Steelmaker Arcelor Mittal is spending a lot of green at its Cleveland Works in order to be green and save a lot more green in the future.
View full sizeHigh-strength steel leaves the finishing line at ArcelorMittal's Cleveland Works in the Flats. New steel formulas from the company have gotten so strong that ArcelorMittal has had to upgrade several pieces of equipment to cut and roll the steel. Higher-strength, hot galvanized steels are in high demand by automakers who need durable, long-lasting steel to cut the weight of vehicles.CLEVELAND, Ohio -- Steelmaker ArcelorMittal on Tuesday paid the state of Ohio $227,667 after discovering that its energy services division did not buy quite enough electricity generated by wind and solar in 2012.
The payment ends an 11-month effort by the company before the Public Utilities Commission of Ohio to make sure its energy procurement division followed the letter of the law when it supplied power to the Cleveland Works.
The company's self-reporting of its shortfall, and immediate payment when regulators finally approved it, follows a pattern of efforts to save money and at the same time embrace efficiency and sustainability.
The payment also comes during an era when the state is offering industry incentives to come to Ohio, or at least not leave.
ArcelorMittal in 2011 won the right from the PUCO to avoid paying a monthly charge to the Illuminating Co. through 2024 to fund the utility's energy efficiency programs. ArcelorMittal spent $59 million between 2004 and 2006 to replace a production line that electro-coated steel with zinc with a new facility that "hot dipped" the steel into the zinc without the use of electricity -- slashing power consumption.
The Illuminating Co. supported the steel mill's application -- made jointly to the PUCO in 2009 -- because in turn it was able to get credit for the huge reduction in power use demanded by state efficiency standards. (Those standards are temporarily in a two-year freeze.)
Then in 2012, ArcelorMittal's specially created energy supply company purchased and delivered more than 254 thousand megawatt-hours of electricity to the steel mill here, its only Ohio customer.
As a point of comparison, most homes here use between 750 and 1,000 kilowatt-hours a month. One megawatt, or one million watts, is enough to supply between 400 and 900 homes, on average, depending on the region.
The steel maker discovered the slight shortfall in renewable energy purchases in 2013 and last September filed its offer to pay the fine. The PUCO a week ago finally approved it.
The company offered to pay the fine in order to "ensure our compliance with the program and keep us in good standing with the PUCO," said spokeswoman Mary Beth Holdford.
The switch to the hot dip galvanizing line originally began as a project to replace another, idle facility at the Cleveland plant but ultimately replaced the power-hungry electro-coating system.
The steelmaker has also expanded its long-time practice of using waste gases to generate electricity on-site.
Since early 2010, the Cleveland Works has used blast furnace gases to generate up to 30 megawatts of power an hour, roughly equivalent to the output of 10 large wind turbines -- and power that in the past it would have had to buy.
The company, which has spent more than $70 million in upgrades at the Cleveland Works this year alone, "projects greater efficiency in the coming years with up to a 10 percent increase in internal power generation forecast" for the Cleveland plant, said Holdford.
This article was edited on Aug. 14 to correctly state the power consumption of ArcelorMittal's Cleveland Works.