ALLETE Board Raises Quarterly Common Stock Dividend By Five Percent

DULUTH, Minn. -- The ALLETE (NYSE: ALE) Board of Directors has increased the quarterly dividend on the company's common stock to 31.5 cents per share, a five percent increase.

"The ALLETE board is very comfortable setting this dividend, given our earnings outlook -- especially with the successful exit from the Kendall County power purchase agreement," said Bruce Stender, chairman of the ALLETE board. "Our objective is to maintain a dividend payout ratio in the same range as companies similar to ours."

On an annual basis, the increased dividend is equivalent to $1.26 per share of common stock. The regular quarterly dividend on common stock is payable June 1 to shareholders of record at the close of business May 16, 2005.

ALLETE, with corporate headquarters in Duluth, Minn., provides energy services in the upper Midwest and has significant real estate holdings in Florida. More information about the company is available at www.allete.com.

The statements contained in this release and statements that ALLETE may make orally in connection with this release that are not historical facts, are forward-looking statements. These forward-looking statements involve risks and uncertainties, and investors are directed to the risks discussed in documents filed by ALLETE with the Securities and Exchange Commission.

Investor Contact:
Tim Thorp
218-723-3953
tthorp@allete.com