Wind farm operator ALLETE, Inc. based in Minnesota and with operations in Oklahoma, reported improved earnings per share as well as net income in 2022. But its wind farm subsidiary also had issues with the Southwest Power Pool and its Oklahoma wind farm operations.
The firm said total 2022 earnings were $3.38 per share on net income of $189.3million along with operating revenue of $1.6 billion. It’s better than 2021 when earnings were $3.23 per share on net income of $169.2 million and operating revenue of $1.4 billion.
“In 2023, we will continue to advance these and other strategic initiatives that set the stage for meaningful future growth,” said ALLETE Chair, President, and CEO Bethany Owen.
ALLETE’s subsidiary, ALLETE Clean Energy is responsible for two wind farms in Oklahoma, the Caddo wind site and the Diamond Spring Wind site. Caddo is in southwestern Oklahoma and Diamond Spring is near Ardmore in the southern part of the state. They are the company’s two largest wind sites at 303 MW each.
ALLETE senior vice president and CFO Steve Morris said the ALLETE Clean Energy business was below expectations for the guidance range for the year, primarily due to losses taken on a now-completed Northern Wind project and financial underperformance of facilities in the Southwest Power Pool. He said efforts are underway to navigate market and contract volatility related to the Oklahoma wind projects but Morris did not offer further details.
ALLETE Clean Energy, the wind farm operator, recorded 2022 net income of $16.3 million compared to $26.3 million in 2021. Net income in 2022 reflected challenges under the Caddo and Diamond Spring wind energy facilities’ power sales agreements resulting from market volatility and transmission congestion in the Southwest Power Pool.
Net income in 2022 also included additional losses related to ALLETE Clean Energy’s now completed and sold Northern Wind project. Net income in 2021 included the impact related to ALLETE Clean Energy’s Diamond Spring wind energy facility due to an extreme winter storm event in February 2021.
ALLETE Clean Energy’s Caddo site was contracted in 2022 to provide renewable energy to McDonald’s Corp., Hormel Foods and Oshkosh Corp. through separate renewable energy sales agreements.
The Diamond Spring Wind site also serves Fortune 500 companies. It has contracts to provide renewable energy to Walmart, Smithfield Foods and Starbucks through separate renewable energy sales agreements with 12-15 year terms.