NorthWestern Energy Group, Inc. (NWE) Business

ITEM 1. BUSINESS

OVERVIEW

NorthWestern Energy - Delivering a Bright Future

NorthWestern Energy Group, doing business as NorthWestern Energy, provides essential energy infrastructure and valuable services that enrich lives and empower communities while serving as long-term partners to our customers and communities. We work to deliver safe, reliable, and innovative energy solutions that create value for customers, communities, employees, and investors. We do this by providing low-cost and reliable service performed by highly-adaptable and skilled employees. We provide electricity and / or natural gas to approximately 850,300 customers in Montana, South Dakota, Nebraska, and Yellowstone National Park. Upon the completion of the holding company reorganization in 2023, NW Corp became a subsidiary of NorthWestern Energy Group. Our operations in Montana and Yellowstone National Park are conducted through our subsidiary, NW Corp, and our operations in South Dakota and Nebraska are conducted through our subsidiary, NWE Public Service. We have provided service in South Dakota and Nebraska since 1923 and in Montana since 2002.

On August 18, 2025, we entered into the Merger Agreement with Black Hills and Merger Sub, that provides for an all-stock merger of equals between NorthWestern and Black Hills (the Merger). The Merger Agreement provides for Merger Sub to merge with and into NorthWestern, with NorthWestern continuing as the surviving entity and a direct wholly owned subsidiary of Black Hills, which would assume the new corporate name of Bright Horizon Energy as the resulting parent company of the combined corporate group. The Merger will combine the strengths of both companies, resulting in an organization with greater scale, financial stability, and operational expertise. It is designed to create a stronger, more resilient energy company focused on delivering safe, reliable, and affordable energy solutions to customers. Pursuant to the Merger Agreement, at the effective time of the Merger, each share of common stock of NorthWestern issued and outstanding as of immediately prior to closing will be converted into the right to receive 0.98 validly issued, fully paid and non-assessable shares of common stock of Black Hills, par value $1.00 per share (Black Hills Common Stock). See Note 3 - Pending Merger with Black Hills Corporation to the Consolidated Financial Statements included herein for additional information regarding this pending Merger.

We manage our businesses by the nature of services provided, and operate principally in two operating segments: electric utility operations and natural gas utility operations. Our electric utility operations include the generation, purchase, transmission and distribution of electricity, and our natural gas utility operations include the production, purchase, transmission, storage, and distribution of natural gas. Our customer base consists of a mix of residential, commercial, and diversified industrial customers.

Our electric and natural gas utility operations are not dependent on a single customer, or even a few customers, and the loss of any one or even a few of our largest customers is not reasonably likely to have a material adverse effect on our financial condition. Our utility operations are seasonal and weather patterns can have a material impact on operating performance. Consumption of electricity is often greater in the summer and winter months for cooling and heating, respectively. Because natural gas is used primarily for residential and commercial heating, the demand for this product depends heavily upon weather patterns throughout our service territory, and a significant amount of natural gas revenues are recognized in the first and fourth quarters related to the heating season.

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We have a social responsibility to our customers to deliver reliable energy at an affordable price. Our reliability standards and results are typically in the first or second quartile compared to our peers and our typical residential bills are significantly lower than the national average. We are engaged with the communities we serve, hosting town meetings to provide updates on important matters relating to both NorthWestern and our residents. For our employees, we offer a career with competitive pay and great benefits, providing a balance between work and life. We have been recognized by Newsweek as one of the “Great Places to Work” three years in a row.

Over time, we have increased our environmental sustainability efforts and our access to carbon-free energy resources. In February 2022, we made a commitment to achieving Net-Zero by the year 2050 for Scope 1 and Scope 2 carbon and methane emissions. Our Scope 1 emissions are primarily from owned electric generation plants, fugitive emissions from our natural gas production, gathering, transmission and distribution systems and company owned transportation fleet. Our Scope 2 emissions are primarily from the electric and natural gas utilized to heat, cool and power our offices, warehouses and other facilities.

We currently own a mix of clean and carbon-free energy resources balanced with traditional energy sources that are necessary for us to deliver affordable and reliable electricity to our customers 24/7. In 2025, approximately 52 percent of our electric portfolio, from owned and long-term resources, was carbon-free, compared to approximately 41 percent (Source: U.S. Energy Information Administration, Annual Energy Review, Electricity Net Generation: Electric Power Sector) for the total U.S. electric power industry in 2024. We do not receive all of the related Renewable Energy Credits (RECs) from our contracted electric supply resources. The owner of the RECs claims the renewable attributes of the energy. Our resource mix does not represent the actual energy delivered to our customers. Market purchases and sales fill the gaps between customer demand and economic dispatch of our supply portfolio resources.

