Good day, and thank you for standing by. Welcome to the Q4 2022 Black Hills Corporation's Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jerome Nichols, Director of Investor Relations.
Thank you. Good morning, everyone. Welcome to Black Hills Corporation's Q4 and full year 2022 Earnings Conference Call. You can find our earnings release and materials for our call this morning at our website at www.blackhillscorp.com under the Investor Relations heading. Leading our quarterly earnings discussion today are Linn Evans, President and Chief Executive Officer, Rich Kinzley, Senior Vice President and Chief Financial Officer, and Kimberly Nooney, Vice President and Treasurer. During our earnings discussion today, some of the comments we make may contain forward-looking statements as defined by the Securities and Exchange Commission. There are a number of uncertainties inherent in such comments. Although we believe that our expectations and beliefs are based on reasonable assumptions, actual results may differ materially.
We direct you to our earnings release, slide two of the investor presentation on our website, and our most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission for a list of some of the factors that could cause future results to differ materially from our expectations. I'll now turn the call over to Linn Evans.
Thank you, Jerome. Good morning, everyone, thank you for joining us. As we announced last quarter, Rich will be retiring mid-year, he gets one final opportunity this morning to provide the year-end financial review. Kimberly, as our incoming CFO, will provide the financial outlook for 2023 and beyond. I'll start on slide four with some key takeaways. While we successfully offset the impacts of the rapid macroeconomic shift through most of 2022, the increased carrying costs driven by natural gas prices and current interest rates are weighing on our expectations for 2023 and into 2024. We'll dive into those details shortly, before I do that, I want to recognize our team's strong execution on what was within our control in 2022. Once again, our team delivered exceptional operational results, we delivered earnings within our guidance range.
This was no small feat considering the challenging macroeconomic and business conditions that impacted Q4 financial performance. I'm very proud of what our team accomplished as we executed our regulatory strategy and advanced our strategic initiatives for system-wide resiliency, growth, and a successful energy future. We also made strides towards strengthening our balance sheet, which remains a key focus for us in 2023. To our Black Hills team listening today, thank you for your dedication to excellence in serving our customers. I'm very proud of what we achieved together in 2022 with more wins than we can adequately cover on this call. To that point, slide five highlights the excellent operational performance of our team and our electric and natural gas assets. I'm particularly pleased with the continued industry-leading electric reliability we provide our customers.
All three of our electric utilities maintain top quartile for reliability for the fourth consecutive year by the latest EEI survey for SAIDI reliability, and two of the three performed in the upper half of the top quartile. That's solid work by our team. We continue to serve growing customer demand for our products and services, which is reflected in 11 new all-time or winter peak loads at our electric utilities last year. These peaks continue to affirm the population and business migration we're witnessing into our service territories. Notably, at our Wyoming Electric utility, we have served a remarkable nine consecutive years of increasing peak customer demand. To put this in perspective, this past year's new peak of 294 MW represents a 53% increase over the 192 MW peak we served 10 years ago.
In December, we also served new winter peak loads at all three of our electric utilities during Winter Storm Elliott while avoiding rolling blackouts experienced by others in some regions of the country. The reliability and resiliency of our infrastructure is perhaps more critical than ever, given growing demand, the ongoing energy transition, and a more interconnected energy network. In our cold weather climate, resiliency and reliability go hand in hand with safety and our absolute priority of keeping our customers comfortable and safe during dangerously cold weather. Our excellent performance through the bitter cold of Winter Storm Elliott in December highlights once again the critical need for immediately dispatchable generation capacity and resilient electric and natural gas infrastructure. During our summer and winter peak load days, our electric utilities typically receive minimal contributions from our renewable resources.
For example, our wind assets serving Colorado Electric include three wind farms that total about 150 MW. On December 22nd, we experienced a winter peak load of 334 MW. During that peak, our wind farm was producing only 17 of its potential 150 MW. This highlights the need for a balanced mix of generation resources until such time that technology can provide more economic and reliable battery storage or other similar energy capacity. Finally, on this slide, we continue to make progress with enhancing our customer experience. During the year, we implemented voice response and live chat enhancements, and we were recognized by J.D. Power for our effective communications with customers. Moving to financial and regulatory execution on slide six, we delivered a 6% year-over-year increase in EPS.
