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PUCO Begins Hearings On Ormet’s Rate Request

By Staff | Aug 28, 2013

Friends and family of Ormet workers gathered in support of the plant at a rally held Aug. 17.

Tuesday began the Public Utilities Commission of Ohio’s series of hearings on a package of requests by Ormet Corporation, concerning electricity rates paid at its Hannibal plant.

Jason Gilham, spokesman of the PUCO, stated that all the intervenors, stakeholders, and anyone who is a party to the case would be presenting their testimony at these hearings. “It’s not a commission meeting where the commissioners will be there. It’s something conducted by the attorney examiner.” Gilham stated the commissioners will be making the ruling, however the attorney examiner is necessary to oversee the proceedings.

“The attorney examiner is just helping the process along,” he noted, “making sure the proceedings advance.”

Afterward, Gilham stated, “Commissioners will then consider the formal case docket which is presented to them after the proceedings.” He added this docket will consist of a staff report from the commission staff. Gilham said there will then be a briefing schedule where there will be the opportunity to file comments.

Timely are remarks Tom Froehle, vice president of external affairs for AEP Ohio, made concerning the matter to The Wheeling Intelligencer, printed Tuesday. Froehle charges that the additional relief Ormet is requesting could result in higher rates for AEP’s other customers. However PUCO spokesman Jason Gilham has also recently stated to The Intelligencer that AEP could seek to increase other customer’s power rates if Ormet, its largest customer, is shutdown.

Gilham stated by phone interview Aug. 26 that Ormet’s application mainly requests that the company receives its discounted electric rates that were given to them, through a unique rate arrangement in 2009, in a shorter amount of time.

The Wheeling Intelligencer reported Aug. 27 that receiving the entire discount over the remainder of 2013 and 2014 terminates the agreement three years early, at the end of 2015. However, by this time the company hopes to be producing electricity independently at a $450 million on-site, natural gas-powered generating facility.

Tom Byers, the United Steelworkers Local 5724 president, said AEP’s rate has increased 46 percent over a four-year period. “If the current power agreement is not changed by the PUCO, Ormet will shut down . . . A temporary reduced power rate would allow Ormet to construct the gas-fired power plant, providing on-site power generation,” he said.

Politicians on both sides of the aisle and river see Ormet’s plan as an acceptable situation, as displayed by appearances and statements from politicians at a rally held Aug. 17 in support of Ormet.

Republican Congressman Bill Johnson of Ohio stated in a letter that with Ormet’s plans to build the 500 MW natural gas power generation plant near the plant, “We have a win-win-win for the county, the state, and all ratepayers involved.”

Johnson had also stated that he had asked PUCO to remember the thousands of families that are “counting on them to make the right decision. Johnson said he would “not accept anything less than a positive outcome.”

A statement given to the Chronicle by Democrat Senator Joe Manchin’s office last week stated that the senator is encouraging “business, labor, and government leaders to come together and find a solution that will protect these jobs, while also ensuring that electricity is affordable for our manufacturing base.” Manchin had said his office stands ready to “assist our West Virginia employees to make sure they have the assistance they need moving forward.”

Switzerland of Ohio School District’s treasurer, Lance Erlwein said the closure of the plant would mean a direct loss of $110,000 in property tax revenue that is given to the school.

“This is going to set back the community 50 years or maybe even 100 years,” Erlwein stated.

“As Ormet goes, so goes the community.”