COLUMBUS - The five members of the Public Utilities Commission of Ohio are expected to decide Wednesday whether Ormet Corp. will get a break on American Electric Power rates, which company leaders say they need to keep operating.
As many as 600 jobs also hang in the balance, as Ormet already has reduced operations to two of its six potlines to reduce power costs in order to keep running. The company also has the option to shut down completely by the end of the year, according to a Worker Adjustment and Retraining Notification Act notice.
"This is a tough thing because other manufacturers will probably show up asking for the same thing," admitted John Puskar, staff representative for the United Steelworkers at Ormet. "We are just asking for a chance to keep these jobs."
The PUCO meeting is set for 1:30 p.m. Wednesday at the commission office at 180 E. Broad St. in Columbus. Commission spokesman Jason Gilham said members worked to expedite the process so that it can be on the agenda this week. Commissioners Todd Snitchler, Steven Lesser, Lynn Slaby, M. Beth Trombold and Asim Z. Haque will decide the matter.
Ormet wants to generate its own electricity by late 2015 via a planned natural gas power center, but President and Chief Executive Office Mike Tanchuk said the company needs a break on AEP rates until then.
"If we cannot get this discount, we will be forced to liquidate," he said previously.
In February, Ormet filed for bankruptcy in U.S. District Court in Delaware. The company later announced a planned $221 million sale to Minnesota-based Wayzata, but emphasized the transactions required convincing the PUCO to allow Ormet to have lower AEP bills until it can begin generating its own power.
Puskar said the stipulations for Wayzata to purchase Ormet include securing the lower AEP rates; securing a working agreement with the USW; and moving the pension debt to the federal Pension Benefit Guaranty Corp.
However, officials with AEP and the Ohio Consumers' Counsel said granting Ormet additional power discounts could result in higher rates for about 1.4 million customers across the Buckeye State, many of whom live hundreds of miles away from the Hannibal facility.
AEP officials have said it is too early to determine if they will seek to raise other customers' rates should Ormet go out of business.