Surcharge Information

Energy Surcharge by Month

There will be no surcharge for October 2024 shipments.
6xxx: $0.000/lb. All other alloys: $0.000/lb.

6xxx Alloys ($/lb)
Month of Shipment Month of DOE data Natural Gas (a) Electricity (b) Diesel (c) Surcharge (a+b+c)
Jan-24 Nov-23 $0.0000 $0.0067 $0.0066 WAIVED
Feb-24 Dec-23 $0.0000 $0.0072 $0.0052 WAIVED
Mar-24 Jan-24 $0.0000 $0.0095 $0.0047 WAIVED
Apr-24 Feb-24 $0.0000 $0.0063 $0.0056 WAIVED
May-24 Mar-24 $0.0000 $0.0047 $0.0055 WAIVED
Jun-24 Apr-24 $0.0000 $0.0037 $0.0054 WAIVED
Jul-24 May-24 $0.0000 $0.0052 $0.0045 WAIVED
Aug-24 Jun-24 $0.0000 $0.0084 $0.0040 WAIVED
Sep-24 Jul-24 $0.0000 $0.0088 $0.0045 WAIVED
Oct-24 Aug-24 $0.0000 $0.0102 $0.0039 WAIVED
Other Alloys *($/lb)
Month of Shipment Month of DOE data Natural Gas (a) Electricity (b) Diesel (c) Surcharge (a+b+c)
Jan-24 Nov-23 $0.0000 $0.0179 $0.0066 WAIVED
Feb-24 Dec-23 $0.0000 $0.0193 $0.0052 WAIVED
Mar-24 Jan-24 $0.0000 $0.0255 $0.0047 WAIVED
Apr-24 Feb-24 $0.0000 $0.0168 $0.0056 WAIVED
May-24 Mar-24 $0.0000 $0.0126 $0.0055 WAIVED
Jun-24 Apr-24 $0.0000 $0.0100 $0.0054 WAIVED
Jul-24 May-24 $0.0000 $0.0140 $0.0045 WAIVED
Aug-24 Jun-24 $0.0000 $0.0224 $0.0040 WAIVED
Sep-24 Jul-24 $0.0000 $0.0236 $0.0045 WAIVED
Oct-24 Aug-24 $0.0000 $0.0273 $0.0039 WAIVED

* all 3xxx, 4xxx, 5xxx, 2xxx and 7xxx series alloys

Indices

2007 Average Energy Prices
Natural Gas
($ / mcf)
Electricity
($ / kwh)
Diesel
($ / gal)
2007 Average $7.1830 $0.0635 $2.8820
Monthly Average Energy Prices
Month of
DOE data
Natural Gas
($ / mcf)
Electricity
($ / kwh)
Diesel
($ / gal)
Jan-24 $3.3040 $0.0853 $3.8540
Feb-24 $1.7871 $0.0779 $4.0440
Mar-24 $1.5481 $0.0742 $4.0220
Apr-24 $1.6624 $0.0720 $4.0020
May-24 $2.2027 $0.0754 $3.8220
Jun-24 $2.6391 $0.0826 $3.7220
Jul-24 $2.1507 $0.0836 $3.8100
Aug-24 $2.0572 $0.0868 $3.7000

Index information is reflected on date listed and is not updated with DOE revisions.

The above prices are quoted by the Department of Energy on its web site:
Diesel: http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=EMD_EPD2D_PTE_NUS_DPG&f=M
Gas & Electric: STEO_m_Gas & Electricity.xls
 

Calculation – How Surcharges are Calculated

The energy surcharge reflects the increase in costs for natural gas, electricity, and diesel fuel as compared to the average prices of these costs in 2007. For example, the average prices in August 2024 and average prices for 2007 for these commodities were:

August 20242007 Base PriceDollars per Unit
Natural Gas$2.0572$7.1830Henry Hub, 000’s of cubic feet (mcf)
Electricity$0.0868$0.0635US Industrial; Kilowatt-hours (KWh)
Diesel$3.7000$2.8820US retail, per gallon

Monthly prices are available on the DOE web site approximately the middle of the following month. When known, such prices will apply to the calculation for products shipped in the next following month. For example, prices for August 2024 are posted on the DOE web site in mid-September, and such August prices will apply to the energy surcharge calculation for all scheduled shipments in October 2024.

For each commodity, the change in price for each month (compared to the 2007 base average price) will be multiplied by a usage factor for each commodity for (a) 6xxx alloys products and (b) all other alloy products. Those factors will remain constant and are:

Usage per
pound
6xxx AlloysOther AlloysUnits
Natural Gas0.00630.0086mcf / pound
Electricity0.43711.1704KWh / pound
Diesel0.00480.0048gallons / pound

Continuing with the example above, orders scheduled to ship in October 2024 will reflect the following energy surcharge:

6xxx AlloysExample: August 2024 DOE prices applied to October 2024 Orders
Natural GasElectricityDiesel Fuel
August 2024 Prices$2.0572$0.0868$3.7000
Base 2007
Average Prices
$7.1830$0.0635$2.8820
Difference-$5.1258$0.0233$0.8180
Usage Factor per lb0.0063
(mcf/lb)
0.4371
(kwh/lb)
0.0048
(gal/lb)
Dollars per pound$0.0000$0.0102$0.0039WAIVED
(a)(b)(c)(a+b+c)
Other Alloys*Example: August 2024 DOE prices applied to October 2024 Orders
Natural GasElectricityDiesel Fuel
August 2024 Prices$2.0572$0.0868$3.7000
Base 2007
Average Prices
$7.1830$0.0635$2.8820
Difference-$5.1258$0.0233$0.8180
Usage Factor per lb0.0086
(mcf/lb)
1.1704
(kwh/lb)
0.0048
(gal/lb)
Dollars per pound$0.0000$0.0273$0.0039WAIVED
(a)(b)(c)(a+b+c)

* all 3xxx, 4xxx, 5xxx, 2xxx and 7xxx series alloys

For convenience, the attached worksheet will allow the calculation of the energy surcharge for historical months or projected months, as the surcharge may apply to pounds shipped. Inputs required are the relevant monthly prices for natural gas, electricity, and diesel fuel as well as the pounds of 6xxx alloy or other alloy products.
 

Explanation – Why have we implemented an energy surcharge?

During 2008, costs for natural gas, electricity and diesel fuel increased dramatically over the prior year. While Kaiser Aluminum absorbed increases over previous years, the escalation required us to adjust our pricing accordingly via the implementation of a surcharge.

We will pass on increases in these costs above a baseline of 2007 levels and concluded that a surcharge is the best vehicle to address this issue. We maintain the data and tracking mechanisms used to support the surcharge on the Kaiser Aluminum Web Site to allow our customers to regularly monitor these commodity costs as they relate to their products.