PUCO approves arrangement between V&M Star and Ohio Edison

COLUMBUS, OHIO (March 4, 2009) – The Public Utilities Commission of Ohio (PUCO) today approved an arrangement between V&M Star and Ohio Edison for electric service to the company’s steel-producing facility in Youngstown. The 10-year arrangement will result in the expansion of V&M Star’s facilities and the creation of 250 to 300 jobs.

“Not only will this arrangement promote economic development in Ohio, it will also assist in fulfilling the policies set forth in Senate Bill 221 through the pursuit of energy efficiency,” PUCO Chairman Alan R. Schriber stated. “With the current condition of both our national and state economy, we are encouraged that this arrangement will promote Ohio’s economy through the expansion of manufactured products and an increase in the availability of skilled jobs.”

V&M Star is a producer of seamless pipe, including oil country tubular goods, at its steel-producing facilities in Youngstown. The company is considering an expansion involving the construction of a new manufacturing facility that will produce products from materials supplied by the company’s current facilities. V&M Star plans to make a capital investment of $835,000,000 over three years through its expansion and operation in Northeast Ohio. This expansion would bring an additional 250 to 300 jobs to the area in addition to 400 construction-related jobs.

As part of the arrangement, V&M Star will consider energy efficiency measures including the capture and use of waste heat energy to produce electricity, improved efficiency of electric furnaces and the introduction of efficiencies in the design and operation of V&M Star’s compressed air system.

In approving the arrangement, the Commission also approved Ohio Edison’s recovery of 100 percent of the delta revenue or the difference from the electric utility’s rate schedule and the economic development rate. The Commission noted in its opinion and order today that it will consider delta revenue recovery for each arrangement application based on the benefits received by the parties, the electric utility’s ratepayers and the state of Ohio.

V&M Star filed the details of the rate discount from this arrangement under seal along with a motion for protective order. The Commission found today that the company’s motion for protective order is reasonable as the information filed under seal is a trade secret. As a result, the rate discount will remain under seal for the duration of V&M Star’s arrangement with Ohio Edison.

A copy of today’s Commission opinion and order is available at www.PUCO.ohio.gov. Click on the link to the Docketing Information System (DIS) and enter the case number 09-80-EL-AEC.

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