Strategy Secure economically priced power

The cost of power was a major factor in Eastern's strategic plan. In its partnership with the community, power companies, and state and local government, Eastern would develop support for its efforts to continue to compete in the world aluminum marketplace. Eastern planned to negotiate lower power costs and explore independent options for generating less expensive power. These initiatives are shown in Table 2-2.

Power costs became the key factor in maintaining competitiveness because of impending major increases in costs from new sources. Eastern management was working closely with utilities, government officials, the community, and other power sources to ensure that it could achieve independence in power generation, should that be necessary. Power-wheeling sources and benefits were being pursued as well as self-generation options.

Although this issue was beyond the scope of any one employee, special attention was given to communicating the power cost issue to all employees so they could understand the urgency of the situation and help Eastern achieve power independence.

TABLE 2-2 Securing Economically Priced Power

Initiatives

Measures

Risks

Address power pricing issues by: maintaining relationships with Potomac Edison, Public Service Commission, People's Council, local and state government; investigate power-wheeling sources and benefits; develop alternative power sources, including self-generation; increase community support for reducing Eastern's power costs; eliminate power modulation

Reduced power costs by 2-4 mills per kilowatt hour (approximately $6-12 million/year); favorable public response and concern for Eastern's power pricing issues

Relationships with stakeholder agencies would deteriorate; power-wheeling sources (independent sources of power created by deregulation) would not provide lower prices; self-generation of power would fail either from technology problems or cost; the community would not support Eastern; power modulation (the practice of energy providers to reduce power) could not be anticipated

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