Green Business

Coal Power Plant to Pay $135 Million for Pollution Violations

| by DOJ

WASHINGTON—Kentucky Utilities (KU), a coal-fired electric utility, has agreed
to pay a $1.4 million civil penalty and spend approximately $135 million on
pollution controls to resolve violations of the Clean Air Act, the Justice
Department and the U.S. Environmental Protection Agency announced today.

KU has agreed to install new pollution control equipment on its largest
generating unit that will reduce combined emissions of sulfur dioxide and
nitrogen oxides by more than 31,000 tons per year, which is 90 percent below the
2007 emission levels.  KU will also install controls to reduce particulate
matter emissions by approximately 1,000 tons per year.

The company will spend approximately $3 million on projects to benefit the
environment and mitigate the adverse effects of the alleged violations
including:

* Contribute $1.8 million to a pilot project on the effectiveness of storing
compressed carbon dioxide gas, a by-product of coal combustion, in deep
injection wells;

* Spend $1 million to retrofit school buses with filters or other controls to
reduce emissions of particulate matter; and

* Pay $200,000 to the National Park Service to help restore Mammoth Cave
National Park, located in Kentucky.

KU has agreed to surrender the excess nitrogen oxide and sulfur dioxide
allowances it will have after installing the pollution controls.  Coal-fired
power plants are allowed to emit sulfur dioxide and nitrogen oxides as
allowances, which are granted under federal or state acid rain permits.  Once
surrendered, these allowances cannot be used again, thus removing the emissions
from the environment permanently. 

“This settlement will result in the substantial reduction of harmful
emissions, and will benefit air quality in Kentucky and downwind areas,” said
John C. Cruden, Acting Assistant Attorney General for the Justice Department's
Environment and Natural Resources Division.  “The Justice Department will spare
no effort in its pursuit of emission reductions from power plants across the
country to achieve the benefits envisioned by the Clean Air Act.”

“Today’s settlement sets the most stringent limit for nitrogen oxide
emissions ever imposed in a federal settlement with a coal-fired power plant,”
said Catherine McCabe, Acting Assistant Administrator for EPA’s Office of
Enforcement and Compliance Assurance.  “EPA is committed to ensuring our
nation's coal-fired power plants comply with the Clean Air Act.  Pollutants from
these facilities can cause severe respiratory problems, contribute to childhood
asthma, and contribute to smog and haze.”

In a complaint filed in March of 2007, the government alleged that KU
modified the largest coal-fired electrical generating unit at the E. W. Brown
Generating Station in Mercer County, Ky., without installing required pollution
control equipment or complying with applicable emission limits, in violation of
the Clean Air Act.  The unit has been operating since 1971, and the
modifications made in 1997 allowed the unit to increase the amount of coal it
burned and increase the amount and rate of emissions for sulfur dioxide,
nitrogen oxide and particulate matter.  The government discovered the violations
through an information request issued to KU.
 
The settlement is part of
the EPA’s enforcement initiative to control harmful emissions from coal-fired
power plants under the Clean Air Act’s New Source Review requirements.  The
total combined sulfur dioxide and nitrogen oxide emission reductions secured
from these settlements will exceed more than 1.8 million tons each year once all
the required pollution controls have been installed and implemented.

Coal-fired plants release sulfur dioxides and nitrogen oxides, which are a
primary cause of acid rain that harms trees and lakes and impairs visibility. 
These pollutants cause severe respiratory problems, contribute to childhood
asthma, and contribute to smog and haze. Air pollution from power plants can
drift significant distances downwind and degrade air quality in nearby
areas.

Kentucky Utilities, based in Lexington, Ky., generates and distributes
electricity to more than 500,000 customers in Kentucky and Virginia.  It owns
and operates five coal-fired electrical generating stations in Kentucky.  The
settlement applies to the largest boiler unit at the E.W. Brown Generating
Station located on Lake Herrington in Mercer County, Ky.

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