In 2025, we completed construction of the 175 MW YCGS electric generation facility and in 2026, we expect to complete construction of Aberdeen Generating Station Units 3 & 4, a 33 MW natural gas fired electric generating facility located in Aberdeen, South Dakota. On January 1, 2026, we acquired an additional 592 MW of ownership interest in Colstrip Units 3 & 4. As discussed further below, in order to meet the SPP's additional accredited capacity needs by 2030, we submitted a project with the SPP under their Expedited Resource Adequacy Study program for the construction of a 131 MW natural gas generating facility located in Aberdeen, South Dakota. While still striving to meet our environmental goal of Net Zero by 2050, these generation facilities are needed to support our efforts to provide reliability and affordability to our customers. Since 2011, we have added 1,096 MW of carbon-free generation (both owned and long-term contract) in Montana and South Dakota. We believe that technological advancements, along with decreasing costs of carbon-free generation and the regionalization of intermittent generation, will significantly contribute to our Net-Zero goal. The pace of transition to Net-Zero will depend on the timing of technological advancements, costs, and retirement of our existing coal fleet.

We are committed to conducting business with integrity, while ensuring transparency and accountability, and meeting our responsibilities to all our stakeholders. We adhere to a strict code of ethics regarding corporate governance. Our Code of Conduct and Ethics applies to all employees, board members, vendors and contractors, with additional Code of Ethics for the Chief Executive Officer and Senior Financial Officers concerning financial reporting and other related matters.

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MONTANA ELECTRIC OPERATIONS

Our regulated electric utility business in Montana, which is primarily conducted through NW Corp, includes generation, transmission and distribution. Our service territory covers approximately 107,600 square miles, representing approximately 73 percent of Montana's land area. During 2025, we delivered electricity to approximately 440,700 customers in 225 communities and their surrounding rural areas, 13 rural electric cooperatives and, in Wyoming, to the Yellowstone National Park. In 2025, by category, residential, commercial, industrial, and other sales accounted for approximately 46%, 46%, 5%, and 3%, respectively, of our Montana retail electric utility revenue.

Transmission and Distribution

Our electric system is composed of high voltage transmission lines and low voltage distribution lines as follows:

In addition to delivering energy to distribution systems to serve customers, we also transmit electricity for nonregulated entities owning generation, and utilities, cooperatives, and power marketers serving the Montana electricity market. Our total control area peak demand reached a peak of approximately 1,976 MWs on February 13, 2025. Our control area average demand for 2025 was approximately 1,345 MWs per hour, with total energy delivered of approximately 11.78 million MWHs.

Our transmission system is directly interconnected with Avista Corporation; Idaho Power Company; PacifiCorp; the Bonneville Power Administration; WAPA; and Montana Alberta Tie. Such interconnections, coupled with transmission line capacity made available under agreements with some of the above entities, permit the interchange, purchase, and sale of power among all major electric systems in the west interconnecting with the winter-peaking northern and summer-peaking southern regions of the western power system. We provide wholesale transmission service and firm and non-firm transmission services for eligible transmission customers pursuant to our FERC OATT.

Electric Supply

Our annual retail electric supply load requirement averages approximately 767 MWs per day, with a peak load of approximately 1,300 MWs, and are supplied by owned and contracted resources and market purchases with multiple counterparties.

In 2025, our owned generation resources generated electric supply representing approximately 67 percent of our retail load. We expect that our owned generation resources will generate electric supply representing approximately 95 percent of our forecasted retail load for 2026. The increase relative to the prior year is due to the acquisition of additional interests in Colstrip Units 3 & 4 from Avista. In addition, we have contracts with QFs totaling 569 MWs of nameplate capacity, including 107 MWs from waste petroleum coke and waste coal, 268 MWs from wind, 17 MWs from hydro, and 177 MWs from solar projects. We have several other long-term power purchase agreements including contracts for 135 MWs nameplate capacity from wind generation, 310 MWs from unspecified resources, 52 MWs of natural gas generation, and 13 MWs of hydro supply. On average, our owned and long-term contracted resources are expected to provide enough energy to meet our retail energy load requirements in 2026. Load requirements during peak demand in excess of our owned and long-term contracted resources will be satisfied with market purchases. Our owned and contracted resources will be economically dispatched to meet load requirements and any excess supply will be sold into the market.

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Owned Generation Facilities

Details of these generating facilities are described in the following tables.

(1) We are in the process of relicensing the Thompson Falls hydro facility. The FERC extended our current license for 2026, and we anticipate that they will continue to extend on an annual basis until our relicensing proceeding is complete.

(2) The Hebgen facility (0 MW net capacity) is excluded from the figures above. These are run-of-river dams except for Mystic, Cochrane, Ryan and Morony.

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(1) We have three separate ownership interests in Colstrip facility, a 30 percent ownership interest in Unit 4, a 15 percent ownership interest in Colstrip Units 3 & 4, and a 25 percent ownership interest in Colstrip Units 3 & 4, totaling to a 55 percent ownership interest in Colstrip Units 3 & 4.

