SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) - DECEMBER 21, 2005
ALLETE, INC.
(Exact name of registrant as specified in its charter)
MINNESOTA 1-3548 41-0418150
(State or other (Commission (IRS Employer
jurisdiction of incorporation File Number) Identification No.)
or organization)
30 WEST SUPERIOR STREET
DULUTH, MINNESOTA 55802-2093
(Address of principal executive offices, including zip code)
(218) 279-5000
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
/ / Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
/ / Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
/ / Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
/ / Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
SECTION 8 - OTHER EVENTS
ITEM 8.01 OTHER EVENTS
Reference is made to ALLETE, Inc.'s (ALLETE or Company) Annual Report on Form
10-K for the year ended December 31, 2004 (2004 Form 10-K), for background
information on the following update.
Ref. Page 9 - Last Paragraph
Ref. Page 10 - First and Sixth Paragraphs
Ref. Form 10-Q for the quarter ended March 31, 2005, Page 22 - Sixth Full
Paragraph
Ref. Form 10-Q for the quarter ended March 31, 2005, Page 28 - Fourth Paragraph
Ref. Form 10-Q for the quarter ended June 30, 2005, Page 29 - Fifth Paragraph
Ref. Form 10-Q for the quarter ended September 30, 2005, Page 30 - Fourth
Paragraph
Minnesota Power, an operating division of ALLETE, filed a petition with the
Minnesota Public Utilities Commission (MPUC) in February 2005 to amend its
automatic fuel adjustment recovery mechanism (fuel clause) to accommodate costs
and revenue related to Midwest Independent Transmission System Operation, Inc.
(MISO) Day 2 market implementation. In March 2005, the MPUC approved interim
ratemaking treatment of MISO Day 2 costs which allowed these costs to be
recovered through the fuel clause, subject to refund with interest.
On December 21, 2005, Minnesota Power received an Order Establishing Second
Interim Accounting for MISO Day 2 Costs, Providing for Refunds, and Initiating
Investigation (Order) from the MPUC related to the automatic recovery of certain
MISO Day 2 costs through its fuel clause. This Order remains subject to
rehearing and appeal, and if upheld, certain costs incurred by Minnesota Power
cannot be recovered from customers through its fuel clause. As a result,
Minnesota Power may be required to refund the disallowed portion of the costs
that had been recovered on an interim basis through its fuel clause. Based on
this Order, Minnesota Power estimates the total amount of possible disallowed
MISO Day 2 costs for 2005 at approximately $7 million after tax. As this Order
from the MPUC is subject to rehearing and appeal, the Company will not record a
charge for this item in 2005 and will continue current recovery of MISO Day 2
costs. The Company intends to request rehearing of the Order in early January
2006, which could result in continued fuel clause recovery or deferral of costs
to be addressed in a subsequent rate case. If the Company prevails in the
rehearing process, there would be no disallowance of these costs. Because the
outcome of the rehearing and any appeal is uncertain, the Company plans to file
a Notice of Intent to Withdraw from MISO and pursue other options.
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READERS ARE CAUTIONED THAT FORWARD-LOOKING STATEMENTS SHOULD BE READ IN
CONJUNCTION WITH ALLETE'S DISCLOSURES UNDER THE HEADING: "SAFE HARBOR STATEMENT
UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995" LOCATED ON PAGE 2 OF
THIS FORM 8-K.
ALLETE Form 8-K dated December 27, 2005 1
SAFE HARBOR STATEMENT
UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, ALLETE is hereby filing cautionary statements
identifying important factors that could cause ALLETE's actual results to differ
materially from those projected in forward-looking statements (as such term is
defined in the Private Securities Litigation Reform Act of 1995) made by or on
behalf of ALLETE in this Current Report on Form 8-K, in presentations, in
response to questions or otherwise. Any statements that express, or involve
discussions as to expectations, beliefs, plans, objectives, assumptions or
future events or performance (often, but not always, through the use of words or
phrases such as "anticipates," "believes," "estimates," "expects," "intends,"
"plans," "projects," "will likely result," "will continue," "could," "may,"
"potential," "target," "outlook" or similar expressions) are not statements of
historical facts and may be forward-looking.
Forward-looking statements involve estimates, assumptions, risks and
uncertainties and are qualified in their entirety by reference to, and are
accompanied by, the following important factors, in addition to any assumptions
and other factors referred to specifically in connection with such
forward-looking statements, which are difficult to predict, contain
uncertainties, are beyond ALLETE's control and may cause actual results or
outcomes to differ materially from those contained in forward-looking
statements:
- ALLETE's ability to successfully implement its strategic objectives;
- prevailing governmental policies and regulatory actions, including those
of the United States Congress, state legislatures, the Federal Energy
Regulatory Commission, the Minnesota Public Utilities Commission, the
Florida Public Service Commission, the Public Service Commission of
Wisconsin, and various local and county regulators, and city
administrators, about allowed rates of return, financings, industry and
rate structure, acquisition and disposal of assets and facilities, real
estate development, operation and construction of plant facilities,
recovery of purchased power and capital investments, present or
prospective wholesale and retail competition (including but not limited
to transmission costs), and zoning and permitting of land held for
resale;
- effects of restructuring initiatives in the electric industry;
- economic and geographic factors, including political and economic risks;
- changes in and compliance with environmental and safety laws and
policies;
- weather conditions;
- natural disasters;
- war and acts of terrorism;
- wholesale power market conditions;
- population growth rates and demographic patterns;
- the effects of competition, including competition for retail and
wholesale customers;
- pricing and transportation of commodities;
- changes in tax rates or policies or in rates of inflation;
- unanticipated project delays or changes in project costs;
- unanticipated changes in operating expenses and capital expenditures;
- global and domestic economic conditions;
- our ability to access capital markets;
- changes in interest rates and the performance of the financial markets;
- competition for economic expansion or development opportunities;
- ALLETE's ability to manage expansion and integrate acquisitions; and
- the outcome of legal and administrative proceedings (whether civil or
criminal) and settlements that affect the business and profitability of
ALLETE.
Additional disclosures regarding factors that could cause ALLETE's results and
performance to differ from results or performance anticipated by this report are
discussed under the heading "Factors that May Affect Future Results" in Item 7
of ALLETE's 2004 Form 10-K and Item 2 of its Form 10-Q for the quarterly period
ended September 30, 2005. Any forward-looking statement speaks only as of the
date on which such statement is made, and ALLETE undertakes no obligation to
update any forward-looking statement to reflect events or circumstances after
the date on which that statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time and it is not
possible for management to predict all of these factors, nor can it assess the
impact of each of these factors on the businesses of ALLETE or the extent to
which any factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statement. Readers are
urged to carefully review and consider the various disclosures made by ALLETE in
its 2004 Form 10-K and in ALLETE's other reports filed with the Securities and
Exchange Commission that attempt to advise interested parties of the factors
that may affect ALLETE's business.
2 ALLETE Form 8-K dated December 27, 2005
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ALLETE, Inc.
December 27, 2005 James K. Vizanko
-------------------------------------------------
James K. Vizanko
Senior Vice President and Chief Financial Officer
ALLETE Form 8-K dated December 27, 2005 3