Legislation that would allow the Missouri Public Service Commission to consider lower electricity rates for proposed aluminum and steel manufacturing facilities in southeastern Missouri was on its way to the state Senate on Thursday after passing the House of Representatives 120-17 late Wednesday.
H.B. 1's outlook is uncertain in the Senate, where a similar measure died earlier this year after winning House approval.
Republicans control both the House and Senate. First-year Governor Eric Greitans, who summoned lawmakers back to state capital Jefferson City on Monday for a special legislative session, is also a Republican.
State Representative Don Rone urged his colleagues to vote in favor of a bill he said could lead to the partial restart of the former 263,000 mt/year Noranda Aluminum primary aluminum smelter in New Madrid, Missouri, and persuade an unidentified overseas investor to locate a steel mill in the same area.
The smelter has been idle since March 2016, shortly after Noranda filed for Chapter 11 federal bankruptcy reorganization. Swiss-based ARG International subsequently purchased the smelter at a court-approved auction for $13.7 million and recently formed a new company, Magnitude 7 Metals, to reopen the plant.
During House debate on the bill Wednesday, Rone said Magnitude 7 Metals will need to buy about 180 MW of electricity to reopen part of the smelter later this year. Ameren Missouri, a subsidiary of St. Louis-based Ameren Corp. and the smelter's long-time supplier, is expected to provide the electricity.
The smelter once used as much as 500 MW when it was operating at capacity, Rone said.
Several lawmakers questioned whether the state should provide lower power rates to foreign-owned companies if that might require other Ameren Missouri ratepayers to pay more for their electricity.
Others wondered how "real" the plans to reopen the smelter and build a steel plant in the New Madrid area were.
"We met with this gentleman who's going to build the steel mill twice in the governor's office," Rone said, declining to identify the official in question. "He said, 'You give me the power rate and we'll build the place.'"
Rone added that Magnitude 7 Metals is registered in the US and has a registered agent in Jefferson City. Rone, citing information from New Madrid officials, said Missouri is competing against New York and Virginia for the new steel plant.
Attempts to reach Magnitude 7 Metals officials for comment Thursday were unsuccessful.
