Plan recommends a balanced mix of generation resources to meet future customer needs
CHEYENNE, Wyo. - Dec. 3, 2018 - Black Hills Corp. (NYSE: BKH) today announced that its Wyoming electric utility subsidiary, Cheyenne Light, Fuel and Power Co., doing business as Black Hills Energy, submitted its 2018 Integrated Resource Plan to the Wyoming Public Service Commission. The plan recommends that Cheyenne Light's long-term electric capacity and energy needs be met utilizing a balanced mix of generation resources, including coal, natural gas and renewable resources, including wind and solar. The plan also recommends that Cheyenne Light's near term electric energy and capacity needs be met through the purchase of the Wygen I power plant, located near Gillette, Wyoming, as the least cost resource.
"The IRP is a comprehensive road map outlining our planning and preparation to meet our electric utility customers' long-term energy needs over the next 20 to 30 years," said Linn Evans, president and chief operating officer of Black Hills. "The IRP incorporates the forecasting of customer demand for energy and economic modeling of a variety of generation resource options to ensure our ability to continue to serve our customers with safe, reliable and cost-effective energy."
The IRP process and evaluation for Cheyenne Light identified a near-term baseload generation capacity shortfall of 60 megawatts stemming from the 2022 expiration of a power purchase agreement for energy produced at the Wygen I power plant, which is owned by Black Hills Wyoming, an affiliate company.
"This shortfall represents approximately 25 percent of the current capacity and energy needs of our Wyoming customers. Our plan recommends that Cheyenne Light exercise its long-standing option to permanently acquire Wygen I as the preferred, least-cost alternative to replace the energy currently made available to Cheyenne Light through the power purchase agreement," said Evans. "The Wygen I power plant has been an extremely reliable and low-cost source of electric capacity and energy for Cheyenne Light since the plant was placed in service in February 2003, which was prior to the acquisition of Cheyenne Light by Black Hills Corp. in January 2005."
"Wygen I is the best long-term choice to cost-effectively meet our customers' current and future baseload capacity and energy needs," continued Evans. "As part of our fleet of owned generating facilities, Wygen I would continue to provide our customers with safe and reliable energy, ensure the long-term price-stability afforded by a low-cost, local Wyoming energy resource, and continue to provide stable, long-term mining and plant operations jobs within Wyoming," added Evans.
Review of Cheyenne Light's 2018 IRP is subject to an open public process governed by the WPSC. In addition, any future purchase of Wygen I by Cheyenne Light would require approval of a certificate of public convenience and necessity by the WPSC and approval by the Federal Energy Regulatory Commission. This process is expected to be completed by year-end 2019.
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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 1.25 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, www.blackhillscorp.com/corporateresponsibility and www.blackhillsenergy.com.
Investor Relations
Jerome E. Nichols
605-721-1171
jerome.nichols@blackhillscorp.com
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888-242-3969
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. This includes Cheyenne Light's ability to purchase the Wygen I power plant and receive the required approvals from the WPSC and FERC. 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 2017 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.
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Source: Black Hills Corporation via Globenewswire
