Business Segments

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Business Segments [Text Block]

BUSINESS SEGMENTS

During the year ended December 31, 2015, management updated our reportable segment presentation to reflect the manner in which we operate, assess, and allocate resources after our recent acquisitions. We now present three reportable segments, Regulated Operations, ALLETE Clean Energy, and U.S. Water Services. Prior period amounts have been revised to conform with the current business segment presentation.

Regulated Operations includes three operating segments which consist of our regulated utilities, Minnesota Power and SWL&P, as well as our investment in ATC, a Wisconsin-based regulated utility that owns and maintains electric transmission assets in parts of Wisconsin, Michigan, Minnesota and Illinois. ALLETE Clean Energy is our business focused on acquiring or developing capital projects that create energy solutions by way of wind, solar, biomass, hydro, natural gas, shale resources, clean coal technology and other emerging energy innovations. U.S. Water Services is our integrated water management company which was acquired on February 10, 2015. The ALLETE Clean Energy and U.S. Water Services reportable segments comprise our Energy Infrastructure and Related Services businesses. We also present Corporate and Other which includes two operating segments, BNI Energy, our coal mining operations in North Dakota, and ALLETE Properties, our legacy Florida real estate investment, along with other business development and corporate expenditures, unallocated interest expense, a small amount of non-rate base generation, approximately 5,000 acres of land in Minnesota, and earnings on cash and investments.

NOTE 2. BUSINESS SEGMENTS (Continued)

Year Ended December 31	2015			2014			2013
Millions
Operating Revenue
Regulated Operations		$991.2			$1,003.5			$925.5
Energy Infrastructure and Related Services
ALLETE Clean Energy	262.1			33.2			—
U.S. Water Services	119.8			—			—
Corporate and Other	113.3			100.1			92.9
Total Operating Revenue		$1,486.4			$1,136.8			$1,018.4
Net Income (Loss) Attributable to ALLETE
Regulated Operations (a)		$131.6			$123.0			$103.6
Energy Infrastructure and Related Services
ALLETE Clean Energy	29.9			3.3			(3.4		)
U.S. Water Services	0.9			—			—
Corporate and Other (a)	(21.3		)	(1.5		)	4.5
Total Net Income Attributable to ALLETE		$141.1			$124.8			$104.7
Depreciation and Amortization
Regulated Operations		$135.1			$118.0			$110.2
Energy Infrastructure and Related Services
ALLETE Clean Energy	18.7			10.1			—
U.S. Water Services	7.3			—			—
Corporate and Other	8.9			7.6			6.4
Total Depreciation and Amortization		$170.0			$135.7			$116.6
Impairment of Real Estate
Corporate and Other	$36.3			—			—
Interest Expense
Regulated Operations (a)	$53.9			$49.2			$44.4
Energy Infrastructure and Related Services
ALLETE Clean Energy	3.3			0.8			—
U.S. Water Services	1.4			—			—
Corporate and Other (a)	8.6			7.1			8.2
Eliminations (a)	(2.3		)	(2.3		)	(2.3		)
Total Interest Expense	$64.9			$54.8			$50.3
Equity Earnings in ATC
Regulated Operations	$16.3			$19.6			$20.3
Income Tax Expense (Benefit)
Regulated Operations		$24.4			$39.0			$35.1
Energy Infrastructure and Related Services
ALLETE Clean Energy	21.0			2.3			(2.3		)
U.S. Water Services	0.9			—			—
Corporate and Other	(21.0		)	(4.6		)	(4.1		)
Total Income Tax Expense		$25.3			$36.7			$28.7

(a) During 2015, an intercompany loan agreement was entered into and interest expense was allocated to certain subsidiaries. The amounts are eliminated in consolidation. Prior period segment results have been revised to conform to the current presentation as if the intercompany loan existed as of January 1, 2013.

NOTE 2. BUSINESS SEGMENTS (Continued)

As of December 31	2015		2014
Millions
Assets
Regulated Operations	$3,862.6		$3,709.6
Energy Infrastructure and Related Services
ALLETE Clean Energy	504.6		291.9
U.S. Water Services	258.3		—
Corporate and Other	281.6		359.3
Total Assets		$4,907.1		$4,360.8
Capital Expenditures
Regulated Operations	$224.4		$583.5
Energy Infrastructure and Related Services
ALLETE Clean Energy	8.6		4.2
U.S. Water Services	2.9		—
Corporate and Other	15.9		16.6
Total Capital Expenditures		$251.8		$604.3