A state judge started hearings Monday over a dispute that could alter the economic prospects of a central North Carolina region or further Alcoa Inc.'s goal of decades of profits from hydroelectric dams.
State Administrative Law Judge Joe Webster is presiding over the hearing to decide if a certificate issued last year by the Division of Water Quality was legitimate.
The division certified that if conditions it set were followed, Alcoa's wholly owned subsidiary, Alcoa Power Generating Inc., could operate the dams while protecting nearly 40 miles of the Yadkin River and its reservoirs.
If the judge decides the certificate was properly issued, it would remove a key barrier to the Federal Energy Regulatory Commission deciding on whether to renew the company's license for up to 50 more years.
A communication breakdown inside the state agency, part of the state Department of Environment and Natural Resources, meant it failed to use its full oversight and led it to wrongly issue the certification, said Thomas Griffin, an attorney for Stanly County officials fighting Alcoa's relicensing.
"DENR failed to do its job," he said.
Gov. Beverly Perdue, her predecessor Mike Easley and Stanly County officials have opposed the company's relicensing bid. They hope to encourage local job growth by attracting industries with dam-generated electricity and by having greater freedom to draw river water.
But Rene Tatro, an attorney representing the Alcoa subsidiary, said opponents were trying to expand the environmental hoops the company has to jump through beyond what the law required.
Pittsburgh-based Alcoa is fighting to renew an expired license to operate Yadkin River dams built decades ago to supply electricity to an aluminum smelting plant. The Stanly County plant once employed hundreds but is now shuttered.
Alcoa now sells the electricity to high-paying commercial customers. The company estimated in 2006 that the dams generated almost $44 million a year in revenues from hydroelectric power generation. Over 50 years, that could mean revenues of more than $2 billion, an amount that could multiply if demand for clean power booms.
The hearing is expected to take several weeks.
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