Duke to pay $93M for Clean Air Violations

by | Dec 23, 2009

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DukeGallagherstationDuke Energy has reached an agreement with the U.S. Environmental Protection Agency (EPA) to spend $93 million to settle Clean Air Act violations at its coal-fired power plant in Indiana, according to the EPA.

This is just the latest major EPA settlement recently. Earlier this month, American Smelting and Refining Company LLC (ASARCO) paid the federal government $1.79 billion for hazardous waste violations, which was cited as the largest environmental bankruptcy settlement in history.

Under the agreement, Duke will spend approximately $85 million to reduce air pollution at the plant, pay a $1.75-million civil penalty, and spend $6.25 million on environmental mitigation projects to resolve this ten-year lawsuit.

The agreement, filed in federal court in Indianapolis, resolves violations of the Clean Air Act’s new source review requirements found at the company’s Gallagher coal-fired power plant in New Albany, Ind.

An Indianapolis jury found that Duke violated the Clean Air Act by failing to obtain required permits and pollution controls before making modifications to Gallagher Units 1 and 3 that caused significant increases in sulfur dioxide. The trial to determine a remedy for the violations will begin on Jan. 25, 2010.

The settlement is expected to reduce sulfur-dioxide emissions at the plant by almost 35,000 tons per year, an 86 percent reduction when compared to 2008 emissions, according to the EPA.

Duke Energy says it can continue to operate its 560-megawatt Gallagher Station and has the option to either convert two of the units from coal to natural gas or retire the units. The power company expects that it will convert the units to gas, but no final decision is required to be made until Jan. 1, 2012.

The transition to natural gas will also reduce other air pollutants, including nitrogen oxides, particulate matter, mercury, and carbon dioxide, says the EPA. As a result, the combined nitrogen-oxide emissions from Units 1 and 3 are expected to decrease by about 2,198 tons per year as compared to 2008 emissions.

By using natural gas rather than coal, Duke will also eliminate emissions of particulate matter and mercury from the units, and decrease carbon-dioxide emissions by roughly half per unit of electricity.

Duke Energy will also install additional pollution controls on the station’s other two units and switch to using lower sulfur fuel at the plant.

Earlier this year, EPA also cited another power company Kentucky Utilities Company for violating the Clean Air Act. Kentucky Utilities agreed to spend over $135 million on new pollution controls after receiving a $1.4 million penalty for Clean Air Act violations.

In the case of the four-year battle with mining company Asarco, the record $1.79 billion settlement pays for the clean-up and restoration of hazardous waste pollution at more than 80 contaminated sites across 19 states, according to federal agencies, reports the New York Times.

Asarco, based in Tucson, was accused of gross environmental misconduct at numerous sites, including illegally burning hazardous waste, which resulted in polluted water and soil, reports the New York Times.

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