Good morning. This is Bob Rowe. Thank you very much for joining us at this year's Annual Meeting. The rules of conduct and the agenda are available over the webpage that you are all watching. On behalf of the Board of Directors and management at Northwestern, welcome to the stockholders meeting.
As CEO, I'm the only non independent member of the Board of Directors. And in light of ongoing developments related to the coronavirus, public health concerns, we've decided to hold our annual meeting in this virtual format. Actually from questions already coming in, I think this is proven to be a good way to have this kind of discussion. I'll start by introducing the 9 members of our Board of Directors. Again, all of these are independent directors and they are a remarkable group.
First, Steve Addict. Steve has been Chair of the Board since 2018. Prior to that, he was Chair of the Board's Audit Committee since 2004. Tony Clark is a Senior Advisor at Wilkinson, Barker and Neuer LLP. He's a former distinguished member of the Federal Energy Regulatory Commission and also the North Dakota Public Service Commission.
Dana Dykhouse is the Chair of our Board's Human Resources Committee. Dana is the Chief Executive Officer of First Premier Bank headquarters in Sioux Falls, South Dakota. Dana is one of the most respected and engaged citizens in South Dakota. Jan Horstfall is the Chair of our newly formed Operations Committee and that committee focuses our Board's attention on safety, technology, environmental concerns and operations. And Jan is Co Founder and Chief Executive Officer of Maxletics Corporation, a sports technology and media company and brings just a real entrepreneurial focus to our work.
Britt Ide is the President of Ide Energy and Strategy. She lives in Montana. She's an engineer and an attorney and is nationally respected in the areas of clean energy and particularly women in energy. Linda Sullivan is the Chair of our Audit Committee. She recently retired as the Executive Vice President and Chief Financial Officer of American Water Works Company, the largest publicly traded U.
S. Water and wastewater utility. Julia Johnson is Chair of our Nominating and Governance Committee. She's the President of NET Communications and is the former Chairwoman of the Florida Public Service Committee. Along with Steve, she's one of our 2 veteran board members and brings a real passion for our customers and the communities that we serve.
Mahvaz Yazdi is one of 2 new directors, who joined our Board late in 2019. She's the President of Feasible Management Consulting, a company that provides strategic consulting in energy, innovation, technology and telecommunications. And she's just dove right into all things technology at Northwestern. Jeff Yingling is our other new Director. He's a founding partner of Energy Capital Ventures, which is a strategic venture fund formed to invest in early stage energy companies.
And he spent an entire career really in the financial side banking around utilities. Immediately prior to forming his fund, however, he was a senior advisor in Investment Banking at Guggenheim Securities LLC specializing in power, energy and renewables. Now it's my pleasure to introduce members of the Northwestern Executive team with whom I'm really privileged to work side by side every day, although none of us have been in the same room together now in quite nearly 2 months, and by whom our investors and customers are very well served. Brian Bird is our Chief Financial Officer Mike Cashel is our Vice President of Transmission Heather Graham is our General Counsel and Vice President of Regulatory and Federal Government Affairs John Hines is our Vice President of Electric and Gas Supply and also Montana Government Affairs Crystal Lael is our Vice President and Chief Accounting Officer Kurt Pohl, our Vice President of Electric and Gas Distribution Bobby Schropel, our Vice President of Customer Care, Communications and Human Resources. I I would like to point out that each of these individuals is great at what they do, great leaders and great participants in a team and fundamentally success depends on task and team.
Also participating in our meeting today is our Corporate Secretary, Tim Olson and Elaine Visco, our Assistant Controller, whom our Board has appointed to serve as the Inspector of Election for this meeting. In addition, representing Deloitte and Touche LLP, the company's registered independent public accounting firm are Judy Dockendorf and Adam Krasnov. Now it's my pleasure to invite Mr. Addict, Board Chair to conduct the business portion of the meeting. And I want to thank Steve for leading this company from the creation of this Board many, many years ago now, 1st as Audit Chair and now as Board Chair.
And Steve has been certainly a great advocate for shareholder value. But to me every bit as importantly, he's been extremely accessible to our employees and to our customers. He's held us to account as a management team and he's also been a great mentor. So Steve, off to you.
Thank you, Bob. On behalf of the Board of Directors, I want to thank all of you who are on this call this morning for joining our virtual annual meeting. I know it's a difficult time for everybody and I hope everybody remains safe. Before I call the business portion of the annual meeting to order, allow me to provide a roadmap of what will happen. 1st, there'll be a relatively formal business section of the meeting at which time we'll ask people to cast their votes electronically using the virtual annual meeting website.
