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Black Hills signed agreements to serve a planned Google data center in Cheyenne beginning Sept. 30, 2026, with terms through 2048. The project includes $1.8B in company-owned natural-gas generation, up to 590 MW of grid-connected service, and is expected to deliver approximately $2.4B of unlevered free cash flow after generation investment.
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Black Hills Signs Definitive Agreements Effective Sept. 30, 2026, With Terms Through 2048, To Serve A Planned Google Data Center To Be Constructed In Cheyenne, Wyoming; Investing $1.8B In New Company-Owned Natural Gas Generation; Project Is Expected To Deliver ~$2.4B Of Unlevered Free Cash Flow, Net Of $1.8B Of Generation Capital Investment nvesting $1.8 billion in new company-owned natural gas generation Providing up to 590 megawatts (MW) of grid-connected energy service and managing 2.1 gigawatts (GW) of third-party contracted resources through a private microgrid Strong customer protections including no cost shifting to other customers Return on generation investment and microgrid management fees are contracted to begin contributing to earnings in 2027, and expected to provide approximately $150 million of net income in 2030 Expected to generate approximately $2.4 billion of unlevered free cash flow through 2048, net of $1.8 billion of capital expenditures RAPID CITY, S.D., Oct. 06, 2026 (GLOBE NEWSWIRE) -- Black Hills Corp. (NYSE:BKH) today announced it has signed definitive agreements effective Sept. 30, 2026, with terms through 2048, to serve a planned Google data center to be constructed in Cheyenne, Wyoming. The negotiated agreements include a Large Power Contract Services Agreement (LPCSA) and a Generation Facilities Agreement (GFA). The project, exclusive of additional transmission system expansion investments, is anticipated to be served by a total resource mix of 2.7 GW, including reserve margins, and is planned to begin taking energy service in late 2027 and ramp to the project’s peak load in 2030. Black Hills will provide up to 590 MW of grid-connected energy service through company-owned generation and market energy. In addition, Black Hills will manage the output of approximately 2.1 GW of Wyoming-based, third-party contracted resources through a privately managed microgrid under the company’s Large Power Contract Service (LPCS) tariff. To support the project, Black Hills plans to invest $1.8 billion between 2027 and 2029 to construct 564 MW (nameplate capacity) of company-owned generation. The company expects to begin earning a return on its generation investment when construction begins in 2027. Revenue from microgrid management fees (MGMF) is anticipated to begin in late 2027 and increase based upon a contractually defined ramp schedule included in the LPCSA. The project is expected to provide approximately $150 million of net income in 2030. Beyond 2030 and as contracted, the company will continue to earn MGMF and a return on its capital investment to be fully depreciated by 2048. The project is expected to deliver approximately $2.4 billion of unlevered free cash flow, net of $1.8 billion of generation capital investment. This cash flow will meaningfully strengthen the company’s financial profile, supporting a strong balance sheet, providing significant flexibility to finance the near-term investment, and creating substantial long-term flexibility for capital allocation.