Paterson OKs Contract Between NYPA, Massena Alcoa
Posted on Monday, 12 of January , 2009 at 3:19 pm
ALBANY– A new contract between the New York Power Authority (NYPA) and Alcoa Inc., which is intended to ensure that the North Country’s largest private employer will remain in St. Lawrence County for decades to come and expand its manufacturing operations, has been approved by Gov. David A. Paterson.
Paterson okayed the contract during a ceremony at Alcoa’s Massena plant.
Under the contract, which will be effective on July 1, 2013, NYPA will make available to Alcoa 478 megawatts of low-cost hydropower for a term of 30 years. In exchange for the use of that power, $600 million will be invested to upgrade Alcoa’s facilities, and retain approximately 1,000 jobs at its two plants.
The project will also create 600 to 900 construction jobs over the two- to three-year construction period. The event follows the ratification of the contract last month by NYPA’s Board of Trustees.
“This contract signifies how the strategic use of the State’s clean energy resources can be used to retain one of Upstate New York’s most significant manufacturers and employers. As outlined in my State of the State address last week, New York State is in a prime position to lead the nation in the energy field, which will help to invigorate our economy and create jobs,” said Governor Paterson. “This is a sound investment of New York’s unique natural resources, and the clean power made available to Alcoa will be used right here in the North Country. This contract is particularly crucial given the challenging business conditions that international companies such as Alcoa are experiencing from the decline in the global economy.”
In addition to the major employment and capital-investment commitments, the contract provides for Alcoa’s funding of a $10 million North Country Economic Development Fund (NCEDF) for use in St. Lawrence, Franklin, Essex, Jefferson, Lewis, Hamilton and Herkimer counties and on the Akwesasne Mohawk Reservation. Alcoa’s funding of the NCEDF will be provided within 90 days of a decision by Alcoa’s Board of Directors to proceed with the rebuilding of Alcoa’s East Plant. The $10-million fund will be jointly administered by NYPA and another entity specified by New York State.
The new contract marks the first time that formal job commitments, similar to arrangements NYPA has with other businesses in the State for various power programs, are part of the requirements for Alcoa’s use of the hydropower. NYPA may proportionately reduce the power allocation if employment falls below the agreed-upon minimum threshold. Also, Alcoa and NYPA may, under certain economic conditions, extend the contract for an additional 10 years.
The new contract provides that Alcoa, the world’s leading producer and manager of primary aluminum, fabricated aluminum and alumina facilities, will continue to receive its current allocation of 478 megawatts (mw) of hydropower (374 mw of firm power and 104 mw of interruptible power) at its Massena East and West Plants. This allocation accounts for approximately 60 percent of NYPA’s St. Lawrence-Franklin D. Roosevelt Power Project’s generating output. 1-12-09
Category: Adirondacks, Business, Environment, Government, New York State, Technology
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