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Alcoa threatens to close Quebec smelters over hydro hikes

The Alcoa aluminum company said it is prepared to close its facilities in Quebec if its electricity rates go up in 2015.

3,000 workers could lose their jobs at alumnimum production facilities

Alcoa employs more than 3,000 workers at its aluminum producing plants in Quebec. (Daniel R. Patmore/Associated Press)

Premier Pauline Marois says the Alcoa aluminum company's threats to close down its Quebec facilities over proposed electricity hikes are "alarmist" and unecessary. 

This week, Alcoa sent a letter to its unions stating that it was prepared to shut down three of its Quebec operations if Hydro-Québec insists on increasing rates in 2015. 

The company has been purchasing its power from Hydro-Québec at a preferential rate, which is expected to rise by more than one cent per killowatt hour, or about 50 per cent overall.

The company said the increase would add 60 per cent to the cost of producing aluminum.

The company employs more than 3,000 workers at its aluminum smelters in Baie-Comeau, Deschambault and Bécancour.

Marois says Alcao 'isn't going anywhere'

Premier Pauline Marois responded to Alcoa's plans on Wednesday and said she was surprised by Alcoa's reaction.

"I find their tone needlessly alarmist," she said.

Marois said high-ranking members of her government are in the process of negotiating with the company. 

"It's a major industry that's very important for Quebec. It has been here for a long time, and it isn't going anywhere."

Minister of Natural Resources Martine Ouellet would not specify whether the government would continue offering the company reduced electricity rates.

But Ouellet did point out that from a global point of view Alcao is paying a fair price for its power.

"The price of electricity in Quebec for the aluminum plant is right in the middle of the price worldwide ... and also we have green electricity which is really important too,” she said.

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