May 3 (Reuters) - U.S. power utility and renewable

energy developer Allete ( ALE ) said on Friday that its

Minnesota electric utility has reached a settlement on its 2024

electric rate proposal with the Minnesota Department of

Commerce, the state's Attorney General's Office and large power

customers.

If approved by the Minnesota Public Utilities Commission

(MPUC), the agreement would set the final rate increases of

about 4.9% for residential and small business customers and

about 4.4% for industrial and large commercial customers.

Minnesota Power provides electric service in northeastern

Minnesota for 150,000 customers, 14 municipalities and some of

the largest industrial customers in the United States.

The utility had filed its rate proposal in November 2023,

asking for an increase of $89 million in revenues to support

investments for a clean-energy transition.

The MPUC has approved an interim rate increase, which

went into effect on Jan. 1, of 8.6%, or about $8 per month for

the average residential customer over the 2023 rates.

With the final approved rate being lower than the interim

rate, the company said it would refund the difference to

customers with interest.