GRIMES, Iowa – June 1, 2021 – Black Hills Energy today submitted a regulatory rate review proposal to the Iowa Utilities Board (IUB) to recover investments made in safety, reliability and system integrity for natural gas service to nearly 161,000 customers across 133 Iowa communities.
Black Hills Energy has not requested a rate review in Iowa in over a decade. Since 2011, the company has invested over $250 million in its infrastructure in the state, including pipeline replacement and reliability projects, safeguarding meters, and farm tap fuel line upgrades. These projects have improved safety and reliability by updating and replacing aging infrastructure and ensuring compliance with state and federal regulations.
“We are proud of our strong legacy of providing safe and reliable service through efficient operations to avoid the need to increase rates in over a decade,” said Black Hills Energy vice president of operations Shirley Welte. “Iowans need and deserve safe and resilient infrastructure. That’s why we’ve been updating our natural gas infrastructure across Iowa and have made significant improvements to our system.”
The request also seeks to implement a five-year System Safety and Integrity Rider (SSIR) to prioritize safety-focused investments using a consistent, long-term approach to benefit customers, regulators, and the company. The request also seeks to provide the High Efficiency Assistance Tool to assist customers choosing natural gas appliances for their home.
The investments that Black Hills Energy has made in modern pipeline materials for Iowa customers has also contributed to more than a one-third reduction in greenhouse gas emissions intensity for the company’s pipeline system since 2005. The SSIR will support the company’s efforts for safety and reliability and its clean energy goals for reducing greenhouse gas emissions.
As proposed, the average residential customer bill would increase by $2.02 per month based on an average monthly use of 63 therms. The increase for customers will vary, based on rate class, load factors and total usage. The rate review does not affect the cost of the natural gas delivered by Black Hills Energy or costs incurred during the recent polar vortex and Winter Storm Uri in February 2021. The cost of the natural gas commodity is a direct pass-through to customers, meaning there is no mark-up or profit.
Customers who would like information about saving energy or bill payment assistance should call Black Hills Energy at 888-890-5554 or visit blackhillsenergy.com/assistance.
Under Iowa law, the company can implement a temporary increase in rates that will remain in effect until the IUB completes its review of the proposal. Black Hills Energy will implement a temporary rate increase of approximately $0.05 per month based on the average residential customer monthly usage of 63 therms on June 11, 2021. Temporary rate increases are subject to refund, plus interest, after the IUB issues a final decision on the request.
For more information about this rate review, please visit blackhillsenergy.com/IA-rates.
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, including anticipated revenues from the new rate increase and our ability to deliver an appropriate return to investors. 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 2020 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.