Santee Cooper has approved a temporary electricity tariff that should be used by Century Aluminum to keep the company’s 300 workers foundry plant operating in Berkeley County.
South Carolina’s state utility board of directors voted on Monday to create what is being called an “experimental” pricing structure that could benefit the manufacturer by the end of 2023.
The vote will allow Santee Cooper to effectively develop a price for energy that is not currently available to other customers.
The dealership will use one of its old coal-fired boilers near Georgetown to help meet the demands of Century, which operates the state’s only aluminum smelter.
The Winyah generating unit is expected to be decommissioned and retired in 2023, which is why the special tariff for Century will expire in three years.
Century and Santee Cooper have not yet formally signed a new energy contract, but Monday’s vote is a big step towards cementing a new agreement between the two.
It should also help to soften the icy business relationship between Century and Santee Cooper, which has supplied power to the Mount Holly plant since the start of operations in the 1980s. The Chicago-based dealership and metal producer are fighting an incessant fight for fees for years.
Most companies in South Carolina cannot negotiate how much they pay for electricity, but Century has consistently pushed for special deals with Santee Cooper in an effort to reduce the cost of operating its energy-consuming smelter. The company also filed lawsuits, lobbied the Legislature of SC and, in general, tried to bypass Santee Cooper to get what it wants.
In recent years, Century has been authorized to purchase 75% of its electricity from other undisclosed sources. But that deal with Santee Cooper expired in late 2020.
Century warned state officials in October that, unless it reached a new energy contract, it could shut down the Mount Holly plant and lay off its 295 employees in Berkeley County by the end of the year.
The announcement sparked emergency negotiations between the company Santee Cooper and the SC Department of Commerce, responsible for recruiting and maintaining companies.
Dan Ray, acting president of Santee Cooper, said these talks led to the experimental index that Santee Cooper revealed on Monday.
“This was a great team effort, not just from Santee Cooper, but from our customer Century Aluminum,” said Ray.
Santee Cooper leaders hired an outside consultant to study the trial fee and said that offering the deal to Century would not hurt its other powerful customers.
“It’s a win, win, win in every way,” Mark Bonsall, CEO of Santee Cooper, told the board.
Century did not respond to an email asking for comment on Monday. But last month, the company said it could expand production at its South Carolina plant if it successfully negotiates a three-year contract with Santee Cooper.
The energy deal, Century said, could allow the company to restart part of the smelting operations that closed in 2015. This, in turn, could lead to another 70 jobs at the partially idle factory on US 52, near Goose Creek.
Reach Andrew Brown at 843-708-1830 or follow him on Twitter @andy_ed_brown.