Why Black Hills (BKH) Is Up 8.2% After Inking Long-Term Google Data Center Power Deal

• Black Hills Corp. previously announced it had signed long-term agreements running through 2048 to supply up to 590 MW of energy and manage a 2.7 GW resource mix for Google's planned Cheyenne, Wyoming data center, supported by US$1.80 billion of new natural gas generation investment starting in 2027.

• The project structure, including approximately US$399 million of refundable advances from Google and contract-based microgrid management fees, is designed to generate substantial long-term cash flow while preventing cost shifts to existing retail customers.

• We'll now examine how Black Hills' US$1.80 billion data center generation build and long-term Google contracts affect its broader investment narrative.

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Black Hills Investment Narrative Recap

To own Black Hills, you need to be comfortable with a regulated utility that is leaning harder into large‑load data center growth while still depending on constructive rate outcomes and manageable weather volatility. The Google Cheyenne data center contracts are a major validation of the data center thesis and appear to become a key near term earnings driver, but they also increase the company's exposure to regulatory approvals and execution risk around a US$1.80 billion build‑out.

The most relevant recent announcement is the pending all stock merger with NorthWestern Energy, which is moving toward final regulatory approval. That deal, if completed as outlined, would change the Black Hills story from a pure play regional utility with a concentrated Wyoming data center pipeline into a larger, more diversified platform, potentially altering how investors weigh the Google project against the rest of the business.

Yet investors should also be aware that if future rate cases fail to keep pace with the added depreciation and financing costs of projects like the Google‑backed build...

Read the full narrative on Black Hills (it's free!)

Black Hills' narrative projects $3.7 billion revenue and $593.3 million earnings by 2029. This requires 17.1% yearly revenue growth and about a $294.2 million earnings increase from $299.1 million today.

Uncover how Black Hills' forecasts yield a $83.17 fair value , a 10% upside to its current price.

Exploring Other Perspectives

Two Simply Wall St Community fair value estimates span roughly US$66.53 to US$83.17, showing how far individual views on Black Hills can stretch. Some of these investors focus on the scale of hyperscale data center load growth and the long term Google contracts, which could have meaningful implications for how you think about Black Hills' earnings resilience and risk concentration.