Century Aluminum's special power rate proposal not worth the trouble: Appalachian Power

Appalachian Power has told the state Public Service Commission that the cost of Century Aluminum's proposed special power rate is "staggeringly high" and questioned whether the scheme is worth the trouble.

Century is asking the commission to approve a new power rate structure to help it reopen its Ravenswood plant. The company closed that plant in 2009 after aluminum prices plummeted during the recession. More than 650 people lost their jobs.

Century's proposed rate structure would shift some power costs to other customers if aluminum prices fell again. The company would pay higher rates to reimburse those customers if prices rebounded.

Century said in its filing that if aluminum price forecasts for the next decade proved correct, consumers would come out ahead. But in a response to Century's rate request filed Friday, Appalachian Power said Century's plan leaves no protection for customers.

Attorneys noted that if the price fell to about $1,700 per ton, Century would pay nothing for its power. Other customers would have to pay $126.7 million in total, with residential customers paying an average $17.82 more per month. They also said Century's proposed rate plan doesn't address what would happen if the price fell far below $1,700 per ton.

"It is not clear from Century's petition whether Century would expect its proposed special rate to produce such a bonus payment, but, if it did, Century would actually be paid to consume 'free' electricity."