Colstrip Units 3 & 4 provide base-load supply and are operated by Talen Montana, LLC (Talen). Talen has a 30 percent ownership interest in Colstrip Unit 3. Associated with our 30 percent ownership interest in Colstrip Unit 4, we have a reciprocal sharing agreement with Talen regarding the operation of Colstrip Units 3 and 4, in which each party receives 15 percent of the respective combined output and is responsible for 15 percent of the respective operating and construction costs, regardless of whether a particular cost is specified to Colstrip Unit 3 or 4. However, each party is responsible for its own fuel-related costs. On January 1, 2026, we acquired an additional 40 percent ownership interest in Colstrip Units 3 & 4. This includes the acquisition of ownership interests previously owned by Avista Corporation (Avista) (222 MW) and Puget Sound Energy (Puget) (370 MW) that brought our total share of Colstrip Units 3 & 4 up to 814 MW, or 55 percent of the plant capacity. We have a coal supply agreement to supply fuel from adjacent coal reserves for our ownership interests in Colstrip Units 3 & 4 that is effective through 2033. The 222 MW interest in Colstrip Units 3 & 4 acquired from Avista is owned by NW Corp and is included in our MPSC regulated supply portfolio. The 370 MW interest in Colstrip Units 3 & 4 acquired from Puget is owned by NW Colstrip 370. This resource is not included within the MPSC regulated resource supply portfolio at this time. We expect our future opportunity to serve growing utility customer demand, including large-load customers, may be supported by this resource.

Resource Planning

Resource planning is an important function necessary to meet our customers' future energy needs and is used to guide resource acquisition activities. Our Draft 2026 IRP is publicly available and is scheduled to be filed with the Commission in April 2026. This IRP is our first plan developed under the 2023 Montana administrative rules, which transitioned the planning process from a traditional resource adequacy focus to an integrated evaluation of generation, transmission, fuel supply, and reliability. Our previous resource plan was filed with the MPSC in April 2023.

While 2026 capacity adequacy is maintained due to the recent additions of YCGS and Avista’s 222 MW share of Colstrip Units 3 & 4, the 2026 IRP identifies emerging capacity needs beginning in 2027 driven by load growth, capacity contract expirations, and resource retirements. Consistent with regional practice, NorthWestern evaluates resource adequacy through the Western Resource Adequacy Program, which establishes planning reserve margin requirements based on probabilistic reliability metrics and seasonal system conditions.

In addition to our responsibility to meet peak demand, national NERC reliability standards continue to require sufficient dispatchable generation capable of increasing or decreasing output to manage system variability, including the growing demand of intermittent generation such as wind and solar. Our generation portfolio remains a balanced mix of energy and capacity resources having different operating characteristics and fuel sources designed to reliably serve retail customers at the lowest possible cost while maintaining reliability.

Western Energy Imbalance Market

We entered the Western Energy Imbalance Market (EIM), operated by the California Independent System Operator, on June 16, 2021. We have EIM transfer capability with PacifiCorp, Idaho Power Company, Bonneville Power Administration, Avista Corp, and Tacoma Power.

SOUTH DAKOTA ELECTRIC OPERATIONS

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Our South Dakota electric utility business, which is conducted through NWE Public Service, operates as a vertically integrated generation, transmission and distribution utility. We have the exclusive right to serve an area in South Dakota comprised of 25 counties. We provide retail electricity to more than 65,600 customers in 118 communities in South Dakota. In 2025, by category, residential, commercial and other sales accounted for approximately 39%, 59%, and 2%, respectively, of our South Dakota retail electric utility revenue.

Transmission and Distribution

Our electric system includes high voltage transmission and low voltage distribution lines as follows:

Our South Dakota system is interconnected with the transmission facilities of Otter Tail Power Company; Montana-Dakota Utilities Co.; Xcel Energy Inc.; and WAPA. We also have emergency interconnections with the transmission facilities of East River Electric Cooperative, Inc. and West Central Electric Cooperative.

We are a member in the SPP, with our transmission facilities residing in zone 19 of the SPP footprint. Each year, we review all new or modified transmission assets and transfer functional control of assets that qualify under the SPP Tariff to the SPP. This annual update goes into effect on April 1st each year. To date, we have transferred control of 333 line miles of 115 kV facilities and over 158 line miles of 69 kV facilities. While we have transferred functional control of these facilities to the SPP, they are still owned by us and reflected in the table above. Along with SPP, our South Dakota facilities have ties to MISO. We have grandfathered agreements in MISO, which provide us the access to move the power from the Coyote, Big Stone, and Neal power plants to our customers. Along with operating the transmission system, SPP also coordinates regional transmission planning for all of its members on an annual basis through its Integrated Transmission Planning (ITP) process. Our annual participation in the ITP process includes model development, system needs assessment, and solution development to address identified needs.

Electric Supply

Our annual retail electric supply load requirements average approximately 188 MWs, with a peak load of approximately 325 MWs, and are supplied by owned and contracted resources and market purchases. We use market purchases and peaking generation to provide peak supply in excess of our base-load capacity. We are a member of the SPP. As a market participant in SPP, we buy and sell wholesale energy and reserves in both day-ahead and real-time markets through the operation of a single, consolidated SPP balancing authority. We and other SPP members submit into the SPP market both offers to sell our generation and bids to purchase power to serve our load. SPP optimizes next-day and real-time generation dispatch across the region and provides participants with greater access to economic energy. Marketing activities in SPP are handled for us by a third-party provider acting as our agent.

