HOME
Posted on Mon, Apr. 16, 2007
By KAREN DILLON
The Kansas City Star
Utilities and EPA Dispute Semantics
Power plants call it maintenance. But others call it an upgrade, which could lead to emission. controls
When is an upgrade an upgrade?
That question is at the heart of three Kansas City area disputes and one of the biggest environmental issues facing the country today: pollution from coal-fired power plants.
Since 1977, federal law requires utilities to report upgrades they plan at power plants. And if the upgrades increase emissions, the utility must obtain a permit from the government. This sets off an extensive review process, and the utility may be forced to install anti-pollution controls.
But few plants have done this.
The Environmental Protection Agency and environmentalists say they know why. Utilities have been getting around the pollution requirement by simply denying that any of their power plant work has been an upgrade, they say.
"They basically hid it all from EPA," said Bruce Nilles, an attorney for the Sierra Club who has sued utilities for allegedly failing to comply with the federal laws.
The utility industry denies hiding anything. Almost all power plant upgrades have been routine maintenance that don't increase emissions, don't need to be reported and don't require costly new anti-pollution equipment, the industry says.
"The industry's view is, we are fixing them up and returning them to the way they were," said Jeffrey Holmstead, a former top EPA air official whose work now includes advising utilities in legal cases.
Three local utilities show the way the dispute has played out:
-Last month, leaked documents showed that since 1980 at least 15 upgrades at power plants operated by the Board of Public Utilities of Kansas City, Kan., should have been reported to the EPA under the law. The EPA says it is investigating.
-Westar's Jeffrey Energy Center in St. Mary's, Kan., is under investigation by the EPA, which alleges that major modifications were done to the plant between 1992 and 1999 without installing modern pollution control equipment.
In federal filings in March, Westar said it was discussing a settlement with EPA.
-Kansas City Power & Light has been embroiled with the Sierra Club over whether it upgraded its boilers at the Iatan 1 plant in the 1990s. A report commissioned by the Sierra Club showed KCP&L had increased its emissions, but the utility said none of the work was major or had an effect on pollution.
Last month, KCP&L and environmental groups reached a groundbreaking agreement - the utility would install anti-pollution controls at three plants.
Greenish skies
By 1970, a green haze of pollution enveloped many major metropolitan skylines, including Kansas City.
That year, Congress passed the Clean Air Act.
Studies were showing that pollutants from the plants harmed lung and respiratory health. In addition, by the mid-1970s some researchers already were predicting the effects that millions of tons of carbon dioxide thrown out by plants each year would have on global temperatures.
The 1970 law did not include power plants that had already been built. In 1977, Congress addressed that gap. But Congress did not require utilities to immediately spend millions of dollars to install the pollution controls. Instead, it told utilities only to install the pollution equipment when the plants needed an upgrade that increased emissions.
But there was a problem.
Although state agencies inspect the plants annually, regulators say it is difficult to determine if work done on a plant is merely routine or a true upgrade requiring pollution equipment. And state regulatory agencies lack the manpower to do in-depth inspections, officials said.
"It is not an easy thing to detect," said Kyra Moore, permits chief of the Missouri Department of Natural Resources. "But if there is anything unusual, we would do a review of it."
Even then, determining what is an upgrade can be difficult, officials said.
EPA identifies upgrades, in part, as projects that are large in scope, require the expertise of outside contractors and increase the value of a plant.
"The problem is the power plants are extremely complex industries," said Rick Bolfing, a permitting engineer with the Kansas Department of Health and Environment. It's difficult to determine, he said, "what is an oil change and what is an engine rebuild."
The Kansas City Star found records dating back to 1975 showing that most of the large power plants in both states have never installed state-of-the-art pollution controls that would have been required with upgrades.
That in itself shows that plants are ducking the upgrade requirement, Nilles said. "It is completely inconceivable that the utilities have operated a major power plant for years that has never undertaken major modifications," he said.
But Holmstead said most projects are routine maintenance and utilities don't want to submit to a government examination, which can be costly and take up to two years.
"They have a pretty strong incentive to avoid the process," said Holmstead, who is now in Washington with the law firm Bracewell and Giuliani.
EPA probes
During the mid to late 1990s, the EPA says it found that the power industry had systematically avoided installing the pollution control equipment.
EPA agents found documentation when they went through accounting books that numerous utilities had done upgrades.
"We had plenty of evidence," said Eric Schaeffer, who was head of EPA's office of regulatory enforcement until 2002. "This problem just got neglected."
Except for those years in the 1990s, enforcement actions by the EPA have moved slowly.
Although President Bush promised in his campaign to reduce power plant emissions, enforcement slowed after his administration was swayed by industry lobbyists, said Schaeffer, who now heads the Environmental Integrity Project, a group of former EPA attorneys.
Others say, however, that the Bush administration simply chose different tactics to clean the air, primarily by issuing a cap on pollution by power plants.
"It is much more effective not to go after people one at a time and try to win lawsuits and try to get settlements, but to actually just deal with 1,000 power plants all at once," Holmstead said.
In addition, EPA officials said, enforcement isn't easy.
For example, almost five years ago, EPA Region 7 in Kansas City, Kan., began investigations of Westar, Associated Electric Cooperative Inc., and two utilities in Iowa and Nebraska.
"Those investigations are ongoing," said Kim Olson, an EPA spokeswoman. She said utility investigations take time because they are complex and thousands of documents must be reviewed.
But a change may be coming.
In one development in recent weeks, the U.S. Supreme Court ruled unanimously that Duke Energy Corp. may have violated clean-air laws when it modernized coal-burning power plants without new pollution equipment. The case could cost Duke hundreds of millions of dollars.
The case was sent back to district court, where Duke has vowed to continue fighting the decision.
In addition, three local cases show different ways that utilities are dealing with the upgrade question:
-Westar: EPA cited Westar in 2004 for upgrading its Jeffrey Energy Center plant - which an environmental group lists as one of the country's dirtiest- without adding pollution controls. The utility maintains it did nothing wrong.
"Absolutely not," said Bill Eastman, Westar's director of environmental services.
But the company's recent Securities and Exchange Commission filings relay concerns about the EPA's investigation.
"We expect that any settlement with the EPA could require us to update or install emissions controls at our other coal-fired plants, pay fines or penalties, or take other remedial action," the report said.
In the meantime, Westar has announced it is planning to build a 500-megawatt wind farm and has put construction of a new power plant on hold.
-BPU: After the EPA cited Westar in 2004, BPU sought a legal analysis of projects it had done at its plants since 1980.
The municipal utility spent $112,000 on the report, which found that at least 15 projects may have been upgrades that violated federal law. The confidential document, which The Star disclosed last month, listed 58 other projects that may or may not have been major enough to report.
For almost three years, BPU never reported its findings to the EPA or state regulators, even though state and federal laws required it to.
Mark Conklin, BPU's human resources director and an attorney, said the utility was waiting for the EPA to begin an investigation before turning over its documents.
The EPA is investigating and has requested documents regarding the projects.
-KCP&L: The utility had a turnabout this year.
The Sierra Club had maintained that the utility did upgrades at Iatan 1 in the 1990s, and documents collected by the group were subpoenaed by a federal grand jury. KCP&L denied any such upgrades, but the environmental group used the dispute to fight the utility's plans to build a second plant.
Although the EPA continues to investigate, KCP&L reached a settlement with the Sierra Club. Environmental groups dropped their legal protest over the new plant, and the utility will add 400 megawatts to the existing 100-megawatt wind farm and reduce its emissions at its plants at Iatan and La Cygne to some of the lowest levels in the country.
back to our home page