Environmental Sustainability

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Environmental Sustainability

We are committed to being good stewards of the environment

How we produce and deliver energy matters to us and to our customers. That’s why we responsibly use our natural resources and do so in a manner that reduces our impact on the environment.

Our Environmental Commitment

Our environmental commitment is based on a solid foundation of regulatory compliance and leadership oversight. Our board of directors establishes an annual environmental performance goal of zero compliance violations which is owned by our Chief Operating Officer and cascaded throughout our organization to ensure we meet or exceed all environmental requirements. Our activities are guided by a comprehensive environmental management system (EMS) that incorporates our staff resources, environmental policy and procedures, and technology applications. The EMS is audited on an annual basis by internal and external entities to ensure effective controls are in place.

Reducing Methane Emissions

Our focus, first and foremost, is on the safety of our customers and the communities we serve, and ensuring the reliability of our natural gas system. We have comprehensive programs in place to proactively upgrade our natural gas system to enhance safety and improve system reliability, while also supporting the reduction and elimination of methane emissions from our natural gas infrastructure. Some of our methane emissions reduction efforts include:

  • The removal of 100 percent of all cast and wrought iron pipelines and service lines.
  • A multi-year capital investment plan to replace aging infrastructure and eliminate bare-steel, obsolete plastic and above-ground pipeline from our natural gas pipeline system.
  • The ongoing risk assessment of our natural gas system and the implementation of proactive mitigation measures to ensure continued safety and reliability.
  • With the successful integration of SourceGas now complete, we are standardizing control procedures across our expanded natural gas system during 2018 to include the implementation of a comprehensive, enterprise-wide methane emissions reduction strategy and standardized leak detection and repair programs for all natural gas transmission and storage assets.

Protecting Air Quality

Our coal and natural gas generating facilities are among the most technologically advanced in the country, with some of the lowest emission rates in the United States. Our clean energy strategy is based on methodical and prudent solutions to reduce our emissions while minimizing cost impacts to our customers. Over the past seven years, as we modernized our electric generating fleet by retiring aging coal plants and constructing new natural gas and wind resources, we reduced overall carbon dioxide emissions from the energy we produce by 25 percent and significantly reduced nitrogen oxides (NOx) and sulfur dioxide (SO2) emissions while, at the same time, nearly doubling the generating capacity of our system.

  • Black Hills’ energy complex near Gillette Wyoming, includes three modern coal-fired power plants – Wygen I, II and III -- which were designed and built in 2003, 2008 and 2010. Each unit is outfitted with state-of-the-art emissions control technology to reduce or eliminate emissions of NOx, SO2, particulate matter and mercury.
  • To reduce the risk of short-term air quality emission exceedances, Black Hills developed a state-of-the-art “auto trip” program that automatically shuts down each generating unit if they approach the unit’s permitted emission limits. This technology, coupled with improved plant maintenance, has virtually eliminated air permit exceedances from our generating units.

Since 2010, we have reduced S02 emissions by 5,000 tons while almost doubling our generation output.

Since 2010, we have reduced NOx by more than 2,400 tons while almost doubling our generation output.

Coal Ash Management

Our coal-fired generating plants are located at our energy complex in northeastern Wyoming and fueled by coal produced at our adjacent Wyodak mine. This efficient mine-mouth operation produces cost-effective fuel for our generating units, creating savings for our customers. Coal ash is a by-product of the process of converting coal to energy. Black Hills uses 100 percent of its coal ash for backfill reclamation activities at the Wyodak mine in areas previously mined. This use and reclamation plan was approved by the State of Wyoming and the Office of Surface Mining Reclamation and Enforcement.

Water Use and Water Quality

We have a long and successful track record of environmental leadership and innovation in our utility operations, starting with our pioneering efforts in 1969 when we introduced the first use of industrial air- cooled condensers in the western hemisphere at our energy complex in Wyoming. Using air cooled condensing technology saves millions of gallons of water per year in this arid region with limited water resources. Today, our entire electric generating fleet – in Colorado, South Dakota and Wyoming -- leverages this technology and is deemed a low water use operation.

Clean Energy Options

Renewable energy sources are a growing part of our energy portfolio. In Colorado, we have 90 megawatts (MW) of wind energy capacity at our Busch Ranch and Peak View wind facilities and 12.5 MW of solar energy delivered through our on-site, private solar programs and community solar gardens. We expect to add an additional 60 MW of renewable energy to our Colorado portfolio by 2019 which will put us on track to comply with the State of Colorado’s Renewable Energy Standard which requires that 30 percent of energy delivered to our Colorado customers come from renewable electric generation resources by 2020.

  • In Wyoming, we have 60 MW of wind energy on our system available through long-term purchased power agreements at the Happy Jack and the Silver Sage Wind Farms. Under a separate intercompany agreement, our Wyoming utility sells 50 percent of the Happy Jack Wind Farm’s output to our electric utility in South Dakota.

