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March 30, 2007
RELICENSING UPDATE: STANLY COUNTY
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The federal relicensing of Alcoa Power Generating Inc.'s Yadkin Hydroelectric Project has generated considerable public interest in recent months, especially in Stanly County, the community where Alcoa Inc. began its smelting operations in North Carolina nearly 100 years ago.
With Alcoa's power subsidiary seeking a new 50 year license from the Federal Energy Regulatory Commission, residents are curious about how a new license will impact the local community. This newsletter is designed to answer questions about the relicensing process, how a new license may impact the people of Stanly County, and other questions raised recently.
Please feel free to share this information with others who are interested in these issues.
RELICENSING SETTLEMENT AGREEMENT
Alcoa Power Generating Inc. recently finalized a comprehensive settlement agreement that offers significant environmental protections and enhanced recreational opportunities to the people of North Carolina. The agreement will be submitted to the Federal Energy Regulatory Commission.
How was the Relicensing Settlement Agreement developed?
Alcoa has been working closely with stakeholders for the past two years to develop a settlement agreement. Preceding that was a multi-year effort by Alcoa and those stakeholders to design and perform studies of relevant Project impacts. These studies then provided information to shape the final settlement. The final agreement reflects the involvement, input and influence of many different organizations and represents a balance of the many, often conflicting, interests. Several organizations from Stanly County have been involved in this process from the start and had the opportunity to shape studies and advocate relicensing settlement components.
How does Stanly County benefit from the Relicensing Settlement Agreement?
The settlement agreement offers many benefits for Stanly County, including the donation of 1,085 acres for the future expansion of Morrow Mountain State Park in Stanly County and the donation of 14 acres along the shores of Badin Lake for development of a new public park. In addition, Alcoa will allow the City of Albemarle to withdraw up to 11 million gallons of water per day with no charge by Alcoa for its lost power generation.
Who supports the Relicensing Settlement Agreement?
The settlement agreement has received widespread support from state and federal agencies, local governments, environmental interest groups, local homeowners and others. The City of Albemarle, the Town of Badin and the Badin Lake Association are among the organizations representing Stanly County interests that have joined the North Carolina Department of Environment and Natural Resources in signing the agreement.
Do other hydro operators offer more substantial benefits for local counties?
There has been some discussion about a FERC license recently issued to the New York Power Authority and the economic benefits being offered to local counties in upstate New York.
It is important to understand what makes the New York Power Authority different from Alcoa. For starters, the New York Power Authority is a state agency, not a private corporation. It operates with a different purpose - its mission includes supporting economic development in upstate New York, similar to the Tennessee Valley Authority (TVA) created by the federal government to help the nation recover from the Great Depression.
Another important point: The New York Power Authority can set its own electrical rates to recover the costs associated with its new license spread over a broad spectrum of ratepayers. Alcoa, a private company, does not have that same flexibility.
Finally, the New York Power Authority is the nation's largest hydropower operator. The size and scale of the Yadkin operations simply don't compare.
BADIN WORKS
Badin Works aluminum smelter is operated by Alcoa Inc., the parent company to APGI, independently of the Yadkin Hydroelectric Project and is not impacted by the federal relicensing process. Nonetheless, the relicensing process has raised questions related to the smelter.
Is Badin Works going to resume production?
Alcoa continually evaluates the feasibility of restarting the Badin Works smelter. However, it remains one of the nation's smallest and oldest aluminum smelters. In recent years, those factors have made it more expensive to produce aluminum at Badin Works as compared to other Alcoa smelters. Currently, one smelting cell line is idled, and the second smelting cell line is being decommissioned.
What's going to happen to the Badin Works site?
Alcoa has begun exploring the possible redevelopment of portions of the Badin Works site. Work is already underway to remove equipment from areas of the smelter that have been permanently closed, making approximately 150,000 square feet of space available for industrial use by September 2007.
Earlier this month, Alcoa met with county leaders and representatives from the North Carolina Department of Commerce to discuss redeveloping the site in a manner that helps attract new industries and new jobs to Stanly County.
