Allete, Inc. reported $31.2 million in third-quarter profits Wednesday, up from $30.7 million during the same time in 2018.
The Duluth-based energy company, which owns Minnesota Power, Superior Water, Light & Power, Allete Clean Energy and other subsidiaries, said third-quarter profits reached 60 cents per share, up from 59 cents per share in 2018.
Last year's third-quarter results included 3 cents per share and $1.7 million in profit from U.S. Water Services, which Allete sold earlier this year.
"These results are in line with our expectations for the quarter," CEO Al Hodnik said in a conference call with investors Wednesday morning.
Minnesota Power and Superior Water Light & Power brought in $32.4 million of profit during the third quarter, up from $29.8 million last year.
Last week, Minnesota Power asked the Minnesota Public Utilities Commission Control Agency to allow it to increase its residential rates by 15% and business rates by 10% after an expected drop in revenue from expiring power sales, increasing expenses and an ongoing transition to more renewable sources of power. The company also requested an interim rate increase of 7.7% for all customers starting Jan. 1.
Allete Clean Energy, which builds and operates wind farms throughout the U.S., posted a loss of $1.2 million during the third quarter of 2019, in part due to the expiration of power sales agreements.
Bob Adams, Allete senior vice president and chief financial officer, said he expects Allete Clean Energy to drive much of the company's growth going forward. He said he expects Allete Clean Energy to grow by 2-3 projects each year and that its goal is to own and operate a total of 1,500 megawatts of wind energy by 2022.
Allete Clean Energy, founded by Duluth-based Allete in 2011, has grown rapidly and can currently provide 540 megawatts of wind generation to its customers. The company expects that to jump to 720 megawatts when its next two wind farms are operational and to over 1000 megawatts when Diamond Spring is online. Diamond Spring, a future wind farm Allete Clean Energy owns in Oklahoma, will sell power to Walmart, Starbucks and Smithfield Foods.
Bethany Owen, president of Allete, said the company in 2019 set a "record-setting level of construction in support of cleaner and more energy-efficient energy sources."
Owen said the company was in its final phase of building the Great Northern Transmission Line, which will carry 250 megawatts of hydropower from Manitoba Hydro in Canada. Work on the line, which stretches across much of northern Minnesota, should wrap up in 2020.