Alcoa pulls the plug on Indian Head plant project

Power would have helped Adamstown smelter reopen

‘‘It’s looking cost-prohibitive to us based on the feasibility study,” said Earl H. Robbins Jr., Alcoa’s government affairs manager. ‘‘... We were looking to build a power plant on the Indian Head naval base and it doesn’t look like that’s going to happen.”

The company had eyed the undeveloped site at the southeastern corner of the base for months to construct a plant that would supply electricity to its Adamstown smelter, Eastalco Alcoa Works, which closed in December 2005 because of rising electricity costs. About 600 jobs were lost.

County officials had been facilitating discussions for months between Alcoa and the Navy. The approximately $1 billion plant would have created up to 200 permanent jobs, along with a stable energy supply and additional corporate tax revenues to Charles County. Officials said it could also trigger economic investment on the western side of the county and help shield the Indian Head base from future military downsizing.

The project’s abandonment disappointed local officials.

‘‘The cost of building a modern plant is much higher and they were just not able to make the numbers work,” said Del. Murray D. Levy (D-Dist. 28) of La Plata, who was involved in the discussions.

Base officials received word of the decision Wednesday, but a spokesman for the base said they did not have a large stake in whether the project went forward.

‘‘It was never the Navy’s project. This is something that was brought to the Navy for consideration,” said Gary Wagner, public affairs officer for Naval Support Activity South Potomac, which manages the Indian Head and Dahlgren installations.

‘‘We did what we ... felt was appropriate to listen and accommodate discussion on the project, but it was really up to Alcoa to conduct their own analysis [on] what it would take for them to build a power plant on Navy property at Indian Head and if that would in fact meet their needs,” he said.

Had the project gone forward, it would have provided 350 megawatts to the Eastalco plant, with the balance available for market sale that could have relieved congestion on the power grid and reduced electricity rates for Southern Marylanders.

Another proposed generating station in St. Charles — a 600-megawatt natural gas-fired power plant — could fill the void. Competitive Power Ventures of Silver Spring announced this summer that it would build the $400 million plant on a 77-acre industrial tract that was formerly slated for the abandoned Kelson Ridge power plant project. Construction is scheduled to begin in 2009 and finish in 2011.

Meanwhile, Robbins said Alcoa will seek alternatives in its effort to reopen the Frederick County plant.

‘‘This does not end our goal to get Eastalco restarted,” he said. ‘‘It is a setback, but this does not end that process.”