WARREN, Ohio -- Warren Steel Holdings resumed operations Thursday, following approval by state utility regulators of an arrangement that will allow it to pay reduced electric rates.
The company shut down in late March, explaining that high energy costs made it uncompetitive, according to documents filed in June with the Public Utilities Commission of Ohio.
Warren Steel operates in the former CSC Industries plant in Champion Township. The plant produces carbon and alloy steel continuously-cast products. It employs 180 wage and salary workers.
“The restart of operations marks an important new chapter for WSH and we want to take this opportunity to reiterate our appreciation for those who endorsed and supported us, including our employees, customers and key partners, as we worked to get to this point,” said John Scheel, Warren Steel vice president, in a statement issued Thursday. “Today, we are a stronger organization with an electric power supply rate that puts us on equal footing with our industry peers. This will allow us to function as a more efficient and competitive player in the marketplace, creating new opportunities for the business.”
When it sought rate relief from the PUCO, Warren Steel said its electric costs were i$75 per megawatt an hour, or MWh, while in-state and out-of-state competitors were paying rates of $48 MWh, based on May 2012 data.
Under terms of the agreement approved by PUCO, Warren Steel has committed to have a minimum of 200 direct employees and 25 contract employees after the first full month of restarted operations. The company anticipates it could increase employment to 374 full-time equivalent jobs.
The company has also committed to $10 million worth of capital investment and major repairs over the first 12 months of restarted operations, and $33 million in capital improvements over the length of the PUCO agreement. Should the company add a new air separation plant, at least another $15 million in capital expenditures would be required under the approved deal. Warren Steel is to provide the PUCO annual updates on capital expenditures and quarterly reports regarding employment levels.
U.S. Rep. Tim Ryan, D-13 Ohio, and U.S. Sen. Sherrod Brown, D-Ohio, who both supported Warren Steel in its request to the PUCO for the “reasonable arrangement,” issued a joint statement applauding the restart of the plant.
“I am pleased that Warren Steel Holdings got the utility rate reduction needed to restart their mill,” Ryan said. “This decision will help Warren Steel Holdings remain competitive as they seek new opportunities for growth and increased employment.”
Said Brown, “The reopening of Warren Steel Holdings will save hundreds of jobs and $53 million in employee compensation. Facility upgrades can now be made, and new jobs created. PUCO made the right decision, and as a result, the Mahoning Valley is strengthened.”
Published by The Business Journal, Youngstown, Ohio.
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