ENP Newswire - 04 August 2014
Release date- 01082014 - CHEYENNE, Wyo. - Black Hills Corp. (NYSE: BKH) utility subsidiary Cheyenne Light, Fuel & Power today received approvals from the Wyoming Public Service Commission of settlement agreements allowing the company to increase electric and natural gas revenues.
The settlement agreements among the utility, the Wyoming Office of Consumer Advocate and intervening parties allow Cheyenne Light to implement new rates for its electric and natural gas customers on Oct. 1, the scheduled in-service date for the new Cheyenne Prairie Generating Station.
The new natural gas and electric rates will generate an estimated $9.2 million per year in additional revenue, based on a return on equity of 9.9 percent, and a capital structure of approximately 54 percent equity and 46 percent debt.
The Wyoming PSC's decision provides Cheyenne Light a return on its investment in the 132-megawatt Cheyenne Prairie station and associated infrastructure, and provides for recovery of the utility's share of operating expenses for the natural gas-fired facility. The increased revenues also will be used to recover other infrastructure investments and increased operating costs.
'Our goal is to provide safe, reliable, cost-effective energy for our customers, while delivering an appropriate return for our investors,' said Linn Evans, Black Hills Corp.'s president and chief operating officer of utilities.
'The Cheyenne Prairie Generating Station will produce immediate and long-term benefits,' Evans said. 'The station will serve today's customers, increase the local tax base, create new jobs for the community, support economic growth and meet the increasing demand for electricity in the Cheyenne region for years to come.'
The new generating station is the first energy-efficient, natural gas-fired, combined-cycle power plant in Wyoming. It features relatively low air emissions and can quickly be called upon to supplement the availability of wind power, making it an effective solution to the increasingly strict Environmental Protection Agency air emission standards.
The Cheyenne Prairie station is co-owned by Cheyenne Light (approximately 60 percent) and another Black Hills Corp. subsidiary, electric utility Black Hills Power (approximately 40 percent).
Black Hills Power will use its share of the generating station's electricity to serve its customers in South Dakota, Montana and Wyoming. Earlier this year, Black Hills Power filed for revenue increases with the respective state regulatory commissions in order to recover a return on the utility's investment in the station. Those filings are still being reviewed by the South Dakota Public Utilities Commission and the Wyoming Public Service Commission.
Cheyenne Light, Fuel & Power Company
Cheyenne Light, Fuel & Power Company, a subsidiary of Black Hills Corp. (NYSE: BKH), serves 41,000 electric customers and 35,000 natural gas customers in the greater Cheyenne, Wyoming, region.
Black Hills Power, Inc.
Black Hills Power is the legacy utility business of Black Hills Corp. and has been delivering energy for more than 131 years. The electric utility serves 69,000 customers in 31 communities in western South Dakota, northeastern Wyoming, and southeastern Montana.
Black Hills Corporation
Black Hills Corp. (NYSE: BKH) is a growth-oriented, vertically-integrated energy company with a tradition of exemplary service and a vision to be the energy partner of choice. Black Hills Corp. is based in Rapid City, South Dakota, and serves 777,000 natural gas and electric utility customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. The company generates wholesale electricity and produces natural gas, oil and coal. Black Hills Corp.'s 1,948 employees partner to produce results that are improving life with energy.
More information is available at www.blackhillscorp.com
Jerome E. Nichols
Caution Regarding Forward Looking Statements
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 rate increase and our ability and the timing of receiving regulatory approval to recover Black Hills Power's share of the operating costs and a return on its investment.
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, including the factors discussed above, our ability to obtain adequate cost recovery for our utility operations through regulatory proceedings and the timing in which new rates would go into effect, the risk factors described in Item 1A of Part I of our 2013 Annual Report on Form 10-K filed with the SEC, and other reports that we file with the SEC from time to time.