As Black Hills Energy considers rate hike, Pueblo City Council votes in favor of study into municipal-owned utility

PUEBLO, Colo. (KKTV) - Pueblo is one step closer to severing ties with Black Hills Energy.

City Council voted 5-2 Monday in favor of moving ahead with a study into the feasibility of ending the city's contract with its longtime utility provider and starting its own municipal-owned utility. The study comes with a $150,000 price tag.

"Are we going to let $150,000 get in the way to save this community billions of dollars?" asked Pueblo City Council President Mark Aliff prior to the vote. "I don't think that's something we should even be contemplating."

Money is at the heart of the ongoing dispute between the city of Pueblo and Black Hills Energy. The utility company said over the summer that it was planning a rate increase in response to skyrocketing costs for utility services.

"The cost to provide service has escalated dramatically since 2016 for goods and services across several industries, including ours," Black Hills Energy Vice President of Colorado Utilities Campbell Hawkins told 11 News in a statement in July .

The proposed rate hike would see Pueblo customers paying about $20 more a month, the city said.

"Over the last few years, our small businesses have been through the wringer ... and now we are even starting to see big box, stores, and grocery stores close. The rate increase to the small business community would be detrimental to the city of Pueblo," said Mayor Heather Graham.

City and county leaders stressed that their anger was at the corporation, not the employees on the ground.

"This is not about Black Hills local employees who work every single day to keep our lights on in Pueblo County. To you all, thank you. This is about the predatory corporation whose primary focus is their investors," Pueblo County Commissioner Daneya Esgar told 11 News.