We also increased the annual dividend by 5%, extending our track record to 52 consecutive years of increased dividends to shareholders. Our team managed through supply chain challenges and successfully executed our $600 million capital program. On the regulatory front, negotiating effective solutions for customers and shareholders remains a core strategic strength of our team. Over the last year, we reached constructive settlements and approvals for rate reviews and investment rider requests for both Arkansas Gas and Wyoming Electric. Our Wyoming Electric settlement was recently approved by the commission and includes an electric transmission investment rider. That rider will support transmission expansion to enhance resiliency for our customers. We filed a rate review last October for our Rocky Mountain Natural Gas Pipeline in Colorado, which is advancing through the regulatory process as planned. We anticipate new rates in the Q3 of this year.
In addition to our rate review activity, we finalized approvals for all remaining applications for the recovery of $546 million of incremental fuel costs incurred during Winter Storm Uri, and we have recovered more than one-third of those costs to date. Moving to slide seven. We advanced our strategies to enhance resiliency, support customer growth, and comply with emissions legislation. For our electric utilities, we made progress with our ongoing resource plans in Colorado and for our jointly operated system in South Dakota and Wyoming. We expect these plans to provide investment opportunities and renewable resources to reduce greenhouse gas emissions intensity 70% by 2040 off a 2005 base year. The economic incentives for renewable energy from the Inflation Reduction Act will help make these resources more accessible and more economic for our customers while helping us achieve our emissions goals.
We had a hearing last week before the Colorado Commission regarding our constructive unanimous settlement agreement for our clean energy plan. The settlement includes the addition of 400 MWs of renewable generation needed to achieve an 80% reduction in greenhouse gas emissions by 2030. Half of the 400 MWs will be owned by our utility. This would result in approximately 70% of our Colorado customers' annual electricity being generated by renewable resources. If the settlement agreement is approved as presented to the commission last week, a competitive bidding process for the new resources is expected to commence in the Q2 , again, with the utility owning half of the 400 MWs of resources we will seek.
We also advanced our 2021 integrated resource plan that we submitted for South Dakota, which proposes the addition of 100 MW of renewable resources and the exploration of 10 MW of battery storage. We're planning to issue an RFP for those resources later this quarter. With respect to transmission opportunities, we received approval from the Wyoming Commission last October to construct our Ready Wyoming transmission line, a 260-mile project in southeastern Wyoming. Construction is planned to start this year with final completion by the end of 2025. We're pursuing additional growth opportunities in our renewable natural gas business. We've already placed into service a number of RNG interconnects across our agriculture-rich territories, and we're developing a variety of investment possibilities to expand our RNG offerings and business. We also continue to pursue additional opportunities to serve hyperscale data centers and blockchain customers.
We're upbeat about our first blockchain customer in Cheyenne going into service shortly and other prospects we're developing in the region. We continue to make progress on our sustainability vision for the energy future. I already mentioned our electric emissions goals. During the year, we enhanced our gas utility emission goals to net zero by 2035. We will achieve this goal through ongoing infrastructure investment, enhanced processes and advanced leak detection, reducing third-party line hits, and integrating low carbon fuels such as RNG and perhaps hydrogen. Our published sustainability report includes details about our emissions goals. It includes our initial TCFD disclosure and other relevant information. Our financial outlook is summarized on slide eight. Rich and Kimberly will cover the details in their remarks. I'll share my perspective. Taking a step back, solid execution is reflected in our 2022 earnings.
When we issued 2022 earnings guidance two years ago, it was before Winter Storm Uri, inflation was less than 2%, and before 425 basis points of interest rate hikes and elevated natural gas prices. Through this volatile economic environment, our experienced team managed our business to achieve our guidance range, a significant accomplishment. Since early 2020, we've successfully managed through COVID. We absorbed and financed significant costs for customers related to Storm Uri and from elevated interest rates and energy pricing. We executed multiple years of financial discipline and cost control measures. We navigated supply chain constraints and successfully executed on our capital plan, and we completed numerous regulatory recovery requests, all with constructive results. I could go on, but I believe you get the idea.
It was a great team effort. That said, I know you share our frustration that a solid 2022 is overshadowed by the near-term macroeconomic environment. We're addressing increased carrying costs and inflationary impacts on expenses necessary to serve our customers. Although we expect these pressures to ease over the next 12-18 months, the near-term earnings impact is beyond what can be fully offset through short-term financial discipline and cost control measures. Importantly, our business strategy remains strong and intact. We remain optimistic about our future growth profile as we work through 2023 and 2024, and expect to achieve 4%-6% long-term EPS growth off a 2023 base year. As we will discuss in more detail, we revised our long-term EPS growth target primarily due to three general factors. First, increases in our working capital and interest rates, which are driving increased interest expense.
