This week our guest speaker was Tracy Yount,  Director of External Affairs for Chelan County PUD.  Listen to Tracy's presentation.... AUDIO  
Tracy was introduced by Lorna Klamanski, his fellow in service at the PUD.  Both are active members of our club.  Lorna explained that Tracy’s duties include interfacing with legislators both in Washington, DC and in Olympia.  He is tasked with explaining the value of the PUD and giving input on legislation for topics such as Employment, Safety, and Bitcoin Mining. Tracy joined us this week speaking about the status of the Alcoa plant; its contract with the PUD and possible scenarios going forward.

Tracy shared with us that Alcoa was in the final stages of its decision making process and within a few days will say whether or not they will reopen the plant.  He then explained some details of the contract for us which runs until 2028. This agreement states that Alcoa is guaranteed 26% of PUD energy generated and agrees to pay 26% of generating costs.  Alcoa agreed to pay a capacity charge of $86 million applicable for the total span of the contract.  That fee would be reduced by a certain percent every year the plant was in operation.  Alcoa currently owes $62 million, due “immediately” if their decision is the continued closure of the plant.
At this time, in accordance with the contract, the PUD sells the 26% of the power that would go to Alcoa.  If the sale covers the generation costs, Alcoa owes zero, if not Alcoa pays the difference. If the sale exceeds the generation costs the PUD keeps the excess.

Alcoa has many factors to consider as it weighs the pros and cons of a restart of the plant.
      Employees –  Where are the 400 former employees: 33% moved away, 33% retrained, 33% took early retirement.  Therefore there is a lack of seasoned people to rehire.  Talks with the Union indicate that workers want a decision and are disinterested in dragging out the limbo year after year.   Also there are many weeks of plant preparation before hiring could occur, none of which has begun.
     Supply Chain issues-  How to get materials to the plant as many of the specific rail cars used to move materials are ready to be retired.
     Money -  Alcoa is a huge industry and although $62 million is a great deal of money, not so much for a company this size.

Alcoa is bound by the contract until 2028, and will still be responsible for the 26% of generation costs until the end of the contract – plant open or plant closed.  
If Alcoa closes the plant, there will need to be environmental re-mediation, aka clean-up, of the site.  PUD, Port of Chelan, City of Wenatchee and Chelan County all need to be involved with Alcoa in that planning and process.

Note - This amount exceeds 1 year of income.   Possible uses for that money are :