We'll then pause the business portion of the meeting and Bob will give a presentation on the state of the company. And then perhaps most important, he'll open the floor to questions and comments from you. And during the 15 minute question and answer portion of the meeting, we'll try to answer as many shareholder submitted questions as possible as time permits. You may submit your questions electronically using the virtual annual meeting website at any time during the meeting and may begin submitting questions now if you haven't already. Now we will edit out profanity and other inappropriate language and will exclude questions that are not pertinent to meeting matters or are otherwise inappropriate or failed to comply with the meeting rules of conduct, which can be found posted on the virtual meeting website.
Again, we will try to answer as many questions as we can during that 15 minute time period. I'll now call this annual meeting of the shareholders of Northwestern Corporation to order. Would the Corporate Secretary please provide his report?
Thank you, Chair Addict. This is Tim Olson, Corporate Secretary for Northwestern Corporation. We have received an affidavit signed by Broadridge Financial Solutions that notice of this meeting, along with related proxy and annual report materials, was mailed or made available on March 6, 2020 to Northwestern shareholders of record as of the close of business on February 24, 2020, a record date. A list of shareholders as of the record date is available for inspection using the registered shareholder list link found on the webcast page. Based on the affidavit from Broadridge, this meeting is duly called with timely and proper notice.
In addition, based on the information provided by Broadridge, a quorum of shareholders is present to conduct our meeting today.
Thank you, Tim. Pursuant to the foregoing report of the Corporate Secretary, I hereby declare that a quorum is present at this Annual Meeting and that we may proceed with the business portion of the meeting. We can now turn to the items of business for today's annual meeting. Our business today is to act on 3 proposals that were brought before our stockholders in our proxy statement. These proposals are as follows.
Proposal number 1, the election of 10 members to serve on the Board for 1 year term. The nominees include Stephen P. Attic, Anthony T. Clark, Dana J. Dykhouse, Jan R.
Horstfall, Britt E. I, Julia L. Johnson, Robert C. Rowe, Linda G. Sullivan, Mavash Yazdy, and Jeffrey W.
Yingling. The Board of Directors has recommended a vote for the election of all 10 nominees. Proposal number 2, the ratification of Deloitte and Touche LLP as registered independent public accounting firm of the company for the year ending December 31, 2020. Although actions by stockholders is not required by law, the Board has determined that it is desirable to request approval of our selection of an independent accounting firm by the state stockholders. The Board of Directors has recommended a vote for ratification of Deloitte and Touche as Northwestern's registered independent public accounting firm.
Proposal number 3 is to hold an advisory vote to approved named executive officer compensation. This resolution concerning the approval of compensation paid to the company's named executive officers was set forth in the proxy statement for this meeting. The resolution reads as follows: Resolve that the compensation paid to the company's named executive officers as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation discussion and analysis, the compensation tables and any related material disclosed in this proxy is hereby approved. The Board of Directors has recommended a vote for adoption of this resolution approving on an advisory basis compensation of the company's named executive officers as described in the proxy statement for this meeting. That concludes the matters to be voted on as outlined in the notice of the annual meeting.
Ladies and gentlemen, I'd like to now open the polls for voting. If you've not already voted, you'll have a few minutes to cast your vote electronically. If you've had previously voted your proxy and do not wish to change your vote, you do not need to do anything. Your vote has already been recorded. If you wish to change your previous vote, you should cast your new vote now.
I'll now pause to allow your time to cast your ballot. As a reminder, we'll be closing the polls momentarily. If you intend to vote electronically, please do so now. Mr. Olson, based on the current level of voting activity, do we need any additional time for voting?
Mr. Chair, I do not see any further votes being cast at this time. I believe it would be appropriate to close the polls.
Okay. In accordance with our bylaws, I'll now close the polls with respect to proposals 1 through 3. And now it's my pleasure to call on Bob Rowe to provide an update on the company.
Prior to Bob providing his comments, I do want to provide an update on our forward looking statements. During the course of this presentation, there will be forward looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward looking statements often address our expected future business and financial performance and often contain words such as expects, anticipates, intends, plans, believes, seeks or will. The information in this presentation is based upon our current expectations of the date hereof unless otherwise noted. Our actual future business and financial performance may differ materially and adversely from our expectations expressed in any forward looking statements.
We undertake no obligation to revise or publicly update our forward looking statements or this presentation for any reason. Although our expectations and beliefs are based upon reasonable assumptions, actual results may differ materially. The factors that may affect our results are listed in certain of our press releases and disclosed in the company's most recent Form 10 ks and 10 Q along with other public filings with the SEC. With that, I will hand it over to Bob.
Thank you, Steve. Thank you, Travis. I'll start with a few highlights of the company. First, we are a pure electric and natural gas utility. We are stewards of critical infrastructure in 3 states as well as Yellowstone Park and Wyoming.
