Minnesota Power starts $900 million grid upgrade to boost reliability

Minnesota Power broke ground Tuesday on a $900 million modernization at the Arrowhead Substation site in St. Louis County to keep the grid reliable as older equipment reaches the end of its life and more wind power moves east from North Dakota.

The project replaces an aging converter station that has served the region for nearly 50 years. That station turns direct current into alternating current so Minnesota Power customers can use it, and the upgraded system is designed to support bi-directional transmission while preserving the line’s voltage and power-transfer capability. State planning documents list a new terminal, a new substation and three transmission lines near the existing Arrowhead Substation, with less than a mile of new 345-kV line and two parallel 230-kV lines that are each less than a mile long.

The Minnesota Power HVDC Modernization Project is docketed as TL-22-611 and CN-22-607. Minnesota Power filed its combined application on June 1, 2023, and the Minnesota Public Utilities Commission issued the certificate of need and route permit on Aug. 1, 2024 after review by the Energy Environmental Review and Analysis unit and contested-case proceedings at the Office of Administrative Hearings. The route permit also covers reconfiguring a short portion of the existing ±250-kV line so it can terminate at the new facility.

Mortenson is the general contractor and Siemens is supplying the technology, with about 100 people expected on site during peak construction. The utility has worked to keep costs down for customers and secured about $75 million in grants to help offset the price tag, including $50 million in federal funding from the U.S. Department of Energy and $25 million in state funding, with $10 million from the State Competitiveness Fund.

Minnesota Power bought the 465-mile Square Butte DC line between the Minnesota-North Dakota border and Hermantown in 2009, and the line itself went into service in 1977. The utility serves a 26,000-square-mile territory with 8,742 miles of transmission and distribution lines and 164 substations, and it now provides more than 50% renewable energy while pushing toward 90% renewable energy and coal replacement by 2035.