Electric supply resources include 211 MWs from jointly owned coal plants and 118 MWs from two natural gas-fired plants. Additional resources include several peaking units and an 80 MW wind facility. We also purchase the output of four wind projects, three of which are QFs, under power purchase agreements. Actual output for our wind resources varies based upon weather conditions.

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Owned Generation Facilities

Details of our generating facilities are described further in the following chart:

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The Big Stone, Coyote and Neal plants are owned jointly with unaffiliated parties. Each of the jointly owned plants is subject to a joint management structure, and we are not the operator of any of these plants. Based on our ownership interest, we are entitled to a proportionate share of the capacity of our jointly owned plants and are responsible for a proportionate share of the operating costs.

The fuel for our jointly owned base-load generating plants is provided through supply contracts of various lengths with several coal companies. Coyote is a mine-mouth generating facility. Neal Unit No. 4 and Big Stone receive their fuel supply via rail. The average delivered cost by type of fuel burned varies between generation facilities due to differences in transportation costs and owner purchasing power for coal supply. Changes in our fuel costs are passed on to customers through the operation of the fuel adjustment clause in our South Dakota tariffs.

Resource Planning

We maintain an integrated resource planning process that includes forecasts of customer energy usage and evaluates a range of options to provide for the economic, reliable, and timely supply of energy. We regularly update our load forecasts to reflect changes in customer demand, industrial growth, and regional planning requirements, and we assess future generating capacity needs on an ongoing basis. In September 2024, we submitted an updated 2024 IRP to the South Dakota Public Utilities Commission that incorporates updated load forecasts, revised planning reserve margin requirements, updated resource cost and performance assumptions, and an evaluation of a range of resource portfolios over a twenty-year planning horizon.

Consistent with the 2024 IRP, we are replacing older generation resources at the Aberdeen Generating Station, with construction of Aberdeen Generating Station Units 3 & 4 underway and an expected in-service date in 2026. This project is expected to provide approximately 33 MW of nameplate capacity at a total projected cost of approximately $65.0 million, of which approximately $29.0 million is expected to be incurred in 2026.

The SPP has recently updated its resource accreditation and Planning Reserve Margin (PRM) requirements in response to growing reliability concerns. As a result, SPP is requiring additional accredited capacity by 2030 to meet the updated PRM targets. In October 2025, we submitted a project with the SPP under their Expedited Resource Adequacy Study program for the construction of a 131 MW natural gas generating facility located in Aberdeen, South Dakota, to meet regional capacity needs by 2030. Anticipated costs for this project are approximately $300.0 million.

NATURAL GAS OPERATIONS

Montana

Our regulated natural gas utility business in Montana, which is conducted through NW Corp, includes production, storage, transmission and distribution. During 2025, we distributed natural gas to approximately 249,400 customers in 123 Montana communities over a system that consists of approximately 5,900 miles of underground distribution pipelines. We also serve a smaller distribution company that provides service to approximately 1,417 customers. We transmit natural gas in Montana from production receipt points and storage facilities to distribution points and other nonaffiliated transmission systems. We transported natural gas volumes of approximately 51 Bcf during the year ended December 31, 2025.

We have connections in Montana with five major, unaffiliated transmission systems: Williston Basin Interstate Pipeline, NOVA Gas Transmission Ltd., Colorado Interstate Gas, Black Hills Energy, and Many Islands Pipeline. Thirteen compressor sites provide more than 51,400 horsepower on the transmission line and an additional 16,586 horsepower at our storage fields, capable of moving more than 400,000 dekatherms per day. In addition, we own and operate two transmission pipelines through our subsidiaries, Canadian-Montana Pipe Line Corporation and Havre Pipeline Company, LLC.

Natural gas is used primarily for residential and commercial heating, and as fuel for three electric generating facilities. The demand for natural gas largely depends upon weather conditions. Our Montana retail natural gas supply requirements for the year ended December 31, 2025, were approximately 22.8 Bcf. Our Montana natural gas supply requirements for electric generation fuel for the year ended December 31, 2025, were approximately 10.8 Bcf. We have contracted with several major

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producers and marketers with varying contract durations to provide the anticipated supply to meet ongoing requirements. Our natural gas supply requirements are fulfilled through third-party fixed-term purchase contracts, short-term market purchases and owned production. Our portfolio approach to natural gas supply is intended to enable us to maintain a diversified supply of natural gas sufficient to meet our supply requirements. We benefit from direct access to suppliers in significant natural gas producing regions in the United States, primarily the Rocky Mountains (Colorado), Montana, and Alberta, Canada.

Owned Production and Storage - Since 2010, we have acquired gas production and gathering system assets as a part of an overall strategy to provide rate stability and customer value: as we own these assets, which are regulated, our customers are better protected from potential price spikes in the market. As of December 31, 2025, these owned reserves totaled approximately 25.3 Bcf and are estimated to provide approximately 2.76 Bcf in 2026, or approximately 14 percent of our expected annual retail natural gas load in Montana. In addition, we own and operate three working natural gas storage fields in Montana with aggregate working gas capacity of approximately 17.85 Bcf and maximum aggregate daily deliverability of approximately 194,000 dekatherms.

