MILAN - US ALUMINIUM giant Alcoa said on Tuesday that it planned to shut down two plants in Italy temporarily as it waited for a solution to the problem of high energy prices.
At the same time, however, it said 'there was no hope given the current situation' of reopening one of the plants at a later date. They would stop production until Feb 6, it said.
Late last year, EU regulators ordered Alcoa to repay Italy for state aid worth between US$300 and US$400 million (S$560 million) received since 2006 in the form of subsidised electricity prices for the two smelters at Fusina and Portovesme.
'Price subsidies that result in artificially low energy prices for selected companies waste taxpayers' money and distort competition in the single market,' EU Competition Commissioner Neelie Kroes said in November.
'Alcoa will have to pay back most of the illegal subsidies,' she added. Alcoa said it would appeal the decision and temporarily idle production at its two aluminum smelters.
'The curtailment is a result of uncertainty in obtaining future power supply for the smelters at competitive rates and the financial impact of (the) European Commission decision,' Alcoa said. Alcoa said the tariff had been in place for more than 10 years in Italy and approved by the EU in 1995, the year that Alcoa purchased the operations. -- AFP
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