PARKERSBURG - The impact of a ruling by the West Virginia Public Service Commission on a rate proposal for Century Aluminum on retirees trying to recover health insurance benefits from the company isn't known, a spokesman for the former employees said.
Century has been trying to get a special deal on electrical costs, part of the process in possibly re-opening the shuttered Ravenswood production plant, and the commission Thursday said its decision rejects part of what the company wanted from the Appalachian Power Co., but establishes a special rate mechanism that satisfies the policy goals of the West Virginia Legislature, addresses the concerns of Century regarding the reopening of the plant and balances the interests of the power company and the economy. The ruling is more than 70 pages.
"Although we have seen the news release and the very long and complicated ruling, we are still not totally aware of it's complete meaning," retirees spokesman Karen Gorrell said. "Many have asked what this ruling means to the retirees and at this time, we are not sure. We do know that the restart of the plant hinges on a special rate that Century can live with and that will help them operate through periods of fluctuating LME prices on aluminum products."
The Ravenswood smelter closed in 2009, impacting about 650 workers. Health insurance benefits were discontinued for retirees in 2010.
Since then the company said it hoped to reopen the plant.
A comment from the company was not immediately.
The commission said any risks would be shifted from power customers to Century and requires the company and its parent company to guarantee with Appalachian Power the payment of any revenue shortfalls. The term of that contract will end Dec. 31, 2021, and can be extended another 10 years.
Century will pay a rate based on the price of aluminum, which it favors. After 10 years, if the company overpaid for electricity, up to $200 million would be used for rate reductions for Appalachian Power other customers. Overpayments above $200 million would be divided 75 percent to the company and 25 percent to reduce power rates.
The company will pay the difference to Appalachian Power if it paid less than what it should have paid because of lower prices for aluminum.
"How Century will view this PSC decision is the most important question that will have to be answered," Gorrell said. "It appears that the state of West Virginia and its leaders, our great governor and West Virginia legislators, the commissioners at the PSC and all involved have worked very hard to bring these manufacturing jobs back to West Virginia. It also appears that the agreement is very lucrative and yet protects the average consumer from the risks and that was very important to the retirees."