We're providers of essential service in good times and in bad. Our service territory is actually one of the largest in the United States. But as a company, we're one of the smallest utilities. And there's a dichotomy between the size of our territory and the number of customers. But in the states where we serve, we provide an absolutely critical role.
On this slide, we highlight some of our key attributes, 100 years of operating history, customer bills below the national average. We've achieved the highest ever customer satisfaction scores. I am particularly proud of our recognition for best practices in corporate governance. We have a history of strong and stable earnings growth. We are a stable investment with a stable investment grade balance sheet.
We've taken steps to ensure our liquidity so that we can continue to invest and serve our customers. Our dividend policy again is stable and predictable. And we have a disciplined capital investment program, 100,000,000 just in capital plan for this year, really focused on investing in the critical infrastructure that serves our customers. Customer growth in our region is stable and steady, and we have a diverse energy portfolio that companywide is nearly 60% carbon free and Montana is over 60% carbon free. And our focus is in meeting all of our customers' needs on the infrastructure side as well as on the supply side.
And so as we will discuss, we have focused particularly on meeting capacity concerns. COVID has changed all of our lives. That's the primary reason we are meeting in this format. And I'm really proud of what the company has done in that area. We activated our incident command structure early in March.
We prepared to do that for some time. We've been focused on keeping our employees safe, keeping our customers safe and keeping them in service. I've made the comment that COVID is unprecedented. We plan for various kinds of contingencies, various events, and we're good at executing those plans and we did that here. But COVID is different in the geographic scope.
It covers our entire service territory, but really the entire planet, the duration and the complexity of factors affected. As policies at the state level continue to evolve with announcements about potentially phased relaxing of various kinds of restrictions and that may be appropriate. But we plan to continue for the time being the policies we have in place and again continuing our focus on keeping our employees safe, keeping our customers in service. So we've done a good job executing plans and we will continue with those plans going forward. An important part of that is simply been working with our customers large and small, to ensure that they have service and to ensure that they're able to continue to carry out their roles in our community.
We're unique as a company and that we have people whose jobs are really very specifically working with our communities, working with our customers to help them succeed. And as we work through our incident command structure, they are very, very engaged. Heading the ICS is Bobbie Schropel, who might have introduced a few minutes ago. She and everyone involved have just done a great job. Here's a snapshot of our company.
We provide gas in Central Nebraska. Our Nebraska operation is integrated into our South Dakota operation. In South Dakota, we provide both electric and natural gas service and have a wonderful tradition of service. The book that tells the story of our predecessor in South Dakota is called Light Across the Prairie and was the story of bringing power to previously isolated communities across South Dakota. In Montana, we are an electric and gas supply transmission Distribution Company.
The gross plant and service simply in Montana is over $5,000,000,000 And I'm very proud of the stewardship role that we perform in our entire service area, certainly including Montana. And at the transmission level, for example, our assets are critical not only to serving our customers, but to serving the industrial sector, to serving rural electric co ops, to serving other local gas companies. As I mentioned, we take a long view. We are a pure electric and gas company with a strong utility foundation, stable earnings and cash flow, realistic growth prospects, strong financial metrics. And again, I'm particularly proud of the recognition for best corporate practices.
We talked about the eightytwenty principle. We are essentially 80% electric, 20% natural gas, 80% residential, 20% commercial and industrial, about 80% Montana, and 20% or less South Dakota and Nebraska. And much like Moore's Laws, these are descriptors not scientific predictors in any way. But we are proud and privileged to serve all of our customers in every part of our service territory. This is a depiction of our electric supply portfolio by state.
In Montana, in particular, our system is based on the primarily run of the river hydro system and we take not only the electric generation aspects of that, but our stewardship responsibilities that come along with that very, very seriously. Our customer satisfaction is important to us. We are ultimately in the customer service business as well as the infrastructure business. That has continued to move up even as we've invested in our system. Our rates are substantially below the national average.
On the gas side, our key metric is leaks per 100 miles of pipe. And there again, we are a very, very solid provider. And this reflects a lot of electric side, we provide solid first quartile reliability and this is significant in that our service territory is extremely rural. We have many communities that are served by radial lines rather than lines duplicated coming in from multiple directions. And of course, that service territory is in many instances very, very rugged.
So we're proud of the reliability that we provide and a major focus continues to be enhancing that reliability for our customers. In terms of the region that we serve, I always highlight that we have relatively stable and predictable growth, typically not flashy, but solid. And that's true on both the electric and the natural gas side, population growth. Similarly, in all three states, most recent predictions were at least somewhere above the national average. Unemployment rates in all states before COVID was at or below the national average again.
So many of us on this call live here and all of those attributes are very, very important to us along with the strong environmental attributes. In terms of earnings per share, you see GAAP and non GAAP. The thing to note here is that when we adjust GAAP to non GAAP to take out one time events so that we can show shareholders the most accurate picture of the company. And here we've had stable earnings per share and a stable predictable dividend as well. The return on average equity is within typically 9.5% to 11% over the past 10 years with an average of 10.2%.
