Minnesota Power filed a request with the Minnesota Public Utilities Commission (MPUC) seeking approval for a $134 million increase in revenue net of riders (line-item surcharges on customer bills). The 17.8% increase means residential customers will see their average monthly bill increase by about $24 if the MPUC approves the full rate request.
Minnesota Power’s last rate-increase request was in 2023.
ALLETE, formerly known as Minnesota Power & Light Company, was created in 2000 as the parent organization holding Minnesota Power and its other subsidiaries. In May 2024, ALLETE announced it had agreed to be acquired and taken private by BlackRock’s Global Infrastructure Partners (GIP) and the Canada Pension Plan Investment Board for $6.2 billion. That transaction officially closed on December 15, 2025.
“The electric system is undergoing an unprecedented transformation to achieve reliability and clean energy goals, requiring new investments at a time when our customer energy needs are changing, and we are facing the same inflation and other cost pressures as other businesses,” said Jennifer Cady, Vice President of Public Policy and External Affairs at Minnesota Power.
The increase request provided to the MPUC lists increased costs forecast to be incurred by the company, includes ongoing operations of the company’s generation, transmission and distribution systems, labor, continued investments in a more resilient electric grid, and renewable energy.
The company reports that 2/3 of electric sales go to large industrial customers. The idling of the
Minorca Mine and partial idling of the Hibbing Taconite mine affect the company’s energy sales but do not change the cost of operating, maintaining, and repairing the electric grid shared among all customer classes.
The company said that the rate request it filed is not related to the recent approval of the proposed 24/7 Google data center in Hermantown. The MPUC is still reviewing Minnesota Power’s electric service agreement proposed for the new data center.
“One of the reasons we support new business investment in the longer term is that new large, 24/7 customers benefit our residential and small business customers by diversifying our customer base, sharing in the costs to maintain and operate the overall electric system and reducing the impact when other large businesses have to slow their production and energy use,” said Josh Skelton, Minnesota Power Chief Operating Officer.
In Minnesota, an investor-owned electric utility like Minnesota Power must go through a formal legal and regulatory process called a General Rate Case to change its general retail rates, overseen by the MPUC. The entire process typically takes 12 to 18 months from filing to a final order. The filing includes a detailed projection of revenues, expenses, capital investments, and energy sales for an upcoming 12-month period, called the “test year.”
Minnesota law allows utilities to collect interim rates while the case is being reviewed so operations aren’t financially starved during the regulatory process. Interim rates are calculated using an established formula and usually take effect within 60 days of the initial filing.
Minnesota Power has requested a 15% net interim rate increase beginning in January 2027, or about $15 per month for residential customers. The company recently announced significant bill credits for its customers that will offset some of the interim rate increase.
Public meetings will be held to allow customers to offer comments on the proposed rates.
The MPUC will also request customer comments during its proceedings as it conducts a thorough review of the company’s request.
Arrowhead Electric in Cook County, Cooperative Light & Power and Lake Country Power in Lake County buy their wholesale electricity from Great River Energy. Minnesota Power supplies electricity to several incorporated towns and industrial customers along the North Shore corridor, including Silver Bay.
For more information about the requested increase, visit www.mnpower.com.
