Black Hills Corp. Iowa Gas Utility Reaches Settlement Agreement for Rate Review
GRIMES, Iowa, Nov. 08, 2021 (GLOBE NEWSWIRE) -- Black Hills Corp. (NYSE: BKH) today announced that its Iowa natural gas utility, Black Hills / Iowa Gas Utility Company, LLC, doing business as Black Hills Energy, reached an agreement with all intervening parties to its rate review for a general rate increase to support the company’s efforts to continue delivering safe and reliable natural gas service to its 161,000 customers in 133 communities throughout the state.
“We are pleased to reach a constructive agreement with the Iowa Office of Consumer Advocate and other key stakeholders in Iowa,” said Linn Evans, president and CEO of Black Hills Corp. “The ongoing investments reflect our commitment to our Iowa customers for safe and reliable service, support economic growth in the communities we serve, and meet our clean energy goals.”
Black Hills Energy has nearly tripled its investments in its natural gas pipeline system in Iowa since its last approved general rate filing more than 10 years ago. These investments include replacing, upgrading and maintaining more than 2,800 miles of natural gas pipelines and 164,000 system service lines in the state – critical infrastructure required to ensure the safe and reliable delivery of natural gas to customers’ homes and businesses and support the growth needs of local communities.
The importance of these investments has been demonstrated by the excellent performance of Black Hills’ pipeline system to serve extraordinary demand during extreme weather events. Investments in replacing and upgrading pipeline materials have also contributed to more than a one-third reduction in greenhouse gas emissions intensity for the company’s pipeline system since 2005.
The settlement agreement is contingent upon final review and approval by the Iowa Utilities Board. If approved as filed, the request will shift approximately $2.2 million of rider revenue to base rates and will generate an estimated $3.7 million per year in additional revenue. The settlement proposes a capital structure of 50% equity and 50% debt and a return on equity of 9.6%. Black Hills is seeking new rates effective Jan. 1, 2022, replacing interim rates that were effective on June 11.
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.
Jerome E. Nichols
24-Hour Media Relations Line
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 approval of the settlement and anticipated revenues from new rates. 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 2020 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.