Get AI Briefings, Transcripts & Alerts on Local & National Government Meetings — Forever.
PUC flags nearly 80% proposed jump in Black Hills distribution capital spending and projected bill impacts
Loading...
Summary
At the Oct. 29 meeting the hearing commissioner highlighted Black Hills' distribution system plan, which proposes an almost 80% increase in average annual distribution capital spending versus 2020-2023 levels and warned the companymodeling shows material bill and rate impacts for local customers.
During deliberations on Black Hills' distribution system plan, the hearing commissioner raised concerns about a proposed near-80% increase in average annual distribution capital spending and warned that the change could materially affect customer bills and rates. The record presented in the DSP shows the company proposing to increase average annual distribution capital spending from roughly $27.4 million (2020-2023 average) to about $48 million per year in 2026-2028.
In the base-case model summarized in the recommended decision, the incremental distribution capital spending alone was associated with modeled electric bills roughly 5% higher and base rates about 8% higher by 2029 compared with 2025 levels. When combined with the company's other capital spending plans, the projected increases were larger: advisory staff cited an example of average monthly residential bills modeled more than 26% higher and base rates roughly 50% higher by 2029 compared with 2025 levels (the advisor noted that subsequent ERP results could alter those numbers).
The hearing commissioner said the local communities that will bear the costs include some of the state's lower-income areas and expressed concern that the distribution capital budgets were not clearly presented to affected communities when the company filed the DSP. He also said distribution spending models are often filed as confidential and therefore are hard for nonintervenors to review without formally intervening in the case.
The recommended decision did not grant a presumption of prudence for the proposed spending levels; the case record indicated parties were opposed to an across-the-board cap. The commissioner said the next regular regulatory opportunity to revisit ordinary-course distribution spending for prudence review is a future rate case after the spending has been incurred.
The commission did not take a final decision to change the spending levels at the Oct. 29 meeting; the hearing commissionerwanted to ensure the community and parties were aware of the scope of the proposed increases and of the likely bill impacts as the DSP proceeds through exceptions and final decision.
