Hoosier Energy Will Spend Up to $300 Million for Cleaner Air

BLOOMINGTON, Indiana, July 26, 2010 (ENS) – Under a legal settlement with the federal government filed Friday, Hoosier Energy Rural Electric Cooperative Inc., an Indiana electric generation and transmission cooperative, has agreed to install state-of-the-art pollution control technology at its two coal-fired power plants.

Filed in federal court, the settlement requires Hoosier to reduce air pollution from the cooperative’s Merom and Ratts Stations, located in southwest Indiana.

Hoosier estimates that it will spend between $250 and $300 million upgrading and installing pollution controls at the two coal-fired units through the end of 2015.

As a result, emissions of sulfur dioxide, SO2, will be reduced by almost 20,000 tons and nitrogen oxides, NOx, by more than 1,800 tons per year. The settlement will also reduce harmful sulfuric acid mist and particulate matter emissions.

To achieve these reductions, Hoosier will upgrade existing, and install new, pollution controls at the Merom and Ratts plants, and comply with annual tonnage limitations across its system.

Hoosier’s Merom Generating Station in Sullivan County, Indiana (Photo Hoosier Energy REC)

Hoosier must also pay a civil penalty of $950,000 and spend $5 million on environmental mitigation projects, the Justice Department and Environmental Protection Agency announced Friday.

“Hoosier Energy remains committed to environmental compliance and stewardship, reliable service, and keeping costs and rates as low as possible,” said Chief Executive Officer Steve Smith. “The settlement agreement is in the best interests of our members and their consumers in southern Indiana and Illinois. It removes litigation risk and uncertainty, enables us to focus on power supply operations and reliability, and minimizes cost and rate impacts to consumers.”

The state of Indiana joined in the settlement and will receive $100,000 of the $950,000 civil penalty.

“The large reductions in harmful air pollutants including sulfuric acid mist emissions secured by this settlement will have a significant beneficial impact on air quality in Indiana and downwind states,” said Ignacia Moreno, assistant attorney general for the Justice Department’s Environment and Natural Resources Division.

Sulfur dioxide, and nitrogen oxides, two key pollutants emitted from power plants, have numerous negative effects on human health and the environment. These pollutants are converted in the air to fine particles of particulate matter that can cause severe respiratory and cardiovascular impacts, and premature death.

The two pollutants are also contributors to acid rain, smog and haze. In addition, air pollution from power plants can drift far downwind, affecting communities across a wide area.

Hoosier will spend $5 million on environmental mitigation projects in its service territory to address the impacts of past emissions.

Hoosier must direct $200,000 for projects to mitigate the harm caused by Hoosier’s excess emissions at lands owned by the U.S. Forest Service.

The remaining $4.8 million will be spent on one or more of the following projects:

  • Coal Bed Methane: Hoosier will capture and combust methane from coal beds to generate at least 10 megawatts of electricity. Carbon dioxide emissions resulting from the combustion of methane will be supplied to a greenhouse for use as a fertilizer.
  • Wood Appliance Changeout and Retrofits: Hoosier will sponsor a wood-burning appliance changeout and retrofit project. Hoosier will provide incentives through rebates, discounts, and in some instances, actual replacement of old, inefficient, high polluting wood-burning technology.
  • Clean Diesel Retrofits: Hoosier will retrofit in-service, public diesel engines with emission control equipment designed to reduce air pollutants.
  • Solar Technologies: Hoosier will install solar power systems on public schools or non-profit groups in the company’s service territory.

The settlement marks the federal government’s 20th settlement under its national enforcement initiative to reduce emissions from coal-fired power plants under the Clean Air Act’s New Source Review requirements.

“This settlement continues our important enforcement initiative to reduce harmful air pollution from coal-fired power plants and provide the public with cleaner, healthier air to breathe,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance.

“Pollution from these sources can cause severe respiratory and cardiovascular impacts, and are significant contributors to acid rain, smog and haze. Coal-fired power plants of all sizes are large sources of air emissions, and EPA is committed to making sure that they all comply with the law.”

As part of the 1977 Clean Air Act Amendments, New Source Review is a preconstruction permitting program that requires existing sources of emissions to receive a permit when facilities are modified resulting in increased emissions.

What constitutes a modification has been a source of conflict among EPA, utilities, industrial groups and environmental interest organizations.

Copyright Environment News Service (ENS) 2010. All rights reserved.

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