South Dakota and Nebraska

Through NWE Public Service, we provide natural gas to approximately 51,200 customers in 82 South Dakota communities and approximately 43,400 customers in 4 Nebraska communities. In South Dakota, we also transport natural gas for nine gas-marketing firms and three large end-user accounts. In Nebraska, we transport natural gas for four gas-marketing firms and one large end-user account. We delivered approximately 31.0 Bcf of third-party transportation volume on our South Dakota distribution system and approximately 3.8 Bcf of third-party transportation volume on our Nebraska distribution system during 2025.

Our South Dakota natural gas supply requirements for the year ended December 31, 2025, were approximately 6.3 Bcf. We contract with a third party under an asset management agreement to manage transportation and storage of supply to minimize cost and price volatility to our customers. In Nebraska, our natural gas supply requirements for the year ended December 31, 2025, were approximately 4.1 Bcf. We contract with a third party under an asset management agreement that includes pipeline capacity, supply, and asset optimization activities. To supplement firm gas supplies in South Dakota and Nebraska, we contract for firm natural gas storage services to meet the heating season and peak day requirements of our customers.

Municipal Natural Gas Franchise Agreements

We have municipal franchises to provide natural gas service in the communities we serve in Nebraska and South Dakota. The terms of the franchises vary by community. The maximum term permitted under Nebraska law for these franchises is 25 years while the maximum term permitted under South Dakota law is 20 years. Our policy generally is to seek renewal or extension of a franchise in the last year of its term. We continue to serve those customers while we obtain formal renewals. In the 2025 Montana legislative session, new language was enacted eliminating the requirement for gas franchise agreements. Under this law, utility providers may construct and maintain natural gas lines within the public rights-of-way without obtaining a franchise agreement. Two of our South Dakota franchises and two of our franchises in Nebraska, which account for approximately 32,613 or 34 percent of our South Dakota and Nebraska natural gas customers, are scheduled to reach the end of their fixed term during the next five years. We do not anticipate termination of any of these franchises.

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GOVERNMENT REGULATION

Our provision of utility service is regulated by the MPSC, the SDPUC, the NPSC, and the FERC. We are also regulated by many other state and federal agencies. For example, because our operations impact land, waterways and the air, we are subject to a wide range of regulations administered by the federal EPA, the U.S. Fish & Wildlife Service, and parallel state agencies regulating environmental and natural resources in Montana, South Dakota and Nebraska. Another example relates to our provision of natural gas service. The U.S. Department of Transportation through the Pipeline and Hazardous Materials Safety Administration, along with its state partners, regulates natural gas pipeline and natural gas storage field safety. As a publicly-traded company, we are subject to the SEC’s requirements regarding financial reporting, disclosures, and laws and regulations protecting investors. We are subject to the Occupational Safety and Health Administration (OSHA), which regulates workplace safety. We are also subject to local zoning laws and regulations.

As detailed below, the rates we charge our utility customers are set through approval by the regulatory commission with jurisdiction in each of our respective service territories. Base rates are the rates that are intended to allow us the opportunity to collect from our customers total revenues (revenue requirements) equal to our cost of providing delivery and rate-based supply services, plus a reasonable rate of return on invested capital. We have both electric and natural gas base rates and cost tracking clauses. We may ask the respective regulatory commission to increase base rates from time to time. Rate increase requests are normally reviewed based on historical data and any resulting approvals may not always keep pace with increasing costs. For more information on current regulatory matters, see Note 5 - Regulatory Matters, to the Consolidated Financial Statements.

The following is a summary of our rate base (amounts we earn a return on) and authorized rates of return in each jurisdiction, estimated as of December 31, 2025:

(1) The revenue requirement associated with the FERC regulated portion of Montana electric transmission and ancillary services are included as revenue credits to our MPSC jurisdictional customers. Therefore, we do not separately reflect FERC authorized rate base or authorized returns.

(2) The Montana gas revenue requirement includes a step-down which approximates annual depletion of our natural gas production assets included in rate base.

(3) This jurisdiction was acquired in 2025 as part of the acquisition of Energy West Operations. For additional information regarding this acquisition, see Note 4 - Acquisition of Energy West Operations to the Consolidated Financial Statements included herein.

(4) This table excludes insignificant jurisdictions for Montana propane delivery, Havre Pipeline Company, and Cut Bank Gas natural gas delivery.

(5) For those items marked as "n/a," the respective settlement and/or order was not specific as to these terms.

MPSC Regulation

Nearly all of our Montana operations are subject to the jurisdiction of the MPSC with respect to rates, terms and conditions of service, accounting records, electric service territorial issues and other aspects of our operations, including when we issue, assume, or guarantee securities in Montana, or when we create liens on our regulated Montana properties. We have an obligation to provide service to our customers with an opportunity to earn a regulated rate of return.