So PSR, total shareholder return, is solid over the 1 10 year periods, but we fully acknowledge lags over the 3 5 year periods. And here is another depiction of total shareholder return. This was 2019. And then at the bottom, you see 2020 for the Q1 and you see the dramatic change in that picture as COVID began to have its effects. We invest for the benefit of our customers.
That's the business we're in and we appreciate our shareholders and debt holders support for that. So as we've continued to invest, for example, in Montana, the rate base investment has and this is the depreciated amount, the plant in service, net plant in service has grown at a rate of 10.7% over 2010 to 2019, while the electric bills in Montana have grown about 1.8%, that's lower than the national average. Non GAAP diluted earnings per share has grown at 5.7% over that period. Our typical natural gas bills have grown at 5 point 6% or negative or have gone down an average of 5.6% over that period compared to a decline of about 2.7%. So the story here is we've invested responsibly to serve our customers and maintained affordability.
Here you see our credit ratings, liquidity, debt to capital ratio and the debt maturity schedule. Typically, I've highlighted that we have been successful in attracting debt capital at attractive rates and long tenure. And we have targeted pre COVID have in excess of $100,000,000 and move the debt to cap ratio towards the bottom of our 50% to 55% range. Credit ratings, a very, very good story, moving our credit ratings up since the emergence from bankruptcy in 2004. Unfortunately, regulatory concerns in Montana have put pressure on ratings in the last few years.
In 2018, Fitch placed Northwestern on negative outlook. And then on also in 2018, Moody's downgraded our senior secured and unsecured ratings. Typically, the ratings agencies make their decisions based on a combination of objective accounting measures, particularly funds from operation, but then also for regulated utilities assessment about the regulatory environment is a very important driver as well. This gives you on the left picture of dividends and our maintenance CapEx budget below the line and then cash from operations above the line and then the ratio with the dotted line. On the right, you see federal and state net operating losses.
And this allows us to again manage our business with a great, great deal of stability. Our capital forecast over the next 5 years includes investments that we are confident about. This is not these are not speculative. The key thing is that you see the investment spread really in a balanced way over Montana Electric and Gas, South Dakota Electric and then South Dakota and Nebraska Natural Gas. We anticipate funding these investments for our customers typically with a combination of cash flow from operations aided by the net operating losses that I mentioned, 1st mortgage bonds and equity issuances based on what we currently know and believe any equity issuance would be late in 2020 or early in 2021 and would be sized to maintain and protect our current credit ratings.
As I mentioned, significant investments that are not in these projections, negative regulatory actions could necessitate additional funding. This slide does include incremental investment in South Dakota generation, but does not include any investment necessary to address additional generation in Montana. We have announced today that we are lowering our 2022 earnings guidance had been at a range of $3.45 to 3.60 dollars per diluted share and we're lowering that to $3.30 to $3.45 So essentially the bottom of our guidance range now becomes the top. And this is based on factors including COVID-nineteen related measures that we anticipate remaining in place generally through June, but then beginning to ease normal weather in our service territory, both on the electric and gas side and a consolidated income tax rate of about 5% to 0% of pre tax income and then diluted shares outstanding of about 50,900,000. And again, continued investment in our system to serve our customers and our communities is expected to provide a targeted long term growth rate of 6.9 percent total shareholder return through a combination of earnings growth and dividend yield.
Just to highlight a couple of things, we've been recognized as an industry leader in safety, accident prevention most recently just a few days ago by the American Gas Association. I've mentioned we've received our best ever customer satisfaction scores from J. D. Powers, very, very good electric reliability scores. Something again in the governance area in 2019, our proxy statement was winner of the best proxy statement for a small to mid cap company by Corporate Secretary Magazine.
We've been a finalist 7 of the 8 years and also won the award in 2014. Like so much of our work, it's all done in house rather than by using consultants. And this was a reflection on transparency in how we disclose and communicate, but also the soundness of the underlying practices. Also very proud to have been recognized now several years in a row for gender diversity on our Board of Directors. And this was from 2020 Women on Boards.
Our Investor Relations program has been recognized in both 2018 2019 by institutional investor as a top midcap utility and energy company that's based on access to senior management, well informed and empowered IR team, and appropriate and timely disclosures to our investors. Our Investor Relations team is essentially 2 people working in this area and working on a tremendous amount of other activity for the company. But they are factual, they are accessible and they are knowledgeable. I'm going to spend a few minutes on what we now have come to refer to as environmental, social and governance reporting. We've been participating in publishing the EEI ESG or Sustainability Template since December of 2018.
