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ALLETE Inc.’s (
- Snapshot Report
unit Minnesota Power has submitted its full-year 2013 Resource Plan to the Minnesota Public Utilities Commission (“MPUC”). This plan is part of the company’s EnergyForward initiative and its commencement is subject to government approvals. The Commission is expected to take action on the plan in 2013.
Under the EnergyForward initiative, ALLETE concentrates on an approach to provide safe and reliable services to its customers at the cheapest probable price while protecting and enhancing the local standard of living. The company continues to transform its generation fleets to those that emit less carbon, and are varied and flexible.
In the time period from 2013 to 2017, ALLETE plans to add new wind resources in its portfolio under the EnergyForward initiative. In addition, the company is taking several steps to diversify its portfolio. These include saving competitive base load generating resources along with lesser emissions, execution of least expensive demand-side resources, decreasing dependence on coal fired generation, diminishing carbon usage on the system, and adding renewable energy and transmission infrastructure.
In the long run, ALLETE plans to rebalance its generation portfolio. Renewable resources, coal and natural gas or other sources will contribute one-third each to the company’s total power generation.
Globally, the demand for renewable energy is rising primarily due to its clean nature and growing awareness among the masses regarding its benefits. This factor influences the utility providers to shift their mode of power generation to wind, solar and water from coal.
In Aug 2005, the U.S Environmental Protection Agency circulated a regulation that each of the federal agencies will consume renewable energy in amounts of not less than 7.5% in 2013 and afterward.
To meet the environmental legislations, apart from Minnesota Power, other utility providers including Wisconsin Energy Corporation ( WEC - Analyst Report ) , Sempra Energy ( SRE - Analyst Report ) and Northeast Utilities ( NU - Analyst Report ) also invest substantial amounts to develop and upgrade their renewable emission-free utility assets.
It is evident from past transactions that ALLETE is also jumping on this bandwagon. The company continues to convert its existing generation bases into cost-effective units, which will subsequently improve its forthcoming earnings.
Recently, Minnesota Power completed the operational and commissioning process of its 210-megawatt Bison 2 and 3 projects of its Bison Wind Energy Center. With the installation of these projects, the share of renewable generation in ALLETE’s total electricity portfolio will increase to 20%. This will subsequently enable the company to meet the state’s renewable energy goals.
ALLETE expects energy demand in the region to increase in the near term primarily due to the commencement of the several large-scale industrial projects. We believe the enhancement and diversification of the generation capacity will enable the company to meet demand growth, and subsequently improve its future performance.
Minnesota-based ALLETE Inc. is a multi-service provider and has operations in Florida, North Dakota and Wisconsin. It has a wide array of businesses, starting from the supply of electricity and water utility to automobile auction. The company currently has a Zacks Rank #2 (Buy).
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