Looking for a Market Rate

Fortnightly Magazine - February 1 1996
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Looking for a Market Rate:

Anchor Glass Tries to Shake JCP&L Stranglehold

By Joseph F. Schuler, Jr.

Why assume that a city or town

can't run a power plant?

It wasn't a demand for a $2-million rate cut. It was a request for a rate in line with neighboring New Jersey utilities.

That's how Walter J. "Wally" Schaffer, Anchor Glass Container's energy director, decribes his company's position at the start of the Aberdeen Township municipalization fight against New Jersey Central Power & Light (JCP&L). "We didn't say 'We want a 50-percent reduction,'" Schaffer explains. "We said 'We want a market rate. And by the way, when you calculate that out, it does come to around $2 million.'"

A semantic difference, but important, Schaffer notes. That and other unacceptable contractual provisions proposed by JCP&L prompted the bottle-making company to spend more than $70,000 to advance the cause of a municipal electric utility (em a cause it figured would cut its annual $4.5-million electric bill by more than half.

Anchor, selling more than $1.1 billion in bottles and glass containers each year, is headquartered in Tampa, FL, and has 14 manufacturing plants nationwide. It employs about 5,000 people, and its energy costs exceed $100 million annually. In 1994, its plants used 90 megawatt-hours of electricity. The plant in Aberdeen, NJ, called Cliffwood, uses 7,000 kilowatts each year. Anchor, in fact, accounts for more than half of the power load in the small township of 17,000 people. The 326 employees at the Cliffwood plant keep it running 24 hours a day, 350 days a year. Annually, the plant makes 750 million bottles for beer, soda, food, wine and liquor. It's a high-volume, low-margin business.

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