by Joshua Haiar, South Dakota Searchlight
June 24, 2026
South Dakota utility regulators unanimously approved the merger of Black Hills Energy and NorthWestern Energy on Wednesday in Pierre.
The new utility will be named Bright Horizon Energy, with an estimated total value of $15.4 billion and 2.1 million customers in eight states.
Public Utilities Commission Chairman Chris Nelson said state law makes the approval of mergers the default unless there’s a serious problem discovered.
“It says you shall approve these kinds of mergers, unless there’s a likelihood of significant adverse impacts to customers in this state,” Nelson said. “And I would submit that’s probably a fairly low bar. But that’s the bar that the Legislature has established. It’s not something we establish.”
Utility company leader tells audience that data centers will extend fossil fuel usage
Along with the merger, regulators approved two negotiated settlements addressing customer protections and labor concerns.
One settlement bars charging South Dakota customers for costs stemming from executive “golden parachutes” and other merger-related costs. It also delays rate increases and ensures the combined company keeps its headquarters in Rapid City for at least 10 years, and maintains a corporate office in or near Sioux Falls for at least five years.
The other settlement gives union and South Dakota-based contractors added consideration for projects.
Frank Kloucek is the Democratic nominee for the Public Utilities Commission seat being vacated by Commissioner Gary Hanson, who is not seeking reelection. Kloucek criticized the merger during the public comment portion of Wednesday’s meeting, which happened after the vote.
Kloucek said the merger creates a “super monopoly,” and he criticized the commission for not providing more time for public input and scrutiny.
The companies announced the proposed merger in August. They said it would diversify the combined entity’s energy sources, help meet rising energy demands from data centers, and benefit investors.
NorthWestern Energy serves about 65,600 South Dakota electric customers and 51,200 South Dakota natural-gas customers. Black Hills Energy serves 78,976 South Dakota electric customers.
Among the states affected by the merger, Montana is the only one in which regulators have not yet approved it.
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South Dakota Searchlight is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. South Dakota Searchlight maintains editorial independence. Contact Editor Seth Tupper for questions: info@southdakotasearchlight.com.
