Cheoah Dam Modernization Project Commissioned

ROBBINSVILLE, N.C.--(BUSINESS WIRE)--Alcoa (NYSE:AA) and U.S. Department of Energy officials yesterday commissioned the $110 million modernization project at Cheoah Dam in Robbinsville, NC, one of four hydroelectric dams that make up Alcoa Power Generating Inc.’s Tapoco Project. The modernization effort has increased the dam’s efficiency and energy output and increased the life of the facility by at least another 40-50 years.

“This project demonstrates a partnership and cooperation among private industry and government to protect and sustain renewable energy for future generations”

“This project demonstrates a partnership and cooperation among private industry and government to protect and sustain renewable energy for future generations,” said Mark Gross, Alcoa Power Generating Inc. Hydro Operations Manager. “The Cheoah Modernization project directly supports green energy growth, the use of renewable energy resources and enhanced recreational opportunities.”

DOE objectives for the project specified that ultimately, the full four-unit modernization would result in a 28 percent increase in generating capacity. “We are pleased to be able to announce that Cheoah Dam has actually demonstrated a 50 percent increase – from 88 MW to 132 MW,” Gross added.

In addition to the capacity improvements, the modernization efforts have eliminated the use of circuit breaker oil and minimized the need for transformer oil, resulting in a net decrease in total oil volume in high voltage equipment of almost 40,000 gallons. And by using air-cooled transformers, cooling water requirements have dropped by 122,000 gallons per day.

The modernization project received a jump start when the U.S. Department of Energy awarded Alcoa a $12.95 million grant as part of the 2009 American Recovery and Reinvestment Act. DOE’s Office of Energy Efficiency and Renewable Energy issued the grant. U.S. Department of Energy representatives - Matthew Hess, Renewable Energy Technologies Project Officer; and Erik Mauer, Wind & Water Power Program Senior Engineer - joined Gross at the commissioning ceremony.

The overall project includes upgrades to four of the dam’s five power generation units, along with process and utility systems, such as transformers, switchgear, power and control wiring, piping and fire protection equipment. Another two units will be upgraded during phase two of the project and are estimated to be completed by spring of 2013.

Alcoa Energy is a global producer, controlling nearly 3 GW of generating capacity to provide for the energy needs of Alcoa’s worldwide smelting and refining system as well as the needs of regional wholesale markets. The business includes Alcoa Power Generating Inc, which currently owns and manages the 351-megawatt Tapoco system.

In June of this year, Alcoa announced that it had reached an agreement to sell the Tapoco Project to Brookfield Renewable Energy Partners. The transaction is expected to close by the end of the year.

About Alcoa
Alcoa is the world’s leading producer of primary aluminum, fabricated aluminum and alumina. In addition to inventing the modern-day aluminum industry, Alcoa innovation has been behind major milestones in the aerospace, automotive, packaging, building and construction, commercial transportation, consumer electronics and industrial markets over the past 120 years. Among the solutions Alcoa markets are flat-rolled products, hard alloy extrusions, and forgings, as well as Alcoa® wheels, fastening systems, precision and investment castings, and building systems in addition to its expertise in other light metals such as titanium and nickel-based super alloys. Sustainability is an integral part of Alcoa’s operating practices and the product design and engineering it provides to customers. Alcoa has been a member of the Dow Jones Sustainability Index for eight consecutive years and approximately 75 percent of all of the aluminum ever produced since 1888 is still in active use today. Alcoa employs approximately 61,000 people in 31 countries across the world. More information can be found at www.alcoa.com.

About APGI
Alcoa Power Generating Inc. (“APGI”) is a wholly-owned subsidiary of Alcoa Inc. ("Alcoa"), the nation’s (and the world’s) leading producer of primary aluminum and fabricated aluminum. APGI exists primarily to generate, purchase or manage electricity for Alcoa’s use in its aluminum smelters and other industrial processes.

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