Electric Supply Tracking Mechanism - The PCCAM tracks, for recovery through utility rates, the cost of power purchased and fuel used to generate electricity. The PCCAM incorporates sharing of a portion of the business risk or benefit associated

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with the energy supply costs with 90 percent of the variance above or below the established base revenues and actual costs collected from or refunded to customers. As part of its December 2025 order, the MPSC has suspended the 90/10 cost sharing mechanism of the PCCAM on a temporary basis pending further review by the MPSC. See Note 5 - Regulatory Matters within the Consolidated Financial Statements for further information. Certain PCCAM rates are adjusted on a quarterly basis for volumes and costs during each July to June 12-month tracking period based on the established base revenues and actual costs collected from or refunded to customers. Customer prices may be adjusted annually to absorb the difference for the annual tracking period. Annual filings are based on a July through June 12-month tracking period, and are subject to review by the MPSC to determine if electric supply procurement activities were prudent. If the MPSC subsequently determines that a procurement activity was imprudent, recovery of such costs may be disallowed.

Natural Gas Supply Tracker - Rates for our Montana natural gas supply are set by the MPSC. Certain supply rates are adjusted on a monthly basis for volumes and costs during each July to June 12-month tracking period based on the established base revenues and actual costs collected from or refunded to customers. Customer prices may be adjusted annually to absorb the difference for the annual tracking period. Annual filings are based on a July through June 12-month tracking period, and are subject to review by the MPSC to determine if natural gas supply procurement activities were prudent. If the MPSC subsequently determines that a procurement activity was imprudent, recovery of such costs may be disallowed.

Montana Property Tax Tracker - We file an annual property tax tracker (including other state/local taxes and fees) with the MPSC for an automatic rate adjustment, which reflects the incremental property taxes since our last base rate filing adjusted for the associated income tax benefit.

SDPUC Regulation

Our South Dakota operations are subject to SDPUC jurisdiction with respect to rates, terms and conditions of service, accounting records, electric service territorial issues and other aspects of our electric and natural gas operations. Our retail electric rates, approved by the SDPUC, provide several options for residential, commercial and industrial customers, including dual-fuel, interruptible, special all-electric heating, and other special rates. Our retail natural gas tariffs include gas transportation rates for transportation through our distribution systems by customers and natural gas marketers from the interstate pipelines at which our systems take delivery to the end-user. Such transporting customers nominate the amount of natural gas to be delivered daily. On a daily basis, we monitor usage for these customers and balance it against their respective supply agreements.

Adjustment Clauses - An electric adjustment clause provides for quarterly adjustment based on differences in the delivered cost of energy, delivered cost of fuel, ad valorem taxes paid and commission-approved fuel incentives. A purchased gas adjustment provision in our natural gas rate schedules permits the monthly adjustment of charges to customers to reflect increases or decreases in purchased gas, gas transportation, and ad valorem taxes. The adjustment clauses for both electric and gas utilities go into effect upon filing, and are deemed approved within 10 days after the information filing unless the SDPUC Staff requests changes during that period.

Phase In Rate Plan Rider - Effective July 1, 2025, we received approval to begin recovering costs for Aberdeen Generating Station Units 3 & 4 through our Phase in Rate Plan Rider. This tariff allows recovery of capital investments without filing a general electric rate review. SDPUC approval of the plan and associated project cost recovery are required. An update to this plan is required to be filed with the SDPUC by June 1 of each year.

NPSC Regulation

Our Nebraska natural gas rates and terms and conditions of service for residential and smaller commercial customers are regulated by the NPSC. High volume customers are not subject to such regulation, but can file complaints if they allege discriminatory treatment. Under the Nebraska State Natural Gas Regulation Act, a regulated natural gas utility may propose a change in rates to its regulated customers, if it files an application for a rate increase with the NPSC and with the communities in which it serves customers. The utility may negotiate with those communities for a settlement with regard to the proposed rate change if the affected communities representing more than 50 percent of the affected ratepayers agree to direct negotiations, or it may proceed to have the NPSC review the filing and make a determination. Our tariffs have been approved by the NPSC, and the NPSC has adopted certain rules governing the terms and conditions of service of regulated natural gas utilities. Our retail natural gas tariffs provide residential, general service and commercial and industrial options, as well as firm and interruptible transportation service. A purchased gas adjustment clause provides for biannual, or more often if needed, adjustments based on changes in gas supply and interstate pipeline transportation costs.

FERC Regulation

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We are subject to FERC's jurisdiction and regulations with respect to rates for electric transmission service and electricity sold at wholesale, hydro licensing and operations, the issuance of certain securities, incurrence of certain long-term debt, and compliance with mandatory reliability standards, among other things. Under FERC's open access transmission policy, as owners of transmission facilities, we are required to provide open access to our transmission facilities under filed tariffs at cost-based rates. In addition, we are required to comply with FERC's Standards of Conduct for Transmission Providers.

Our Montana wholesale transmission customers, such as cooperatives, industrial customers, and other customers that have third-party commodity supply providers, receive transmission delivery service under our OATT, which is on file with FERC. The OATT defines the terms, conditions, and rates of our Montana transmission service, including ancillary services. These transmission rates are adjusted annually through formula rates. Our South Dakota transmission operations are in the SPP, and transmission service is provided under the SPP OATT. These transmission rates are adjusted annually through formula rates.

