Colorado electric regulatory rate review
Delivering safe, reliable electric service for Southern Colorado
At Black Hills Energy, our most important responsibility is providing safe, reliable electric power to our customers and communities. We are seeking a rate update for the first time in eight years to adjust for rising costs to operate and maintain our Southern Colorado electric system which serves over 100,000 customers in Pueblo, Cañon City, Rocky Ford and surrounding communities. The last Black Hills Energy rate update was in 2016, eight years ago.
The rate review, submitted to the Colorado Public Utilities Commission (PUC) on June 14, 2024, in proceeding No. 24AL-0275E, requests approval to recover critical system costs already incurred by Black Hills Energy to support the safe and reliable delivery of electricity to power customer homes and businesses. It includes necessary infrastructure investment and operating costs, including higher costs for poles, wires, transformers and other equipment, and competitive pay and benefits for the 136 local employees who keep the system running.
Subject to PUC approval, Black Hills Energy is requesting an increase in its base electric rates which would result in an average monthly bill increase for residential customers of about $20. This equates to an approximate 2.25% annual increase over the eight years since Black Hills Energy last changed its rates. Bill impacts will vary across customer classes based on how much energy each customer uses. Following extensive review and approval by the PUC, new rates would go into effect in or before March 2025.
How your electric rates are set
Our electric rates are established through a highly regulated process guided and approved by the PUC, allowing utility companies to recover the prudent costs of providing service to customers. Over several months, the PUC will evaluate Black Hills Energy's rate review proposal while also hearing from intervening parties and considering public comment before it makes its decision about customer rates and the way rates are structured. In this proceeding, Black Hills Energy is proposing changes to its rate structure to simplify the bill to make billing charges easier to understand, while also creating options to help customers better control and manage their energy use. This includes a proposal to eliminate the existing tiered rate structure and replace it with a flat rate energy charge and an optional time of use rate.
Helping customers use less energy
Because the amount of energy used has always been the single biggest factor in determining how much customers pay – about 90% of the average monthly bill for residential customers – taking steps to manage energy use by making your home or business more energy-efficient is an important way to save.
• We offer free energy efficiency kits for customers, with information on easy steps you can take to make your home more energy-efficient and materials like weatherstripping for doors, energy-saving LED bulbs, faucet aerators and showerheads.
• We offer free virtual home energy assessments for Colorado electric customers, where a trained energy evaluator will assess home energy use and recommend ways to save.
• Rebates from Black Hills Energy when customers make qualifying purchases of energy-efficient heat pumps, air conditioners, water heaters and home appliances, as well as smart thermostats, insulation and sealing to reduce home energy use.
For more information visit Colorado electric residential rebates.
Support for customers
We recognize the impact that rate increases have on our customers, especially at times of high inflation. That is why we have avoided asking for an electric base rate increase for eight years. We are taking action to minimize the impact and have increased our efforts to provide support for customers who need it, including launching a new Energy Assistance Team with a dedicated resource in Pueblo.
Our Energy Assistance team helps:
• Reduce our customer’s energy burden throughout Southern Colorado to offer immediate support to customers who qualify.
• Advocate for additional federal funding to be provided to states.
• Engage community partners who work with families to provide additional programs and resources to assist customers in need and connect them to Black Hills Energy programs for income qualified customers.
For more information visit Colorado payment assistance.
Frequently Asked Questions
What is a rate review?
Utilities periodically review customer rates to align with the actual cost of delivering electric service – this includes operating costs, capital investments and other system expenses. As a regulated public utility, Black Hills Energy must work with the PUC to request review and approval for any change to tariffs or rates.
Black Hills Energy will follow the PUC’s formal process to recover allowable costs and system investments necessary to meet our responsibility to provide safe, reliable electrical service for our customers. The PUC will review our request and consider public comment and perspective from stakeholders.
Why are you requesting a rate increase?
Our most important responsibility is providing safe, reliable electric power to our Colorado customers and communities. We are seeking a rate update for the first time in eight years to adjust for rising costs to operate and maintain our Southern Colorado electric system. A rate update allows us to recover critical system costs already incurred to support the safe and reliable delivery of electricity to power customer homes and businesses.
Why now?
It’s necessary to update our rates so we can continue to provide safe, reliable service to our customers. Electric rates were last set eight years ago, in 2016. Since that time, we have made critical system upgrades and improvements to support the resilience and reliability of our transmission and distribution system.
How will the proposed changes impact my bill?
If approved by the PUC, residential customers on average would see an increase of about $20 per month. This equates to an approximate 2.25% annual increase over the eight years since Black Hills Energy last changed its rates.
When will new rates take effect?
Following extensive review and approval by the PUC, new rates would go into effect in or before March 2025
