Black Hills Corp. has signed definitive agreements to supply power to a planned Google data center in Cheyenne, Wyoming. The company disclosed the agreements in an Oct. 6, 2026 release filed as an exhibit to a Form 8-K. There are two contracts, a Large Power Contract Services Agreement (LPCSA) and a Generation Facilities Agreement (GFA). Both took effect Sept. 30, 2026 and run through 2048. Black Hills said the project is anticipated to be served by a total resource mix of 2.7 GW, including reserve margins and excluding additional transmission system expansion investments.

How the supply is split

The arrangement has two parts. In the first, Black Hills will provide up to 590 MW of grid-connected service. Of that, 564 MW of nameplate capacity is new natural gas generation that Black Hills will construct and own through a non-regulated affiliate, located at the site of its existing Cheyenne Prairie Generating Station. The remaining 26 MW will come from a combination of market energy purchases and retail service under the company's industrial tariff.

In the second part, Black Hills will manage the output of approximately 2.1 GW of Wyoming-based resources contracted from third parties, delivered through a privately managed microgrid under the company's Large Power Contract Service (LPCS) tariff. The microgrid management fees are a negotiated rate based on a contracted minimum peak load, the release said, and are expected to begin in 2027 and increase through the project's ramp period.

Black Hills said it plans to invest $1.8 billion between 2027 and 2029 to build the 564 MW of company-owned gas generation. The company expects the project to provide approximately $150 million of net income in 2030 and approximately $2.4 billion of unlevered free cash flow through 2048, net of the $1.8 billion generation investment. Google has also provided Black Hills with $399 million of refundable advances for long lead-time equipment, which the company expects to reimburse by June 30, 2027.

The company also addressed who pays. CEO Linn Evans said in the announcement that the agreements "are structured so that Google bears all costs associated with serving the planned data center throughout the life of the project."

A separate fuel cell plant with its own contract

On Oct. 14, 2026, American Electric Power announced plans to invest approximately $4 billion in a 702-MW fuel cell generation project near Cheyenne that uses fuel cell technology developed by Bloom Energy. Google will acquire the plant's power under a 20-year power purchase agreement with Cheyenne Fuel Cell, LLC, which AEP said is approximately 92% owned and controlled by AEP and nearly 8% owned by funds advised by Basalt Infrastructure Partners.

AEP's release says the fuel cell project follows the agreements between Google and Black Hills that took effect Sept. 30. Bill Fehrman, AEP's chairman, president and CEO, said in the release that AEP "is bringing together new technologies and strong partnerships."

Transmission application at the Wyoming PSC

Black Hills' Wyoming utility is also seeking state approval for new transmission. On Sept. 1, 2026, Cheyenne Light, Fuel and Power, which does business as Black Hills Energy, applied to the Wyoming Public Service Commission for a certificate of public convenience and necessity for the South Cheyenne Transmission Project in Laramie County. The case is Docket 20003-278-EN-26, Record No. 18235, according to the commission's public notice.

The application covers:

  • a new 230-kV and 115-kV substation connecting to the existing CPGS-Archer 115-kV line
  • two new 230-kV lines of approximately 4.3 miles each, interconnecting the new Goldeneye substation to the Holliday-Bluffs 230-kV line
  • a new 230-kV line of approximately 6 miles connecting the new Robinson and Holliday 230-kV substations
  • upgrades and reconductoring on the WAPA Happy Jack-Cheyenne 115-kV line and reconductoring of the South Cheyenne-Sweetgrass 115-kV line

The utility says the project is designed to meet the growing energy needs of its large load customers by expanding local transmission capability and making it easier to integrate future generation resources. It estimates the cost at approximately $80.1 million and proposes to allocate it under the LCTCAM, a mechanism under commission review in a separate case, Docket 20003-273-ET-26 (Record No. 18157).

Context

The transmission case is one of several regulatory steps Black Hills lists in its release in support of the project. The company said the Robinson substation CPCN was approved in May 2026, an industrial siting permit for the Cheyenne Prairie expansion was filed in July 2026, and an air quality permit for that expansion was approved in August 2026. It also said it filed the Large Customer Transmission Cost Adjustment Mechanism in June 2026 and plans to file a Wyoming transmission expansion CPCN in the fourth quarter of 2026, as part of transmission investment it anticipates for this project and other regional large-load opportunities. AEP, for its part, described its fuel cell plant as supporting Google's growing energy needs in the greater Cheyenne area.

What Happens Next

  • Black Hills service: Energy service is planned to begin in late 2027 and ramp to the project's peak load in 2030, according to the company, which expects to begin earning a return on its generation investment when construction begins in 2027.
  • AEP fuel cell plant: AEP said it and its partners plan to start construction in 2026, with the facility expected to be fully operational by the end of 2028.
  • Wyoming PSC transmission case: The deadline to file interventions, protests or hearing requests in Docket 20003-278-EN-26 was Oct. 9, 2026, and has passed. The project still needs the commission to grant the certificate. Cheyenne Light has asked for an effective date of May 1, 2027, anticipates starting construction in the second quarter of 2027, and expects the first components to be in service by the fourth quarter of 2027.

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