) business ancillary Minnesota Power concluded installation work
on a handful of midstream and electric infrastructure assets in
Nashwauk County, Minn. These include new substations and
transmission lines that will meet the lofty power demands of
Essar Steel Minnesota's taconite mine and processing
The 230 Kilovolt ("KV") program was completed on Mar 8, 2013
while the remaining job on the 115 KV line will be wrapped up in
In Feb last year, ALLETE signed a long-term contract to
deliver power to Nashwauk County till Jun 30, 2024. Later,
Nashwauk County officials entered into a deal with Essar to
fulfill the company's electric needs for the taconite facility.
The county also agreed to provide power services to accommodate
Per the agreement, ALLETE will build three 230 KV transmission
lines which include a five-mile segment of double circuit 230 KV
and 115 KV lines. The company constructed and installed the first
key transmission assets in the Iron Range region. It took two
years for ALLETE to finish the job on the $35 million
transmission infrastructure. Overall, it constructed 28 miles of
lines and re-routed or detached 21 miles.
Essar is currently building a mine, concentrator and a
taconite production complex which has a maximum output capacity
of 7 million metric tons. Essar's electric demand is expected to
reach 110 megawatts when the facility goes into full production
and might increase further given its plans to expand production
of other by-products.
Meanwhile, the substations - McCarthy Lake and Calumet -
recently completed will together offer services to the mine. Both
ALLETE and Nashwauk County share the ownership and costs
associated with these facilities.
ALLETE has been aggressively investing its resources for the
development of its utility-scale assets. Minnesota Power earlier
disclosed its strategic Energy Forward plan which will focus on
offering clean, sustainable, affordable and reliable energy
services to the residents of Minnesota.
To achieve a balanced mix in its asset basket, the company has
been seeking options to enlarge its renewable business. This will
prove favorable with the gradual rise in renewable consumption in
the U.S. going forward.
We believe these broad initiatives will encourage customer
retention in Minnesota and attract non-ALLETE customers as well.
Presently, ALLETE retains a Zacks Rank #2 (Buy).
Other utility stocks that are worth a look include Zacks
Ranked #1 (Strong Buy)
Brookfield Infrastructures Partners L.P.
Pike Electric Corporation
Based in Duluth, Minn., ALLETE along with its subsidiaries
engages in the generation, transmission, and distribution of
coal-fired, hydro, wind, and biomass co-fired power in the United
ALLETE INC (ALE): Free Stock Analysis Report
BROOKFIELD INFR (BIP): Free Stock Analysis
EDISON INTL (EIX): Free Stock Analysis Report
PIKE ELECTRIC (PIKE): Free Stock Analysis
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