A new 10 year electric power supply contract signed on December 7th 2012 ends years of job uncertainty for 625 Alcoa Intalco Works employees.
More than 100 workers gathered at the aluminum smelter's Totem Terrace assembly hall west of Ferndale to watch Bonneville Power Administration boss Mr Steve Wright and Alcoa executive Mr Bob Wilt sign the deal first announced in October. Also on hand were US Sen. Patty Murray, Gov. Chris Gregoire, US Rep. Rick Larsen and US Rep Suzan DelBene along with many local officials.
Mr Wilt said that "You can have a great Christmas because we've got 10 years ahead of us and we hope, a lot more."
Intalco and its employees have survived some tense times the past 10 years as power supply disruptions led to the shutdown of most of the other aluminum smelters in the region and idled Intalco for a time. Alcoa officials repeatedly warned that the smelter would have to close permanently without a contract guaranteeing long term access to BPA's supply of relatively low-cost hydropower.
In recent years, Intalco has been operating with shorter term power contracts that left workers fearful of what might happen next. The walls of the meeting room were decorated with Wright is Wrong and Wright is Still Wrong" T-shirts souvenirs of the days when members of Intalco's International Association of Machinists and Aerospace Workers' local traveled to BPA's Portland, Ore, headquarters to protest BPA's initial reluctance to provide the power deal the company wanted.
The deal will provide Intalco with 300 average megawatts of power through September 2022. The company will pay an industrial rate that averages about USD 36 MW which is USD 6 more per MW than public power utilities pay when they buy BPA power. 300 MW is equivalent to about one fourth of the power supply at Seattle City Light.
Intalco plant manager Barry Hullett acknowledged that it takes a lot of power to turn ore into aluminum. But once the aluminum is made, it makes cars lighter and more fuel efficient and can be recycled to new uses with just 5 percent of the power required for the original smelting. The Intalco smelter can produce 279,000 tonnes of aluminum a year.
As a part of the deal with BPA, Alcoa agreed to invest USD 35 million in capital improvements during the next 7 years in order to keep the contract in force for the full 10 year term.
