New furnace at WCI is good for the company and the area

The State Controlling Board approved release of funds Monday that show just how good a deal low-interest, state-backed loans can be.
The amount was just 5 million, a pittance by state budget standards, and the risk to state is minimal. But the dividends are large.
The loan was one piece in a financial package that assures the installation of a new 36 million reheating furnace at WCI Steel Inc. in Warren.
The new walking beam slab reheat furnace will be good for WCI and its employees, good for WCI's customers, who will get a higher quality product, and will be good for the environment, because the new furnace will replace three older units that date to the 1960s and it will be much more energy efficient.
The loan was approved in December by the State Development Financing Advisory Council, and work at WCI has already begun. The seven-year loan will carry an interest rate of 1 percent for the first three years and 3 percent for the remainder.
The furnace will allow WCI to produce coils for its specialty customers that are almost 20 percent larger than are now produced and will reduce surface defects. Over a period of about two years, the new furnace will allow WCI to increase its output by about 60,000 tons annually.
Economic boost
Increased production and higher customer satisfaction will help the company's bottom line and help protect the employment prospects of more than 1,300 workers at the plant, who make an average of nearly 20 an hour. WCI is an important part of the Mahoning Valley economy.
On the environmental front, Tim Roberts, public affairs manager for WCI, notes that the plant is a huge consumer of electricity, coke gas and natural gas. It uses enough electricity to power a small city.
Combustion control technology will reduce electricity usage by 25 percent per ton produced, and overall fuel consumption will be reduced by 37.5 percent. That will convert to savings of 12 million to 14 million a year for the company.
WCI, like much of the domestic steel industry, has seen some difficult times. But it worked its way out of bankruptcy reorganization last year and is now working toward producing more and better steel. This furnace, which is scheduled to be in operation in about a year, is the first major project under the company's new ownership Harbinger Capital Partners.
The state of Ohio has made a sound investment in the company and in the Mahoning Valley.