Kelly, Cleveland-Cliffs officials unpack proposed energy mandate
BUTLER TWP — Hundreds of people gathered Monday evening, April 1, at Butler County Community College for a town hall protesting a proposed rule from the U.S. Department of Energy that would change energy standards and make products produced at Cleveland-Cliffs obsolete.
Aaron Steinheiser, general manager of Cleveland-Cliffs’ Butler Works and Zanesville, Ohio, plants, said Monday the steel produced by Cleveland-Cliffs is more than 99% efficient, and more efficient than amorphous metal when running at high capacities.
“They are trying to take a huge step,” Steinheiser said of efficiency improvements. “When you look at it, we’re already over 99% efficient, so how much more efficient are you really getting?”
According to Steinheiser, Cleveland-Cliffs can make up to 250,000 tons of electrical steel per year — and the product is the largest output of the Butler Works plant. The plant also improved the efficiency of its steel in 2016, the last time the DOE upped its efficiency standards. The jump in the efficiency standard the DOE is proposing — from 99.11% to 99.29% efficiency — is too wide for the plant to adapt to in just under three years, he said.
U.S. Rep. Mike Kelly, R-16th, hosted the town hall at BC3’s Founders Hall to explain the DOE’s proposed rule raising energy standards above Cleveland-Cliffs’ capacity of grain-oriented electrical steel, or GOES, cores.
In January 2023, the DOE proposed mandating amorphous steel cores in new distribution transformers. If adopted, the standards would come into effect in 2027, effectively making the Butler Works and Zanesville, Ohio, plants obsolete, leaving no other domestic source of the steel.
Kelly emphasized at the town hall that the proposed rule is not a policy being put in place by elected officials. He said the event’s large attendance could demonstrate to the DOE how many people its proposal could affect if enacted.
“We’re not letting this happen,” Kelly said. “I’ll be glad to support any policy that comes forward as long as it protects American security and American jobs.”
In January, Kelly and seven congressional co-sponsors introduced the bipartisan Distribution Transformer Efficiency & Supply Chain Reliability Act of 2024. The bill, which has not yet been approved, is designed to stabilize domestic transformer manufacturing to meet increasing demand without disrupting existing supply chains or undermining American steel production.
Gov. Josh Shapiro said March 27 he had spoken with members of President Joe Biden’s administration, who had indicated to him the proposed rule would be reworked. Kelly said without the release of the proposal, there is no way to be sure the mandate against Butler Works’ output is still included. President of United Auto Workers Local 3303 Jamie Sychak said the DOE will release the rules by the end of June.
Sychak said until the proposal comes out in writing, he would not stop spreading the word about its effect on the Butler area. At the town hall, he emphasized the importance of unity in a situation like this, which was demonstrated by the red union shirts worn by many people in the crowd.
Before speaking at the town hall, Sychak also said the closure or hampering of the Butler Works plant would affect the local economy and everybody in the area.
“If you don’t know about your future, if you don’t know if you’re going to have a job three years from now, two years from now ... all that ties into your financial decisions,” Sychak said. “We want a definitive answer, and we want that answer to be the right answer.”
Butler County Commissioner Leslie Osche said before the town hall the Butler Works plant — which employs 1,300 people — has the county’s largest payroll, and its closure would drain a huge tax generator from the region.
“First of all, you take the property taxes, you're talking about $1.5 million, which primarily affects school districts; another $1 million in local taxes to many, many municipalities where the employees work,” Osche said.
Steinheiser told the crowd assembled at the town hall he is cautiously optimistic the DOE would not raise energy standards to the rates outlined in its proposal.
“We are truly hopeful that the DOE is responsive, and I know they are listening to us, so hopefully we can see this rule change or be improved,” Steinheiser told the crowd.
Kelly wrapped up the town hall at around 6:45 p.m.
Larry Sassone, a retiree of AK Steel, attended the meeting in a red union shirt. He said he plans to contact state officials regarding the proposal to ensure they know the information he learned Monday evening.
“It doesn’t make sense why we’re trying to eliminate jobs” Sassone said. “Why would we have someone else do what we do so well here?”