The electricity sold from NW Colstrip 370, which has a 25 percent ownership interest in Colstrip Units 3 & 4, is subject to the FERC's jurisdiction and regulations with respect to rates for electricity sold at wholesale. We have submitted a request to the FERC for approval of cost-based rates and expect this rate approval to be effective in the first quarter of 2026. We have signed a contract to sell the dispatchable capacity and associated energy from NW Colstrip 370 through late 2027. This contract is subject to the approval by the FERC.

Our natural gas transportation pipelines are generally not subject to FERC's jurisdiction, although we are subject to state regulation. We conduct limited interstate transportation in Montana and South Dakota that is subject to FERC jurisdiction, and FERC has allowed the MPSC and SDPUC to set the rates for this interstate service. We have capacity agreements in South Dakota and Nebraska with interstate pipelines that are also subject to FERC jurisdiction.

Our hydroelectric generating facilities are licensed by the FERC and operated in accordance with the terms of those licenses and applicable FERC regulations. As part of the relicensing process, federal law authorizes FERC to issue a new license to the current licensee, to a different licensee, or, alternatively, permits the U.S. government to assume ownership and operation of the facility. If the existing licensee is not granted a new license, it is entitled to compensation equal to its net investment in the facility, not to exceed the fair value of the property taken, plus reasonable severance damages for other property adversely affected by the loss of the license.

Reliability Standards - We must comply with the standards and requirements that apply to the NERC functions for which we have registered in both the MRO for our South Dakota operations and the WECC for our Montana operations. WECC and the MRO have responsibility for monitoring and enforcing compliance with the FERC-approved mandatory reliability standards within their respective regions. We expect that the reliability standards will continue to evolve and change as a result of modifications, guidance, and clarification following industry implementation and ongoing audits and enforcement.

COMPETITION

We are subject to public policies that promote competition and development of energy markets. Certain of our industrial and large commercial customers have the ability to choose their electric supplier and may generate their own electricity. In addition, customers may have the option of substituting other fuels or relocating their facilities to a lower cost region. Customers have the opportunity to supply their own power with distributed generation including solar generation, and in Montana, can currently avoid paying for most of the fixed production, transmission and distribution costs incurred to serve them. These incentives and federal tax subsidies make distributed generating resources viable potential competitors to our electric service business.

The FERC has continued to promote competitive wholesale markets through open access transmission and other means. Our wholesale customers can purchase their output from generation resources of competing suppliers or non-contracted quantities and use our transmission systems to serve their load. There is also competition for available transmission capacity to meet our electric supply needs to serve customers.

ENVIRONMENTAL

The operation of electric generating, transmission and distribution facilities, and gas gathering, storage, transportation and distribution facilities, along with the development (involving site selection, environmental assessments, and permitting) and

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construction of these assets, are subject to extensive federal, state, and local environmental and land use laws and regulations. Our activities involve compliance with diverse laws and regulations that address emissions and impacts to the environment, including air and water, and protection of natural resources and wildlife. We monitor federal, state, and local environmental initiatives to determine potential impacts on our financial results. As new laws or regulations are issued, we assess their applicability and implement the necessary modifications to our facilities or their operation to maintain ongoing compliance.

In 2024, the EPA released final rules that will potentially impose requirements on fossil fuel assets, however, in 2025, the EPA issued multiple Notices of Proposed Rulemaking that would remove these additional requirements on fossil fuel assets. There is no mandated timeline for final action on these rules. If the MATS Rules are implemented and enforced as currently written, between now and 2028 total compliance costs for the Colstrip plant are estimated to range from $350 million to $665 million, of which we would be responsible for our proportionate share. This estimate has been developed by the Colstrip operator and represents an initial high-level scoping estimate that will require significant refinement to narrow the range of costs, which is currently underway. Without change, implementation of existing environmental regulations have the potential to limit or curtail our operations, including the burning of fossil fuels at our coal-fired and some natural gas power plants. While we strive to comply with all environmental regulations applicable to our operations, it is not possible to determine when or to what extent additional facilities or modifications of existing or planned facilities will be required as a result of changes to energy and environmental laws and regulations, or new administrative or judicial interpretations or enforcement decisions regarding them.

For more information on environmental regulations and contingencies and related capital expenditures, see Note 20 - Commitments and Contingencies, to the Consolidated Financial Statements.

CORPORATE INFORMATION AND WEBSITE

We were incorporated in Delaware on May 30, 2023. Our Internet address is https://www.northwesternenergy.com. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, along with our annual report to shareholders and other information related to us, are available, free of charge, on our Internet website as soon as reasonably practicable after we electronically file those documents with, or otherwise furnish them to, the SEC. This information is available in print to any shareholder who requests it. Requests should be directed to: Investor Relations, NorthWestern Energy Group, 3010 W. 69th Street, Sioux Falls, South Dakota 57108 and our telephone number is (605) 978-2900. References to our website in this report are provided as a convenience and do not constitute, and should not be viewed as, an incorporation by reference of the information contained on, or available through, the website. Therefore, such information should not be considered part of this report.

