Minnesota Power Proposes Next Step in EnergyForward Plan
June 07 2017 - 1:00PM
Business Wire
Wind, solar and natural gas package will
increase company’s renewable mix, reduce carbon and preserve
reliability for customers
Minnesota Power, a utility division of ALLETE (NYSE:ALE), today
announced the next step in its EnergyForward strategy for
ensuring a safe, reliable and competitive energy supply for
customers and the region. If approved by regulators, the resource
package coupled with the company’s existing renewable resources
will result in renewable resources providing 44 percent of the
company’s energy supply by 2025, further reducing carbon emissions
while keeping rates affordable.
In an upcoming filing with the Minnesota Public Utilities
Commission (MPUC), Minnesota Power will request the addition of 250
megawatts of wind power capacity, an additional 10 megawatts of
solar power and 250 megawatts of combined-cycle natural gas
generation to meet customer demand for power, which is projected to
grow throughout the region. The new resources will increase the
company’s already robust wind portfolio of 620 megawatts and double
its solar generation.
“For the past four years, EnergyForward has been
exceeding expectations for how an energy company can transform the
way it produces and delivers energy,” said Brad Oachs, president of
Regulated Operations. “We look forward to working with our
customers and regulators to continue down the path toward a safe,
reliable, cleaner and affordable energy future.”
With approval of the proposed resource package by the MPUC,
renewable energy resources— including wind, Canadian hydro, solar
and biomass—will account for 44 percent of the utility’s energy
supply portfolio, exceeding the initial EnergyForward goal
of one-third renewable power. Minnesota Power’s long-term goal is
an energy mix of two-thirds renewable energy and flexible,
renewable-enabling natural gas and one-third environmentally
compliant baseload coal.
Natural gas is an essential component of the resource package to
be filed with regulators. Without this plant, Minnesota Power would
be reliant on fluctuating wholesale market prices when sun and wind
resources aren’t available, increasing overall costs over the
long-run.
“Through a unique partnership with Dairyland Power Cooperative
and access to a competitive natural gas supply, this approximately
$350 million investment will further balance Minnesota Power’s
energy mix while contributing meaningful growth for ALLETE’s
shareholders,” said ALLETE Chairman, President and CEO Al Hodnik.
“Minnesota Power’s EnergyForward investments and industrial
load prospects complement nicely the nexus of energy and water
growth initiatives already announced and additional opportunities
being pursued by ALLETE Clean Energy and U.S. Water. The ALLETE of
today is a stronger and much more balanced company, with each of
its businesses providing attractive growth and diversity consistent
with our overall growth thesis.”
Minnesota Power will file later this summer with the MPUC
requesting approval of the resource package. After filing, state
regulators will open a formal review process to consider Minnesota
Power’s request. After input from stakeholders and the public, a
final determination is expected in the latter half of 2018.
The details of Minnesota Power’s proposal include:
- Natural
gas. Minnesota Power is proposing a joint ownership
structure with Dairyland Power Cooperative to build a
state-of-the-art 525- to 550-megawatt combined-cycle natural gas
power plant in Superior, Wisconsin. Minnesota Power would purchase
approximately 50 percent of the plant’s output (250 megawatts) from
an ALLETE subsidiary starting in 2025 to serve customer load,
stabilizing energy supply for times when renewable energy
capability is lower. The project will create an estimated 260
construction jobs and employ approximately 25 full-time
workers.
- Wind.
Minnesota Power conducted a robust competitive process as part of
its 2015 Integrated Resource Plan. An independent, third-party
evaluator reviewed the bids and recommended a 250-megawatt, 20-year
purchase power agreement (PPA) with independent power producer
Tenaska, to be located in southwestern Minnesota. In addition to
providing the lowest overall cost among the wind farm bids,
Tenaska’s Nobles 2 Power Partners wind farm will offer greater
geographic diversity among Minnesota Power’s wind resources and a
highly efficient wind resource. Minnesota Power has an option to
purchase the wind farm after 10 years of production.
- Solar. To
achieve the state’s solar requirements, the Minnesota Power package
proposes to add 10 megawatts of solar power by 2020 through a
25-year PPA with Cypress Creek Renewables. The addition will
complement the current 10-megawatt Camp Ripley project that was
completed last year and will be placed within Minnesota Power’s
distribution system near Royalton in central Minnesota. The
agreement includes an option for Minnesota Power to purchase the
array.
Minnesota Power already is meeting or exceeding state standards
for renewable power, energy conservation and carbon emission
reduction through fleet transition of smaller coal units and the
addition of renewable energy. The company has already achieved a 25
percent renewable energy mix well ahead of Minnesota’s goal of 25
percent by 2025. Minnesota Power expects to reduce carbon emissions
on its system by about 40 percent by 2030 compared with 2005
levels.
“We believe this resource package is the best way to meet
changing customer expectations for clean energy while preserving
safe, affordable and reliable supplies of energy for the customers
who depend on us to power homes, schools, hospitals and the natural
resource based industry that fuels our region’s economy," Oachs
said.
Minnesota Power provides electric service within a
26,000-square-mile area in Northeastern Minnesota, supporting
comfort, security and quality of life for 145,000 customers, 16
municipalities and some of the largest industrial customers in the
United States. More information is available at www.mnpower.com.
ALE-CORP
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.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170607005334/en/
Minnesota Power/ALLETEAmy Rutledge, 218-723-7400Manager -
Corporate Communicationsarutledge@mnpower.com
Allete (NYSE:ALE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Allete (NYSE:ALE)
Historical Stock Chart
From Apr 2023 to Apr 2024