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Black Hills seeks tariff to support blockchain in Wyoming

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Black Hills seeks tariff to support blockchain in Wyoming

In a bid to accommodate an emerging industry, Black Hills Energy wants a new tariff to serve blockchain business customers in Wyoming.

The company, a Black Hills Corp. subsidiary known legally as Cheyenne Light Fuel and Power Co., recently told the Wyoming Public Service Commission that without a new tariff it cannot attract those in the blockchain industry and still provide safe and reliable service without hurting existing retail customers.

"Without an innovative tariff solution, blockchain customers create risk for existing customers, as blockchain customer loads tend to be large and can be moved off of the system quickly," Shirley Welte, vice president of Black Hills' electric and gas operations for Wyoming, said in testimony filed with the company's Sept. 28 application.

Blockchain technology has many uses, including for the creation, or "mining," of cryptocurrencies such as Bitcoin. Creation of cryptocurrency is energy-intensive, and companies involved in the industry have been seeking out low-cost power across North America.

Wyoming has made moves to bring in blockchain businesses, such as enacting legislation to exempt certain cryptocurrencies from state securities and money transmission laws.

Welte told state utility regulators that Black Hills Energy is exploring opportunities and fielding calls from blockchain customers interested in Wyoming as a possible location. The company has the ability to serve loads the size those customers have requested through available transmission capacity and power market purchases. The proposed tariff would mitigate risks to existing customers and the company.

The "Blockchain Interruptible Service," or BCIS, tariff would apply to customers seeking loads of 10,000 kW or greater who are able to have power interrupted at the company's discretion. Black Hills Energy also proposed to give its retail customers a $2 credit to the power cost adjustment for each megawatt-hour of electricity served to customers under the new tariff.

Under the proposed tariff, BCIS customers would enter into an agreement that, among other things, would last at least two years; include pricing for all electricity purchased, with pricing subject to renegotiation at least every three years; and identify customer and company costs for any new electric infrastructure that may be required.

If approved, the new structure would take effect on Dec. 1. (Wyoming PSC Docket No. 20003-173-ET-18)