Second, inflationary pressures and expenses not yet included in our rate structures. Finally, the equity we intend to issue to capitalize our business, support the regulatory construct, and maintain our solid credit rating as we improve our balance sheet. Slide nine summarizes our strategic growth plan. We rolled our capital plan forward by one year, maintaining our five year forecast total of $3.5 billion . This translates to a run rate of approximately $700 million per year. We've kept our 2023 capital forecast at approximately $600 million to help strengthen our balance sheet while prudently investing capital to maintain a safe system. Our forecast for 2024 is approximately $800 million, reflecting Ready Wyoming and our intentional deferral of some projects.
I'll note the base plan does not include any renewable generation assets resulting from our Colorado Clean Energy Plan or our South Dakota and Wyoming Resource Plan, which are examples of incremental investment opportunities. Other incremental investments could arise from transmission projects beyond Ready Wyoming, and we're always evaluating our capital needs, including natural gas pipeline and storage projects and additional programmatic investment. We're also pursuing other earnings drivers, especially those that require little to no capital investment. As I mentioned already, population migration across our service territories continues to drive organic growth, with 5% growth in customer counts since 2018. This has translated into increased customer usage, with the electric utility's total retail megawatt hours sold since 2018 up over 6%, and our natural gas utilities usage also increasing by more than 4%.
We're also fostering ongoing sustainable cost savings through innovation and continuous improvement in how we do business and how we serve our customers. I'll complete my prepared comments by once again welcoming Kimberly to our call, who many of you have already had the pleasure to interact with in recent years. Kimberly has 26 years of deep experience with Black Hills and was appointed to be Rich's successor as CFO effective April 1st. It's just like her to already be working ahead of the curve and joining us today. I'm confident she is the right CFO to help lead our success going forward. Before we hear from Kimberly, Rich is still on the clock, and he's finishing with his knees high, and he will provide a review of our 2022 results. Rich?
Thanks, Linn, good morning, everyone. Since this is my last earnings update, I wanna thank all the investors and analysts I've had the privilege to work with over the last eight years as CFO. It's been an honor to represent the Black Hills Corporation team, and I've appreciated the conversations and friendships developed over the many years. As I transition to retirement, I want to assure you that you're in good hands with Kimberly. I'll start my comments on slide 11, where we've laid out earnings per share for the full year and by quarter for 2022 compared to 2021. We delivered EPS for the full year of $3.97 compared to $3.74 last year, a 6% increase, and then $1.11 for the quarter, consistent with Q4 2021.
Slide 12 and 13 illustrate the detailed drivers of change in net income year-over-year for the Q4 and full year. All amounts listed on these slides are after tax. I'll focus on the full year on slide 13. Higher margin was driven by $32 million from new rates and investment riders, $3.8 million of increased margin from customer growth and higher usage per customer, especially at our electric utilities, and $5.9 million of wholesale energy sales. Results for the year benefited from warm summer weather and higher than normal heating degree days in early Q1 and late Q4. Compared to normal, weather benefited earnings by $0.05 per share for the Q4 and $0.19 per share for the full year.
Compared to 2021 and the record-breaking warm weather in Q4 2021, weather benefited earnings by $0.21 per share for the Q4 and $0.26 for the full year. O&M expenses increased 9% year-over-year, driven generally by the inflationary environment. O&M increased due to higher fuel and materials costs and higher expenses for outside services, bad debt, labor, cloud computing, and property taxes. DD&A increased due to our capital investment program. Interest expense increased due to higher short-term debt balances, which were driven by volatile natural gas prices and increased short-term rates. Additional details on quarter-over-quarter and year-over-year changes in margin and operating expenses are available in yesterday's earnings release and in our 10-K to be filed early next week. Slide 14 reflects our long-term track record.
These charts show our strong rate base and earnings growth, with EPS growth being tempered by equity issuances to strengthen our balance sheet after the 2016 SourceGas acquisition. I'll now turn the call over to Kimberly for our financial outlook.
