ALE ALLETE, Inc.

Risks

• We rely on access to financing sources and capital markets. If we do not have access to capital on acceptable terms or are unable to obtain capital when needed, our ability to execute our business plans, make capital expenditures or pursue other strategic actions that we may otherwise rely on for future growth would be adversely affected.
• A deterioration in general economic conditions may have adverse impacts on our financial position, results of operations and cash flows.
• We are subject to extensive state and federal legislation and regulation, compliance with which could have an adverse effect on our businesses.
• The inability to attract and retain a qualified workforce including, but not limited to, executive officers, key employees and employees with specialized skills, could have an adverse effect on our operations.
• Item 1A. Risk Factors (Continued)
• Entity-wide Risks (Continued)
• Market performance and other changes could decrease the value of pension and other postretirement benefit plan assets, which may result in significant additional funding requirements and increased annual expenses.
• We are exposed to significant reputational risk.
• Catastrophic events, such as natural disasters and acts of war, may adversely affect our operations.
• We are vulnerable to acts of terrorism or cybersecurity attacks.
• Item 1A. Risk Factors (Continued)
• Entity-wide Risks (Continued)
• We maintain insurance against some, but not all, of the risks and uncertainties we face.
• Government challenges to our tax positions, as well as tax law changes and the inherent difficulty in quantifying potential tax effects of our operations and business decisions, could adversely affect our results of operations and liquidity.
• Item 1A. Risk Factors (Continued)
• Regulated Operations Risks (Continued)
• Our utility operations are subject to an extensive legal and regulatory framework under federal and state laws as well as regulations imposed by other organizations that may have a negative impact on our business and results of operations.
• Our regulated operations present certain environmental risks that could adversely affect our financial position and results of operations, including effects of environmental laws and regulations, physical risks associated with climate change and initiatives designed to reduce the impact of GHG emissions.
• Item 1A. Risk Factors (Continued)
• Regulated Operations Risks (Continued)
• The operation and maintenance of our regulated electric generation and transmission facilities are subject to operational risks that could adversely affect our financial position, results of operations and cash flows.
• Our ability to successfully and timely complete capital improvements to existing regulated facilities or other capital projects is contingent upon many variables.
• Our regulated electric generating operations may not have access to adequate and reliable transmission and distribution facilities necessary to deliver electricity to our customers.
• Item 1A. Risk Factors (Continued)
• Regulated Operations Risks (Continued)
• Our results of operations could be impacted by declining wholesale power prices.
• The price of electricity and fuel may be volatile.
• Demand for energy may decrease.
• We may not be able to successfully implement our strategic objectives of growing load at our utilities if current or potential industrial or municipal customers are unable to successfully implement expansion plans, including the inability to obtain necessary governmental permits.
• Item 1A. Risk Factors (Continued)
• The inability to successfully manage and grow ALLETE Clean Energy and our Corporate and Other businesses could adversely affect our results of operations.
• The generation of electricity from our wind energy facilities depends heavily on suitable meteorological conditions.
• The construction, operation and maintenance of our electric generation facilities or investment in facilities are subject to operational risks that could adversely affect our financial position, results of operations and cash flows.
• As contracts with counterparties expire, we may not be able to replace them with agreements on similar terms.
• Item 1A. Risk Factors (Continued)
• ALLETE Clean Energy / Corporate and Other Risks (Continued)
• Counterparties to turbine supply, service and maintenance, or power sale agreements may not fulfill their obligations.
• BNI Energy may be adversely impacted by its exposure to customer concentration, and environmental laws and regulations.
• Real estate market conditions where our legacy Florida real estate investment is located may not improve.