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Investor Presentaiton

L (dollars in millions) Appendix 50 Gross Margin (Full Year) Twelve Months Ended December 31, Electric Natural Gas 2020 2019 Variance $ 704.2 $ 741.6 $ (37.4) (5.0)% 188.3 198.3 (10.0) (5.0)% $ 892.5 $ 939.9 $ (47.4) (5.0)% (1) (1) Total Gross Margin $ (11.0) (10.6) (9.4) Decrease in gross margin due to the following factors: Electric retail volumes and demand Natural gas retail volumes Disallowance of prior period supply costs (3.3) Lower electric QF liability adjustment (2.7) Montana electric supply cost recovery Montana natural gas production rates Montana electric retail rates (2.7) Electric transmission (1.2) 1.6 (9.2) $ (48.5) $ 6.3 (5.0) (0.1) (0.1) $ 1.1 $ (47.4) Other Change in Gross Margin Impacting Net Income Gross Margin, defined as revenues less cost of sales, is a non-GAAP Measure See appendix for additional disclosure. Property taxes recovered in trackers, offset in property tax expense Production tax credits flowed-through trackers, offset in income tax expense Operating expenses recovered in trackers, offset in operating expense Gas production taxes recovered in revenue, offset in property & other taxes Change in Gross Margin Offset Within Net Income Decrease in Gross Margin NorthWestern Energy Delivering a Bright Future 50
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