And this is quantitative information and it supplements our environmental stewardship report that provides information about very much of what we do. Looking forward on the regulatory front, the Montana Commission is deliberating on requests for reconsideration coming out of our last electric rate case, which included a settlement on many key items. One of the issues on reconsideration is decoupling. Decoupling is a measure was proposed originally by in this case by the Natural Resources Defense Council and strongly supported by Northwestern. At the same time, we filed with the Federal Energy Regulatory Commission a transmission rate case for our Montana assets, that is now pending in front of a settlement judge and settlement discussions are going on obviously by phone given the restrictions on travel.
Each year we submit a variety of trackers to our state commissions for electricity, natural gas and in Montana, property taxes. In South Dakota, we've completed and are implementing an electric supply plan in South Dakota. We participate in the Southwest Power Pool, which has provided great, great value to our customers and what we're really focused on here is increasing reliability and flexibility in dealing with extremely old infrastructure. We continue to invest in our transmission and distribution infrastructure and we've been on truly a 10 plus year journey to modernize that system. I talk about deployment at the speed of value and this includes both traditional assets and substantial technology investments as the technologies become viable and are useful to serve our customers.
We plan to join the Western Energy Imbalance Market in April of 2021. And this is a real time market that we believe will help lower costs of energy for our Montana customers, allow more efficient use of renewables and provide greater overall grid reliability. So substantial undertaking, we have people working very hard to ensure that we're able to meet that target. I mentioned our 2 great new Board members. They along with other members of our Board are really providing fantastic value in both Jeff and Mavash just jumped in with both feet.
And this has been just the latest step in our process of Board renewal that's been going on for really quite a few years. This is a remarkable team. And as I mentioned, I think our not only our shareholders, but our customers and employees are extremely well served. This is our Board overall. We introduced them earlier.
This is our executive team. Again, great, great people. Couple more things to highlight on corporate governance. I think I've talked about most of these, certainly our corporate ethics program is another one to highlight and various other recognitions for a range of governance activities. Environmental, social and governance, I mentioned this is an area of real focus for us.
I do encourage all of you to take a look at a number of documents for a high level, but still pretty comprehensive report on our environmental activities. Please do look at the 2019 environmental report. Mary Gail Sullivan is our Director of Environmental Work and she and her team do a great job. As important as our annual report to shareholders is I'm actually more proud of our community report. The 2020 report is available just this week.
The photo you see on the cover is of some stream bed restoration work and we had a lot of fun participating in over in the Dillon area. I think again, this involves our responsibilities as a company, as a good participant in the community and it's an important part of who we do, who we are and what we do. Under governance, our annual report obviously and our proxy statement. I touched on our overall supply portfolio in Montana, hydro being the base. And I think what's notable here is just in terms of nameplate capacity for generation resources, the electric industry has made some big commitments overall.
And about 28% on average of the nation's portfolio is carbon free resources in South Dakota, 35% in Montana, depending on how you're looking for resources up to 65% and resources continue to come online on a regular basis. Our challenge as we've discussed is meeting our customers' need for peak. This highlights some of our environmental stewardship, but also some of our ongoing projects. And this is avian protection, creek restoration, our LEED gold certification for our general office in Butte, the solar projects we're working on at the community level. It's very interesting things we're doing in our distribution system on a pilot level to potentially help address rural reliability using storage.
And then we're well underway with a massive streetlight conversion in Montana and ultimately in South Dakota. On the social front, we truly do invest in our community in multiple ways. And I've been on certainly phone calls even over the last few weeks talking about how we can support our communities and customers is a particular focus on our low income customers. I mentioned our bills being substantially below national average and customer satisfaction rates moving up. I'm extremely proud of our safety culture and how we have driven down those lost time incidents and OSHA recordable rates.
And this has continued even with the disruption and how we work through the COVID pandemic. Something that's particularly notable is 86% of our employees are proud to work at Northwestern Energy and I am incredibly proud to work with all of them. On the governance front, highlighted already the diversity of our Board, some of the recognitions that we have received, one that is under the radar, but incredibly important. Moody's is one of the 3 credit ratings agencies. And like the other 2, they evaluate us from a credit perspective, but they've also started evaluating companies from a governance perspective.
And among 50 publicly traded North American utility and power companies, Moody's gave us the 5th highest rating and that's regardless of size. And I think that reflects well on the company and paraphrasing Warren Buffett, when that tide goes out, you can tell who's wearing a swimsuit. And I think you've seen our employees really step up most recently over the last several months as we work with our customers to deal with COVID. We've adopted what we think is an actionable realistic carbon reduction vision for Northwestern in Montana. And because of the hydro system, we start from a very good place.
