Something not right about Alcoa Inc (NYSE:AA)’s NC dam-ownership rights
On Friday, officials in North Carolina filed a lawsuit against Alcoa Inc (NYSE:AA). The state’s bout with the Aluminum giant has been a long-running. The issue about who will control the electric power and water that is generated from the 2nd largest river in the state, for the next 5 decades, is the central point of contention.
Starting over a century ago, 4 dams were constructed across the Yadkin River. In the lawsuit that has been filed by the NC official, they have stated that the company does not have any ownership-rights over the river bed. The lawsuit has asked Wake County’s State Court Judge to rule that NC State will retain the ownership rights to all the submerged land. This means that the state is asking to have rights to a stake in these hydropower-dams.
An environment agency in the state rejected a water-quality certification that the aluminum company needs for a completely new federal-operating license. They have cited this dispute over the riverbed property rights as the reason for the rejection. The Yadkin River runs for around 200 miles east of Charlotte, turns into the River Pee Dee before it enters South Carolina enroute to the Atlantic Ocean.
At one point of time these dams used to power the company’s aluminum smelter that was shutdown in 2007. Since then, AA has sold the power to various commercial customers.
State wants control
In a statement, Pat McCrory, North Carolina’s Governor said that the state should be able to use the water to meet the water-needs in the state and also as a means for job creation. Beverly Perdue, the former Governor also took a similar stand on this issue. Alcoa said that Alcoa Power Generating Inc, its operating-subsidiary will ask for the case to be moved to a Federal Court where the Judge can then weigh the merits of the case.