Shapiro: Union 'power' saved Butler steel mill

Apr. 12—Union workers in Western Pennsylvania power the only domestic mill that produces grain-oriented electrical steel used to produce distribution transformers.

Gov. Josh Shapiro credited these same workers with charging the political infrastructure toward reversing a proposed federal rule that jeopardized an estimated 1,300 jobs in Butler County.

"This is a story about power, the power of all of you and the work you did," Shapiro said Friday in celebrating a policy shift that prevented the closure of the Cleveland-Cliffs Butler Works plant and a sister plant in Zanesville, Ohio.

The Department of Energy proposed a rule change in January 2023 mandating that manufacturers of the transformers installed atop utility poles use a different steel, amorphous alloy, to improve energy efficiency and resiliency of the nation's power grid and reduce greenhouse gas emissions. That would have ended the use of grain-oriented electrical steel, or GOES, produced at Butler Works within three years.

Members of United Auto Workers Local 3303 raised concerns echoed by Cleveland-Cliffs' chairman, president and CEO, Lourenco Goncalves, that the company's future and that of the collective workers were at immediate risk.

Elected officials on the local, state and federal levels responded to these concerns. The Shapiro Administration lobbied the White House. Legislation to prevent the change was introduced in both chambers of Congress. U.S. Rep. Mike Kelly hosted a public town hall in late March to heighten awareness.

The Department of Energy ultimately heeded these concerns, adjusting the final standards to extend compliance to five years rather than three years and, most importantly to the Butler County mill, continue the production and use of GOES in distribution transformers.

"Never has this mill been faced with a threat to its existence so real as it faced last January when we were presented with the rule proposed for distribution transformer efficiency," Jamie Sychak, UAW Local 3303 president, said.

"This saved our steel, our jobs," Sychak said.

The material had been incorporated in about 95% of the transformer market. According to the Department of Energy, its market share shifted to 75%.

However, because of increasing demand for grid infrastructure and related economic stimulus through the Infrastructure Investment and Jobs Act and CHIPS and Science Act, Goncalves said that Cleveland-Cliffs is now looking to expand its operations and investment on the heels of fearing its business might cease.

Citing a report by the National Renewable Energy Laboratory, the Department of Energy projects that transformer installations will triple by 2050.

"We will now take the lead on electrical steel for transformers, EV cars and EV charging stations," mill worker and Local 3303 member Matt Allday said, referring to the growing market for electric vehicles and related infrastructure.

"As we work to create energy jobs and build the energy infrastructure of the future," Shapiro said, "we're going to need a whole lot more of what you're building here, not less. We're going to need to expand this facility going forward."