Proposed sale of Minnesota Power to private equity firm raises questions about state’s energy future

The proposed sale of ALLETE the parent company of our electric utility Minnesota Power to a Canadian pension fund and Global Infrastructure Partners a division of BlackRock raises serious concerns for northern Minnesotans like us As Minnesota Power customers we re deeply concerned about the harmful consequences a private equity acquisition would have on the stability affordability and accountability of a critical masses amenity that our households and our communities rely on This is an key moment for Minnesotans to ask questions about the current structure of our electric power system and even consider a different potential future one that definitely delivers electricity as an essential masses provision and where the population benefits from the system Electricity is essential Yet investor-owned utilities like Minnesota Power are designed to protect their bottom line and pad the pockets of shareholders first State regulation not only allows for this behavior it condones it Monopoly utilities do this at the expense of ratepayers constituents wellbeing and our warming planet The sale of Minnesota Power would facilitate even greater privatization handing over control of necessary albeit profit-driven services to two massive remote entities which operate behind the veil of the private markets Minnesota Power declares that it demands this sale to access capital for clean capacity We call their bluff In fact Minnesota Power has been able to access capital without difficulty The Minnesota Citizens Utility Board has also laid out why these indicates about access to capital are questionable Additionally Minnesota Power has in recent days proposed MWs of new fossil gas and continuing to burn coal at their Boswell plant until hardly a clean potential commitment To be fair Minnesota Power has made progress on clean power and efficiency over the past decade but these achievements occurred under inhabitants stockholder ownership and years of advocacy and masses pressure It s risky to assume that BlackRock whose primary motive is returning a premium profit to its wealthy investors would continue that progress when its track record says otherwise Meanwhile research by the Private Equity Stakeholder Project shows that private equity ownership often leads to cost-cutting reduced staffing asset stripping and infrastructure investments that prioritize profit over the society good moves that could slow the clean potential transition Lost time none of us can afford Another pressing concern this deal poses is the prospective loss of transparency and masses accountability Minnesota Power would remain a regulated utility but private equity firms are known for using complex financial structures to extract profits often bypassing masses oversight ALLETE would not have to meet the same reporting requirements set by the Securities and Exchange Commission so there would be less information publicly available about the company and its plans Decisions about rates staffing and infrastructure would be driven by distant investors not local stakeholders It s critical to ask who truly benefits from and who is burdened by this sale While particular stakeholders might see short-term gains and big pay-offs the long-term burdens would fall on everyday Minnesotans who depend on reliable affordable power and a livable context The state should be cautious about setting a precedent where essential services like electricity are treated as assets to be traded by global investors rather than as populace goods essential to our well-being and societal success State regulators have an obligation to systematically consider alternatives that keep local control and general accountability front and center That means asking tough necessary questions about what private ownership would mean for workers ratepayers and future generations The majority importantly regulators should listen to the concerns of local residents ratepayer advocates residents interest advocates and state agencies like the Office of the Attorney General and Department of Commerce who are rightfully skeptical of this deal Now is a time when Minnesotans can also ask questions about our capacity future Across the country there s a growing movement to democratize and decommodify our force system putting the power literal and figurative into the hands of the citizens that necessities it Rather than handing power and profits to private equity we could begin to develop a system that keeps every dollar of revenue from the electric power system in our communities and reinvested for our long-term beneficial interests We owe it to Minnesotans to move thoughtfully with a clear focus on protecting what matters the bulk transparency accountability and a clean ability future that serves all of us Jenna Yeakle of Duluth is a Minnesota Power customer and a campaign manager with Sierra Club for the Midwest Maggie Schuppert of rural Ely is a Minnesota Power customer and the director of strategic initiatives at CURE a rural society advocacy organization The post Proposed sale of Minnesota Power to private equity firm raises questions about state s resource future appeared first on MinnPost