Montana-Dakota Utilities Co. agreed to buy a North Dakota wind farm expansion to be developed by ALLETE Clean Energy (ACE), a unit of ALLETE, Inc.

The expansion of Thunder Spirit Wind will boost the wind farm's capacity to around 155 megawatts (MW), and will increase Montana-Dakota's generation portfolio from 22 percent renewables to 27 percent.

The original 107.5-MW Thunder Spirit Wind project was constructed by ACE and included 43 turbines; it was purchased by Montana-Dakota in December 2015 for $200 million. The expansion calls for 16 turbines with a generating capacity of 48 MW.

The project's cost is approximately $85 million and is expected to be online in late 2018. ACE qualified the project for federal renewable energy production tax credits.

ACE says it plans to build the 106 MW Clean Energy One wind project in North Dakota to fulfill a power sales agreement with Xcel Energy. At sites in Minnesota and Iowa, the company is refurbishing up to 385 wind turbines. And the company owns and operates some 535 MW of wind energy generation in Minnesota, Iowa, Oregon and Pennsylvania.

Montana-Dakota originally signed a power purchase agreement with ACE for generation from the Thunder Spirit Wind expansion project, with an option to buy the project. North Dakota regulators approved in November 2017 Montana-Dakota's request for an advance determination of prudence for buying the expansion. Regulators found that electricity produced at the site was expected to be more economical than energy purchased on the market.