to run for re-election to a third term in 1984, he got a surprise: Monahan challenged him in the Democratic primary.

Monahan, promising to never vote for a rate increase, won the primary by 109 votes, out of 16,500 votes cast.

"That was really tough," Schneider recalls. "I'd poured eight years of blood into that. It hurt a lot. It really took the wind out of my sails."

Schneider spent the next 18 years as an energy consultant, mostly in Helena. Among his clients was Nolan, who hired him in 1990 to promote a utility "discount" for low-income consumers.

Until then, the only help poor consumers had on utility bills was a weatherization program financed primarily by Montana Power Co. Schneider presented the case to the PSC for the discount, and it was approved.

It started out at 10 percent, and has since risen to 25 percent for electricity and 35 percent for natural gas. Thousands of Montanans who live below 150 percent of the federal poverty level take advantage of the discount every winter.

"When he talked, people listened," Nolan said. "He knows how to get to the heart of an issue and ask the right questions. (The program) is a significant impact on low-income people's lives, and we owe it all to Tom Schneider."

In 2002, the PSC seat representing Helena came open. Schneider ran again and won this time, in a close race against Republican state Sen. John Cobb of Augusta.

During his past four years on the PSC, Schneider helped set up standards for utility ownership, in the wake of the NorthWestern bankruptcy; led the charge to deny NorthWestern part of a huge increase in natural gas rates; and voted to help small wind-power and hydro projects get contracts with NorthWestern.

He also was awarded the 2006 "Conservation Eagle Award" by the Northwest Energy Coalition, for his work on energy issues.

"I think he's a dedicated advocate for both consumers and the environment," said Pat Judge of the Montana Environmental Information Center.

Yet his final term also was filled with personal tragedy. His younger brother died unexpectedly of a heart attack, both his parents passed away, and he went through a divorce. When it came to gearing up for another re-election campaign, Schneider said he couldn't do it.

"I just did not have the energy and the desire to start over with another campaign," he said.

He'll be succeeded by Democrat Ken Toole, who won a close race over Republican Mike Taylor in PSC District 5.

As Schneider leaves the PSC, he's also leaving Montana, for he's taken a job with the Western Electric Coordinating Council in Salt Lake City. He starts this month as the council's new compliance officer, setting up a process to decide complaints before the council, which monitors electric transmission systems in the West.

Mood said the PSC and the state will be the lesser for Schneider's departure: "He had 12 years (on the commission). That experience level just doesn't exist here any more. Frankly, we're going to miss that."

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