Minnesota Power’s Great Northern Transmission Line Will ‘Unlock a Powerful Synergy’ between Wind and Hydro Power

  Minnesota Power’s Great Northern Transmission Line Will ‘Unlock a Powerful
  Synergy’ between Wind and Hydro Power

Business Wire

DULUTH, Minn. -- October 22, 2013

Citing the benefits of additional clean energy to power electric growth across
a stronger regional electric grid, ALLETE (NYSE:ALE) division Minnesota Power
this week outlined the public need for a 500-kilovolt (kV) Manitoba-Minnesota
transmission line.

The Duluth-based company filed Monday, October 21, with the Minnesota Public
Utilities Commission (MPUC) a Certificate of Need application for the
approximately 240-mile 500kV Great Northern Transmission Line, which will link
to a Manitoba Hydro transmission line at the Canada-U.S. border, and will
carry renewable hydro power from the province of Manitoba, Canada, to a
Minnesota Power electric substation on Minnesota’s Iron Range. The
international transmission interconnection is needed to support delivery of
hydroelectric energy from Manitoba Hydro to the U.S. from two new generating
stations under development in northern Manitoba that will be capable of
producing more than 2,000 megawatts (MW) of renewable electricity.

The Great Northern Transmission Line will facilitate the delivery of at least
750 MW of energy into the U.S. Beginning in June 2020, Minnesota Power will
utilize the Line to deliver 250 MW from Manitoba Hydro through a power
purchase agreement approved by the MPUC in early 2012. In addition, the two
utilities recently finalized a term sheet outlining how Minnesota Power will
purchase additional energy and substantially expand its energy storage
opportunities using the new transmission asset.

Minnesota Power will own 51 percent of the Great Northern Transmission Line,
while a subsidiary of Manitoba Hydro will own 49 percent. Minnesota Power
estimates that construction of the project in the U.S., including substation
work, represents an investment ranging from $400 million to $600 million,
depending upon final route. Subject to receipt of permits, construction is
anticipated to begin in June 2016 and take approximately 48 months to
complete. A recent economic impact study showed that construction of the Line
would generate more than $800 million in local economic impact and create
approximately 250 jobs for the design and construction period.

“The Great Northern Transmission Line is an innovative component of our
EnergyForward strategy to achieve a balanced energy mix of one third
renewable, one third coal and one third natural gas,” said ALLETE President,
Chairman and CEO Alan R. Hodnik. “Not only will this initiative advance the
nation’s goal to transform the energy landscape to a less carbon intense
platform, it will also open the door to further transmission investment in the
Midwest, while supporting planned industrial growth on Minnesota’s Iron

In approving the 250-MW power purchase last year, the MPUC determined that the
hydropower resources proposed in the agreement represented the most cost
effective way to help meet Minnesota Power’s customers’ future electric needs.
An innovative feature of the contract allows Minnesota Power to use Manitoba
Hydro’s system to “store” wind energy it produces at its Bison Wind Energy
Center in North Dakota, optimizing the timing and value of power delivery for

“The wind doesn’t always blow at times of peak electric demand,” explained
Minnesota Power Chief Operating Officer Brad Oachs. “The Great Northern
Transmission Line unlocks a powerful synergy between wind resources in the
north central U.S. and flexible Canadian hydropower in northern Manitoba.”

In addition to demonstrating need, Minnesota regulatory proceedings will
include a route permit process based on public input and feedback which
Minnesota Power anticipates filing in early 2014. The international project
will also require a Presidential Permit from the United States Department of
Energy. Concurrent with the regulatory processes in Minnesota and the U.S.,
Manitoba Hydro is proceeding with the necessary regulatory approval processes
for the generation and transmission additions in Manitoba.

More information about the project is available online at

Minnesota Power provides electric service within a 26,000-square-mile area in
northeastern Minnesota, supporting comfort, security and quality of life for
143,000 customers, 16 municipalities and some of the largest industrial
customers in the United States. More information can be found at

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


Minnesota Power/ALLETE
Amy Rutledge, 218-723-7400
Manager–Corporate Communications
Cell: 218-348-2961
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