After Ameren Missouri successfully beat Noranda Aluminum’s request for rate relief at the Missouri Public Service Commission, Noranda is making good on its promise to scale back its Southeast Missouri manufacturing facility.
On Tuesday, Noranda announced it would be cutting 200 employees from its New Madrid, Mo., work force and put on hold expansion projects at the aluminum smelter citing financial constraints. The relief they were seeking would have trimmed their utility bill by more than $500 million over the next decade by shifting the costs on to other Ameren consumers.
The job cuts and the latest rate fight are all part of the ongoing saga between Ameren Missoo.uri and its largest customer that dates back to the beginning of their relationship nearly a decade ago.
All along, Ameren opposed the rate reduction. In a statement Tuesday, the company said, “we care about the people working at Noranda and it is unfortunate that this layoff is occurring.”
“We’ve attempted to find a path forward with Noranda that is helpful to that company and fair to our other customers. This may be something that is most appropriately addressed in the Missouri general assembly, where significant economic development issues are typically addressed,” Warren Wood, vice president of external affairs and communications for Ameren.
His statement continued: “Noranda’s rate shift proposal was unfair, represented bad public policy, and did not include any meaningful protections for our other customers. It proposed to shift more than a half-billion dollars of their costs to our other customers for the next 10 years, and would have set Noranda’s rate well below what it costs us to serve them. Noranda currently receives the lowest electric rate in Missouri, a state with electric rates 16 percent below Midwest averages.”
Kip Smith, CEO of Noranda Aluminum, said in his own statement to reporters gathered in New Madrid on Tuesday that the company would seek a rehearing at the PSC.
“Depending on how quickly an affordable rate can be secured, we would be in position to re-evaluate these actions and minimize job losses,” he said.