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Minnesota Power wants to cut rates for mines and mills, raise them for homes

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Northeastern Minnesota's leading utility company has a plan to help the region's two leading industries by cutting their electric bills – with residential and business customers picking up the slack.

Minnesota Power says a plan it submitted to state regulators this week would cut the rates paid by taconite plants and paper mills by five percent. In would also raise the average residential customer's bill by 14.5 percent, which would come to $11.45 per month, the company says.

Businesses, schools, and government would see a flat monthly increase of $11.45 per meter. Minnesota Power says that amounts to an increase of 1 to 4 percent,

The taconite and paper industries have both fallen on hard times recently, with more than 1,000 iron workers laid off in Minnesota this year.

The Duluth News Tribune says Minnesota Power's proposed rate reductions would would apply to four paper mills and seven iron or taconite facilities, although four of those taconite plants are currently idled by the industry's downturn.

Not only are those industries big employers in northeastern Minnesota, they're also the biggest users of electricity.

MPR News reports, Minnesota Power has said that ore mines and taconite plants consume 40 percent of the power produced by the company, while paper mills use nearly 20 percent.

Minnesota Power says those industries have been paying higher rates to help keep homeowners' bills down. They say the proposed change would only reduce that subsidy, not reverse it.

The Public Utilities Commission has 90 days to consider the plan. the Mesabi Daily News says if it's approved, rate changes could occur as soon as March.

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