Federal Government’s new bill seems to be a saviour for Alcoa Intalco aluminum smelter

Alcoa Intalco aluminum smelter sees a silver lining once again to restart its operation, as the climate and health care bill has been passed by Congress and signed by President Joe Biden with provisions that could help the resumption of the smelter’s operation.

Already the reopening campaign for the smelter is in full swing since the rise of the aluminium spot price to a record high in March 2022. But what appears as a hurdle is the affordable source of electricity for energy-intensive aluminium production.

So far, the smelter has been unable to reach an agreement with the Bonneville Power Administration, which sells electricity generated by federal Pacifica Northwest dams.

As per the Seattle Times report, the climate and health care bill has dubbed the Inflation Reduction Act, which includes tax incentives and grant money for low carbon aluminum production in the US.

A former Alcoa executive who has been helping to lead the restart effort is optimistic about the bill and expects it to be helpful for the recommencement of the smelter. But what still needed is a favourable power deal.

An investment firm Blue Wolf Capital Partners also hopes to bring the smelter back to life and restore some 700 jobs.