An aluminum company has reached a power agreement the company hopes will prevent its Berkeley County smelter from closing and laying off 300 employees.
Century Aluminum announced Wednesday it has renegotiated a market-based agreement with a third-party supplier to provide approximately 75% of the power requirements for the Mt. Holly smelter. The remaining 25% of Mt. Holly’s power requirement will continue to be supplied by state-owned utility Santee Cooper. The new agreement will allow the plant to continue to operate at half-capacity while it seeks a long-term arrangement.
“We have regrettably not been able to achieve an agreement for full market power access; such a structure is required for Mt. Holly’s long-term competitiveness,” Century’s President and CEO Michael Bless said in a statement. “We have achieved this current milestone due to the highly competitive nature of the wholesale power markets at the present time and additional cost reduction measures.”
The smelter has been operating at 50 percent capacity since December, when Century idled one of its two pots and laid off 300 employees. The company said the remaining 300 workers will stay at the plant as it continues to negotiate for a long-term power deal. Smelters require enormous amount of power to operate and Century has spent the past several years in disputes with Santee Cooper over discounted rates. Santee Cooper officials have refused to sell at lower prices, saying further cuts would force it to raise rates on its other customers.
“We are hopeful that additional consideration of this complex matter in South Carolina will enable Mt. Holly to purchase its full power requirement from the competitive market,” added Bless. “The facts support the conclusion that such an outcome would be beneficial to each and every constituency, including Santee Cooper and its entire customer base. In addition, full access to market power will enable us to run Mt. Holly at its maximum capacity, rehire 300 employees and restore the $500 million in economic impact that has been unnecessarily lost.”