Black Hills Energy announced plans Tuesday to build a 350-megawatt natural- gas power plant and add 64 megawatts of renewable generation to serve customers in southeastern Colorado.
The utility said the generation should be in service by January 2012. Black Hills has 93,000 customers in southeastern Colorado, which came from its $940 million acquisition this year of Aquila’s natural-gas and electric operations in four states.
Black Hills said it is evaluating sites near existing transmission lines and natural-gas pipelines for the projects, which would replace a purchased power agreement it has with Xcel Energy.
Black Hills currently buys 75 percent of its electricity from Xcel under a deal that expires at the end of 2011.
“Continuing to substantially rely on purchased power agreements is no longer prudent,” said Gary Stone, vice president of operations for Black Hills in Colorado, in a written statement.
The proposal requires regulatory approval.
The company didn’t specify the type of renewable power but said it has been working to integrate biomass, wind and solar into its portfolio.
Rapid City, S.D.-based Black Hills Corp., the parent of the Colorado utility, serves 750,000 customers in six states.
Andy Vuong: 303-954-1209 or avuong@denverpost.com
