BKH Black Hills Corp

PUEBLO, Colo., Dec. 19, 2014 - Black Hills Corp. (NYSE: BKH) subsidiary Black Hills Energy today received approval from the Colorado Public Utilities Commission for an estimated $3 million per year in additional revenue, effective Jan. 1, 2015.

The new rates provide a return on the utility's investment over the past three years to maintain and enhance its electrical service infrastructure. The PUC order also authorized the implementation of a return on the Company's capital expenditures associated with constructing a new generating facility that will replace the retired W.N. Clark coal-fired power plant. The increased revenue is based on a return on equity of 9.83 percent with a capital structure of 49.83 percent equity and 50.17 percent debt.

"Our goal is to deliver safe, reliable electric service at a good value for our customers, while delivering an appropriate return for our investors," said Linn Evans, Black Hills Corp.'s president and chief operating officer of utilities. "We are committed to providing value, controlling costs and making responsible investments."

The new rates provide a return on additional capital investments made in 2012 and 2013 totaling $54 million by the utility to maintain and enhance its electrical service infrastructure since the last rate case, in 2012. Those investments include the 29-megawatt Busch Ranch Wind Farm south of Pueblo, in operation since October 2012.

The new natural gas-fired turbine at the company's Pueblo Airport Generating Station will replace the coal-fired W.N. Clark power plant. The new turbine is expected to begin commercial operation in early 2017.

Investor Relations:
Jerome E. Nichols
605-721-1171
jerome.nichols@blackhillscorp.com

Media Contacts:
Bret Jones
719-248-9139
bret.jones@blackhillscorp.com

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Black Hills/Colorado Electric Utility Company, LP d/b/a Black Hills Energy
Black Hills Energy serves 94,000 electric customers in 21 southeastern Colorado communities. Black Hills Energy is a subsidiary of Black Hills Corp. (NYSE: BKH).

Black Hills Corporation
Black Hills Corp. (NYSE: BKH) is a growth-oriented, vertically-integrated energy company with a tradition of exemplary service and a vision to be the energy partner of choice. Black Hills Corp. is based in Rapid City, S.D., and serves 777,000 natural gas and electric utility customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. The company generates wholesale electricity and produces natural gas, oil and coal. Black Hills Corp.'s 1,948 employees partner to produce results that are improving life with energy. More information is available at www.blackhillscorp.com.

Caution Regarding Forward Looking Statements
This news release includes "forward-looking statements" as defined by the Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this news release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward looking statements, including anticipated revenues from the rate increase and our ability to deliver an appropriate return to our investors. These forward-looking statements are based on assumptions which we believe are reasonable based on current expectations and projections about future events and industry conditions and trends affecting our business. However, whether actual results and developments will conform to our expectations and predictions is subject to a number of risks and uncertainties that, among other things, could cause actual results to differ materially from those contained in the forward-looking statements, including the factors discussed above, the risk factors described in Item 1A of Part I of our 2013 Annual Report on Form 10-K filed with the SEC, and other reports that we file with the SEC from time to time.

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