Public Service Commission Knifes the Heart of SEMO
New Madrid, Mo. – Today, the Public Service Commission delivered what is expected to be a fatal blow to the area’s largest employer, Noranda Aluminum, by denying a compromise rate adjustment that would have kept the plant in business. The commission, made up entirely of members along the I-70 corridor, sided with Ameren UE in stating that the loss of 1,000 jobs in the poorest part of the state was not worthy to take action on.
“This is a very, very difficult public policy decision and the impact would be felt statewide. Noranda failed to show that their current rate is causing a crisis of liquidity. I hope the parties can continue to work together to solve this issue,” said PSC Commissioner Daniel Hall.
Hall was appointed by Governor Jay Nixon in the spring, and his nomination was in danger of stalling in the Gubernatorial Appointments committee before last minute efforts were taken to save his confirmation.
Contrary to the Public Service Commission’s predictions, rumors are that Noranda will either begin laying off employees or will suspend the construction of their new rod mill that was set to bring even more jobs to the impoverished area. Governor Nixon helped break ground on the rod mill last year calling it “a great development for the bootheel.”
In November, the Ormet smelter in Ohio closed after the Ohio equivalent of the PSC failed to act. At their final hearing the chairman of the commission noted that he did not feel the smelter would actually close. Just last week, Mike Bliss, the CEO of Century Aluminum Company, the only smelter who pays a higher electric rate than Noranda, stated they would be forced to close their smelter without rate relief.
In the wake of the damning decision for Southeast Missouri some are looking at the geographical makeup of the commission as a possible reason for their lack of concern.
Commissioners of the PSC are appointed by the Governor and approved by the state senate. Currently there are commissioners from the City of St. Louis and counties of Jefferson, Boone, Jackson, and St. Charles. The nearest commissioner lives over 130 miles from the largest energy consumer the commission regulates.
Senator Doug Libla (R- Butler County) said, “The rate relief was turned down in its entirety, and that is very disappointing and the way it came about. I think the commission should be represented by people all across the state. I generally don’t like to forecast my decisions, but I am definitely looking for the next appointment to be from southeast Missouri or a rural area, balance is important.” The lack of balance on state commissions has been a recurring theme of the Nixon administration.
The imminent loss of jobs and the lack of state response adds to an already bad week for Governor Nixon. Not only has he seen continued unrest after taking the lead in Ferguson, but the St. Louis County Prosecuting Attorney, Bob McCulloch, actually demanded in a press conference that the Governor “man up”. Now, it looks likely that Nixon failed to save the largest employer in Southeast Missouri.
The Governor’s office did not return calls for comment.