Black Hills Corp. Requests Rate Review in South Dakota

Rhea-AI Summary

Black Hills Corp (NYSE: BKH) said its electric utility filed a rate review with the South Dakota Public Utilities Commission seeking $50.6 million in new annual revenue to recover roughly $523 million of investments since 2014 to serve about 75,000 customers in South Dakota.

The filing uses a 53.2% equity / 46.8% debt capital structure and requests a 10.5% return on equity. The company seeks interim rates effective 180 days after filing and final rates in Q1 2027.

Positive

• Requesting $50.6M in new annual revenue for South Dakota operations
• Seeks recovery of approximately $523M of investments since 2014
• Interim rates requested to become effective 180 days after filing
• Filed case based on 10.5% ROE and 53.2% equity capital structure

Negative

• Potential upward pressure on bills for about 75,000 South Dakota customers
• Pending regulator decision could delay revenue recovery until Q1 2027

Key Figures

Requested new annual revenue: $50.6 million Investments since last review: $523 million South Dakota electric customers: 75,000 customers +5 more

8 metrics

Requested new annual revenue $50.6 million Sought in South Dakota electric rate review

Investments since last review $523 million Critical electric investments in South Dakota since 2014 rate review

South Dakota electric customers 75,000 customers Customers served by the South Dakota electric utility

Total utility customers 1.37 million customers Natural gas and electric utility customers across eight states

Capital structure 53.2% equity / 46.8% debt Proposed basis for South Dakota rate review

Requested ROE 10.5% Return on equity in South Dakota rate review filing

Interim rate timing 180 days Requested effective date after filing for interim rates

Final rate timing First quarter 2027 Target timing for finalized South Dakota electric rates

Market Reality Check

Price: $73.07 Vol: Volume 1,587,569 vs 20-da...

normal vol

$73.07 Last Close

Volume Volume 1,587,569 vs 20-day average 1,201,047 (relative volume 1.32x). normal

Technical Price $73.07 trading above 200-day MA at $63.54, near 52-week high of $75.87.

Peers on Argus

BKH was down 0.68% pre-news while sector peers were mixed: SR -2.44%, OGS -3.14%...

1 Up

BKH was down 0.68% pre-news while sector peers were mixed: SR -2.44%, OGS -3.14%, NJR -2.52%, SWX -1.76%, and MDU roughly flat at +0.10%. Momentum scanner separately flagged OGS moving up, reinforcing stock-specific rather than broad sector behavior.

Historical Context

5 past events · Latest: Feb 04 (Positive)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Feb 04	Earnings and guidance	Positive	+0.9%	2025 EPS reported with 2026 guidance and long-term capex plan.
Jan 23	Dividend increase	Positive	+1.4%	Raised quarterly dividend, extending 56-year increase streak.
Jan 07	Earnings call schedule	Neutral	-1.0%	Announced timing for Q4 and full-year 2025 earnings release and call.
Jan 07	Transmission project done	Positive	-1.0%	Completed $350M Ready Wyoming 260-mile electric transmission expansion.
Dec 09	Rate approval	Positive	+1.0%	Nebraska gas rate settlement enabling recovery of $453M investments.

Pattern Detected

Recent fundamental and regulatory wins (earnings, rate approvals, dividend increases) have more often seen modest positive price alignment, though some large infrastructure milestones drew negative reactions.

Recent Company History

Over the past few months, Black Hills has focused on earnings growth, regulatory outcomes, and system expansion. In Dec 2025, Nebraska gas rate approval supported recovery of over $453M of investments, with shares up modestly. The Ready Wyoming $350M transmission completion in Jan 2026 coincided with a small decline. Fourth-quarter and full-year 2025 results on Feb 4, 2026 highlighted adjusted EPS of $4.10, 2026 guidance of $4.25–$4.45, and a $4.7B 2026–2030 capital plan, with a positive reaction. Today’s South Dakota rate review request continues the theme of recovering recent infrastructure spending through regulated mechanisms.

Market Pulse Summary

This announcement highlights Black Hills’ effort to align South Dakota electric rates with $523M of ...

Analysis

This announcement highlights Black Hills’ effort to align South Dakota electric rates with $523M of grid and reliability investments made since 2014. The utility is seeking $50.6M in new annual revenue based on a 53.2% equity capital structure and 10.5% ROE, with interim rates requested after 180 days and final rates targeted for early 2027. Investors may monitor the South Dakota PUC process, precedent from the recent Nebraska rate case, and how approved terms compare to the filing assumptions.

