BLACK HILLS CORP /SD/

We are subject to significant state and federal environmental regulations that encourage the use of clean energy technologies and regulate emissions of GHGs. We have undertaken initiatives to meet current requirements and to prepare for anticipated future regulations, reduce GHG emissions, and respond to state renewable and energy efficiency goals. Compliance with future environmental regulations could result in substantial cost.

On June 11, 2025, the EPA proposed to repeal the GHG reduction requirements commonly referred to as the Clean Power Plan 2.0 which were finalized by the prior administration on May 9, 2024. Clean Power Plan 2.0 requirements, which established GHG control requirements for existing coal and natural gas fired generation beginning January 1, 2030, are currently in effect as the U.S. Supreme Court denied a motion to stay them. The EPA is anticipated to finalize their proposal in the first half of 2026. We will evaluate the impacts of the final rule at that time.

Environmental risk changes frequently with the implementation of new or modified regulations, changing stakeholder interests and needs, and through the introduction of innovative work practices and technologies. We continually assess risk and develop mitigation strategies to manage and ensure compliance across the enterprise successfully and responsibly. For additional information on environmental matters, see Item 1A - Risk Factors and Note 3 of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K.

Clean Energy Goals

In November 2020, we announced clean energy goals to reduce GHG emissions intensity for our Electric Utilities by 40% by 2030 and 70% by 2040 and achieve GHG reductions of 50% by 2035 for our Gas Utilities. Our goals are compared to a 2005 baseline. Electric Utility goals include Scope 1 emissions from electric utility generating units and Scope 3 emissions from purchased power for sales. Our Gas Utilities goal initially included only Scope 1 emissions from distribution system main and service lines. In August 2022, we announced a new "Net Zero by 2035" target for our Gas Utilities, which doubled the previous target of a 50% reduction by 2035 and expanded the scope of the goal to all Scope 1 sources of methane emissions on our distribution system. Net Zero will be achieved through pipeline material and main replacements, advanced leak detection, third-party damage reduction, expanding the use of renewable natural gas and hydrogen, and utilizing carbon credit offsets.

During the second quarter of 2025, we published our 2024 Corporate Sustainability Report, highlighting our environmental, social and governance impacts and our progress on major projects and climate goals. We reported a 38% reduction

in electric utility emissions since 2005 and are on track to reduce emissions 40% by 2030 and 70% by 2040. We

also continue to advance toward our goal of net zero natural gas utility emissions by 2035.