But our commitment is to reduce carbon 90% by 2,045 from a 2010 baseline. I've already highlighted where we are currently. And then we discuss ways to get from here to there. None is by itself a magic bullet. There's a real need for a lot of cooperation to get there and that involves understanding what technologies do and do not make sense, certainly placeholders for new technology.
And there's a lot of work to be done on as far as I'm concerned on the policy front. We are a pure utility and the statutory regulatory requirements of the policy environment coupled with the technology, coupled with the business plan, coupled with customer expectations, are how on any major issue we get from point A to point B. But this is something that our Board has spent a lot of time on, our executive team has spent a lot of time on and we believe that this is actionable. Do want to talk about our proposed acquisition of Colstrip Unit 4, it's 25% now. And the concept was first of all to provide our customers a low cost transitional resource meeting in the near term 25% of our customers' exposure to peak markets.
It was also a responsible way to address future closing costs for the part of Colstrip that currently serves our customers and a responsible transition for the community and the infrastructure there. Talon, the operator at Goldstrip, a merchant operator, but also does operate the plant itself, recognized that this was an extremely attractive proposition. They asserted their ROFR, their right of first refusal to claim 25 to claim half of that transaction. That essentially takes that much value away from our customers both in terms of an affordable near term power supply, but also very importantly in terms of prefunding closing costs for the existing ownership at Colstrip. Very important to recognize that as part of this transaction, Puget Sound Energy was going to retain liability for its share of future closing costs decommissioning as well as pension liabilities.
So that was a key way to address risks of taking on any additional ownership. So Talend asserting its ROFR does diminish the value to our customers. But at the same time, it confirms that the transaction was a good one, very good one from our perspective because another party made the decision to exercise those ROFR rights. Many of you I know followed our Montana procurement process and are aware that in our view, we have a 46% reserve margin deficit at peak times. This is a regional problem.
It's a West wide problem. It's a Pacific Northwest problem and it's also a Montana problem. West wide, it's fair to say energy is becoming cheap, capacity is becoming scarce and therefore expensive. In the Pacific Northwest, where the region has been able to really ride on past investments and where traditional base load generation is being closed down, regional experts are now for the first time in many years talking about a loss of load probability. This is new and it is a regional concern.
In Montana, it's an even more acute concern because of the resources we have and where we sit. Great thing about being able to acquire the hydro system dedicating that to serve our customers was it really helped fill in most of our need for energy. And at the time, we were very clear, we continue to need to address our customers' capacity requirements. And our customer load because we serve the retail customers tends to be tends to move up and down dramatically driven particularly by weather. Meanwhile, because our resources beyond hydro, our primary resource is wind.
Wind also moves up and down dramatically and often in opposite directions from load. It's a great resource, but we need to be able to address our customers' peak needs. So what the transaction with QJET did was help us to address about a quarter of that need, which among other things would buy time for other technologies to mature and we would hope become more cost effective. So in conclusion, we consider ourselves to be we are a pure electric and gas infrastructure and service provider with a solid utility foundation, very proud of our corporate best practices and I think those come into play at times like this. Our future growth prospects are realistic And because we have maintained financial discipline, we're in a good position to work through the current situation in appropriate ways.
So that concludes the presentation. There are quite a few questions online. If you have a question, you can submit that through the virtual annual meeting website. We will edit profanity. I don't see any so far or inappropriate language.
We would exclude questions that weren't pertinent to the meeting or fail to comply with the rules of conduct. And although I ran a bit long with the presentation, we will try to cover about 15 minutes or so of questions. And I will read the questions, do my best to answer and I have a lifeline to other members of the executive team or subject matter experts in some areas. We have at least one question for our outside auditors. So, first question, isn't it correct that Northwestern Energy was planning to generate a bunch of revenue from selling energy back to Puget Sound and use that money to pay for environmental cleanup at Colstrip.
So doesn't Talend's effort to buy some of Colstrip 4 hurt the environmental cleanup funding because you'll make half as much money or less. And the and I actually touched on this in the presentation. But yes, 2 of the key attributes of the proposal were that Puget would retain its environmental responsibility, its future closing costs for the part of the unit that we are requiring. And then we propose to use that to pre fund those closing costs. As far as I know, that's a unique proposal, and I think an extremely responsible proposal from an environmental perspective, from a stewardship perspective.
And I'm going to turn to John Hynes in just a few minutes. When he comes on, he can speak to whether the Talon ROFR assertion reduces the value by as much as half. And it's not exactly one for 1. But yes, it absolutely does reduce value not to shareholders by any means or to the company. It reduces value to customers, but there is still a positive value.
Next question, if there is a new president in 2020 and the price is put on carbon, what does that do to your analysis of the viability of an asset others are bailing out of? And will the cost of carbon pricing fall on the ratepayers? Just parenthetically, I hate the word ratepayers. We have customers or on the stockholders. I will offer a general comment.
