Black Hills Corp. (NYSE: BKH) has signed agreements with Google to power a data center campus in Cheyenne, Wyoming. The arrangement runs through 2048, which in utility terms is a very long engagement.
The South Dakota-based utility announced the deal on October 6, 2026, with the agreements effective as of September 30. The Motley Fool cast the move as a dividend stalwart joining the AI energy boom.
What Black Hills is actually building
The setup is a hybrid supply model. Black Hills plans to deliver up to 590 MW of grid-connected power, mostly from newly built natural gas plants.
On top of that, the utility will manage around 2.1 GW of additional resources through a microgrid. A microgrid is a localized power network that can run alongside the main grid or independently.
Combined, the overall resource mix comes to approximately 2.7 GW. That is a substantial amount of capacity dedicated to one data center campus.
To get there, Black Hills plans to spend about $1.8 billion between 2027 and 2029. The money will fund 564 MW of natural gas-fired capacity at the Cheyenne Prairie Generating Station.
Whatever that new plant does not cover will come from market purchases and retail tariffs.
The timeline is not immediate. Energy service is set to start ramping up in late 2027, with the load expected to peak in 2030.
Google is picking up the tab
The most notable term may be who pays. Under the agreements, Google will cover all associated project expenses, which is meant to shield other Black Hills customers from the financial impact.
Google has already put money behind the commitment. It advanced $399 million so Black Hills can procure long-lead equipment, the kind of turbines and gear that take a long time to order and deliver.
For Black Hills, the projected payoff is meaningful. The utility anticipates around $150 million in additional net income by 2030.
It also estimates roughly $2.4 billion in unlevered free cash flow through 2048, net of generation capital expenditures.
The AI power scramble comes to Wyoming
Black Hills is also mid-merger. The company is combining with NorthWestern Energy, a deal aimed at creating a larger regulated utility better positioned to serve big customers like Google.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.