The Kentucky Public Service Commission has approved agreements that Century Aluminum of Kentucky says are necessary to keep operating a western Kentucky smelter.
The agreements allow the smelter to be supplied power purchased on the open market by Kenergy Corp. rather than power generated by Big Rivers Electric Corp.
The PSC said in its order Thursday that the agreements are substantially the same as those it approved in August for the Century smelter in Hawesville.
The Hawesville smelter has about 700 employees and the Sebree smelter about 500.
Big Rivers has a pending rate increase request to compensate for revenue it will lose when it is no longer producing power sold to the Sebree smelter. In October, Big Rivers was granted a rate adjustment to compensate for lost revenue from the Hawesville smelter.
A paper company has announced plans to invest $20 million in its facility in Hancock County and retain 452 jobs. Domtar Paper Company LLC says it will upgrade and add equipment to its Hawesville operation.
Domtar operates 13 mills throughout the world, including its pulp and paper facility in northwestern Kentucky. The Hancock County plant makes an estimated 80,000 tons of market hardwood pulp—used for paper production—and about 600,000 tons of printing grade paper each year.
One of the changes at the plant will be a new conveyor system, which Domtar says will lower operating costs and reduce greenhouse gas emissions from the facility.
Legislation introduced in both the Kentucky House and Senate is designed to help keep aluminum smelter jobs in the northwestern Kentucky region of Daviess, Henderson, Hancock, and Webster counties.
The Owensboro Messenger-Inquirer reports Sen. Joe Bowen and Rep. Tommy Thompson, both of Daviess County, have introduced identical bills in their respective chambers. Bowen told the newspaper the legislation is aimed at allowing Century Aluminum in Hawesville to buy electricity on the open wholesale electricity market.
That is currently not allowed under state law.
Last summer, Century, which employs 700 workers, announced it would shutter its smelter unless either the price of metal went up or its electric rates dropped. The smelter terminated its contract with Henderson-based Big Rivers Electric Corp. Before that, Century was Big Rivers largest customer.