When we do our resource planning, where our supply folks work through the planning exercise, they use multiple scenarios, including a proxy price of carbon. And so that's part of the traditional analysis. John Heinz, are you available?
I am.
Okay. Let me read one other question to you as well, I think is in your wheelhouse relevant to this. So the other question is Puget Sound says it expects Colstrip 4 to become more expensive in coming years because of rising fuel and operating costs. Would Northwestern Energy take into account the rising costs of maintaining Coal Strip 4 and the fact that coal is the number one contributor of greenhouse gas emissions. So can you take those 2 please?
Sure. So the important piece to gain an appreciation for from this transaction is that, under with the 185 Megawatt transaction, the full amount, a good from a percentage perspective, a very large percentage of the entire transaction value is over the 1st 5 or 6 years. And that coincidentally, and when I say value, that's for our customers. And coincidentally, that timeframe is also when we have the best understanding of what the actual cost of running the facility is. We have firm coal costs between now 2025.
Now regarding the carbon tax, we have run scenarios with carbon tax, as you mentioned, Bob. And while it does change the cost effectiveness slightly for different resource portfolios, It doesn't move the needle, especially in the early years, enough to degrade the value of this transaction to an amount where we'd want to look at an alternative. Fundamentally, you're buying a facility for 0.50 dollars You know what the costs are over the next 5 years. You have a fixed power purchase arrangement back to Puget based upon what market prices are and that revenue stream does come back and help fund future customer environmental liabilities.
Okay. John, I'm sorry, anything else you want to add?
I was just going to ask if there was anything I missed.
No, I think that's good. Next a question for our outside auditors. Let me pull that up. And this will go to Adam Krasnov. COVID-nineteen is placing increasing focus on the impact of air pollution on public health.
Lawsuits over climate crisis are becoming increasingly common such as the one brought in Montana by our Children's Trust. This is the same pattern we previously saw with the tobacco suits, which didn't go anywhere at first, but eventually resulted in huge verdicts. Is Northwestern Energy including this liability risk in their financials? What timeframe are they estimating for these risks to mature? And have you determined the timeframe is reasonable?
Are directors meeting their fiduciary responsibility to stockholders to take these risks into account? If not being accounted for, do you believe you have a fiduciary responsibility to flag this in the audit?
Hi, Bob. Can you hear me?
Yes.
Wonderful. Thank you. This is Adam Krasnoff, and I'm the audit partner from Deloitte and Touche that opines on the financial statements for the year ended 2019. The company discloses these items in Note 18 to its financial statements, which can be found in Form 10 ks filed with the SEC. I believe that the comments the company makes in Note 18 are materially correct in the context of the financial statements taken as a whole.
I do not consider the item to be a critical audit matter at this point as defined by our professional standards. We will continue to monitor these items individually and in aggregate. And if they do become a critical audit matter, we will address it in further detail by describing the risks and our audit procedures in further detail. The question about the Director's fiduciary responsibility is one that I'd refer back to the company.
Sure. And I think the Adam, you answered that in part. But beyond that, we have a responsibility to disclose risks as Adam described and Crystal Lael, our Chief Accounting Officer leads an extremely robust Sarbanes Oxley disclosure process within the company. John, here's another one I should have picked up for you. In light of recent EPA changes on coal, what impact will this make on Colstrip for operations, if any?
I guess, I'd need a little bit more specificity on that directly what the question is referencing. But again, we've taken into account all known environmental obligations today and into the future that are currently required or expected to be required under a reasonable standard. Those costs have been incorporated in our evaluation. And again, there is over $50,000,000 to $55,000,000 of value that flows back to our customers from this transaction over the next 5 years under the pre Roper
transaction. Okay. Here's a question on a little bit different subject. How many employees have you furloughed due to COVID-nineteen? And if so, when are they expected back to work?
And the answer is none. And in fact, we had a successful onboarding of a group of new employees just last week using an online platform. We operate a lean company. When we benchmark ourselves against others in the industry, we are extremely efficient at how we use all our resources, including people. I touched on at the start of the presentation some of the steps we took, but it's whether it's an engineer working on a project, whether it's a customer service representative trying to help a customer, whether it's a gas technician or journeyman lineman in the field or any of the other specialties that go up to make Northwestern.
It's just it's important for us to be available to serve our customers. So we've had many employees working from home. That's created space in our buildings for others to socially isolate. We stood up our backup electric and gas transmission centers and have our crews in the field working in ponds, but they are very much at work. Okay.
Here's one. For each director, do you accept the science behind climate change? If so, how do you square that with the path Northwestern Energy is on in terms of fossil fuel usage? If not, what on what basis do you dismiss or do you dismiss overwhelming scientific consensus? The directors are not online.
