It Looks like success -- but Bush Admin. will not enforce it.
ENVIRONMENT -- ADMINISTRATION PROHIBITS LEGAL ACTION AGAINST POLLUTER UNTIL 2018: The Environmental Protection Agency and American Electric Power (AEP) reached an agreement this week in a suit regarding AEP's "failure to take the necessary steps to mitigate the impact of acid rain." The agreement, in which AEP "agreed to spend $4.6 billion to reduce chemical emissions" was initially hailed by environmental groups. But "buried in paragraph 133 of the consent decree...is a section that assures AEP that the government will not pursue any action stemming from the 'modification' of these plants between now and Dec. 31, 2018." This signals that the Bush administration "has no intention of taking enforcement actions against the utility for the same kind of Clean Air Act violations in the future." In the 1990s, power companies extended the operation of aging plants to evade stricter reductions required of new plants. The Clean Air Cct requires refurbished plants to meet the same standards as new ones to avoid this situation. Now the Bush administration is using settlements over past violations to allow this dirty practice to continue for ten more years at the same facilities that broke the law in the 1990s. Frank O'Donnell of the advocacy group Clean Air Watch, notes that it is nothing new with this administration. "Seven or eight years ago, the U.S. electric industry was frantically on the run because federal enforcers were going after them at every turn," he said. "Then the Bush administration called off the dogs."
CONTACT
SENATOR Joseph R. Biden (D)
- 221 Russell Senate Office
- 1101Windsor Bldg.,
SENATOR Thomas R. Carper (D) 513 Hart
- J. Allen Frear Bldg., 300 S. New St.,
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congressman Michael N. Castle (R) 1233 Longworth House Off.
- 3 Christina Ctr.,
- J. Allen Frear Bldg., 300 S. New St.,
BACKGROUND on THE REG THAT the BUSH ADM WILL NOT ENFORCE:
"AEP utility in $4.6 bln clean air settlement: EPA
Tue
WASHINGTON (Reuters) - Giant U.S. utility American Electric Power will spend more than $4.6 billion to comply with a landmark settlement to reduce emissions from its coal plants that cause acid rain and haze, the Environmental Protection Agency said on Tuesday.
AEP disputed the figure, which the agency did not detail, and said that it had been spending billions to clean up for years before the deal. Wall Street barely reacted.
The EPA called the agreement the single biggest environmental enforcement settlement in
"This is a landmark, an unprecedented case, in the annals of air pollution regulation in the
It was not immediately clear how the EPA calculated the $4.6 billion compliance estimate, or if it includes billions of dollars that AEP has already spent to reduce emissions.
The previous investment record was when Virginia-based Dominion Resources Inc. agreed in 2003 to spend $1.2 billion on pollution controls in an EPA settlement.
In its deal, AEP agreed to pay $15 million in civil penalties and $60 million in pollution cleanup costs to end the "new source review" case brought by the Justice Department in 1999.
AEP, whose fleet of coal-fired power plants form the backbone of the
AEP spokesman Pat Hemlepp disputed the $4.6 billion figure and pointed out that the number did not appear anywhere in the consent decree filed in a
EPA's Nakayama called the $4.6 billion figure "a solid and conservative number," and said it would probably end up higher because it does not include operating costs.
"It's fair to say that those things were not in the plans in 1999 when this case was first brought," Nakayama said.
"We are doing these projects to comply with existing or upcoming environmental regulations, not because of some sort of requirement in the settlement agreement," Hemlepp countered.
AEP has spent $2.6 billion since 2004 to install pollution-control equipment at coal-fired plants in
SHARES EDGE UP
The company's shares firmed in afternoon trade, rising 0.9 percent to $48.13, off an earlier high at $48.22, on the
"In a way it's expanding substantially their base," said Dahlman Rose analyst Daniele Seitz. That is because utilities can recover equipment and upgrade costs from their customers and earn set profits from state regulators, Seitz said.
Environmental groups applauded the settlement. John Walke, an attorney at the Natural Resources Defense Council, said it "puts big polluters on notice that they can no longer run and hide from their actions or circumvent the Clean Air Act."
It is unclear how the AEP settlement will impact three other companies that face similar lawsuits - Southern Co <SO.N>, and Duke Energy <DUK.N> and Cinergy - which have since merged into a single company.
(Additional reporting by Lisa Lee and Matt Daily in
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