2030 Clean Energy Plan advances with proposed addition of 400 MW renewable energy resources

Black Hills Energy is seeking approval to advance its 2030 Ready: Clean Energy Plan to cost-effectively achieve the state of Colorado’s greenhouse gas emissions reduction target of at least 80% by 2030. In its 120-Day Report filed with the Colorado Public Utilities Commission on April 17, 2024, Black Hills Energy details the results of a competitive solicitation process for the procurement of 400 megawatts (MW) of new renewable energy resources needed to meet the state’s policy requirements. Through careful consideration and planning, Black Hills Energy is proposing a preferred portfolio of resources to meet the state’s clean energy objectives while also presenting back-up options.

During a competitive solicitation conducted in late 2023, Black Hills Energy received more than 100 bids from developers for the renewable energy resource procurement. With the oversight of a third-party evaluator, the company completed extensive modeling and analysis of each bid to fully assess the value of each project. Considerations were given to reliability, cost-effectiveness of resources, bill impact to customers, environmental benefits, state and local economic impact, and geographic diversity, among others.

Black Hills Energy is proposing a preferred portfolio of renewable energy resources which include 200 MW of utility-scale solar, 150 MW of wind, and 50 MW of battery storage. Together, these resources will cost-effectively achieve an estimated reduction of 89% by 2030. This plan achieves the state’s reduction target of 80% by 2030.

If approved, we anticipate our Ready 2030 Plan will meet 75% of our customers' electricity needs through renewable energy in 2030. 

All three proposed projects in our preferred portfolio are located in Colorado, with two projects located in Pueblo County.

If approved, these resources are planned to be in service by the end of 2027, and together, will achieve the state’s reduction target of 80% by 2030.

No. Our ability to serve our customers with 75% of their power supplied by renewable energy by 2030 is possible in large part due to the flexibility provided by the Pueblo Airport Generating Station, also known as PAGS. The power supplied by PAGS, our modern, highly efficient natural gas-fired generating station, is critical to this effort. Because of the intermittent nature of renewable energy-based generation – meaning, the wind doesn’t always blow, and the sun doesn’t always shine - we must have a consistent source of generation available to be dispatched at all times. PAGS is the most efficient means of maintaining reliable service to our customers, 24x7.

Not at all. Leadership in emissions reduction is nothing new for Black Hills Energy in Colorado – we retired our last Colorado coal plant in 2013, becoming the first electric utility fleet in the state to move away from coal. Over the past nine years, we have replaced emission-intensive coal plants with lower emission natural gas generation and renewable generation while maintaining system safety and reliability. Our 2030 Ready Plan is built upon years of phased-in renewable generation developments that have resulted in our energy supply being one of the cleanest in the state, powered 100% by natural gas and renewable energy. Because we have already transitioned a significant portion of our fleet to low-emission resources, we do not need to retire large portions of our generation resources, like other utilities are required to do. However, we are proposing to retire all three of our diesel generating facilities by 2030.

If approved, Black Hills Energy will add the Clean Energy Plan Rider (CEPR) to customer bills beginning Jan. 1, 2025. This surcharge will equate to 1.5% of the total annual bill or about $1.50 per month for the average residential customer. The surcharge is needed to help pay for the capital investments and related expenses associated with the implementation of a Clean Energy Plan and is allowed by Colorado state statute.  

To offset the new monthly Clean Energy Plan Rider, the company proposes to reduce the monthly Renewable Energy Standard Adjustment (RESA) rider, from 2% to 1.5%. As more renewable energy is added to the system, the company will generate less electricity from natural gas-fired generating units. This will lead to fuel cost savings to customers through a lower Energy Cost Adjustment (ECA).