In a settlement with the federal government, Kentucky Utilities has agreed to spend $57 million to install a sulfuric acid mist emission control system, replace a coal-fired boiler, and pay a civil penalty of $300,000 to resolve alleged Clean Air Act violations at its 2-GW coal-fired Ghent Station.

The Environmental Protection Agency and Department of Justice on Wednesday revealed terms of the settlement, which will require the Lexington, Ky.–based utility to “adhere to more stringent and permanent emission limits and install a sulfuric acid mist pollution control system that will reduce sulfuric acid mist emissions by more than two-thirds (3.7 million lbs/year).”  Kentucky Utilities will spend about $57 million dollars in injunctive relief to install the system and make other changes at the Ghent County facility.

As part of the settlement, the company has also agreed to spend $500,000 for an environmental mitigation project that will include the replacement of a coal-fired boiler with a geothermal heating and cooling system at an elementary school in the Kentucky Utilities service area.

Kentucky Utilities continues to deny the allegations, according to the consent decree. The company is currently evaluating whether it will seek permission from the state Public Service Commission to pass along the cost of the upgrades to ratepayers.

The company and its affiliate Louisville Gas and Electric are reportedly performing a number of environmental upgrades to put the 1973-commissioned Ghent Station in Ghent, Ky., into compliance with federal environmental rules.

The consent decree was lodged with the U.S. District Court for the Eastern District of Kentucky on Dec. 20, 2012, and will be subject to a 30-day public comment period.

Sources: POWERnews, EPA, KU