CHICAGO Century Aluminum
Co. and Rio Tinto Alcan are in discussions with Big Rivers
Electric Corp. about the aluminum producers smelters in
Kentucky potentially tapping the open market for power, a
spokesman for the utility said.
The move comes after a bill
backed by Monterey, Calif.-based Century seeking to legislate
the issue effectively died when the Kentucky legislature ended
its session on March 26 without voting on the matter.
"Since the session ended, we
have resumed talks with Century and Rio Tinto Alcan to work
towards an equitable solution to allow them to access market
power," the spokesman for Henderson, Ky.-based Big Rivers said
in a March 29 e-mail to AMM. "Actually, the smelter
legislation stalled progress on negotiations."
Big Rivers has always been open
to negotiations but "cant provide corporate entitlements
at the expense of our other customers," the spokesman said. But
the utility does care about the smelters existence, he
"Thats why we are willing
to allow them to access the open market as long as they pay for
any incremental costs associated with their decision to do so,"
the Big Rivers spokesman added.
Neither Century, which operates
a smelter in Hawesville, Ky., nor Montreal-based Rio Tinto
Alcan, which operates a smelter in Sebree, Ky., responded to
requests for comment.
Century had been pushing for
legislation that would allow its Hawesville smelter to access
power on the open market. Company president and chief executive
officer Michael Bless said during the companys last
earnings call that the smelter "is not viable" without a better
power deal from Big Rivers (
amm.com, Feb. 22).
Similar bills on the issue were
introduced in both the Kentucky House and Senate. The bill in
the House made it out of committee but was never taken up for a
vote by the wider House, while legislation in the Senate
remained stuck in committee. Both bills effectively fizzled
when Kentucky lawmakers wrapped up their legislation session
for 2013 on Tuesday, a source familiar with the matter
Still, the source cautioned
AMM that while "bills die, issues dont." The
smelter issue could still be taken up by Kentucky lawmakers if
Kentuckys governor were to call a special session and
bring lawmakers back to Frankfort, the states capital,
for more legislative work, the source said. "So it depends on
what your definition of dead is," he quipped.
But both the source and the Big
Rivers spokesman questioned the likelihood of such an outcome.
"I dont anticipate a special session to be called by the
governor considering he stated that this is a private business
negotiation, not a legislative matter," the Big Rivers
Gov. Steve Beshears office
was unable to comment by press time, a spokeswoman said.
Century gave Big Rivers a 12-month power termination notice
for its smelter in Hawesville in August (amm.com, Aug.
20), while Rio Tinto Alcan gave its 12 months notice Jan.
amm.com, Feb. 4). The two smelters together
account for about 70 percent of Big Rivers power
(amm.com, Feb. 4).