Utilities launch counter-offensive against EPA pollution demands

Two electric power utilities have mounted a legal challenge to the US EPA's attempts to force them to implement pollution reduction measures as prescribed by the Agency. One of the utilities believes its case could lead to the dismissal of the majority of the complaints filed against the company.

The utilities, Tennessee Valley Authority (TVA) and American Electric Power (AEP) have adopted a variety of legal strategies. TVA, a federal Government agency, has abandoned its talks with the EPA, and launched a legal appeal against the Agency’s demands. Meanwhile, AEP asserts that the Agency’s claims were made after the five-year limit for bringing enforcement actions had expired.

AEP has also filed a separate motion to dismiss a complaint by several special interest groups and asked the court to require those parties to participate in the suit filed earlier by the EPA.

Both utilities deny the EPA’s complaint that they violated the Clean Air Act: TVA says it has already taken steps to reduce emissions from its plants and that the EPA did not notify it of any failure to comply with the Act over the last 20 years. AEP argues that modifications it made to its coal-fired power stations did not violate the Act because they were carried out as part of routine maintenance or repair work and did not result in an increase in generating capacity.

Last November, the EPA filed air pollution lawsuits against AEP and six other electric utility companies in the Midwest and South. The companies were charged with making modifications to 17 power stations without installing suitable emissions-control technology (see related story). The EPA simultaneously issued an administrative order against TVA for violations of the Clean Air Act at seven of its coal-fired power stations.

One of the utilities, Tampa Electric Company, has already announced a major overhaul of its operations in response to the EPA suit (see related story).

Environmentalists have reacted to the utilities’ move with dismay. “It’s disappointing, particularly regarding TVA,” Frank O’Donnell, executive director of the Clean Air Trust told edie. “It’s less surprising with AEP, which has resisted clean-up for decades. AEP is considered by environmentalists to be probably the most reactionary utility when it comes to the environment.”

Unlike AEP, TVA is a US federal government agency. The US’s largest electricity generator, TVA operates other nuclear power plants in Tennessee and is also charged with the environmental stewardship of the Tennessee River basin (see related story).

While the lawsuits against the remaining utilities are expected to last several years, TVA’s status as a federal agency means the EPA had to file an administrative order against TVA requiring it to initiate the Agency’s pollution reduction measures. TVA says the cost of implementing the administrative order could force it to raise its rates substantially.

TVA views the appeal as an opportunity to challenge the EPA on the same footing as the utilities. “EPA really left us with no choice,” said TVA Director Glenn McCullough. “Other utilities can test EPA’s new legal position in federal court. This court action now gives TVA the same opportunity.”

The EPA’s complaint against TVA is similar to that against the other utilities. The Agency asserts that TVA has been violating the Clean Air Act for the past 20 years because it has been maintaining its coal-fired power stations without obtaining permits and installing state-of-the-art pollution control equipment.

TVA argues that, during this period, the EPA did not indicate that TVA had not been in compliance with the Clean Air Act. TVA believes it is in full compliance with the Act and says it has spent more than $2.5 billion to reduce emissions from its plants and that it initiated a $600 million voluntary plan two years ago to reduce emissions.

O’Donnell takes a dim view of TVA’s arguments. “It’s really a legalistic way to avoid responsibility. EPA regulations are relatively clear – a major modification of a plant requires certain procedures including reporting that you are doing it. TVA’s reasoning is rather circular. If companies make major changes, they are responsible for notifying the government. Maybe TVA is hoping for a new start with a new administration after the election.”

AEP believe their strategy will not require the intervention of a new Government. The company’s lawyers say their case could lead to the dismissal of approximately 85% of the claims against the company. They say the majority of the activities cited in the complaints occurred many years ago, some as early as 1979, well outside of the five-year limitations period stipulated by the Clean Air Act.

In addition, they say the modifications carried out at the company’s power stations were for routine maintenance and repair, were not designed to increase the plants’ generating capacity and therefore did not require the installation of additional pollution control technology.

“AEP believes firmly that these complaints are without merit,” said Janet Henry, assistant general counsel for AEP. “We have complied with both the letter and spirit of environmental laws and regulations.

“The federal rules provide an opportunity to raise certain procedural issues for early resolution by the court. The motions we are filing today represent the most efficient way to address the majority of the claims because they fall beyond the Clean Air Act’s five-year limitations period.”

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie