PSC denies special power rate for Century Aluminum

The state Public Service Commission denied both alternatives Century Aluminum offered in October in its special electricity rate case because the company's proposals still place the risk on Appalachian Power's customers, the PSC ruled Friday.

But the commission proposed that Century may negotiate with other parties involved, like Appalachian Power and the West Virginia Energy Users Group, to try to negotiate a special electricity rate.

The aluminum plant in Ravenswood has been shuttered since early 2009. Century has asked for a special rate for electricity based on the price of aluminum.

The PSC and its Consumer Advocate Division have repeatedly rejected putting an unreasonable risk on ratepayers and reiterated that notion Friday.

"The most odious element of the 'immediate restart plan' Century proposed is the potential shift of up to an additional $185 million in Century electric costs to other ratepayers," the PSC wrote in its filing. "The Commission previously rejected transferring any further payment obligations from Century onto other customers beyond the value of the substantial fixed cost credit that other ratepayers currently bear."

Century Aluminum officials are still reviewing the PSC's order.

The PSC said that its Oct. 4 order remains "in full force and effect." In that order, the PSC rejected parts of Century's initial proposal but said the Ravenswood company could receive a special rate for electricity but not at the expense of other Appalachian Power customers.

The PSC found neither of the two rate proposals that Century offered on Oct. 26 acceptable.

The PSC said the immediate restart option represents a "completely different plan" from what the PSC ordered on Oct. 4.

The commission called the immediate restart option "unreasonable" and "not acceptable."

The second alternative is a "future restart modification," which Century said would allow the plant to open "sometime in the future when [aluminum] prices materially increase." The PSC said that option also is "unacceptable because it fails to account for changes in electric rates," the PSC said in its order.

The future restart option "potentially deprives the special rate mechanism of funds to offset periods of low aluminum market prices," the PSC said.

Susan Small, a PSC spokeswoman, said now is the time for Century to meet with the other parties involved -- and negotiate -- if the Ravenswood plant is to reopen.

Those other parties are Appalachian Power, the PSC's Consumer Advocate Division and the West Virginia Energy Users Group.

The PSC wants the smelter to start doing business again.

In its filing, the PSC responded to nine modifications that Century had requested to "enable Century to consider a future restart of the Ravenswood production facility," the PSC wrote.