I can say for myself, yes, I do accept that scientific consensus. Certainly, that was a value of the hydro transaction. That's very much what's behind our carbon statement. I would actually quote the letter that the CEO of her site, the letter that the CEO of BlackRock sent out a couple of months ago, he highlighted a concern about carbon. He also highlighted the criticality of infrastructure and energy needs, meeting customer needs, providing affordable power and talked about a transition.
So I believe the transition that we are undertaking is consistent. And again, from an environmental perspective, the proposed Colstrip transaction, I think, is very responsible providing a pathway for the community and the assets, dealing with future closing costs and helping address a transition in resources while meeting the very real need our customers have. All of us, probably most of us on this call have at peak times in winter and summer. Now during that transition, there is an awful lot that we can do. Notably, just in our Montana portfolio, I've talked about hydro being the base.
Wind is very soon going to surpass hydro in terms of nameplate capacity in our Montana portfolio. And even after the acquisition from Puget Sound Energy, Colstrip will be a smaller resource than hydro, but it provides key attributes that other resources don't possess to the same degree. It's also notable that coal strip is not the most carbon intensive resource by any means in our Montana portfolio.
Hey, Bob, just with that, I do understand there's a few more questions in the queue, but we have reached the end of our 15 minutes and should continue the meeting.
Okay. Let me take on one more and these are consistent. What plans does Northwestern Energy have for new renewable projects? 60% is from dams that were repurchased by the ratepayers after having been lost by Montana Power several years ago. What programs are planned to replace dirty coal with gas with new non greenhouse gas emission sources.
Talked about wind, obviously, I've touched earlier on our pilot projects that I think will continue to have real value to our customers. We've also directly engaged with storage technologies. Storage can be challenging because it's typically a very short duration and peaks in Montana tend to be very long. Typically, it's a high pressure situation where the wind isn't blowing. So we're looking at storage initially as it becomes cost effective as a way, as I've mentioned, to enhance reliability in our distribution system.
But storage coupled with controls at some point, we hope will be a cost effective way to contribute to meeting peak needs. So we really do have, I think, a pretty diverse approach. There is huge opportunity to work together on where policy, technology, regulation and customer expectations come together. I know a number of you, for example, are from 350.org. I've shared your letter and the materials with our Board as well as communication from other individual shareholders.
There are things we fundamentally will not disagree on near term, But I nonetheless believe that there are opportunities for people of goodwill to work together, highlight some of those in terms of areas around energy efficiency policy, work we're doing to develop new green products and services, the decoupling proposal that's currently pending in front of the commission. There's a lot that we can do together. Thanks, Travis, for letting me run just a minute long.
Well, thank you, Bob. That was an excellent presentation. With regard to that question, it was positive toward the Board. I can say on behalf of the Board that all of us are concerned about climate change at this point. You only have to look around at the changes in weather to know that there is something happening.
You only have to look around at the rise in sea levels, which seem to be every year the intensity of that is revised upward. And Bob, I thank you for putting together the kind of environmental report you did today. I think it explains our position. One of your slides talks about where we are compared to the national average on nameplate portfolio. And if everyone that's on the call can think back to that one, it shows that we are twice as clean as the national average.
It doesn't mean that that's where it should be. It should be better and that's what Bob is talking about the company doing. And I think on behalf of Bob and the management and the Board, we are all focused on this issue and are concerned about it. But we're also concerned that we provide safe and adequate and cost effective power to our customers. The last thing we can as a society afford is to have a day when hospitals or other businesses have to shut down because there is inadequate capacity available.
So this is something, as Bob said, we all have to work together. I do thank you for all of your questions and how well put they were. And now I'll ask the corporate secretary whether we received the preliminary voting tabulation from Broadridge.
Thank you, Mr. Chairman. We have received the preliminary voting tabulation. We also have seen the number of shares that were voted at the annual meeting today, but not the actual votes. Based on the number of shares voted today and the preliminary voting tabulation from Broadridge, I am pleased to report that on a preliminary basis, shareholders have elected all the director nominees, shareholders have ratified our selection of Deloitte and Touche as the company's registered independent public accounting firm for 2020, and the shareholders have approved on an advisory basis the compensation of the company's named executive officers as set forth in the proxy statement for this meeting.
Now Broadridge will provide a final voting tabulation after the meeting, and we will report the final voting results of today's meeting on a Form 8 ks filed within 4 business days of this meeting. Mr. Chairman, I now turn it back to you.
Thank you, Tim. Well, on behalf of the Board and management of the company, I thank you for your participation and your support. These are difficult times we're all going through. I hope that everyone remains safe, remains involved, protects their families. As there is no other formal business to be conducted at this meeting, I'll now adjourn the meeting.
Thank you so much for coming.
And this does conclude the call. Speakers, please hold your line.