Alcoa, Hydro-Quebec in power agreement deal

23 December 2008

The deal follows a Memorandum of Understanding (MoU) signed earlier this year with the provincial government. Under the arrangement, there would be agreement for additional power as well as renewal of existing supply contracts.

Alcoa said the deals would cover supplies for its three smelters in the Canadian province and provided for the upgrade and expansion of one facility. In total, the power supply agreements are for just over a quarter of the company's aluminium production.

The agreements cover approximately 1.1M tonne/year, and the three smelters (Baie Comeau, Becancour and Deschambault) are to be supplied with a total of 2.1GW through to the end of 2040. The capacity of the Baie Comeau smelter is to be expanded by 111,000 tonne/year by 2014 and have greenhouse gas (GHG) emissions cut by 40%.

In recent months, Alcoa has separately signed a power supply deals for smelters in Washington state. It made an agreement with Bonneville Power Administration (BPA) for the Intalco smelter, and Chelan County Public Utility District (PUD) for its Wenatchee smelter.

Last year, the company's progress with plans for a 340, 000 tonne/year smelter in Iceland led to Norsk Hydro bowing out with its own concept. It already has supplies from the recently built Karahnjukar hydroelectric plant.

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