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Duluth News Tribune op-ed: BlackRock = higher bills

September 30, 2025

Don’t let BlackRock stick MinnesotaPower customers with higher bills

Public Utilities Commission must put ratepayers before BlackRocks profits

The following op-ed by PESP climate and energy director Alissa Jean Schafer published in September in Duluth News Tribune:

Minnesota families should not have to pay higher electricity bills so Wall Street investors can collect outsized returns. Yet this is the risk in front of the Minnesota Public Utilities Commission as it considers BlackRock’s proposed acquisition of ALLETE, the parent company of Minnesota Power. The commission is scheduled to hear the case Thursday, Sept. 25.

BlackRock, through its subsidiary Global Infrastructure Partners, has argued that private-equity ownership would provide Minnesota Power with the capital needed to meet the state’s carbon-free standard. But the record tells a different story. Administrative Law Judge Megan McKenzie, after reviewing both public and confidential materials, concluded the petitioners had not shown the deal was necessary to meet Minnesota’s clean-energy goals.

Her ruling was unambiguous. She wrote, “In considering the true risks and benefits of the Acquisition, it is critical that the Petitioner’s agreements and private discussions do not comport with their public statements. The nonpublic evidence reveals the Partner’s intent to do what private equity is expected to do – pursue profit in excess of public markets through company control. The Partners themselves have carefully committed to do very little, instead largely making commitments through expected holding companies or Minnesota Power itself … Access to capital is the primary benefit touted by the Petitioners. However, the Partners have not, in fact, promised to provide capital to ALLETE. ALLETE did not even ask for some commitment to provide equity … and the merger agreement did not require the Partners to provide ALLETE with any additional equity.”

The judge went further, warning that “the Partners’ private memoranda, modeling, and communications with potential investors establish that the Partners are planning on significant rate increases that will likely exceed the long-run rate of inflation. The Acquisition creates an unacceptable risk of rate increase and rate shock in a critical and economically vulnerable area of Minnesota.”

Private-equity deals like this are not typically designed to benefit ratepayers. Global Infrastructure Partners has advertised to investors that the fund acquiring Minnesota Power seeks annual returns of 15% to 20% before fees, which is nearly double what publicly traded U.S. utilities have been able to earn over the past decade. The firm also expects to collect an additional 5% to 7% annual dividend from portfolio companies. That math only works one way: by extracting more money from captive customers who cannot shop around for electricity.

Speaking out against the deal, State Sen. Jen McEwen said, “It is not always going to be in the financial interests of BlackRock to keep our rates as low as possible, to serve our community the electricity we need. That’s not the business they are in. They are in the business of making profit from as many things as possible.”

The proposed private-equity financial structure could be far more expensive than public financing, where utilities can raise capital at much lower rates. Private-equity firms also typically load their acquisitions with high levels of debt, putting further strain on the utility to raise cash through rate hikes. The administrative law judge’s review makes clear that Minnesota Power’s customers may be left paying for this debt and these profits.

The experience of Michigan’s Upper Peninsula Power Company offers a cautionary example. After being acquired by a private-equity fund in 2014, UPPCO immediately sought rate increases. By 2018, it was back again with another request for nearly $10 million more. Households in Michigan’s Upper Peninsula — a region with similar weather, geography, and economic conditions as northern Minnesota — were left with the fear of possible unaffordable bills.

BlackRock’s takeover threatens to put Minnesota Power customers on the same path. While a recent settlement agreement includes a one-year rate freeze until late 2026, it provides no protections beyond that for Minnesota ratepayers. The judge’s findings show that the risk of rate increases is embedded in BlackRock’s business model.

The question before regulators is whether handing a monopoly utility to a private-equity fund demanding double-digit returns is in the public interest. The evidence suggests it is not. Under private-equity ownership, customers face the risk of higher bills, less reliable grid investment, and a slower clean-energy transition.

The Public Utilities Commission must adopt the judge’s recommendation and reject this acquisition. Minnesota’s energy future must be determined by the needs of communities and the long-term stability of the grid, not by the short-term profit expectations of Wall Street.


Find the full op-ed in Duluth News Tribune here.

Alissa Jean Schafer is climate and energy director at Private Equity Stakeholder Project, a nonprofit watchdog group focused on the impacts of private firms on people and the planet.

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