Large AI campuses need firm power, not just renewable headlines. On 6 October 2026 Black Hills Corp. announced definitive agreements, effective 30 September 2026 and running through 2048, to serve a planned Google data centre in Cheyenne, Wyoming. [1]
Figures below are from Black Hills’ company release unless noted.
What did the utility agree to build and manage?
Black Hills plans to invest $1.8 billion between 2027 and 2029 to construct 564 MW (nameplate) of company-owned natural gas generation at its existing Cheyenne Prairie Generating Station site, owned through a non-regulated affiliate. It will provide up to 590 MW of grid-connected energy service (564 MW of new gas plus about 26 MW from market purchases and retail industrial tariff supply). [1]
Separately, Black Hills will manage about 2.1 GW of Wyoming-based, third-party contracted resources through a privately managed microgrid under its Large Power Contract Service tariff. The total resource mix serving the project, including reserve margins, is put at 2.7 GW. Energy service is planned to start in late 2027 and ramp to peak load in 2030. [1]
The negotiated package includes a Large Power Contract Services Agreement and a Generation Facilities Agreement. [1]
Money, advances and customer protections
Black Hills expects returns on generation investment from construction start in 2027, microgrid management fees from late 2027 on a contracted ramp, about $150 million of net income in 2030, and roughly $2.4 billion of unlevered free cash flow through 2048 net of the $1.8 billion generation capex—all company projections. [1]
Google has provided $399 million of refundable advances for long-lead equipment under a generation reservation agreement; Black Hills expects to reimburse those advances by 30 June 2027. [1]
CEO Linn Evans said the structure is designed so Google bears all costs of serving the planned data centre and costs do not shift to other retail customers. The release lists pass-through mechanisms, stranded-asset recovery over the contract term, early-termination protections and credit/collateral requirements. [1]
Regulatory path cited
Black Hills notes a Robinson substation certificate approved in May 2026, an industrial siting permit for the Cheyenne Prairie expansion filed in July 2026, and an air-quality permit approved in August 2026. Further transmission filings (large-customer cost adjustment, South Cheyenne and Wyoming expansion certificates) are listed as underway or planned. Additional transmission spend is flagged as possible upside beyond the current capital plan. [1]
What we don’t know
- Google’s side. Load shape, IT capacity and on-site details are not in the utility release; the data centre is “planned.”
- Forward-looking finance. Net income and free-cash-flow figures are Black Hills projections with standard SEC caution language.
- Fuel and emissions. The release focuses on gas generation and microgrid management; carbon-intensity outcomes are not quantified here.
- Financing mix. Debt versus other sources for the $1.8 billion remains under evaluation, the company says.
The Bottom Line
Black Hills says it will spend $1.8 billion on 564 MW of new gas generation and manage a ~2.7 GW resource stack—including ~2.1 GW of third-party microgrid capacity—to serve Google’s planned Cheyenne campus from late 2027 toward a 2030 peak, under contracts through 2048 with a $399 million Google equipment advance. Company-reported, utility-side economics; not a Google product announcement, and not investment advice.
Sources
- Black Hills Corp. / GlobeNewswire, 6 October 2026 — “Black Hills Corp. Executes Definitive Agreements to Serve Google’s Planned Data Center in Cheyenne, Wyoming”: https://www.globenewswire.com/news-release/2026/10/06/3376007/10381/en/black-hills-corp-executes-definitive-agreements-to-serve-google-s-planned-data-center-in-cheyenne-wyoming.html
