2nd UPDATE: Edison International Unit Sued Over Clean Air Violations
August 27 2009 - 3:59PM
Dow Jones News
As part of a larger crackdown on pollution from coal-fired power
plants, the U.S. Department of Justice and the state of Illinois
sued an Edison International (EIX) unit Thursday for alleged Clean
Air Act violations at six Illinois coal-fired power plants.
Federal and state officials allege that the plants, owned by
Edison unit Midwest Generation, have been illegally emitting
"massive amounts" of pollutants including nitrogen oxides, sulfur
dioxide and soot for years, particularly after they were modified
in the 1990s by their previous owner, Exelon Corp. (EXC) unit
Commonwealth Edison Co., without required pollution-control
equipment.
Regulators are asking the court to order Midwest Generation to
install new pollution-control technologies at the plants. They are
also seeking civil fines for the alleged violations.
A U.S. Justice Department spokesman declined to comment on the
total amount of fines that federal and state regulators are
seeking.
The lawsuit potentially could expose the company to tens of
millions of dollars or more in fines and perhaps hundreds of
millions in pollution-control costs.
Regulators allege that the Clean Air Act violations have
occurred for a decade, and maximum fines for such violations range
from $27,500 to $37,500 per day.
The U.S. EPA notified Midwest Generation in 2007 that the plants
were violating the Clean Air Act.
The Natural Resources Defense Council and other environmental
groups notified Midwest Generation in late July that they planned
to sue the company over Clean Air Act violations cited in
"numerous" EPA notices. The groups cited a study from the Harvard
School of Public Health that found that pollution from nine
Chicago-area coal plants were responsible for 311 premature deaths
a year, as well as 4,100 emergency-room visits and 21,500 asthma
attacks annually.
Midwest Gen spokesman Douglas McFarlan said the company believed
an agreement it reached with Illinois in 2006 over emissions at its
Illinois coal plants was sufficient, and that additional pollution
control was unnecessary.
However, that agreement was narrowly focused on ensuring the
company could comply with the state's mercury-emissions rules and
had nothing to do with federal and state pollution requirements
with which Midwest Generation is required to comply, said Illinois
Attorney General Lisa Madigan.
"Today's lawsuit alleges that for many years Midwest Gen has and
continues to violate both federal Clean Air Act and Illinois
Environmental Protection Act provisions that limit emissions of
particulate, sulfur dioxide and nitrogen oxides - emissions that
aggravate asthma, cause acid rain and increase ozone levels,"
Madigan said in an email.
Midwest Gen is open to exploring a possible settlement, McFarlan
said.
The Justice Department lawsuit is part of a national initiative
to "stop illegal pollution from coal-fired power plants," the
agency said in a statement. In addition to Midwest Gen, the agency
has sued three other coal-fired power-plant operators this year for
Clean Air Act violations: Westar Energy Inc. (WR) and NRG Energy
Inc. (NRG) unit Louisiana Generating LLC.
In 2005 Dynegy Inc. (DYN) settled a lawsuit filed by the EPA,
the state of Illinois and others over Clean Air Act violations at
three Illinois coal plants. The company agreed to spend about $545
million to install pollution control equipment at the plants, as
well as pay a $9 million civil penalty and spend $15 million on
environmental projects.
Edison International, based in Rosemead, Calif., owns California
utility Southern California Edison.
Edison International shares closed down 1.2% at $33.66.
-By Cassandra Sweet and Brent Kendall, Dow Jones Newswires;
415-439-6468; cassandra.sweet@dowjones.com