CHICAGO Separate bills
aimed at keeping smelters owned by Century Aluminum Co. and Rio
Tinto Alcan operating in Kentucky are drawing opposition from
Power suppliers argue that the
proposed bills, introduced Feb. 5 by state Sen. Joe Bowen (R.,
District 8) and Rep. Tommy Thompson (D., District 14), appear
to have been crafted by the aluminum industry without outside
input and look set to be rammed through the legislative
Monterey, Calif.-based Century
and Montreal-based Rio Tinto Alcan didnt respond to
requests for comment.
Centurys plant in
Hawesville, Ky., employs about 750 people, and Rio Tintos
smelter in Sebree, Ky., employs roughly 550, Bowen told
AMM in a telephone interview Feb. 11. Hundreds more
jobs are at stake when related jobs at suppliers and service
providers are factored into the equation, he said.
"And its not just about
salvaging those jobs, but salvaging that industry (aluminum
smelting). If we lose that industry, the state of Kentucky is
not going to lose it to (another state) but to a country
offshore," Bowen said. "If that happens, its never coming
back and well have to import that product back in."
This would impact on a host of
domestic industries, including the automotive, aviation and the
defense sectors, he said, noting that the bills are intended to
allow Century and Rio Tinto to buy electricity on the open
market, which could help them save money.
Bowen said he hopes the bills,
if signed into law, will "lasso back in" Century and Rio
Tinto while being as fair as possible to other power
customers in the region.
The legislation was introduced
after Rio Tinto gave 12 months notice Jan. 31 to
power provider Big Rivers Electric Corp., Henderson, Ky., that
it would terminate its power contract for the smelter and
perhaps shut the facility (
amm.com, Feb. 4). The notice came six months after
Century gave Big Rivers Electric a 12-month power termination
notice for its smelter in Hawesville (
amm.com, Aug. 20).
Henderson-based Kenergy Corp.,
which distributes power generated by Big Rivers, said Feb. 8
that it hadnt been consulted on the text of the bills
before they were introduced and wanted more input, especially
given the increased expense other customers would face if the
bill were to become law. Citing a third-party study, Kenergy
said the aluminum smelting industry in the United States "was
dying" and that the proposed legislation was in effect asking
other customers to "subsidize the smelters."
Kenergy has since hardened its
stance and now flatly opposes the bills, a source familiar with
the matter said Feb. 11. That is in part because the company
thinks that the bill, which it believes was crafted by the
aluminum industry, is being "fast-tracked" through the
legislative process, potentially not leaving time for
consultation or amendment.