Black Hills Expects $150 Million from Google Project, Plans $1.8 Billion Investment
Key Facts
Black Hills said the data center project it will serve for Google is expected to generate about $150 million in net income in 2030, offering the utility a new path for earnings growth. Chief Executive Lin Evans said earnings from the project will begin in mid-2027 before rising to the expected level in 2030. The estimate comes as the company reaffirmed its 2026 adjusted earnings-per-share guidance range of $4.25 to $4.45, excluding merger-related costs. Black Hills said the project will begin receiving power service in late 2027, then ramp up to its maximum load in 2030. The timing of the project’s earnings contribution depends on the execution of the planned service and expansion phases.
The deal requires a total resource mix of 2.7 gigawatts, including reserve margins, and Black Hills will manage 2.1 gigawatts of contracted third-party resources in Wyoming. In turn, the company plans to invest $1.8 billion between 2027 and 2029 to build 564 megawatts of company-owned generation capacity. The project arrangement combines contracted resources and new company-owned generation capacity, along with management of the data center’s needs. Black Hills estimates the project will generate about $2.4 billion in unlevered free cash flow through 2048, after accounting for the $1.8 billion generation investment. The agreements extend through 2048, linking the cash-flow estimate to the long contract term and planned capital investment.
Black Hills said the agreements and regulatory mechanisms were designed so Google bears all costs associated with serving the data center over the life of the project. The arrangement is part of a deal structure that combines power supply with management of the resources needed for large loads. Microgrid management fees are scheduled to begin in late 2027, then rise gradually through 2030, the company said. This coincides with the start of power service in late 2027, while Evans expects earnings to begin in the middle of that year. The project is expected to reach its maximum load in 2030, the same year it is projected to generate about $150 million in net income.
In the third quarter of 2026, adjusted earnings per share were $0.57, compared with $0.45 in the same period of 2025, while diluted earnings per share under accounting standards were $0.54, versus $0.34. The company attributed part of the quarter’s performance to $0.15 per share from new rates and tariff-cost recovery, and $0.06 from the impact of favorable weather. It said those benefits offset higher operating expenses, financing costs and depreciation. The quarterly results provide context for the reaffirmed 2026 adjusted earnings-per-share range of $4.25 to $4.45, excluding merger-related costs. Management also said it expects to achieve the upper half of its long-term annual EPS growth target of 4% to 6%, based on its current plan for 2026–2030.
Large-load opportunities associated with the project extend beyond existing arrangements: management estimated at least 2.5 gigawatts in exploratory opportunities in the Wyoming region that have not yet been included in the plan or entered active negotiations, it said on the earnings call on November 5, 2026. The company has filed applications for certificates of public convenience and necessity for $686 million in electric transmission expansion investments to serve large-load opportunities in Wyoming. Black Hills expects a decision from the Wyoming Public Service Commission on a tariff to recover the costs of transmitting large loads in the first quarter of 2027. The company said it plans to present its updated financial plan and capital outlook for 2027–2031 in February 2027. The regulatory decision and forthcoming plan set a framework for the next steps in expanding the infrastructure needed for these loads.