Thank you, Rich. Before I dive into the details, I would like to revisit what Linn said earlier. During the last three years, we've managed through some extraordinary times, including COVID, Winter Storm Uri, and more recently, decades high inflation, aggressive monetary policy, and geopolitical turmoil, resulting in higher interest rates and volatile energy markets. The charts on slide 16 reflect the macroeconomic environment we operate in today. Specifically, we experienced volatile and higher natural gas spot prices and basis differentials in our service territories at the end of the year. This contributed to a significant increase in working capital needs, which we fund through our commercial paper program. We had approximately $200 million more short-term debt at year-end 2022 than we had anticipated only a couple of months earlier.
Our higher short-term debt balance, coupled with higher short-term borrowing rates, increased our interest expense in the Q4. As we recover deferred gas costs and pay down these balances, we expect elevated interest expense in the near term. Slide 17 presents the revised outlook for our 2023 earnings guidance range of $3.65-$3.85 per share. This bridge identifies the major drivers leading to our revised guidance. Moving from left to right on the slide, we expect increased margins on new investments and ongoing customer growth, which offset non-recurring 2022 margin benefits. Although inflation continues to impact expenses, we expect to manage O&M to a level below 2022. Additionally, as a predominantly pure play utility, higher deferred gas costs are magnifying regulatory lag within our gas cost recovery mechanisms.
This, combined with higher short-term interest rates, has resulted in rapidly increase in interest expense. We expect recovery of these deferred costs over the next 12-18 months, which are impacting our financing activities this year. We now expect two debt issuances in 2023 instead of one as previously planned. You'll find our updated guidance assumptions in the appendix and our earnings release issued yesterday. Slide 18 outlines our financial position through the lens of credit quality, capital structure, and liquidity. We're committed to maintaining our solid investment-grade credit rating, and we continue to maintain adequate liquidity and a manageable debt maturity schedule. We are targeting a debt to total capitalization ratio of mid-50s by late 2023 or early 2024. Our progress toward this goal was interrupted by Winter Storm Uri in early 2021, driven by deferred fuel costs and the associated debt.
We made progress in 2022 by reducing this ratio, even with the upward pressure on short-term borrowings I discussed earlier. In the Q4, Moody's and Fitch affirmed our credit ratings with a stable outlook. We're also providing our leverage ratio targets of 14%-15% for FFO to debt and 5x FFO adjusted leverage, which we expect to achieve by year-end. We are very intentional about strengthening our balance sheet and maintaining our credit ratings as we leverage strong future cash flows to repay short-term debt, continue to exercise financial discipline and issue equity. We are also maintaining our capital expenditures at approximately $600 million for a second consecutive year while prudently investing for our customers.
Regarding equity, we issued $90 million through our at-the-market equity program in 2022 and expect to issue $140 million-$160 million in 2023. In our last quarterly call, we discussed options to strengthen our balance sheet, including a minority investment in our gas utilities. After extensive due diligence and rapidly changing market conditions, we elected not to pursue a transaction at this time. We're always evaluating tools to manage our capital and businesses, and this will remain an alternative for ongoing consideration. Our gas utilities continue to be a valuable long-term business that is essential to the safety of those who live and work in our cold weather service territories. Slide 19 lays out our long-term growth outlook.
We remain confident in our strategy and the long-term growth opportunities, particularly around renewable generation and transmission, ongoing population migration, and hyperscale data centers and blockchain, which are upsides to our base capital forecast. Most of these incremental investment opportunities benefit earnings in the latter part of our five-year plan and beyond, and we assume a more normalized macroeconomic environment beyond 2024. As a result, we are targeting long-term EPS growth of 4%-6% off 2023 as a base year. Also, a dependable and increasing dividend is a critical component of our strategy for growing long-term value for our shareholders. We expect to continue our 52-year track record of dividend increases, and we're targeting a long-term payout ratio of 55%-65%. In closing, I'm confident in our strategy.
When I look at our experienced and agile team, our strategic position, and the pipeline of opportunities we are developing, I'm optimistic that we are well-positioned for sustainable and long-term success. With that, I'll turn it back over to Lynn for some final comments. Linn?
Thank you, Kimberly. Once again, I'm very pleased with what our team accomplished in 2022, including safe and reliable service for our customers, solid financial results, regulatory execution, and advancing resiliency and supporting our customers' growth. We've successfully adapted to overcome a variety of challenges while maintaining our long-term focus and financial discipline, and we will continue to do so as we migrate through a dynamic financial landscape and leverage the long-term opportunities in front of us. With that, we'll take your questions.
Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from Julien Dumoulin-Smith with Bank of America. You may proceed.
Hey, good morning, team. Thanks for the time, and congratulations again, Rich.
Good morning, Julien.
Good morning, Julien.
Hey, good morning. Thanks, guys. Hey, listen, just want to come back to the core update here, if we can. Can you talk first maybe about the updated dividend payout ratio? The midpoint of the guidance implies slightly above the top end of the new payout ratio. Why not change your target, to something that aligns with the updated 2023? I get that you wanted to move things. Why not align it there?
secondly, I think more critical question here, how do you think about your earned returns and the structural nature of the reset lower here from 5-7 to 4-6, considering many of the dynamics that you point to, while obviously interest rates are more structural, gas prices seem more transient, for instance, if you can speak about you know, how you think about the longer-dated 2025, 2026 earnings trajectory?
Yeah. Good morning, Julien. This is Kimberly. Regarding your dividend payout ratio question, you know, we're really confident in our long-term strategy. You know, as we noted there, we believe that our 52-year growth target is growth track record is pretty evident of how we think about our dividend payout ratio. We felt the increase of the 55%-65%, given some of the other changes, was warranted. you know, as we talk about and think about the longer term vision for the company, 55%-65% made sense to us.
Julien, this is Linn. I would go to the latter part of your question. We feel confident in our business strategy and the growth projects and prospects we have in front of us. What we've got is some of these early headwinds are going to last for a while. You mentioned that gas prices are moderating. That is true at places like Henry Hub, et cetera, but we have price differential with our basis differentials we're watching. We incurred some pretty significant gas price costs, expenses in December, especially during Winter Storm Elliott. The El Paso pipeline, for example, not being at full capacity, et cetera, caused some extraordinary prices that we had to absorb in December alone, which of course we did not forecast otherwise.
Things like Winter Storm Elliott would be a good thing for us in terms of, you know, gas that we sold, et cetera. In that particular circumstance, we had to spend a lot more money than we anticipated, and now we have significant debt that we are financing. You think about, as a predominantly pure play utility, we do have good gas cost adjustments in our states. However, when we have this extraordinary basis differential, blowout if you will, it's gonna take us 12 to 18 months before we really recoup those costs. Again, that's debt that we're financing, et cetera. These headwinds, especially that came up in December for us, are going to linger into the next year or two. We have just general inflation that we're managing as well.
As we, I hope you know and recognize, we've done a nice job of controlling O&M, and we were able to absorb, you know, general inflation, higher employee costs and things of that nature through programs that we had in place to help us with our expenses. However, after what we experienced late Q4, that just piles on to the challenge that we have before us. I wanted once again comment, you know, the structure of the business is sound. We've got some great growth opportunities. We have things crystallizing with respect to our clean energy plan in Colorado, our IRP in South Dakota. We've got some good opportunities ahead of us that are not reflected currently for example, in our capital program.
Understood. I mean, maybe this becomes a little bit more of a specific state-level type of question. How do you think about the recovery of those associated costs, right? i.e., the elevated interest costs here, the elevated gas costs incurred as a function of Winter Storm Elliott. And then ultimately, how does that make its way through cost recovery? Understand that inflation is here to stay, or at least some of them should be structural. As you think about maybe moving beyond the near term 2023, 2024 into, say, 2025 and 2026, how do you think about the specifics of going back in for recovery here and ultimately being able to get closer to your authorized returns, if you will.
Yeah.
A great lag item?
Sorry to interrupt your question there, Julien. Good question. Again, this is Linn. We recognize that our regulatory strategy will have to be adjusted. We've often said we would always have two or three rate reviews going on at any one time. We still see those three rate reviews per year, if not more. We'll also, as we go for those rate reviews, be looking very close at our riders that we have, what could be amended, changed, tweaked, if you with respect to those. We recognize and understand, and we will be adjusting our regulatory frequency, our regulatory cadence, if you will, going forward. Of course, we'll have different kinds of requests in those as we go forward. We're also, you know, very sensitive to customer bill pressures.
