Black Hills Corp. Gains Approval for Arkansas Natural Gas Rates
Black Hills Corp. Secures New Rates in Arkansas
Black Hills Corp. (NYSE: BKH) has made headlines recently with a significant development regarding its Arkansas natural gas utility operations. The Arkansas Public Service Commission has granted approval for new rates, marking a pivotal step in the utility's journey. The rates, set to take effect with the upcoming billing cycles, are aimed at recovering approximately $130 million in pipeline system investments.
Commitment to Customers
Linn Evans, president and CEO of Black Hills Corp., expressed satisfaction with the Commission's decision. He stated, "We are pleased to receive approval of a settlement that supports our long-term commitment to our Arkansas customers and communities to deliver safe and reliable natural gas service." This commitment is reflected in the critical infrastructure investments made, which are essential for meeting the growing demand for energy while enhancing the resilience of the natural gas system in Arkansas.
Financial Implications of the New Rates
The approved settlement agreement not only signifies an increase in service quality but also has notable financial implications. It is expected to generate approximately $25.4 million in new annual revenues. Additionally, around $3.7 million in annual rider revenue will be migrated to base rates, resulting in a total annual base rate revenue increase of $29.1 million. The approval allows for a 9.85% return on equity along with a capital structure of 46% equity and 54% debt.
About Black Hills Corp.
Black Hills Corp., based in Rapid City, South Dakota, is a growth-oriented utility company. The firm serves approximately 1.34 million natural gas and electric utility customers across states including Arkansas and others. Their mission evolution signifies a dedication to improving the quality of life through energy partnerships, reflecting a blend of tradition and innovation.
Investor Relations Contact
For any queries, interested parties can reach out to Sal Diaz from Investor Relations through email. The company also offers support via a dedicated media relations line available around the clock for further inquiries.
Frequently Asked Questions
What is the main purpose of the new rates approved for Black Hills Corp.?
The new rates aim to recover investments in pipeline systems and enhance the quality of natural gas services for customers in Arkansas.
How much additional annual revenue is expected from the rate increase?
Approximately $25.4 million in new annual revenues is projected from the approved rate adjustments.
What is the estimated total base rate revenue increase?
The total annual base rate revenue increase is expected to be around $29.1 million.
What type of return on equity has Black Hills Corp. received approval for?
The company has received approval for a return on equity of 9.85%.
How many customers does Black Hills Corp. serve?
Black Hills Corp. serves approximately 1.34 million natural gas and electric utility customers across several states.
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