The Colorado Public Utilities Commission on Wednesday slashed 85 percent from Black Hills Energy’s request to increase electric rates.
The utility was seeking an $8.5 million annual increase, but the hike will likely be less than $2 million. Final rates won’t be determined until a technical conference on Wednesday.
Rapid City, S.D., based Black Hills asked for the rate increase in May to help recover the cost of a new gas-fired generation unit at the Pueblo Airport Generating Station that replaced a coal-fired plant in Cañon City. The Cañon City unit was closed to comply with Colorado’s Clean Air-Clean Jobs Act.
If the commission had approved Black Hills’ proposal, . Since 2008, the utility has increased average residential customers’ bills by 58 percent. It serves 94,000 customers in Pueblo, Cañon City and other parts of southern Colorado.
The PUC said the utility company was within its rights to build the replacement plant. But the commission said it was disappointed that Black Hills did not pursue a cheaper option.
The commission made multiple decisions that cut the company’s proposed revenue increases in areas including employee pension expenses, executive incentives and property tax allowances.
