Ameren and Noranda Urge Missouri Lawmakers: Cap Electric Rates
Establishing caps on rate increases and utility profits were just two of the pressing legislative priorities outlined in a letter to the members of the Missouri General Assembly on February 24 by Michael Moehn, president of Ameren Missouri, and Layle “Kip” Smith, CEO of Noranda Aluminum.
Ameren Missouri and Noranda “have rarely seen eye-to-eye on what Missouri’s comprehensive energy policy should include,” the two corporate leaders admitted, noting, “Yet today we stand together committed to support real, much needed progress on energy policy and to do our part to bring [the gridlock and stalemates that have dominated energy policy discussions in Jefferson City] to an end.”
Under the status quo, Moehn and Smith said, “Electric rates have risen through a series of unpredictable spikes over the last eight years while our electric infrastructure has been aging faster than it is being replaced.”
As a result, they alleged, Missouri’s largest consumer of electricity, Noranda Aluminum, is facing significant economic pressures – and the situation is serious.
“Due to policies adopted domestically and internationally and other issues beyond Noranda’s control, Noranda’s current energy costs are not competitive in the global aluminum market. If Noranda’s energy costs are not reduced to a globally competitive level,” the letter warned, the company’s financially challenged aluminum smelter at New Madrid, Missouri – due to be idled by mid-March– may never be restarted.
Losing the plant and the 900 jobs it once supported would be “devastating to the economy of Southeast Missouri and mean other Missourians would pay more for electricity,” Moehn and Smith stated.
Specifically, the new framework the two business leaders would support would require a number of industry changes – among them, they said:
- Establishing caps on rate increases and utility profits while providing additional layers of transparency to ensure more rate stability and predictability;
- Accelerating modernization of Missouri’s electrical grid for safe, dependable, secure and cleaner energy for current and future generations of Missourians;
- Accelerating installation of smarter technology to help customers’ better control their energy costs, making it possible to restore power more quickly after an outage and prevent some outages from occurring;
- Creating new and expanded Missouri Public Service Commission oversight responsibilities;
- Moving rapidly to make investments in physical and cyber-security technology to protect customer data from hackers, and protect critical energy generation, transmission and distribution infrastructure; and
- Providing a globally competitive power rate to Noranda’s New Madrid aluminum smelter.
Finally, the two companies warned that lack of action, leading to a Noranda bankruptcy, was not an option. “Because Noranda is Missouri’s largest electrical consumer, all other Ameren Missouri customers pay more for electricity if Noranda is off the electric grid.”
There had been no comments from the General Assembly at press time.
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