Share
Under normal conditions, the N.C. secretary of commerce would be doing whatever was possible to keep state businesses happy and operating in the black. But Secretary of Commerce Keith Crisco, a former textile executive, and Gov. Bev Perdue are engaged in a notable exception: They argue the federal government should "recapture" a major river and industrial facilities owned by Alcoa Power Generating Inc. and allow the state to purchase and operate four hydroelectric dams on the Yadkin River.
In recent filings before the Federal Energy Regulatory Commission in Washington, the state argues that Alcoa's right to control the river and use its flow to produce electricity ended when the company shut down its aluminum smelter at Badin and laid off most of the 1,000 workers it once employed there. We agree.
In 1957, the state strongly backed Alcoa's request for a 50-year license to control the river and make electricity at its dams for the smelter's operations. One reason for the state's support, Crisco said in documents, was the company's role as the largest employer and taxpayer in the region. Its "continued operation of the smelting works was in the public interest."
But with the shutdown of the Badin Works in 2007, he said, the company "is no longer woven into the economic well-being of the people." Not only does Alcoa not offer benefits that once were "a quid pro quo for the state's support of its initial license, but it produces harm in that it does virtually nothing to address the water quality needs or the economic or recreational needs of the region."
The filing before the federal commission is part of a recent effort by the state to reverse the prospects of Alcoa receiving another lengthy license to continue operating the Yadkin project. The state backed the company until last year when it began raising questions about continued company control of the river's resources. Alcoa sells the power on the open market and is not subject to the same state regulation as Duke Energy or Progress Energy.
The state wants to buy the plant, as federal law contemplates, for Alcoa's net investment of $24 million, plus make other investments in equipment that would run the acquisition cost to about $150 million. The plan is to finance that over 30 years with bonds and use proceeds from the sale of power for a variety of economic development, educational, environmental, recreational and other public purposes.
As Perdue puts it, "We believe strongly that the state is the most appropriate body to plan use of this invaluable natural resource, to help assure the region's municipal water supply and quality and to facilitate future growth." Indeed it is.
It's an ambitious proposal. Although the Federal Power Act provides that rivers can be "recaptured," it has not happened before. Congress would have to approve the plan, a tough hurdle for the state.
Alcoa long ago accepted that it might not win relicensing. It knew the day might come when it could no longer make use of the Yadkin. The state has made a compelling argument that that day has arrived.
