The 250MW power purchase agreement is expected to provide a competitive energy resource for customers of Minnesota Power, a utility division of Allete. The additional hydropower will also support the utility’s resource planning goals of more efficiency, flexibility and diversity while lessening its dependence on coal and lowering emissions from its generation fleet.
“The Commission’s endorsement of this agreement demonstrates that cooperation in energy supply and transmission planning can cross state and national boundaries in the interest of meeting a changing North American energy landscape,” said Allete Chairman, President and CEO Al Hodnik.
The power purchase agreement will require additional new transmission capacity between Manitoba and the US. The two companies have been evaluating various transmission options that are cost competitive for customers, while also considering regional benefits.
“The transmission build required to deliver this carbon-free energy to Minnesota Power's service territory presents Alletewith yet another significant capital investment opportunity as we execute our multi-faceted, multi-year growth strategy,” Hodnik added.
A unique aspect of the power purchase agreement is Minnesota Power’s ability to store wind energy generated in North Dakota in Manitoba Hydro’s hydroelectric system. Through a provision in the agreement, Minnesota Power will be able to deliver electric energy northward from its wind farms in North Dakota when wind production is high and electric loads are low, thereby maximizing the value of its wind resources.
The company purchases, operates and is developing wind energy centers in Mountain Iron, Minn. and near Center, N.D. that by the end of this year will represent more than 400MW of renewable wind energy.
