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Lower-cost power ‘essential’ for smelter viability: Noranda

Keywords: Tags  Layle Smith, Noranda, rate case, Ameren, electricity costs, Century Aluminum, Ormet, aluminum Michael Cowden

SAN ANTONIO — Affordable power is necessary for any primary aluminum smelter to survive, Noranda Aluminum Holding Corp.’s top executive said during a press conference April 2 at the Aluminum Association’s spring meeting in San Antonio.

"As you’re looking at the viability of a smelter, whether it’s a brand-new one or an existing one, cost-competitive power is essential," Noranda president and chief executive officer Layle K. "Kip" Smith said.

Smith stressed that he was speaking from an "overall industry standpoint," including smelters outside of the United States, but he also noted that his company has been "quite public" about its needs for lower-priced power.

Noranda is petitioning for cheaper electricity from Ameren Missouri, a subsidiary of St. Louis-based utility Ameren Corp. The Franklin, Tenn.-based aluminum producer has said that without a lower rate—which Ameren doesn’t want to grant Noranda—it will need to cut 150 to 200 jobs or ultimately close its 260,000-tonne-per-year New Madrid, Mo., smelter (, Feb. 13).

Smith declined to answer questions related to Noranda’s rate case.

U.S. aluminum producers have turned to state power regulators for lower electricity rates in the face of historically low London Metal Exchange aluminum prices.

Two of Chicago-based Century Aluminum Co.’s smelters—one in Hawesville, Ky. (, Aug. 14) and one in Sebree, Ky. (, Jan. 30)—have already used the regulatory process to get a lower power price.

Bankrupt aluminum producer Ormet Corp., Hannibal, Ohio, ceased operations after failing to secure the rate relief it requested from state power regulators (, Oct. 4).

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