Noranda legislation clears Missouri House

JEFFERSON CITY, Mo. -- Legislation Noranda Aluminum Inc. deems vital to maintaining its New Madrid facility and the 1,100 jobs it provides cleared the House of Representatives Friday.

The bill would allow the company to negotiate contracts for the purchase of electric power at rates not subject to regulation by the Missouri Public Service Commission.

Because of a depressed aluminum market, Noranda officials say they need to purchase power, which accounts for one-third of the plant's operating costs, as cheaply as possible if the facility is to remain in Missouri.

"The difference between having flexibility in power contracts is the difference between survival and nonsurvival," said Steve McPheeters, a Noranda spokesman.

Although the Senate had already approved the bill, sponsored by Senate President Pro Tem Peter Kinder, R-Cape Girardeau, it must take further action because of House changes. Final passage is expected Monday.

Although the House voted 88-53 in favor of the bill, supporters failed to garner the two-thirds majority necessary to enact an emergency clause that would allow it to become law immediately upon receiving Gov. Bob Holden's signature. As it stands, the measure wouldn't take effect until Aug. 28.

That presents some problems for the company as its existing power contract expires at the end of the month. However, McPheeters said the company is hopeful of striking a short-term deal before June 1.

The bill generated some House opposition because of a provision that would allow Noranda to resell excess power on the open market. Efforts to amend the bill so the company could only recoup its actual costs through power resale were defeated.

"The fear is they might buy more than they need and sell it in competition with electric companies," said state Rep. Jim Seigfreid, D-Marshall.

State Rep. Lanie Black, R-Charleston, said such fears are unfounded as the company would only resell power in instances where the plant is forced to temporarily shut down.

The bill is SB 555.

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