Coal costs contributed to aluminum plant closure, but a cleaner, greener plant is possible

The last two decades have not been kind to American-made aluminum.

Up until the early 2000s, the United States produced more primary aluminum than anybody, but now only a paltry 2% of the world’s supply comes from a handful of American plants.

And one more of those plants, the Magnitude 7 Metals smelting facility located in southeast Missouri, just shut down, putting over 400 union members out of work.

The plant was hailed as a lifeline for the region when it reopened in 2018, but earlier this year, employees showed up to work only to be notified by a short letter that they would suddenly be out of a job in a few days, a violation of the Worker Adjustment and Retraining Notification (WARN) Act, labor law which requires 60-days notice.

Residents of Marston said the curtailment at the plant will have a “devastating” impact on other local businesses and has left many in the community wondering how they will pay their bills.

Magnitude 7’s announcement wasn’t just a blow to hundreds of Missouri workers and their families, it’s another barrier to a just transition to renewable energy.

Aluminum is a key material for clean energy products like solar panels and electric vehicles. The United States alone will require more aluminum for solar and wind energy by 2035 than current domestic consumption across all sectors.

Magnitude 7 was producing one-fifth of American-made primary aluminum. If its doors remain closed, renewable energy developers and other industries demanding clean aluminum will be more dependent on global supply chains, which are vulnerable to disruption and reliability issues.

If is the key word here.

House Minority Leader Crystal Quade has introduced legislation, House Bill 2540, that could save the plant and hundreds of union jobs by attracting buyers through lower production costs. Paired with a wave of federal funding available from the Inflation Reduction Act (IRA), there’s a real opportunity to keep industrial plants like Magnitude 7 afloat, and let domestic manufacturing flourish.

One of the main factors that led to curtailment at the plant is high electric bills.

Magnitude 7 buys all of its energy from Associated Electric Cooperative, Incorporated’s (AECI) New Madrid coal plant. While the cost of clean, renewable energy has consistently dropped, AECI has stubbornly stuck with dirty, expensive coal, brought over 1,000 miles from Wyoming. AECI has made so little progress the utility received the lowest possible score on Sierra Club's Dirty Truth About Utility Climate Pledges report.

The cost of shipping coal to New Madrid has risen by more than 25% in the last two years, and as fossil fuel prices have risen, so has the cost of smelting aluminum for Magnitude 7. According to a press release from Representative Quade, the plant was racking up a $55 million electric bill every year.

But with help from new IRA initiatives like USDA’s New ERA or the Energy Department’s Energy Infrastructure Reinvestment program, AECI could bring the long-term cost, and volatility, of electricity costs down for the smelter plant and other Missourans. The special purpose programs in the IRA are built to facilitate the orderly replacement of the high-cost fossil plants like the New Madrid coal plant with new, clean and affordable energy supplies.

AECI could save jobs at one of America’s last remaining aluminum facilities and lower the cost of energy to all of its customers. But when clean energy advocates approached AECI about the federal funding opportunities, the utility’s executives dismissed them.

Our electric grid is already moving toward affordable and reliable clean energy sources, and will continue to move in that direction over the next two decades as renewable energy and energy storage prices keep falling. This is good news for consumers, the economy, public health and our environment.

If we save Magnitude 7 and re-open the plant, powered by clean, renewable energy, Missouri could be at the heart of this transition, producing American-made aluminum that will go into solar panels, electric vehicles and wind turbines all across the country.

Brian Smith is the organizing representative for Sierra Club's Beyond Coal Campaign.

This article originally appeared on Springfield News-Leader: Sierra Club: Renewable energy could make Magnitude 7 plant viable