Key Terms

rate review, public utilities commission, capital structure, return on equity

4 terms

rate review regulatory

"has filed a rate review application with the South Dakota Public Utilities Commission"

Rate review is a regulatory check where an insurer, utility, or other regulated service provider submits proposed price or premium increases to a government agency for examination and possible approval or modification. It matters to investors because the outcome determines how much revenue the company can charge customers, affecting earnings, profit margins and demand; think of it like a landlord asking the city for permission to raise rents, with regulators able to limit or reshape the increase.

public utilities commission regulatory

"with the South Dakota Public Utilities Commission (PUC) requesting recovery"

A public utilities commission is a government agency that oversees and regulates essential services such as electricity, water, and natural gas to ensure they are provided safely, reliably, and at fair prices. For investors, it matters because these agencies influence the profitability and stability of utility companies, which are often seen as steady, reliable investments due to their regulated nature.

capital structure financial

"The request is based on a capital structure of 53.2% equity and 46.8% debt"

Capital structure is the way a company finances its operations and growth by using different sources of money, such as borrowed funds (loans or bonds) and owner’s equity (investments from owners or shareholders). It’s like a recipe for baking a cake, where the balance of ingredients affects the final product's strength and taste; similarly, the mix of debt and equity influences a company's stability and risk. For investors, understanding a company's capital structure helps gauge how risky it might be to invest or lend money.

return on equity financial

"and a return on equity of 10.5%. The company is seeking interim rates"

Return on equity shows how effectively a company uses its shareholders' money to generate profit. It is calculated by dividing the company's net profit by its shareholders' equity, indicating how much profit is earned for each dollar invested by owners. Higher return on equity suggests the company is good at turning investments into earnings, which can be an important factor for investors assessing its profitability and efficiency.

AI-generated analysis. Not financial advice.

RAPID CITY, S.D., Feb. 19, 2026 (GLOBE NEWSWIRE) -- Black Hills Corp. (NYSE: BKH) today announced that its electric utility has filed a rate review application with the South Dakota Public Utilities Commission (PUC) requesting recovery of the necessary capital infrastructure and operational costs required to deliver safe, reliable electric service to approximately 75,000 customers in South Dakota.

The company is seeking $50.6 million in new annual revenue for recovery of approximately $523 million of critical investments since its last rate review in 2014 and increased costs of delivering safe and reliable electric service to homes and businesses. This includes investments to strengthen the electric grid, maintain reliability and reduce wildfire risk.

“For more than a decade, we have held our base rates unchanged while maintaining the safe and reliable service our customers and communities depend upon,” said Linn Evans, president and CEO of Black Hills Corp. “Our customers have benefited from our critical infrastructure investments and prudent cost management, which support our ability to successfully operate, maintain, and modernize our electric system while supporting our customers’ growing energy requirements during that decade.”

The request is based on a capital structure of 53.2% equity and 46.8% debt and a return on equity of 10.5%. The company is seeking interim rates to be effective 180 days after the filing, with new rates to be finalized in the first quarter of 2027. The rate review application can be accessed on the South Dakota PUC’s website later today or tomorrow.

Black Hills Corporation
Black Hills Corp. (NYSE: BKH) is a customer-focused, growth-oriented utility company with a tradition of improving life with energy and a vision to be the energy partner of choice. Based in Rapid City, South Dakota, the company serves 1.37 million natural gas and electric utility customers in eight states: Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. More information is available at www.blackhillscorp.com.

Investor Relations
Sal Diaz
605-399-5079
Investorrelations@blackhillscorp.com

24-Hour Media Relations Line
888-242-3969

FAQ

What did Black Hills Corp (BKH) request in its February 19, 2026 South Dakota filing?

They requested $50.6 million in new annual revenue to recover about $523 million of investments. According to the company, the request covers capital and operating costs to serve roughly 75,000 customers.

When would interim and final rates from the BKH South Dakota rate review take effect?

Interim rates are requested to be effective 180 days after the filing, with final rates expected in Q1 2027. According to the company, that timeline reflects the requested provisional and final PUC actions.

How did Black Hills Corp (BKH) justify the requested return and capital structure in the filing?

The filing is based on a 53.2% equity / 46.8% debt capital structure and requests a 10.5% return on equity. According to the company, those metrics underlie the revenue requirement calculation.

How many South Dakota customers would be affected by the BKH rate request?

About 75,000 electric customers in South Dakota would be covered by the requested rate change. According to the company, the filing aims to fund safe, reliable service and grid investments for those customers.

Where can investors view the Black Hills Corp (BKH) South Dakota rate review filing?

The filing will be available on the South Dakota Public Utilities Commission website later the same day or the next day. According to the company, the PUC site will host the full application and supporting exhibits.