Our customers are seeing general inflation across the economy, not just with their energy bills. We recognize that fact, we're sensitive to that fact, and we will be as innovative as we possibly can be as we strive to reduce our own expenses. I'm glad that for more than a year now, we've had our program that we call Energy Forward going on within our organization as we focus on innovative and less expensive and efficient ways that we can serve our customers in recognizing the bills that they have. You know, to summarize, you know, to your point, we do recognize we'll have a different cadence for regulatory reviews going forward.
Excellent. Well, thank you guys very much. Appreciate the time. Good luck.
Thank you, Julien.
Thank you. Our next question comes from Chris Ellinghaus with Siebert Williams Shank & Company. You may proceed.
Hey, everybody. How are you? Rich, good luck with retirement. Hope it goes as you had hoped. The supply chain, you know, issues that you referenced, is that more on the cost side or really the supply side? Since the Q3 have, you know, sort of cost of equipment risen faster than you anticipated?
Good morning, Chris. Yes, I would generally say that the same pressures that we're feeling, our vendors are feeling. They're working to try to determine how to pass on some of those elevated costs, you know, to our company as well. Yes, it's both from an availability perspective, we're starting to see some ease, but yet, you know, the timing of being able to receive the materials is still delayed. We are continuing to see, you know, those elevated prices from our vendors being pushed through. I would say it's trying to stabilize, but overall, you know, it's still a real issue.
Yeah, it's a great question, Chris. This is Linn, and I would really compliment our team on how they've been on top of all of our projects, analyzing them as a bulk, analyzing them individually. We have been able to push some out, which will help us with respect to overall capital expense and the impact on our customers. Real, real pleased with how our team has managed through that and will continue to.
Okay. you could sort of see in your interest expense guidance, the Storm Elliott impact to a degree. Was some of the increase in your interest expense expectations a change in your interest rate outlook since the Q3?
Yeah, that's a great question, Chris. We finance all of this through our commercial paper program. If you look at the A2/P2 rates over the last couple of months, right, you know, it elevated 100 basis points alone. When you think about that with the inverted curve, you know, we're just paying more from an interest rate perspective on short-term rates. That was higher than we had originally forecasted.
Okay. You have some things that are not in the growth guidance, you know, the Colorado, South Dakota, you know, clearly there's a lot of transmission, let's call them events, or opportunities. Do you have a chance to get back into that 5%-7% former growth rate with some of the upside opportunities?
Good question, Chris. This is Linn. I'll be cautious, I suppose. You know, we put out a 4%-6% because that's what we will achieve, can achieve. You're right. I will recognize. We recognize that the clean energy plan in Colorado is crystallizing. We have a unanimous settlement that would allow our utilities to own 50% of 400 MWs of new generation to achieve that plan of 80% reduction in our greenhouse gas emissions. Yes, that's not in our program, our plan, but it's gonna take a little bit of time for that to get done. In other words, we'll issue RFPs, I believe next quarter. We're looking forward to getting that out there and done. That will be an opportunity for us that, yes, will begin to impact our outer years.
We've got the integrated resource plan in South Dakota. We have been meeting with our stakeholders with respect to that one, and we're starting to crystallize around what we think we can perhaps build and own there. We're not yet ready to make that public quite yet, but we'll issue RFPs on that this quarter. Those are both exciting. Of course, we've got the Ready Wyoming, and you mentioned transmission as part of our approved rate review in Wyoming this past year, recently approved in January. We do have a transmission rider that will be effective for us as well. There are several opportunities, as you indicated and intimated in your question, that are beginning to crystallize for us. We're very excited about them, and it's gonna be some great opportunity for us and our company.
Lastly, you didn't really address dividend growth, but given the payout range, does this sort of suggest we should assume, you know, slightly lower than, you know, recent dividend growth rate?
Chris, you know, from a dividend growth rate perspective, we view this from a long-term perspective, just given our history. you know, obviously we've noted here in the short term from a 2023 and 2024 perspective that, you know, it may be a slower growth rate, but overall, as Linn just mentioned, as we think about the long-term growth of the company, we're very confident in where we're going, and we think that the dividend is a crucial component of the overall return for shareholders. that's just how we're viewing it.
Again, this is Linn. Kimberly did a nice job answering that. We value the dividend. We understand our shareholders perspective on that. Increasing it for 52 straight years is a record that we intend to keep and to maintain, of course, subject to our board approval. As we navigate these waters in front of us, flexibility for a bit might be very important to us. We can anticipate that we'll continue to increase the dividend.
Okay. Thank you so much for the call. I appreciate it, guys.