Avian Protection Plans

We are a leader among energy companies in our Avian Protection Plans due to our comprehensive planning and mitigation strategies to encompass all areas of our operations. For decades, we have constructed nesting platforms and boxes, retrofitted or modified power poles to avian-safe standards and installed netting and other measures to mitigate risks to protected, threatened or endangered species. We carefully evaluate impacts to birds and other wildlife in the siting, design and construction of new wind facilities and projects to modernize our energy infrastructure. Black Hills employees are trained to comply with federal avian protection laws and reporting requirements associated with injured or dead birds.

Former Manufactured Gas Plants (FMGP)

Former Manufactured Gas Plants (FMGPs) operated from the 1890s to the 1940s, before natural gas was available as an energy source. These plants used coal and oil to produce gas for lighting, heating and cooking, and created a by-product, waste coal tar, which was typically buried on-site at the FMGP or left in underground tanks at the site. Waste coal tar from former FMGPs is a regulated hazardous substance today and subject to remediation.

Starting with the Aquila acquisition in 2008, Black Hills has managed seven FMGP sites in: Nebraska (Columbus, Norfolk, Blair, Plattsmouth, Beatrice); Iowa (Council Bluffs); and Kansas (Lawrence). All have been remediated with the exception of the Council Bluffs site. We are currently in discussions with the EPA and the Iowa Department of Natural Resources to determine a mitigation and clean-up strategy.

With the SourceGas acquisition in 2016, we added three additional FMGP sites for potential mitigation located in: Nebraska (McCook and Scottsbluff); and Colorado (La Junta). We are working with Alliant Energy on the remediation of the McCook site and are currently in the investigation phase of mitigation for the Scottsbluff and La Junta sites.

Energy Efficiency and Conservation

Since 2011, Black Hills’ electric utilities have saved nearly 197 million kilowatt-hours (kWh) of energy through our demand-side management (DSM)/energy efficiency programs – enough electricity to power more than 18,000 homes for one year.* For the 6-year period (from Jan. 1, 2011 through Dec. 31, 2017), we have provided more than $25.2 million in electric rebates to residential and business customers to help them save energy and reduce their overall demand on Black Hills’ system.

*The U.S. average annual electricity consumption for a residential customer is 10,766 kilowatt-hours (kWh), an average of 897 kWh per month. – U.S. Energy Information Administration.

Our natural gas energy efficiency programs have resulted in more than 2 million dekatherms (Dth) of energy savings since 2011, enough energy to satisfy the natural gas needs of about 24,000 homes for one year.* For the 6-year period (from Jan. 1, 2011 through Dec. 31, 2017), we have provided more than $37 million in natural gas rebates to residential and business customers to help them save energy and reduce their overall demand on Black Hills’ system.

*Assumes 84 Dth usage per household per year.

DSM/Energy Efficiency Program Impact (rounded)

Year Spending Rebates paid to customers electricity savings (kwH) Natural Gas Savings (dth)
2017 $21,000,000 $10,000,000 28,849,000 339,000
2016 $20,000,000 $10,000,000 26,790,000 377,000
2015 $20,000,000 $10,000,000 34,542,000 410,000

*DSM/energy efficiency programs are funded by a surcharge on customers’ bills depending on the conditions set forth by state public utilities commissions.

2017 DSM/Energy Efficiency Program Impact by State (rounded)

STATE SPENDING REBATES PAID TO CUSTOMERS ELECTRICITY SAVINGS (KWH) NATURAL GAS SAVINGS (DTH)
Arkansas $3,300,000 $2,000,000 N/A 126,000
Colorado $8,400,000 $3,000,000 18,738,200 76,000
Iowa $7,500,000 $4,000,000 N/A 108,000
South Dakota* $800,000 $400,000 4,723,000 N/A
Wyoming $1,300,000 $1,000,000 5,387,000 29,000
TOTAL $21,300,000 $10,400,000 28,848,000 339,000

*Program data for period Sept. 1, 2016 through Aug. 31, 2017.

DSM/Energy Efficiency Program Overview

We offer our residential and commercial customers a wide variety of programs and rebates* to help them conserve energy and lower their energy costs including:

Electric
  • High efficiency lighting
  • Cooling (central A/C, evaporative coolers)
  • Air source heat pumps
  • Building envelope (insulation and air/duct sealing)
  • High efficiency appliances
  • Appliance recycling program
Natural Gas
  • Heating equipment (furnace, boiler, space heating)
  • Water heating
  • High efficiency appliances (commercial cooking equipment)
  • Building envelope (insulation)

*Programs and rebates vary by state. Visit www.blackhillsenergy.com/save-money-energy to learn more.