The U.S. Department of Justice (DOJ) and the Environmental Protection Agency (EPA) announced on Monday that Dominion Energy has agreed to pay a $3.4 million civil penalty and spend approximately $9.8 million on environmental mitigation projects to resolve Clean Air Act (CAA) violations.

The EPA said the settlement will result in reductions of nitrogen oxides (NOx), sulfur dioxide  (SO2), and particulate matter by more than 70,000 tons per year, across three of the utility’s coal-fired power plants, located in Kincaid, Ill.; State Line, Ind.; and Somerset, Mass. The settlement was lodged April 1 in the U.S. District Court for the Central District of Illinois, and is subject to a 30-day public comment period and final court approval.

Under the settlement, Dominion must install or upgrade pollution control technology on two plants—the Kincaid plant in Illinois and Brayton Point in Massachusetts—and permanently retire a third, in State Line, Ind. Dominion will be required to continuously operate the new and existing pollution controls and will be required to comply with stringent emission rates and annual tonnage limitations. The actions taken by Dominion to comply with this settlement will result in annual reductions at the Brayton Point and Kincaid plants of SO2 and NOx emissions by 52,000 tons from 2010 levels. The retirement of the State Line plant will result in an additional reduction of 18,000 tons of SO2 and NOx.

The settlement also requires Dominion to spend $9.75 million on projects that will benefit the environment and human health in communities located near the Dominion facilities. A total of $9 million will be spent on such projects as:

  • Wood stove changeouts, including $2 million for changeouts in southeastern Massachusetts, Rhode Island, and eastern Connecticut.
  • Switcher locomotive idle reduction for Chicago rail yards.
  • Land acquisition and restoration adjacent to, or near, the Indiana Dunes National Lakeshore.
  • Energy efficiency and geothermal/solar projects for local schools and food banks.
  • Clean diesel engine retrofits for municipalities and school districts.

Dominion must also pay a total of $750,000 to the U.S. Forest Service and the National Park Service, to be used on projects to address the damage done from Dominion’s alleged excess emissions.

Dominion announced on March 11 that it has signed a purchase and sale agreement for both the Kincaid and Brayton Point plants with a subsidiary of funds controlled by Energy Capital Partners, a private equity firm with offices in Short Hills, N.J., and San Diego, Calif. Both sales are expected to close in the second quarter of 2013. Kincaid consists of two 579-MW coal-fired generating units. Brayton Point has three coal-fired units—the 243-MW Unit 1, 240-MW Unit 2, and 612-MW Unit 3—plus the 435-MW Unit 4, which uses natural gas or oil, and three diesel-generators with a combined output of 7.6 MW.

The AP quoted a Dominion spokesman as saying the company denies the pollution allegations. He said the new owner will assume any upgrades that aren’t completed.

Sources: EPA, Dominion, AP

Gail Reitenbach, PhD, Managing Editor (@POWERmagazine, @GailReit)

This story was first published April 2.