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Investment in ATC | 9 Months Ended
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Sep. 30, 2014
Investment in ATC [Abstract] |
Investment in ATC [Text Block] | INVESTMENT IN ATC Our wholly-owned subsidiary, Rainy River Energy, owns approximately 8 percent of ATC, a Wisconsin-based utility that owns and maintains electric transmission assets in parts of Wisconsin, Michigan, Minnesota and Illinois. ATC rates are based on a FERC-approved 12.2 percent return on common equity dedicated to utility plant. We account for our investment in ATC under the equity method of accounting. As of September 30, 2014, our equity investment in ATC was $120.7 million ($114.6 million at December 31, 2013). In the first nine months of 2014, we invested $3.1 million in ATC, and on October 30, 2014, we invested an additional $0.8 million. We do not expect to make any additional investments in 2014.
ALLETE’s Investment in ATC |
Millions |
Equity Investment Balance as of December 31, 2013 |  | $114.6 |
Cash Investments | 3.1 |
Equity in ATC Earnings | 15.6 |
Distributed ATC Earnings | (12.6 | )
Equity Investment Balance as of September 30, 2014 |  | $120.7 |
NOTE 8. INVESTMENT IN ATC (Continued) ATC’s summarized financial data for the quarter and nine months ended September 30, 2014 and 2013, is as follows:
| Quarter Ended |  | Nine Months Ended
ATC Summarized Financial Data | September 30, |  | September 30,
Income Statement Data | 2014 |  | 2013 |  | 2014 |  | 2013
Millions |  |  |  |  |  |  |
Revenue | $163.6 |  | $160.5 |  |  | $487.0 |  |  |  | $464.3 |
Operating Expense | 76.6 |  | 77.6 |  | 229.6 |  |  | 217.2 |
Other Expense | 21.4 |  | 20.2 |  | 65.1 |  |  | 62.6 |
Net Income | $65.6 |  | $62.7 |  |  | $192.3 |  |  |  | $184.5 |
ALLETE’s Equity in Net Income |  | $5.3 |  |  | $4.9 |  |  | $15.6 |  |  |  | $15.1 |
In November 2013, several customer groups located within the MISO service area filed a complaint with the FERC requesting, among other things, a reduction in the base return on equity used by MISO transmission owners, including ATC, to 9.15 percent. ATC's current authorized return on equity is 12.2 percent. Any change to ATC's return on equity and capital structure could result in lower equity earnings in ATC and dividends from ATC in the future. We own approximately 8 percent of ATC and estimate that for every 50 basis point reduction in ATC’s allowed return on equity our equity earnings in ATC would be impacted annually by approximately $0.5 million on an after-tax basis.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6382943&loc=d3e33918-111571 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=35687916&loc=d3e32787-111569 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=35687916&loc=d3e32847-111569 + Details
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