HUMAN CAPITAL RESOURCES

Our ability to achieve the objectives of our business strategy and serve our customers within our service territory depends on employing and continually investing in the development of skilled individuals at all levels of our organization. We aspire to be an employer of choice and a great workplace by offering competitive salaries and benefits and providing a safe working environment where employees can grow personally and in their careers. We value diversity, foster inclusion and encourage a healthful work–life balance that includes taking personal time and giving back to the communities we live and work in. Our success comes when employees feel purpose in the work they do and empowered to take initiative, voice their opinions, and build on their experiences within our company and our communities.

As of December 31, 2025, we had 1,667 employees. Of these, 1,353 employees were in Montana and 314 were in South Dakota or Nebraska. Of our Montana employees, 489, or 36 percent are covered by five unions under eight collective bargaining agreements. All eight of these collective bargaining agreements are set to expire in 2026 and are currently under renegotiation. Of our South Dakota and Nebraska employees, 167, or 53 percent, are covered by a collective bargaining agreement that is set to expire in 2026 and is now being renegotiated. We consider our relations with employees and union leadership to be positive and respectful.

Talent Management

Attraction and retention of skilled employees is key to our ongoing success. We invest resources in maintaining a culture that supports the ongoing development of our workforce. This includes an integrated learning and performance management system which includes annual performance reviews that link goals and competencies together so that managers are able to provide a holistic view to employees in regards to their performance against goals as well as key competencies as they relate to their role in the organization. This process provides opportunities to develop and enhance skills and knowledge, and enables our

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employees to grow professionally and perform their duties in a safe and efficient manner. This structured training and development is intended to provide employees a consistent learning experience, and maximizes learning retention and background knowledge. We offer tuition reimbursement to promote continued professional growth for current employees, and a scholarship program for students attending universities, colleges, and technical schools in our service area to assist in developing current and future skills sets needed by our employees. We support annual pre-apprentice scholarships, recruit and hire suitable candidates from the program, serve as industry advisors on the program board and have donated training assets to support the program.

Hiring, promotions, work assignments, or other decisions related to the terms and conditions of employment are made by considering skills, experience, proven track record of performance, and other traits that serve to create a team with varied strengths and backgrounds. Our workforce reflects the available talent in the communities we serve. In compliance with current mandates, our employment data is tested annually by a third party. This testing determined that there is no current need to establish corrective placement goals.

Compensation and Benefits

Our overarching compensation philosophy is structured to be consistent with our peers, and to align the long-term interests of our employees, executives, shareholders, and customers so the pay appropriately reflects performance in achieving financial and non-financial operating objectives. We offer a competitive pay and benefits package, which is benchmarked on an annual basis to external market data. Beyond base pay and incentive compensation, we offer competitive, cost-effective, and well- rounded benefits, which aligns with our desire to be an employer of choice. From considerable employer retirement contributions, to generous paid time off, to health care and well-being programs, our benefits are designed to meet the varied needs of our employees.

We are committed to internal pay equity, and the Human Resources Committee of the Board of Directors monitors the relationship between the pay our executive officers receive and the pay our non-managerial employees receive. During 2025 and 2024, the compensation for our Chief Executive Officer (CEO) was approximately 36 and 34 times, respectively, the compensation of our median employee.

We believe that a significant portion of an executive’s pay should be at risk in the form of performance-based incentive awards that are only paid if the individual and company performance targets are met. For 2025, approximately 82 percent of the targeted compensation of our CEO and about 63 percent of the targeted compensation of our other named executive officers is at risk in the form of performance-based incentive awards or time-based awards tied to the value of equity. Our Board of Directors establishes the metrics and targets for these incentive awards, based upon advice from the Board of Directors’ independent compensation consultant. In addition, our compensation practices have led to a relatively low CEO to median employee ratio of approximately 36 to 1 for 2025.

We engage nationally recognized outside compensation and benefits consulting firms to independently evaluate the effectiveness of our compensation and benefits programs and to provide benchmarking against our peers within the industry. We provide pay equity between our employees performing equal or substantially similar work. We engage a third party to review our pay equity and share the results with our Board of Directors. Our most recent study was performed in 2024, with no corrective action required.

Health and Safety

As stewards of critical infrastructure, providers of energy service, and members of the communities we serve, our top service value is the safety and well-being of our employees and customers. We integrate safety and health into every aspect of our business, continuously monitoring various areas related to safety practices and policies. Key metrics include the recordable incident rate (the number of work-related injuries per 100 employees over a one-year period) and the lost time incident rate (the number of employees who miss work due to work-related injuries per 100 employees over a one-year period). During the years ended December 31, 2025 and 2024, our recordable incident rates were 1.73 and 1.65, respectively, and lost time incident rates were 0.54 and 0.57, respectively, on a company wide basis.

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INFORMATION ABOUT OUR EXECUTIVE OFFICERS

(1) As of February 6, 2026.

(2) Michael Cashell has announced that he will retire from the Company in April of 2026.

Officers are elected annually by, and hold office at the pleasure of, the Board of Directors (Board), and do not serve a “term of office” as such.