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Black Hills Energy reaches settlement agreement for Kansas Winter Storm Uri cost recovery plan

WICHITA, Kan. – Nov. 10, 2021 – Black Hills Energy today announced it reached a settlement agreement for its plan to recover costs incurred for Kansas customers resulting from Winter Storm Uri in February 2021. The agreement with Kansas Corporation Commission staff and Citizens’ Utility Ratepayer Board includes recovery over a five-year period for $87.9 million of incremental fuel costs incurred to serve extraordinary demand and carrying costs associated with financing the costs to reduce the impact on customers’ bills.

“We are pleased to reach a constructive agreement for recovery of costs we incurred to keep our customers warm and safe when they needed us the most,” said Jerry Watkins, Kansas general manager for Black Hills Energy. “Our team is proud of our reliable service through the dangerously cold conditions of Winter Storm Uri and other winter events. Recovery of these costs are essential to continue delivering safe and reliable service for our 117,000 customers across 66 communities in Kansas.”

Black Hills’ commitment to safe and reliable service was demonstrated by the excellent performance of Black Hills’ pipeline system during Winter Storm Uri. As a result of the storm, the company incurred significant costs to procure natural gas critical for customers. Incremental costs were the result of extraordinary demand above and beyond the company’s commission-approved procurement and commodity hedging program to reduce commodity cost volatility for customers.

The settlement agreement is pending a final hearing and approval by Kansas Corporation Commission. While the recovery of natural gas costs typically occurs over twelve months, Black Hills Energy has instead proposed a recovery of these natural gas costs over the next five years to reduce the impact to customer bills. As proposed in the settlement agreement, a residential customer will see an average increase of $11.47 each month based on their usage moving forward.

“We’re committed to providing the safe, reliable energy that our communities need to thrive,” Watkins added. “We encourage our customers struggling to pay their bills to reach out to our customer service team to inquire about energy assistance funding such as the Kansas Low Income Energy Assistance Program, Black Hills Cares and Budget Billing.”