Missouri regulators have denied a request by Noranda Aluminum to lower the company's electricity rate at its large Missouri factory, which produces about 15 percent of all U.S. primary aluminum.
Five Missouri Public Service Commission members voted unanimously Wednesday to leave intact the rate Noranda pays its utility, Ameren. Executives with Franklin-based Noranda had asked for a cut of about 25 percent, which Ameren would have had to pass on to its other customers. In a statement, Noranda said the denial does not actually increase the electricity bill at its New Madrid complex and said its leaders are thinking about alternatives.
"We remain committed to transforming our cost structure and to reducing the cost of New Madrid's electricity," said President and CEO Kip Smith, who has in the past said that he might have to altogether shut down New Madrid — which employs almost 900 people — without a smaller electric bill. "We will thoughtfully evaluate our alternatives for accomplishing our objectives and provide additional information at an appropriate time."
Smith and his team had signed on to a compromise plan, proposed by the Missouri Office the Public Counsel, that would have trimmed Noranda's rate by 16 percent and asked the company to commit to minimum investments and employment levels at New Madrid. On Wednesday, Acting Public Counsel Dustin Allison told the St. Louis Post-Dispatch he wants to continue to pursue that middle ground.
Shares of Noranda (Ticker: NOR) fell more than 10 percent Wednesday after word of regulators' decision became public and are down another 2 percent today. At about 1:40 p.m., they were changing hands around $4.10. Year to date, they're still up more than 20 percent.