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FORM 10-K
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EXHIBIT 12
ALLETE
Computation of Ratios of Earnings to Fixed Charges and
Supplemental Ratios of Earnings to Fixed Charges
For the Year Ended December 31 2000 1999 1998 1997 1996
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Millions Except Ratios
Income from Continuing Operations Per
Consolidated Statement of Income $148.6 $ 68.0 $ 88.5 $ 77.6 $ 69.2
Add (Deduct)
Current Income Tax Expense 91.1 70.5 52.9 44.7 31.4
Deferred Income Tax Expense (Benefit) (4.8) (11.3) 2.7 3.2 (9.8)
Deferred Investment Tax Credits (1.8) (1.5) (1.6) (1.3) (2.0)
Undistributed Income from Less than 50%
Owned Equity Investments - (0.6) (14.1) (13.9) (11.0)
Minority Interest - 1.8 2.0 2.3 3.3
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233.1 126.9 130.4 112.6 81.1
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Fixed Charges
Interest on Long-Term Debt 54.5 48.4 48.5 50.4 52.4
Capitalized Interest 0.9 0.7 1.0 1.5 1.5
Other Interest Charges - Net 15.9 12.0 17.1 14.3 10.2
Interest Component of All Rentals 8.5 4.8 5.7 3.7 2.5
Distributions on Redeemable Preferred Securities of Subsidiary 6.0 6.0 6.0 6.0 4.7
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Total Fixed Charges 85.8 71.9 78.3 75.9 71.3
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Earnings Before Income Taxes and Fixed Charges
(Excluding Capitalized Interest) $318.0 $198.1 $207.7 $187.0 $150.9
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Ratio of Earnings to Fixed Charges 3.71 2.76 2.65 2.46 2.12
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Earnings Before Income Taxes and Fixed Charges
(Excluding Capitalized Interest) $318.0 $198.1 $207.7 $187.0 $150.9
Supplemental Charges 14.8 15.4 14.5 12.0 14.4
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Earnings Before Income Taxes and Fixed
and Supplemental Charges (Excluding Capitalized Interest) $332.8 $213.5 $222.2 $199.0 $165.3
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Total Fixed Charges $ 85.8 $71.9 $78.3 $75.9 $71.3
Supplemental Charges 14.8 15.4 14.5 12.0 14.4
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Fixed and Supplemental Charges $100.6 $87.3 $92.8 $87.9 $85.7
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Supplemental Ratio of Earnings to Fixed Charges 3.31 2.45 2.39 2.26 1.93
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The supplemental ratio of earnings to fixed charges includes Minnesota Power's obligation under a contract with
Square Butte which extends through 2026, pursuant to which Minnesota Power is entitled to approximately 71% of the
output of a 455-megawatt coal-fired generating unit (Unit). Minnesota Power is obligated to pay its pro rata share of
Square Butte's costs based on Unit output entitlement. Minnesota Power's payment obligation is suspended if Square Butte
fails to deliver any power, whether produced or purchased, for a period of one year. Square Butte's fixed costs consist
primarily of debt service. Variable operating costs include the price of coal purchased from BNI Coal under a long-term
contract. (See Note 14.)
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ALLETE 2000 ANNUAL REPORT 75
