North Carolina imposes record fine on Duke for Sutton plant coal ash pollution

The North Carolina Department of Environment and Natural Resources on March 10 issued Duke Energy Progress the state’s largest-ever penalty for alleged environmental damages, fining the utility $25.1 million for groundwater contamination from coal ash at the Sutton Plant near Wilmington, N.C.

DENR fined the utility $25,116,883.61 based on the extent of impacts to groundwater, the characteristics of the constituents causing the impacts and the duration of the violations. The calculation for the fine incorporated the state’s investigative costs and a formula taken from state groundwater laws that allows fines to be assessed by multiplying the number of days an individual contaminant leached into groundwater by a civil penalty for each violation, the department said. State groundwater violations at other Duke Energy facilities could result in additional fines against the utility, it added.

“Today’s enforcement action continues the aggressive approach this administration has taken on coal ash,” said DENR Secretary Donald R. van der Vaart. “In addition to holding the utility accountable for past contamination we have found across the state, we are also moving expeditiously to remove the threat to our waterways and groundwater from coal ash ponds statewide.”

At Sutton, the state agency determined that Duke Energy allowed a host of coal ash contaminants to leach into the groundwater for several years, in at least a few cases. To determine the civil penalty, state officials used data from water samples of monitoring wells at the facility’s compliance boundaries and multiplied the number of days each individual contaminant leached into groundwater.

In the case of the thallium, for instance, state officials determined that Duke allowed the pollutant to leach into groundwater at the Sutton facility for 1,668 days. State officials multiplied 1,668 by a civil penalty of $5,000 per day. The result was a fine of $8,340,000 for thallium alone. Pollutants that are considered a greater public health risk, including thallium, selenium, arsenic and boron, carried heavier penalties than other pollutants, state officials said.

The March 10 fine was issued by a “Findings and Decisions and Assessment of Civil Penalties” to Duke Energy Progress from Jay Zimmerman, director of the N.C. Division of Water Resources. Under state law, Duke Energy has 30 days to respond to the fine and may choose to appeal it to the N.C. Office of Administrative Hearings.

The Sutton Plant began operation as a coal-fired estation in 1954. The three coal units were retired in 2013 as a new natural gas-fired unit came online at the site.

In August 2014, DENR sent Duke Energy Progress a notice of violation and intent to enforce for Sutton, calling it “the legally required first step toward issuing the utility a fine for violations of the state’s groundwater contamination laws.” That action followed the filing in 2013 of lawsuits that focused on stopping the violations at Duke Energy’s coal ash ponds.

The March 10 action marks the second time in recent months that DENR has reversed decisions made under previous administrations to protect the environment in the Wilmington area. In November 2014, DENR reclassified Sutton Lake as a public resource instead of an industrial cooling pond. The lake, which receives coal ash wastewater discharges from the Sutton plant ash ponds, is now considered to be “waters of the state,” a classification that means the lake will be protected by more stringent water quality standards. As a result of the reclassification, the state agency gave Duke Energy 60 days’ notice that its wastewater discharge permit would be reopened. The reclassification may mean additional treatment conditions are placed in the discharge permit or other environmental permits will be required in the future to ensure the health of the lake.

In addition to the penalties for violating state groundwater standards, penalties for violations of the utility’s federal Clean Water Act permit will be addressed through an enforcement agreement DENR has established with the U.S. Environmental Protection Agency.

In September 2014, North Carolina’s Coal Ash Management Act became law, putting the state on a path to closing all the utility’s coal ash ponds. Then in December 2014 the EPA published federal regulations on coal ash that, although largely weaker than North Carolina’s Coal Ash Management Act, reinforce the responsibility of impoundment owners.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.