On April 29, 2008, our subsidiary, Black Hills Generation, Inc., entered into a definitive agreement with Southwest Generation Operating Company, LLC, the acquisition company formed by affiliates of Hastings Funds Management Ltd and IIF BH Investment LLC, a subsidiary of an investment entity advised by JPMorgan Asset Management, to sell certain independent power production (“IPP”) assets with a total capacity of 974 megawatts for $840 million cash, subject to working capital adjustments. The assets to be sold include the following gas-fired power plants:

Under the terms of the agreement, we have the right to retain ownership of the Fountain Valley power plant in Colorado in the event closing conditions for the planned acquisition of utility assets from Aquila, Inc. are not met. The purchase price for the Fountain Valley plant represents $240 million of the total $840 million purchase price.

The agreements contain various provisions customary for transactions of this size and type, including representations, warranties and covenants with respect to the IPP assets that are subject to usual limitations. Completion of the sale transactions is subject to various conditions, including: (i) approval of the Federal Energy Regulatory Commission; (ii) the expiration or early termination of any waiting period under the Hart-Scott-Rodino Antitrust Act of 1976, as amended; and (iii) approval by the Committee on Foreign Investment in the United States (“CFIUS”).

The foregoing descriptions of the agreement and the transactions contemplated thereby do not purport to be complete and are qualified in their entirety by reference to the purchase and sale agreement, a copy of which is filed as an exhibit to this Form 8-K and incorporated herein by reference.

On April 30, 2008, we issued a press release announcing we entered into a definitive agreement with an entity formed by affiliates of Hastings Funds Management Ltd and IIF BH Investment LLC, a subsidiary of an investment entity advised by JPMorgan Asset Management, to sell certain independent power production (“IPP”) assets with a total capacity of 974 megawatts for $840 million cash, subject to working capital adjustments. A copy of the press release is attached as an exhibit to this Form 8-K. This press release is being “furnished” and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

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