Minnesota Power Breaks Ground on Square Butte HVDC Upgrade

Minnesota Power has broken ground on a high-voltage direct current (HVDC) modernization project estimated at $900 million, marking the start of one of the largest grid construction efforts in the region. The Duluth-based utility, a division of ALLETE, held a groundbreaking ceremony on Tuesday at its site in Solway Township, just outside Hermantown in northeastern Minnesota.

The project will modernize an HVDC transmission line that has been in service since 1977. The 465-mile line runs from Center, North Dakota, to Solway Township near Duluth, delivering renewable wind energy from Minnesota Power's Bison Wind Energy Center in North Dakota. It is one of only two HVDC lines in Minnesota and one of only a handful in the United States. Minnesota Power acquired the line in 2009.

Rather than stringing new conductors, the work centers on building new converter stations and substations at both ends of the existing line. In Minnesota, new converter facilities will replace aging infrastructure at the Arrowhead Substation near Hermantown, with similar upgrades planned at the Square Butte East Substation in Center, North Dakota. The converter stations change direct current into alternating current so the power can flow onto the existing AC grid.

The line currently carries up to 500 megawatts of wind energy. According to Minnesota Power, the upgraded terminals will nearly double the amount of energy the line can deliver. The new stations will also enable bi-directional power flow — a capability the original 1977 system lacked — allowing electricity to move in either direction across the Upper Midwest as needed. The utility said the facility is being built larger than currently required to leave room for future capacity growth.

Dan Gunderson, Vice President of Transmission Planning and Operations, pointed to the line's original design. "When they built this line, they manufactured the largest possible cable that they could in the world," he said. "This was a record-breaking cable that was on here in the 70s, and so they built it with that future capacity in mind."

The utility began planning the modernization more than a decade ago after identifying the need to replace key equipment dating to the 1970s. The Minnesota Public Utilities Commission approved permits for the project in 2024, and Minnesota Power has also sought approval from the North Dakota Public Service Commission for the facility modifications in that state. Construction is expected to continue until 2029.

Siemens is supplying the converter technology under a preferred supplier agreement, and Mortenson is serving as general contractor. About 100 workers are expected on site during peak construction.

The project has secured roughly $75 million in combined state and federal funding, comprising $25 million from the state of Minnesota and $50 million in federal support through the bipartisan infrastructure law. The federal grant was rescinded in 2025 and subsequently reinstated by the U.S. Department of Energy following an appeal by Minnesota Power.

Josh Skelton, Chief Operating Officer of Minnesota Power, said the funding helped limit costs for ratepayers. "We've worked hard to keep the cost for our customers as low as possible, including obtaining federal and state government grants affirming the project's importance," he said.

The line forms part of Minnesota Power's broader strategy to support the state's target of 100% carbon-free electricity by 2040; the utility currently generates about 60% of its electricity from carbon-free sources. The upgraded HVDC system will also connect to a proposed 67-mile transmission line between the Iron Range and St. Louis County, which Minnesota Power is developing as a regional electricity transmission hub.

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