FRANKFORT, Ky. -- The Kentucky Public Service Commission has approved an agreement allowing a large western Kentucky aluminum smelter to end its contract with a utility and begin buying electricity on the open market.
The Century Aluminum smelter in Hawesville was Big Rivers Electric Corp.'s biggest customer. The smelter, along with another aluminum smelter in Sebree, accounted for about 70 percent of the power generated by the utility.
The PSC says Century will purchase power on the open market. Century has said it needs cheaper power to keep operating in Kentucky.
The PSC says the agreement achieves "a delicate balance" between keeping the smelter open and not burdening ratepayers. Big Rivers is asking the PSC to approve a 19 percent rate hike for its customers to make up for the loss.Century also owns a shuttered aluminum smelter in Ravenswood. The company worked with state regulators last year in an attempt to get favorable rates for that plant, but the state-approved plan fell short of company demands.