Reliable Arkansas
Providing you with the energy you depend on
Every day, we provide the essential energy that our customers rely on. From cooking and heating to fueling manufacturing and agriculture, Black Hills Energy is here for you.
That’s why we’ve been updating our natural gas system throughout Arkansas to deliver safe and reliable service to our customers.
Black Hills Energy continues to make critical infrastructure investments that meet the growing demand for energy with continued resilience of the safe delivery of natural gas to our more than 184,000 customers in 100 Arkansas communities.
Infrastructure investments in our natural gas system improve the safety, reliability, sustainability and regulatory compliance of our over 7,200 miles of pipeline in the state.
2023-24 Arkansas Gas rate review
Black Hills Energy filed a rate review with the Arkansas Public Service Commission (APSC) December 4, 2023, seeking to recover the necessary capital infrastructure and operational costs required to enable safe, reliable natural gas service for customers in Arkansas. The company is also requesting modifications to the System and Integrity Rider and a refund to customers of $1.2 million of state excess deferred income taxes in early 2025. If approved by the APSC, new rates will be implemented in late 2024.
Public evidentiary hearing
Thursday, August 22, 2024
9:30 a.m.
Arkansas Public Service Commission Building
Commission Hearing Room
1000 Center Street
Little Rock, AR 72201
Public comment hearings
Monday, August 26, 2024
6 p.m.
Fayetteville Public Library
Willard and Pat Walker Community Room
401 W. Mountain St.
Fayetteville, AR 72701
Thursday, August 29, 2024
6 p.m.
Manila High School
Auditorium
404 S. Davis St.
Manila, AR 72442
What is a rate review?
Utilities periodically review customer rates to align with the actual cost of delivering natural gas service – this includes operating costs, capital investments and other system expenses. As a regulated public utility, Black Hills Energy must request approval from the APSC for any change to tariffs or rates.
Black Hills Energy will follow APSC’s formal process to recover allowable costs and system investments necessary to meet our responsibility to provide safe, reliable natural gas service for our customers. APSC will review our request and consider public comment and perspective from stakeholders.
What is the System and Integrity (SI) Rider?
The SI Rider supports ongoing infrastructure replacement projects, along with gas meter and replacement projects to increase safety. More than 55,000 feet of natural gas main and 29,000 feet of service lines have been replaced as part of the current SI Rider program.
Black Hills Energy is requesting modifications to the SI Rider to include reliability projects and necessary project investments Arkansas customers depend on to heat their homes and businesses, protect their property during freezing cold weather and provide products and services essential to public health and safety.
What is the Tax Adjustment Rider?
The Tax Adjustment Rider approved during the last rate review has expired, and Black Hills Energy is requesting a renewal to refund customers approximately $1.2 million of state excess deferred income taxes.
Why now?
Since its last rate review in 2021, Black Hills Energy completed more than $130 million in system safety, integrity and reliability projects for its natural gas utility system in Arkansas. These critical projects were required to support the safe and reliable delivery of natural gas and transportation services and meet compliance requirements of state and federal regulations.
It is necessary for the company to recover costs for investments made on behalf of customers to continue to provide safe, reliable service and prepare for expected growth and demands on our system of over 184,000 households and businesses in 106 communities across the state. There have been approximately 4,000 net new customers to include in rapidly developing Northwest Arkansas and with industrial growth in Northeast Arkansas with increased costs to serve customers since the last rate case was filed.
What is needed to maintain the natural gas system?
Black Hills Energy spends millions of dollars each year to safely operate, maintain and update more than 7,200 miles of natural gas system infrastructure in Arkansas. Ongoing inspections and maintenance are pivotal to the delivery of safe reliable natural gas service. This includes infrastructure replacement projects such as gas exchanging meters with advanced technology and pipeline replacements and projects to meet state and federal regulations.
How will this benefit Black Hills Energy customers?
Our customer-focused investments are essential to continue to deliver safe and reliable natural gas service and support the ongoing growth in Arkansas. For example, from 2019 through 2023, the company completed over 3,300 at-risk meter replacements to relocate meters to safer locations.
If approved by the APSC, how will it impact customer bills?
Actual rate impacts will be determined through the APSC review and approval process. If the total $44 million request is approved as filed, the typical residential customer would see an average increase in their monthly bill of approximately $15, based on an average monthly usage of 53 Ccf (hundred cubic feet). The increase for commercial customers will vary, based on rate class, load factors and usage.
Through our internal evaluation of rate design and individual customer load factors and usage characteristics, we’ve estimated the percentage rate change to individual customers.
| Customer class | Current rates bill amount | Requested rates bill amount | Monthly change | Percent change |
|---|---|---|---|---|
| Residential Service |
|
|||
| 53 Ccf | $74.25 | $89.56 | $15.31 | 20.62% |
| Small Business Service: B1 | ||||
| 154 Ccf | $181.76 | $228.26 | $46.51 | 25.59% |
| Small Business Service: B2 | ||||
| 1,654 Ccf | $1,601.45 | $1,762.69 | $161.24 | 10.07% |
| Medium Business Service: B3 | ||||
| 8,480 Ccf | $6,741.44 | $6,952.46 | $211.02 | 3.13% |
| Large Business Service: B4 (Non-Demand) | ||||
| 39,453 Ccf | $24,747.97 | $25,715.68 | $967.71 | 3.91% |
| Large Business Service: B5 (Demand) | ||||
| 162,249 Ccf | $93,437.50 | $99,061.69 | $5,624.20 | 6.02% |
The rate review does not affect the cost of natural gas, which is adjusted twice a year in Arkansas. Natural gas prices are a pass-through cost without any markup from Black Hills Energy.
Energy efficiency and customer resources:
In July 2023, Black Hills Energy released its 2022 sustainability report sharing progress on environmental stewardship and economic and charitable impact. Energy efficiency efforts in Arkansas were recognized by the U.S. Environmental Protection Agency and Department of Energy for the fifth year with the highly regarded 2023 ENERGY STAR® Partner of the Year Award. This includes receiving the highest Sustained Excellence designation in 2021, 2022 and 2023 for our long-term commitment to energy efficiency in Arkansas.
Arkansas customers are encouraged to review energy efficiency rebates, programs and services at energy-readyarkansas.com and visit our new Ready page to get helpful safety and energy and cost savings tips.
Assistance programs to include Budget Billing and Black Hills Cares are also available to support our customers.
For questions, customers may contact our customer service team at 888-890-5554.