Black Hills Corp. Electric Utility Requests Rate Review in Wyoming

Rhea-AI Summary

Black Hills Corp. (NYSE: BKH) announced a rate review application for $15.4 million in new annual revenue for its Wyoming utility, Cheyenne Light, Fuel and Power Company. The request comes after $250 million of investments in safety and reliability upgrades since the last rate filing in 2013, benefiting approximately 44,000 customers. The application seeks a capital structure of 54% equity and 46% debt, with a proposed return on equity of 10.3%. New rates are targeted for implementation in Q1 2023.

Positive

• Black Hills Energy invested approximately $250 million since 2013, enhancing electric distribution reliability.
• The proposed rate increase indicates commitment to infrastructure improvement and service reliability.

Negative

• The request for a $15.4 million increase may lead to higher costs for consumers.
• Dependence on regulatory approval for rate increase introduces uncertainty.

RAPID CITY, S.D., June 01, 2022 (GLOBE NEWSWIRE) -- Black Hills Corp. (NYSE: BKH) today announced that its Wyoming electric utility, Cheyenne Light, Fuel and Power Company, doing business as Black Hills Energy, filed a rate review application with the Wyoming Public Service Commission requesting $15.4 million in new annual revenue.

Since the company’s last general rate filing in 2013, Black Hills Energy has invested approximately $250 million in safety, reliability and system integrity for more than 1,330 miles of electric distribution and 59 miles of electric transmission lines, which serve approximately 44,000 electric customers in Cheyenne.

“This rate review request reflects our long-standing commitment to our customers and to the greater Cheyenne community to deliver safe and reliable service,” said Linn Evans, president and CEO of Black Hills Corp. “This investment in our system, combined with excellent operational execution by our team, supports our ability to deliver top-quartile reliability to our Cheyenne customers. This investment is also essential to our ability to meet our customers’ demands for energy, while also preparing to meet steady economic growth in Cheyenne.”

As proposed, the rate review requests a capital structure of 54% equity, 46% debt and a return on equity of 10.3% for investments the company has made in its electric system in Cheyenne. Black Hills Energy is seeking to implement new rates in the first quarter of 2023.

Black Hills Corporation
Black Hills Corp. (NYSE: BKH) is a customer focused, growth-oriented utility company with a tradition of improving life with energy and a vision to be the energy partner of choice. Based in Rapid City, South Dakota, the company serves 1.3 million natural gas and electric utility customers in eight states: Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. More information is available at www.blackhillscorp.com and www.blackhillsenergy.com.

Investor Relations
Jerome E. Nichols
605-721-1171
jerome.nichols@blackhillscorp.com

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Caution Regarding Forward Looking Statement
This news release includes “forward-looking statements” as defined by the Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this news release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward looking statements, including anticipated revenues from the new rate increase. These forward-looking statements are based on assumptions which we believe are reasonable based on current expectations and projections about future events and industry conditions and trends affecting our business. However, whether actual results and developments will conform to our expectations and predictions is subject to a number of risks and uncertainties that, among other things, could cause actual results to differ materially from those contained in the forward-looking statements, the risk factors described in Item 1A of Part I of our 2021 Annual Report on Form 10-K filed with the SEC, and other reports that we file with the SEC from time to time.

New factors that could cause actual results to differ materially from those described in forward looking statements emerge from time-to-time, and it is not possible for us to predict all such factors, or the extent to which any such factor or combination of factors may cause actual results to differ from those contained in any forward-looking statement. We assume no obligation to update publicly any such forward-looking statements, whether as a result of new information, future events or otherwise.

FAQ

What is the recent rate review application filed by Black Hills Corp. (BKH)?

Black Hills Corp. filed a rate review application requesting $15.4 million in new annual revenue for its Wyoming utility.

How much has Black Hills Energy invested since 2013?

Since 2013, Black Hills Energy has invested approximately $250 million in safety and reliability improvements.

When does Black Hills Corp. plan to implement the new rates?

The company plans to implement new rates in the first quarter of 2023.

What is the proposed capital structure for the rate review application by BKH?

The proposed capital structure is 54% equity and 46% debt.

What return on equity is Black Hills Corp. seeking?

Black Hills Corp. is seeking a return on equity of 10.3% for its investments.