Black Hills Corp. (NYSE:BKH) today announced that its Wyoming natural gas utility, Black Hills Wyoming Gas, LLC, doing business as Black Hills Energy, received approval from the Wyoming Public Service Commission of a settlement agreement allowing the company to consolidate its base rates and tariffs and for a general rate increase.
This approval is the final step in Black Hills’ utility jurisdiction consolidation process for Wyoming. Previously, Black Hills received approval and legally consolidated its four natural gas utilities in the state. This settlement agreement allows Black Hills Energy to establish statewide customer rates and consolidate general tariffs, gas cost adjustments, and certain riders and adjustment clauses.
“This settlement approval is an important step toward simplifying how we operate our natural gas utilities in Wyoming,” said Linn Evans, president and CEO of Black Hills Corp. “Our consolidation effort will improve customer service and reduce the complexity and number of rate reviews and other regulatory filings.”
Black Hills Energy has invested approximately $150 million since 2018 in safety, reliability and system integrity for its nearly 6,000 miles of Wyoming transmission and distribution pipeline to serve its 129,500 customers.
The new rates will generate an estimated $13.3 million in new annual revenue starting March 1, 2020, to recover Black Hills Energy’s investment in utility infrastructure and increased operating expenses. The new revenue is based on a return on equity of 9.4 percent and a capital structure of 50.23 percent equity and 49.77 percent debt.