Transmission System Customer Discussions – July 2009 Common Use System (CUS) Black Hills Power Basin Electric Power Cooperative Powder River Energy Corporation Revised July 24, 2009

Agenda Introductions Common Use System Overview Basin Electric Costs Transmission Rate Case Schedule Customer Impacts Discussion / Questions

Regional Transmission System - Existing MONTANA WYOMING SHERIDAN SPEARFISH CARR DRAW RAPID CITY WYODAK BUFFALO Y. CRK HUGHES S. RC DC TIE B. CRK RENO OSAGE PUMPKIN BUTTES TECKLA HOT SPRINGS YELLOWCAKE SPENCE S DAKOTA NEBRASKA CASPER Common Use System DAVE JOHNSTON PacifiCorp System WAPA System M. MILE STEGALL LRS

Regional Transmission System - New MONTANA 2009 2009 ARVADA WYOMING TONGUE RIVER 2009 SHERIDAN SPEARFISH CARR DRAW 2009 2009 WYODAK Y. CRK RAPID CITY BUFFALO HUGHES Donkey Creek S. RC DC TIE B. CRK RENO OSAGE PUMPKIN BUTTES TECKLA HOT SPRINGS 2009 32 MVAr’s D-VAR 2010 (BH) YELLOWCAKE SPENCE S DAKOTA “DJ AREA” NEBRASKA CASPER DAVE JOHNSTON Common Use System Common Use System (new) PacifiCorp System M. MILE WAPA System STEGALL LRS

Basin Electric Costs Cost of Equity Cost of Debt General Plant Allocator Capital Projects Potential Future Facilities

Basin Electric Costs Cost of Equity – 10.80% Cost of Debt General Plant Allocator Capital Projects Potential Future Facilities

Basin Electric Costs Cost of Equity – 10.80% Cost of Debt – 5.95%(2009); 6.08%(2010) General Plant Allocator Capital Projects Potential Future Facilities

Basin Electric Costs Cost of Equity – 10.80% Cost of Debt – 5.95%(2009); 6.08%(2010) General Plant Allocator – GP1 per settlement Capital Projects Potential Future Facilities

Basin Electric Costs Cost of Equity – 10.80% Cost of Debt – 5.95%(2009); 6.08%(2010) General Plant Allocator – GP1 per settlement Capital Projects – $82.9m  $87.6m Potential Future Facilities

Basin Electric Costs Cost of Equity – 10.80% Cost of Debt – 5.95%(2009); 6.08%(2010) General Plant Allocator – GP1 per settlement Capital Projects – $82.9m  $87.6m Potential Future Facilities Generation Interconnection Network Facilities Other?

Transmission Rate Case Schedule FERC Filing – August 1, 2009 (July 31, 2009) Effective Date – October 1, 2009 Compliance Filing – After end of Calendar year 2010, prior to June 1, 2011

Rate Impacts Estimate Revenue Requirement of $18.30 million

Rate Impacts 2009 rate - $2.03 / kW-month Black Hills $ 9.41 m Basin Electric 13.33 m PRECorp 1.30 m Revenue Credits (0.20) m Total 23.84 m Usage – 980 MW Rate – $2.03 / kW-Month

Rate Impacts 2010 rate - $2.44 / kW-month Black Hills $ 9.41 m Basin Electric 18.30 m  PRECorp 1.30 m Revenue Credits (0.51) m Total 28.50 m Usage – 973 MW  Rate – $2.44 / kW-Month

Discussion / Questions