the film
forum
library
tutorial
contact
Economic and dam related articles

Alcoa's Energy Deal With
Bonneville Quashed by Court

by Staff
Bloomberg, August 28, 2009

Bonneville Power Administration's agreement to pay Alcoa Inc. $32 million this year to buy power from a competitor, driving up energy rates for other customers, was invalidated by a federal appeals court.

The payment from Bonneville, a U.S.-owned power utility based in Portland, Oregon, to Alcoa amounted to a “gift” that demonstrated unsound business practice, a federal appeals court said in a ruling today. The payment was part of an amended power contract for Alcoa's aluminum smelter in Washington state.

A provision of a 2007 contract had been tossed out by the same court last year because it provided cash payments to Alcoa based on a formula that let the company pay below-market rates. That resulted in higher costs for other customers.

Kevin Lowery, an Alcoa spokesman, said the company and Bonneville have negotiated a new power contract, which is open for public comments. The contract doesn't provide for any cash payments and calls for Alcoa to pay Bonneville's industrial power rate, Lowrey said in a phone interview. He declined to comment on the ruling.

New York-based Alcoa is the largest U.S. aluminum producer.

Katie Pruder, a spokeswoman for Bonneville, didn't return a message left at her office.

The case is Pacific Northwest Generating Cooperative v. Bonneville Power Administration, 09-70228, U.S. Court of Appeals for the Ninth Circuit (San Francisco).


Staff
Alcoa's Energy Deal With Bonneville Quashed by Court
Bloomberg, August 28, 2009

See what you can learn

learn more on topics covered in the film
see the video
read the script
learn the songs
discussion forum
salmon animation