Noranda throws its weight around, threatening to cut employment at its New Madrid smelter or even close down if Ameren and the PSC don’t grant the unprecedented rate cut. Noranda says if it closes, Ameren would come up $55 million short of revenue needed to maintain earnings allowed by the commission.

Not true, say PSC staffers. Ameren would be better off financially without Noranda. If the cost shift proposed by Noranda goes into effect, other Ameren customers would pay some $28 million more annually.

Everyone hopes Noranda can survive and thrive, but it makes no sense for its financial salvation to come at the expense of rational rate regulation policy and out of the pockets of Ameren’s 1.2 million other customers.

Already Ameren has given Noranda a favorable rate commensurate with the company’s large demand. Electricity is the largest single cost for a smelter, but that doesn’t mean the public should provide whatever it takes in subsidies to satisfy the company’s allegation of need. At some point, as the PSC staff points out, it makes more sense to draw a line.

The Public Service Commission will decide this case in August. In the meantime, Noranda and Ameren will be out and about campaigning to influence the commissioners. Unless I hear something new, I see no valid grounds for the PSC to go as far as Noranda wants.

Only when the official line is drawn will we know what Noranda really will do, but it’s not a game of chicken. The bottom line is fair rate policy. Noranda simply wants too much special treatment at the expense of everyone else.