Plant owners allege a “change in the rules”

The federal Environmental Protection Agency (EPA) filed a complaint against EME Homer City Generation LLP last week, but Wednesday a spokesperson for the company said the legal complaint arose from the EPA changing the rules of the game.

The EPA’s complaint against the coal-burning electricity generating power plant alleges two cases of misconduct.

First, the agency argues modifications were made to the facility’s boiler units without notifying the EPA, and the owners continued to operate the equipment without obtaining the necessary permits. The operators also did not install the “best available pollution control technologies” to reduce sulfur dioxide and particulate matter emissions, as required by the federal Clean Air Act.

Secondly, the EPA alleges the company did not include sufficient information in its application for its Title V permit, which is issued to facilities with a large quantity of emissions. Missing information includes the plant’s “major” modifications, the need for best available control technologies and the appropriate emissions limits for the power plant given the installation of that technology.

Charley Parnell, spokesperson for EME Homer City Generation, said the previous owners of the facilities made modifications to the plant before the current owners took control of operations.

“For years routine maintenance projects – tube leaks just basic stuff – did not require you to install those best available controls technology,” said Mr. Parnell. “Our predecessors who owned the facility went about some of these routine maintenance projects and didn’t think anything of it because the rules had been the rules. Those are the types of projects that are now being accused of violating the…Clean Air Act.”

Before being purchased in 1999, EME Homer City Generation was previously owned by New York State Electric and Gas Corp (NYSEG) and Pennsylvania Electric Co, who are also named in the lawsuit. Violations named in the EPA’s complaint occurred in 1991 and 1994. The facility is now jointly owned by eight limited liability corporations.

Asked why there was a 14-year lapse between the last alleged violation and the EPA’s first notice of violation to the owners in 2008, Bonnie Smith, spokesperson for the EPA said after a 1998 inspection, the Pennsylvania Department of Environmental Protection notified the EPA of the alleged violations before the notices were sent out.

Neither the EPA nor the company spokesperson could or would list the alleged modifications under scrutiny.
As for any monetary penalty being sought by the EPA, Ms. Smith said the agency’s primary goal was compliance, not fines.

“The penalty would be a matter for dispute in litigation,” she said. “But our goal is compliance. We’re seeking for the defendants to put in the best available control technologies, so they will reduce harmful air pollutants.”

The monetary penalty, if pursued, could be a multi-million number. In the complaint, the EPA lists the maximum fine it could seek as: civil penalties of $32,500 per day of each violation for violations occurring between March 14, 2004 and January 12, 2009 and $37,500 per day of each violation for violations occurring after January 12, 2009 with no set end date.

“We’re allowed by the Clean Air Act under the New Source Review provisions to ask for a penalty up to that amount,” said Ms. Smith.

The New Source Review provision, effected during the Clinton Administration, requires when modifications are made at a power plant, the best available technology is installed and the EPA is notified.

Included in the EPA’s complaint is a claim EME Homer City Generation emits approximately 100,000 sulfur dioxide unites annually, “making it one of the largest air pollution sources in the nation.” Mr. Parnell did not dispute the EPA’s figure but also said since the new owners took operational control, the company has significantly reduced the facility’s air pollutant emissions.

“These are coal fire powered plants,” said Mr. Parnell, “and no matter what you install on these facilities you are going to have emissions. What we have done since acquiring the plant in 1999 is invest approximately $300 million to reduce nitrogen oxide and sulfur dioxide.”

While Ms. Smith said the EPA does not currently know of any actual victims who suffered from the down-wind impact of air pollutants, the agency cited several risks of sulfur dioxide including damaged lung tissue and cardiovascular and respiratory disease.

“The information that I have at this point is about the air emissions in a more general way,” she said. “That matter could be a matter for dispute in litigation.”

As to whether the new owners could have limited liability for the modifications made without the EPA’s permission, Mr. Parnell would only say “that’s an issue for the courts.” Defendants typically have 30 days to respond to a plaintiff’s initial complaint. The EPA filed against EME Homer City Generation on Jan. 6.