Noranda, Ameren remain at odds over electric rates

NEW MADRID -- A proposal by Ameren on the rates it wants to charge its largest customer, Noranda Aluminum, needs more work according to Noranda officials.

During a recent hearing before the Public Service Commission, Matt Michels, senior manager of corporate analysis for Ameren, reportedly proposed to offer a lower wholesale rate based on market pricing to Noranda, as an unregulated customer, in a new five-year contract. At the end of the five-year term, Ameren would then have the ability to sell the energy Noranda was using on the open market.

While welcoming Ameren's actions to stabilize rates for the aluminum smelter, John Parker, vice president of communications and investor relations for Noranda, said the testimony "falls quite short of a workable proposal.

"To our knowledge, no testimony or proposals have been filed with the PSC that define a rate structure for this 'market-based pricing,'" he added, declining to comment further on the proposal.

On Oct. 1, the commission denied Noranda's petition seeking a reduced electricity rate for the smelter, saying the company had failed to meet the burden of proving its rates are not just and reasonable.

At that time PSC Chair Robert Kenney urged Noranda and Ameren to present their compromise proposals during hearings on Ameren's request to raise rates on all of its customers.

For more on the story see Thursday's Standard Democrat