Noranda makes new run at cutting electrical rates

NEW MADRID, Mo. -- Noranda has returned to the Missouri Public Service Commission with a proposal in the general electricity rate case for Ameren Missouri.

Noranda, which operates an aluminum smelter in New Madrid, has sought a reduction in the amount of money it pays for electricity from the utility.

In a rate design agreement submitted Tuesday with the Office of Public Counsel, the Consumer Council of Missouri, the Missouri Retailers Association and the Missouri Industrial Energy Consumers, Noranda's proposal calls for a base rate charge to residential customers of $8 per month. It recommends an exemption from the proposed increase for qualifying low-income residential customers.

The 21-page proposal suggests a new class of customer -- Industrial Aluminum Smelters. The class would have a base rate of $34 per megawatt hour for 10 years and would exempt the smelter from fuel adjustment charges.

The IAS class, however, would be subject to a base rate adjustment of 50 percent of the system average and zero percent of any rate decrease as part of the general rate adjustment.

Also, the class would be subject to 100 percent of any new surcharges.

According to a news release from Noranda, "compared to rates in place during 2014, at full production the proposed smelter rate structure would have reduced the smelter's electricity costs by $30 million in 2014, or about 5 cents per pound of primary aluminum produced."