Thank you, Chris.
Thank you.
Thank you. Our next question comes from Andrew Weisel with Scotiabank. You may proceed.
Hey, good morning, everyone. I wanna follow up on a couple of questions that have been asked. First on the 4%-6%, you call it long-term. In the past, you had it defined a little bit more clearly. I guess my question is, given the macro headwinds going into 2024, should we expect growth to accelerate in 2025+? You also clarified it's an average annual compound growth rate. Does that mean that 2024 growth might be at or below that 4%, the low end?
Andrew, this is Linn. Great question. Thanks for bringing it forward. We anticipate the headwinds that we're seeing in 2023 may go into 2024. We don't know that, but that's how we're planning for that. We're planning for the worst, if you will, with respect to what we will continue to see into next year. I think your observation, I'll say is right, yes. We do see more growth on the back end of this five-year plan, we're gonna focus on being sure we're growing each year, including off of 2023. Hopefully that's responsive to your question, Andrew.
Yes. You said it's a five year plan, so that goes through 2027?
Yes.
Okay, great. Next question on the gas price recovery. How often do you reset your rates in your biggest jurisdictions? Obviously, the volatility, you know, up and down means you're always kind of playing catch up. How often are they reset, and is this one of the potential changes you might pursue in some states?
Yeah. Thank you for that question. Andrew, this is Linn again. It varies by state. That's where I'll start. Some states, we get fairly quick, immediate recovery. Some states, we have a full year lag. Some are more than that. Sometimes we're based off of a forecast. Frankly, some of our recent gas cost adjustments were based on forecasts that turned out not to be, you know, accurate in hindsight. It varies by state, and that's what we will evaluate as we go forward, is what is the most fair to customers and fair to shareholders with respect to timeliness, so that we're sending price signals appropriately and things of that nature. Again, probably for the third time, it really varies by state.
Okay, fair enough. Lastly, you mentioned, potentially accelerating the regulatory calendar. Where specifically might we see the next filings, sort of beyond what's currently underway?
Yeah. Thank you for that question, Andrew. This is Linn again. We're not quite prepared to announce that. We will probably do that relatively soon, maybe next quarter. Our regulatory team does a fantastic job of managing relationships and expectations. We wanna make sure we're sitting down, talking to our stakeholders in that regard before we make public announcements, and we're just not quite ready to do that. You can anticipate we'll probably still have, you know, the three typical rate reviews in 2023 that we will file.
Very good. Thank you very much. Congratulations again to Kimberly and Rich. Rich, enjoy the time with your grandkids.
Thank you.
Thank you for your questions, Andrew.
Thank you. Our next question comes from Brandon Lee with Mizuho. You may proceed.
Hey, Linn. Hey, Rich. Hey, Kimberly. Quick question. For your 4%-6% range, I guess where does the capital plan currently put you at? Are you in the middle, and what gets you to the 6% and what gets you to 4%?
Thank you for that question, Brandon. This is Linn again. we'll stay silent on that. it's important to just know that that EPS growth rate is out there. Our capital program is going to be a foundation fundamental part of that. we've got other growth opportunities with respect to continuing to serve our expanding hyperscale data centers, blockchain mining. Our first blockchain miner turns on here very, very soon. We're very excited about that. we've got incoming migration into our service territories, more businesses coming, all those fundamentals are strong. it's a combination of all the things that we have in our current plan and our current forecast that have put us in the next, growth range target.
Okay, great. That's all I had. All my other questions were asked. Thanks a lot.
Brandon, thank you for your question. We appreciate it.
Thank you. This concludes the Q&A session. I'd now like to turn it back to Linn Evans for any closing remarks.
Thank you very much. Well, we look forward to providing our customers and shareholders value, as we migrate through these current interest rates and macro environment. I'm more confident than ever in our team and what we can do and these headwinds that we're facing today are gonna make us a better and stronger company. I hope you hear the optimism in our voices about the future despite the short-term and near-term challenges that we will migrate through and will migrate through successfully. In closing, I again extend my sincere gratitude to each one of my coworkers, for their dedication to safety, their dedication to serving our customers. I'm very privileged to work alongside each of you every day. Best wishes to all of you for a Black Hills Energy safe day and a very productive day, and we appreciate the questions this morning.
Thank you.
Thank you. This concludes today's conference call. Thank you for participating. You may now dis-