JEFFERSON CITY, Mo. – The International President of the United Steelworkers, Leo W. Gerard, and Congressman Jason Smith of the 8th District sent letters to the Missouri Public Commission (PSC) urging the Commission to consider the Office of Public Counsel’s (OPC) compromise stipulation in a rehearing. Gerard and Smith join the Fair Energy Rate Action Fund (FERAF), Barry Aycock, Gov. Jay Nixon, and former senator Joan Bray in support of a rehearing.
OPC filed for a rehearing of the Noranda adjustment case weeks ago, which would grant 45% of the original rate of relief requested by Noranda.
The United Steelworkers’ letter pointed to aluminum as being a steadily growing industry that Southeast Missouri direly need.
“The United Steelworkers are bullish on the future of the aluminum industry,” reads their letter. “From cars to home building materials, the uses for aluminum are growing every day and will continue to do so. However, the process our skilled workers go through to make aluminum is highly energy intensive. The New Madrid plant’s short-term survival and long-term viability is tied directly to the cost Noranda pays for electricity.”
“Thirty-five years ago this country was home to 32 aluminum smelters,” Gerard’s letter continued. “These smelters employed thousands of men and women in organized labor. These were the type of jobs that personified a growing middle class, the true key to America’s economic well-being. Today only nine smelters remain. We cannot allow New Madrid to become the next Ormet, or Goldendale or Ravenswood. The power to save these jobs and this plant lies squarely in your hands.”
American Metal Market, a publication focused on the metals industry, published an article Wednesday highlighting the downfall of the Ormet plant closing due to high energy costs.
“The owner of the former Ormet Corp. smelting facility in Hannibal, Ohio, will auction a majority of its assets and equipment in November, meaning the plant, as it currently stands, will no longer smelt aluminum,” read the article.
“‘It’s become very clear that there is no way to break through the regulatory components,’ Eric J. Spirtas, president of Niagara Worldwide LLC, which purchased Ormet’s assets in June, told AMM in an exclusive interview. ‘There is no magic sauce here. Despite all we tried to do, I don’t have an answer to the power problem. The electricity rate is simply too high.’
“Spirtas said he made the decision after talking with metals industry experts and government regulators.”
“‘I have to move on with the site. It’s discouraging. This plant, in its current state, will not smelt aluminum because power isn’t available at the right price.'”
Smith played to the economy of his district.
“The uncertainty surrounding the outcome of this case and the future of Noranda Aluminum is causing concern, and even panic, throughout my Congressional District,” Smith wrote. “Noranda employs over 900 individuals, in addition to paying 17.87 percent of the total property taxes in New Madrid County and 28.66 percent of the taxes paid for the New Madrid County Central R-1 School District. Our community depends on Noranda as a large, reliable employer.”
Since the PSC denied and dismissed Noranda’s case, the aluminum smelter has begun layoffs. FERAF pointed out in their letter of support on September 12 that the 200 jobs eliminated at Noranda are a direct result of the constant barrage of electric rate hikes by Ameren Missouri in recent years.
The PSC stated that they were not convinced of Ameren’s overearning or that the other energy consumers should “subsidize” the cost of a rate reduction and ultimately denied and dismissed Noranda’s case for rate relief.
Missourians for a Balanced Energy Future sticks to their previous statement regarding the PSC’s original decision.
“We fully support the Missouri Public Service Commission’s unanimous order rejecting Noranda’s claim,” a statement from MBEF read. “The report clearly indicated that the smelter misrepresented its financial status to the Commission and the relief requested would in fact cost Missouri consumers MORE, not less as Noranda alleged. Their stock price jumped 33% today on the heels of paying millions of dividends to shareholders, which is great news for Wall St., but no relief for laid off workers.”
Rachael Herndon was the editor at The Missouri Times and also produced This Week in Missouri Politics, published Missouri Times Magazine, and co-hosted the #MoLeg podcast. She joined The Missouri Times in 2014, returning to political reporting after working as a campaign and legislative staffer.
Rachael studied at the University of Missouri – Columbia. She lives in Jefferson City with her husband, Brandon, and their two children.