Minnesota Power Reaches Milestone in Renewable Energy Efforts with Purchase of Interstate Transmission Line
05 January 2010 - 1:00AM
Business Wire
Minnesota Power, an ALLETE company (NYSE: ALE), has finalized
the purchase of a 465-mile transmission line, signaling a new era
of renewable energy transport and development for the Company.
For approximately $70 million, Minnesota Power has acquired a
250-kilovolt line connecting Center, N.D. with its Arrowhead
Substation in Hermantown, Minn.
Purchase of the direct current (DC) transmission line from the
Square Butte Electric Cooperative will further Minnesota Power’s
long range plan to bring more renewable energy into its system. The
company plans to develop several hundred megawatts of new wind
generation in North Dakota and deliver wind-fueled electricity to
customers via the DC line.
Minnesota Power is already laying the groundwork for
construction of its Bison wind farm, a 75-megawatt installation
near New Salem, N.D. The project, consisting of 33 turbines with a
2.3 MW capacity each, will be installed in two phases. Phase
one, which will involve the construction of the first 16 turbines,
is scheduled to be operational by the end of 2010.
“The DC line is the centerpiece of our wind development efforts
in North Dakota and reflects our commitment to providing long term
value for our customers and shareholders,” said ALLETE CEO Don
Shippar. “Finalizing this purchase will allow us to deliver more
clean energy to our customers and the Upper Midwest in a cost
effective manner while supporting our efforts to meet Minnesota’s
aggressive mandate of producing 25 percent of our energy from
renewable sources by 2025.”
In November, the Federal Energy Regulatory Commission issued
written orders authorizing Minnesota Power’s acquisition of the
transmission facilities. On December 21, the Minnesota Public
Utilities Commission issued its written order approving Minnesota
Power’s purchase of the DC line.
The rich wind resources of central North Dakota are considered
among the nation’s premier sites for wind energy development, but
there’s a shortage of transmission assets available to move the
renewable energy to population centers.
“The transmission of renewable energy has been a big challenge
for our industry,” said Eric Norberg, Minnesota Power’s Senior Vice
President of Strategy and Planning. “With the closing of this
strategic agreement, we’re proud to be at the forefront of long
distance wind energy transport.”
Direct current is a more economical way to transmit power over
long distances than the standard AC, or alternating current. When
Square Butte built the DC line in the 1970s, it was designed to
move electricity from the coal-fired Young Station to supply
Minnesota Power’s growing taconite customers in northeast
Minnesota’s Iron Range.
Once described as a way to transport “coal by wire,” Minnesota
Power intends to use its DC line as an innovative method of moving
“wind by wire.” Electricity generated at the Young Station is now
shared by Minnesota Power and Minnkota Power Cooperative, an
affiliate of Square Butte. Over the next several years, Minnesota
Power will phase out its generation rights at the Young Station,
allowing Minnkota to eventually take all of the coal-based
electricity it once shared.
Minnesota Power provides retail electric service within a
26,000-square-mile area in northeastern Minnesota to 144,000
customers and wholesale electric service to 16 municipalities. More
information can be found at: www.mnpower.com.
The statements contained in this release and statements that
ALLETE may make orally in connection with this release that are not
historical facts, are forward-looking statements. Actual results
may differ materially from those projected in the forward-looking
statements. These forward-looking statements involve risks and
uncertainties and investors are directed to the risks discussed in
documents filed by ALLETE with the Securities and Exchange
Commission.
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