Black Hills Energy Serves First Customer Under BCIS Tariff

Black Hills Energy to Serve First Customer Under New Wyoming Blockchain Interruptible Service Tariff

Written by on June 22, 2022

Cheyenne Light, Fuel and Power Company (CLFP), doing business as Black Hills Energy, announced today it will serve its first customer under its Blockchain Interruptible Service Tariff, a new electric rate option to support the growing blockchain industry in Wyoming.

Courtesy of BHE

“We are pleased to deliver yet another innovative solution to support business and technology growth in Wyoming while benefiting other Cheyenne customers,” Mark Stege, Black Hills Energy’s vice president of operations says. “This agreement is the culmination of Wyoming’s enabling legislation, our unique customer focused Blockchain Interruptible Service Tariff, and our team’s business development efforts. We are excited to serve this new type of customer and to explore the benefits we can provide to other flexible load customers over the longer-term.”

The customer, a crypto mining company, recently signed a “five-year service agreement with Black Hills Energy” for up to 45 megawatts (MW) of electric service with an option to expand service for up to 75 MW. The company plans to locate initial operations in Cheyenne at the “North Range Business Park,” which is just west of town. During operational in the fourth quarter, the crypto mining facility, according to BHE, will become represent one of the largest bitcoin mining operations in the region.

As BHE representative Laurie Farkas explains regarding the megawatt usage, “this difference is simply indicative of various phases of the project. 45MW is the first phase with 75MW being the potential second phase. Once up and running we would expect the load to be consistent (not varying between 45 and 75).”

“This first application of an innovative blockchain energy rate is a ‘win-win’ for our city, our state and the region,” Betsey Hale, CEO of Cheyenne LEADS, says.  “Together, with our energy partner Black Hills Energy, we are strengthening and thoughtfully growing our local economy by attracting exciting new businesses and well-paying jobs.”

Under the terms of the Blockchain Interruptible Service Tariff, the customer’s energy requirements will be economically sourced by Black Hills Energy through “wholesale electricity energy market using the company’s electric transmission infrastructure.” The tariff also permits Black Hills Energy to interrupt the customer’s electric service if needed, during periods of peak electrical demand, to prioritize the electricity requirements of its existing CLFP customers.

According to Farkas, under the BCIS tariff, customers are required to “agree to interruptible service. The ability to interrupt service of these large loads provides protections for our existing customers during peak demand periods, periods of high energy prices or to preserve system reliability. The BCIS tariff incorporates numerous protections for existing customers and this is one example.”

“With this new rate option, we can play an integral role in supporting Cheyenne’s business-friendly environment,” Stege says. “Large electric use customers such as blockchain and crypto mining facilities provide significant economic benefits in terms of property and sales taxes, new jobs and energy cost savings to our existing retail customers in the form of a bill credit.”

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