American Metal Market
May 14, 2014
By Daniel Fitzgerald & Metal Bulletin

Power rate spat hampers Felman restart

Felman Production, still trying to overcome objections to its special electricity rate plan in order to take advantage of an improving silicomanganese market, has yet to sign a new deal with electricity supplier Appalachian Power Co (APCo).

The Letart, West Virginia-based producer filed a motion with the West Virginia Public Service Commission on May 12 urging the commission to strike down a May 9 filing from the commission's consumer advocate division (CAD).

"The procedural rules do not permit a party seeking reconsideration to file a reply to the reply filed by a party opposing reconsideration," Felman said in the filing.

"Until the petitions for reconsideration are resolved, Felman Production is hampered in its ability to move forward under the terms of the order to conclude a special contract consistent with the order, which in turn is indispensable to reopening the New Haven (W.Va.) plant promptly in the presently favorable market conditions."

Felman previously announced its intention to sign a new deal with APCo on May 1, claiming that it was "incurring sizable losses while it is in standby mode".

Felman successfully petitioned the commission for a special electricity rate from APCo tied to free-market silicomanganese prices, claiming that such a rate would allow it to restart production at its idled New Haven plant. However, the CAD and the West Virginia Energy Users Group subsequently filed objections to the commission's order.

US silicomanganese spot prices were in a range of 59 to 61 cents per lb on May 12, having rallied from a low of 49 to 51 cents per lb in mid-2013, when Felman was idling production at the New Haven plant.