Colorado PUC Approves Black Hills Energy's 29 MW Wind Project to Meet the State's Renewable Energy Standard

PUEBLO, Colo., Aug. 8, 2011 /PRNewswire/ -- Black Hills Corp. (NYSE: BKH) utility subsidiary Black Hills Energy – Colorado Electric today announced it has received approval from the Colorado Public Utilities Commission regarding the utility's proposed 29 megawatt wind project. The Colorado PUC approved a settlement which allows Black Hills Energy to construct and own 50 percent of the wind project, an investment of $26.5 million, and authorized Black Hills Energy to conduct a competitive solicitation for ownership of the other 50 percent of the project. A written order is expected by Aug. 12, 2011, and Black Hills Energy will issue a request for proposals no later than Aug. 15, 2011 (http://www.blackhillscorp.com/BHErfp.htm).

"This approval of our wind project by the PUC is an important milestone as our utility continues to put assets and programs in place to meet the requirements of Colorado's Renewable Energy Standard, and will also provide economic development opportunities in southern Colorado," said Christopher Burke, vice president of Colorado utility operations. "The Huerfano County, Colo. site, just south of Pueblo, was chosen for its abundant wind resources and proximity to our existing transmission system."

Currently, the 50 percent of the project subject to the RFP is owned by a wind developer and is subject to a Renewable Energy Purchase Agreement (REPA) with Black Hills Energy. If Black Hills Energy determines that a new REPA with more favorable terms is available based on proposals gathered during the upcoming solicitation process, then a replacement REPA may be executed with the alternative wind developer no later than Jan. 1, 2012.

The project, planned for completion in late 2012, is expected to qualify for the U.S. Department of Treasury's section 1603 cash grant program. It will include 16 Vestas wind turbines, components of which will be manufactured in Pueblo and at other Vestas facilities in Colorado. On-site construction for the project, which will serve the 94,000 customers of Black Hills Energy in southern Colorado, will create approximately 55 construction jobs for southern Colorado, as well as new and recurring tax revenues for Huerfano County.

Black Hills/Colorado Electric Utility Company, LP d/b/a Black Hills Energy

Black Hills Energy serves 94,000 electric customers in 21 southeastern Colorado communities and was ranked No. 6 in Total Solar Watts per Customers in Solar Electric Power Association's 2009 Utility Solar Rankings report. Black Hills Energy is a subsidiary of Black Hills Corp. (NYSE: BKH).

Black Hills Corporation

Black Hills Corp. — a diversified energy company with a tradition of exemplary service and a vision to be the energy partner of choice — is based in Rapid City, S.D., with corporate offices in Denver and Papillion, Neb. The company serves 762,000 natural gas and electric utility customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. The company's non-regulated businesses generate wholesale electricity, produce natural gas, oil and coal, and market energy. Black Hills' 2,100 employees partner to produce results that improve life with energy. More information is available at www.blackhillscorp.com.

SOURCE Black Hills Corp.

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