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American Municipal Power Clean Air Act Settlement

(WASHINGTON, DC - May 18, 2010) American Municipal Power (AMP), an Ohio non-profit utility, will permanently retire its Richard H. Gorsuch Station coal-fired power plant near Marietta under a settlement to resolve violations of the Clean Air Act, the U.S. Environmental Protection Agency (EPA) and the U.S. Justice Department announced today. As part of the settlement, AMP will also spend $15 million on an environmental mitigation project and pay a civil penalty of $850,000.

Overview of Company

American Municipal Power (AMP) is a corporation headquartered in Columbus, Ohio. AMP is a nonprofit organization which provides wholesale electric power to municipal electric systems. AMP is made up of 129 member municipal communities in six states. The utility serves more than 570,000 customers in the midwest region of the country.

This settlement covers the Richard H. Gorsuch (Gorsuch) coal-fired electric generating station, located in Marietta, Ohio. The Gorsuch station consists of four 53-megawatt units, originally constructed in the 1950's.

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In March 2009, the United States issued an Notice of Violation to AMP and Elkem Metals alleging that modifications were made at the Gorsuch Station without first complying with pre-construction obligations, including obtaining pre-construction permits and installing and operating state-of-the-art pollution control technology, in violation of:

  • The Clean Air Act (CAA) Prevention of Significant Deterioration/Nonattainment New Source Review provisions, 42 U.S.C. §§ 7470-7492, §§7501-7515
  • The CAA's New Source Performance Standards, 40 CFR 60.40b
  • Title V of the CAA

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Injunctive Relief

The consent decree secures injunctive relief from the Gorsuch Station. The settlement will reduce nitrogen oxides (NOx) and sulfur dioxide (SO2) emissions by over 34,000 tons per year from 2008 levels. The settlement will include:

  • Retirement of the Gorsuch Station by no later than December 31, 2012
  • Interim declining annual emission caps for sulfur dioxide and nitrogen oxides until the station is retired
  • Electrostatic precipitator (ESP) optimization to obtain maximum particulate matter emission reductions
  • Annually retire any excess SO2 and NOx emission allowances resulting from actions taken pursuant to the consent decree.

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Pollutant Reductions

As a result of the retirement of the Gorsuch Station, AMP will reduce the following pollutants from the plant's 2008 emission levels:

  • SO2 emissions by approximately 30,600 tons per year (tpy)
  • NOx emissions by approximately 3,160 tpy
  • Particulate matter (PM) emissions by approximately 630 tpy

Interim caps are expected to reduce:

  • SO2 emissions by:
    • 4,600 tons in 2010
    • 9,600 tpy by 2012
  • NOx emissions by:
    • 560 tons in 2010
    • 1,060 tpy by 2012

The retirement of the Gorsuch Station will also provide a co-benefit of reducing CO2 emissions from the station by over 1.7 million tons annually.

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Health and Environmental Effects

The pollutants reduced under this settlement are known to have numerous adverse, significant environmental and health effects. Sulfur dioxide and nitrogen oxides can be converted to fine particulate matter once in the air. Fine particulates can be breathed in and lodged deep in the lungs, causing a variety of health impacts, including premature death. Other health and environmental impacts from the pollutants addressed in this settlement include the following:

  • Sulfur Dioxide - High concentrations of sulfur dioxide affect breathing and may aggravate existing respiratory and cardiovascular disease. Sensitive populations include asthmatics, individuals with bronchitis or emphysema, children and the elderly. Sulfur dioxide is also a primary contributor to acid deposition, or acid rain.
  • Particulate Matter - Particulate matter, especially fine particles, contains microscopic solids or liquid droplets that are so small that they can get deep into the lungs and cause serious health problems. Particulate matter is linked to a variety of problems, including increased respiratory symptoms such as irritation of the airways, coughing, or difficulty breathing, decreased lung function, aggravated asthma, and premature death in people with heart or lung disease.
  • Nitrogen Oxides - Nitrogen oxides can cause or contribute to a variety of health problems and adverse environmental impacts, such as ground-level ozone, acid rain, global warming, water quality deterioration, and visual impairment. Affected populations include children and people with lung diseases such as asthma. Exposure to these conditions can cause damage to lung tissue for people who work or exercise outside.

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Environmental Mitigation Projects

This settlement also requires AMP to spend $15 million on environmental mitigation projects to address the impacts of past emissions. The $15 million will be spent on a large-scale energy efficiency project that will:

  • Provide energy efficiency services to all of the member municipalities that are part of the Gorsuch Station for four years
  • Include energy efficiency services that will provide financial incentives and marketing and outreach for several areas including, lighting, refrigerator replacement/removal, and installation of efficient building systems
  • Act as seed money for a larger project that will include all of AMP's member municipalities, including those beyond Gorsuch
  • Include mechanisms to ensure that a minimum number of megawatts/hours saved will be achieved from the project

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Civil Penalty

American Municipal Power will pay $850,000 in civil penalties.

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Comment Period

The proposed settlement, lodged in the U.S. District Court for the Southern District of Ohio, is subject to a 30-day public comment period and final court approval. Information on submitting comment is available at the Department of Justice website.

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The Power Plant Enforcement Effort

The United States has filed lawsuits against several other utilities for alleged violations of the CAA. This series of cases seeks to bring the power plant industry into full compliance with the New Source Review and Prevention of Significant Deterioration requirements of the Clean Air Act. This settlement with AMP represents the nineteenth judicial settlement under the power plants enforcement effort.
The United States has reached similar settlements with the following utilities:

  • Westar Energy
  • Duke Energy
  • Kentucky Utilities Company
  • Salt River Project Agricultural Improvement and Power District
  • American Electric Power
  • East Kentucky Power Cooperative
  • Nevada Power Company
  • Alabama Power
  • Minnkota Power Cooperative and Square Butte Power Cooperative
  • First Energy (Ohio Edison Company, W.H. Sammis Power Station)
  • Illinois Power Company and Dynegy Midwest Generation
  • Southern Carolina Public Service Authority (Santee Cooper)
  • Southern Indiana Gas and Electric Company Culley Station
  • Wisconsin Electric Power Company
  • Virginia Electric Power Company
  • Alcoa, Inc. (Rockdale, TX facility)
  • PSEG Fossil, and Tampa Electric Company

The total combined sulfur dioxide and nitrogen oxides emission reductions secured from these settlements will be about 2 million tons each year once all the required pollution controls have been installed and implemented. More information about these settlements is available at the Coal-Fired Power Plant Enforcement Initiative website.

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