Canada court upholds sale of hydropower from 896-MW Kemano

British Columbia’s Court of Appeals has confirmed an earlier ruling that concluded there are no restrictions on an agreement by Rio Tinto Alcan to sell power to BC Hydro from the 896-MW Kemano hydropower plant in Kitimat, B.C.

Rio Tinto Alcan announced in January that it reached a new agreement with BC Hydro on sale of Kemano’s power, allowing it to proceed with a US$2 billion expansion of its smelter in Kitimat. (HNN 1/31/08)

In 2004, the town of Kitimat filed suit to require Alcan to use power generated at Kemano to restore smelter production and local jobs. The suit alleged outside sales of power to BC Hydro hurt Kitimat’s economy by cutting smelter production and jobs.

Rio Tinto Alcan Primary Metal President Jacynthe Cote said the February 22 appeals court ruling now should allow the company and the community to focus on economic challenges and opportunities in the region.

�We hope that this legal challenge, which has caused so much uncertainty in the region, is now ended and we can focus our collective energies on bringing the Kitimat Modernization Project to fruition,� she said. �A project that will allow a reduction of more than 400,000 tons of greenhouse gas emissions is in line with our sustainability approach.�

The company said the recent power sales agreement means the smelter’s electricity needs will have priority over any other power sales. It said that would allow Rio Tinto Alcan to adjust its power sales to BC Hydro depending on the final configuration and power requirements of the modernized smelter.

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