Allete sale would help fund clean energy investment for Minnesota

I’m writing in strong support of approving the sale of Minnesota Power to Canada Pension Plan Investments and Global Infrastructure Partners, as recommended in the settlement agreement with the Minnesota Department of Commerce. These firms are among the world’s most respected and experienced infrastructure investors — exactly the kind of partners needed at this critical juncture.

Minnesota’s utilities are facing the largest surge in electricity demand in decades along with serious climate challenges that require unprecedented investments in clean energy and resiliency. This moment demands deep capital, strategic vision and operational excellence. The key question before the Minnesota Public Utilities Commission is whether this transaction, along with targeted innovation and operational shifts, can better position Minnesota Power to meet the state’s long-term energy needs while protecting the public interest. The evidence suggests it will.

Like many others, I’ve been closely following the proposed sale of Minnesota Power and I’m fully aware of what’s at stake for customers and communities across the region. This is no ordinary service area — it’s home to the iron ore mines that supply 85% of America’s steel production, the nation’s furthest inland freshwater seaport and two major military installations. The outcome of this sale will ripple far beyond the Northland. It’s also pivotal to Minnesota’s ambitious push to decarbonize its utility sector while keeping energy affordable — a balancing act that will define the state’s economic and environmental future.

I’ve long believed that America can do big things. We have the innovation, the talent and the drive to decarbonize our economy while expanding it — strengthening our global competitiveness and creating more opportunities for Americans. But ambition alone isn’t enough. Big things require big investment. That investment comes from the private sector — through public markets and private deals like this one. Government has a role to play, but it can’t shoulder the burden alone. In fact, some of the new leadership in Washington is pushing states toward outdated strategies — like propping up aging coal plants — that would raise costs for consumers rather than support forward-looking, affordable energy solutions.

Minnesota is stepping up — and so is Minnesota Power. As the backbone of the state’s iron range and a key driver of economic growth, Minnesota Power plays a vital role in fueling America’s steel industry while leading the charge on clean energy. The state’s landmark law requiring 100% carbon-free electricity by 2040 is one of the most ambitious in the country, and Minnesota Power is proving it’s up to the challenge. Once almost entirely coal-dependent, the utility has transformed itself — becoming the first in the state to generate more than half its electricity from carbon-free renewables. All the while, it’s delivered highly reliable service and kept its residential bills the lowest among investor-owned utilities in the state. That’s a track record worth building on.

These are remarkable achievements — especially for the eighth smallest investor-owned utility in the nation. But the road ahead is even steeper. To fully decarbonize its electricity sales and keep pace with rising demand, Minnesota Power must navigate an increasingly complex and capital-intensive landscape. Over the next five years alone, it will need to raise roughly $1 billion in equity — an extraordinary sum that matches what the utility has raised over its entire 75-year history as a publicly traded company. That’s the scale of investment required to keep the lights on, emissions down and reliability high. Because doing big things doesn’t just take vision — it takes capital. A lot of it.

Recognizing the scale of what lies ahead, Minnesota Power’s leadership made a pivotal decision more than a year ago: to find a larger partner capable of helping the utility meet the growing needs of its customers and clean energy requirements of the State. They sought investors who could bring not only deep capital, but a long-term commitment to reliability, affordability and local stewardship. They found that in Canada Pension Plan Investments and Global Infrastructure Partners — firms with the scale to deliver the billions in investment required, while keeping Minnesota Power firmly headquartered and rooted in the region it serves.

Some have voiced concerns about private investment in Minnesota Power — but those concerns often overlook the utility’s current ownership structure. Minnesota Power isn’t government-funded or community-owned; it’s a publicly traded company, owned by private shareholders and large institutions working through Wall Street firms. The real issue is that the public markets are increasingly volatile and swayed by global forces like tariffs, inflation and even speculative trends like AI. That volatility makes it extremely difficult for a small utility to raise the unprecedented amount of equity — roughly $1 billion — it now needs. On top of that, public markets reward short-term performance, quarter by quarter.

What Minnesota Power needs is long-term vision and stable capital — precisely what this private investment offers. That’s the only way to do the big things required to serve its communities, especially when federal energy rhetoric doesn't always align with real on-the-ground needs.

It’s especially noteworthy that, if this transaction is approved, 60% of Minnesota Power will be owned by public pension funds — the very definition of long-term, stable investors. This is exactly the kind of patient capital a public utility needs. The sale would inject a massive infusion of private capital into Minnesota Power, capital guided by a long-term perspective rather than short-term market pressures. That dependable access to equity will empower the utility to pursue projects with higher upfront costs but lower long-term operating expenses — precisely the kind of investments needed to decarbonize affordably. And importantly, all of this will remain under the oversight of the Minnesota PUC and the safeguards set forth in the Department of Commerce settlement.

The settlement includes strong safeguards to ensure this transaction serves the public interest. It requires the buyers to provide the capital Minnesota Power needs to meet its investment obligations — especially in expanding clean energy generation and building out the transmission infrastructure essential to delivering it. Beyond that, the settlement delivers immediate and tangible benefits to customers:

• A one-year freeze on Minnesota Power’s rates;
• A reduced authorized return on equity; and
• A $50 million innovation fund — fully paid by the buyers — to support the development of next-generation clean energy technologies that will help decarbonize the grid without sacrificing reliability.

Investor-owned utilities are facing unprecedented challenges. Insisting on old approaches will only drive massive rate hikes for customers. The only way to meet this challenge affordably is by deploying next-generation technologies — and that requires patient, long-term capital. This transaction delivers exactly that: large-scale private investment, placed under the oversight of the regulatory commission, to ensure it serves the public interest. It will enable reliable, clean energy solutions that protect our climate while fueling economic growth and opportunity.