"We've been an important part of this community for nearly 100 years and have an interest in the county's future success," said Geoff Cromer, president of Alcoa's U.S. Primary Metals division. "We are prepared to invest in the future of Stanly County to help bring new industries to the community, and we want to work with the county to make that happen."
Alcoa has successfully redeveloped other smelter sites to benefit local communities. In Troutdale, Oregon, Alcoa has invested millions to prepare a former smelter site for redevelopment as an industrial park. The 700-acre property is being acquired by the nearby Port of Portland and is expected to support hundreds of new jobs.
"We're beginning to discuss the possibilities that exist in Badin," Cromer said. "We plan to continue discussion with local leaders and representatives from the N.C. Department of Commerce about what type of project or industry might be most successful."
Alcoa has scheduled additional meetings with county redevelopment representatives on March 28 and is launching a study to determine the highest and best use of portions of the site that have been permanently closed.
What is being done about waste from Badin Works?
For the past 20 years, Alcoa has worked closely with state and federal officials to identify and study any sites that may have been affected by waste from the Badin Works smelter. Our studies found eight sites that required attention, and Alcoa has spent more than $8 million to remediate those sites in a way that protects the environment and the people of Stanly County.
Studies on those sites indicate that no further action is necessary, aside from periodic monitoring and some ongoing maintenance.
"We have made significant strides to remediate these sites to protect the environment and the people who live here," said Kirk Gribben, Alcoa's global remediation manager. "We will continue to monitor these sites closely and, if necessary or appropriate, we will take additional action."
Alcoa has made every attempt to answer questions about these sites. On February 5, Alcoa's global remediation manager made a presentation to the county commissioners about the remediation process. As a follow up to that meeting, Alcoa provided the county with detailed studies and reports related to the waste sites. These are the same reports that have been submitted to the North Carolina Dept. of Environment and Natural Resources for review.
Alcoa is planning to meet with the Stanly County Board of Health and other officials to review information about these sites and answer questions. A meeting date has not yet been scheduled, but Alcoa is committed to open and factual communication about these sites.
FACTS ABOUT ALCOA IN STANLY COUNTY
- Alcoa currently owns thousands of acres in Stanly County, including the dams, powerhouses and property beneath Badin Lake. The company intends to donate more than 1,000 acres of property to the State of North Carolina for the future expansion of Morrow Mountain State Park.
- Alcoa is the largest taxpayer in Stanly County, paying twice as much as any other company.
- Alcoa has a direct economic impact of $8.75 million per year on the Stanly County economy. The indirect impact is two or three times that amount.
- The Yadkin Project generates clean and renewable energy to help meet the nation's rising energy demands. The Yadkin Project has a total generating capacity of nearly 215 megawatts of electricity.
- Alcoa has been a part of the Stanly County community for nearly 100 years. It originally purchased an unfinished aluminum smelter from a failing French firm in 1915. The Badin Works smelter began production in 1917.
- Alcoa and the Alcoa Foundation have donated more than $2 million to support non-profit organizations across central North Carolina since 1985. Alcoa provided financial support to more than 20 organizations in Stanly County in 2006: Badin Volunteer Fire Department, Better Badin, Badin Pee Wee T-Ball League, Badin Lake Search & Rescue, Stanly County Chamber of Commerce, Stanly Memorial Hospital, Hospice of Stanly County, Stanly Community College, Stanly County Christian Ministries, Stanly County Arts Council, Stanly County Health Department, Stanly County American Legion baseball, Stanly County Chapter of NAACP, Stanly County American Red Cross, Stanly News & Press, Stanly County DARE Program, Stanly County Rescue Unit, North Stanly High School, Men Making a Difference in Stanly County, Albemarle Rotary Club, Albemarle Downtown Development and Friends of the Senior Center.
SHARE YOUR THOUGHTS
Please let us know if you have comments or questions you would like to share. We will do our best to address those issues in future updates.
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