Black Hills Energy proposes voluntary RNG, carbon offset program

By Black Hills Corp. | June 14, 2022

Black Hills Corp. on June 6 announced its Colorado natural gas utility subsidiary, doing business as Black Hills Energy, submitted a proposal to the Colorado Public Utilities Commission seeking approval to offer a voluntary renewable natural gas and carbon offset program for residential and business customers. The program would allow participants to offset 100 percent or more of the emissions associated with their own natural gas usage.

“We believe natural gas will continue to play a critical role in a clean energy future,” said Linn Evans, president and CEO of Black Hills Corp. “While thousands of customers and communities rely on natural gas each day for highly efficient home and space heating, water heating, and cooking, our customers are increasingly looking to us for sustainable and cost-effective options to help them reduce the carbon footprint associated with their natural gas usage.”

“Our Colorado natural gas customers have told us they are interested in sustainable energy and we’re listening,” said Evans. “We’ve designed this voluntary RNG and carbon offset program with their direct feedback in mind, cultivated over the past two years through customer surveys which indicated that more than half would be ‘somewhat’ or ‘very interested’ in a program of this nature.”

As proposed, participants in the voluntary program would be able to purchase fixed price “blocks” at $5 per block, representing a portion of their natural gas usage. One block would be the equivalent of 20.5 therms of natural gas, which amounts to approximately 25 percent of the average Colorado residential customer’s monthly usage. Based on customer preference, participants could purchase enough blocks to offset more than 100 percent of the emissions associated with their natural gas usage. The offset would be achieved through a combination of carbon offset credits and renewable natural gas attributes.

Black Hills Energy has designed its voluntary RNG and carbon offset program as a comprehensive four-year pilot program starting in 2023 and running through 2026, pending Colorado PUC approval.

“Over the course of the pilot program, we will closely monitor a variety of performance factors to better understand how we can shape the program to meet the expectations of our customers,” continued Evans. “As customer interest and enrollments grow, we will study the potential for growth in the carbon offset market and in renewable natural gas development across the communities we serve.”

The company will submit the voluntary RNG and carbon offset program to state regulators in Kansas and Nebraska later this summer with filings in Arkansas, Iowa and Wyoming expected by 2023.