Duke Energy agrees to pay $20 million for groundwater contamination from coal ash ponds

File Sep 29, 10 58 20 AMRALEIGH – Duke Energy has reached a $20 million settlement with North Carolina’s environmental agency over a fine for groundwater contamination from its coal ash ponds, the agency said Tuesday. The Department of Environmental Quality says that the settlement includes a $7 million fine and requires accelerated cleanup of groundwater contamination at four sites: the Sutton Plant near Wilmington, the Asheville Plant, the H.F. Lee Plant in Goldsboro and the Belews Creek Plant northeast of Winston-Salem.

“This agreement holds Duke Energy accountable for past groundwater contamination and mandates that Duke Energy expeditiously clean up polluted groundwater near its coal ash sites,” DEQ Secretary Donald R. van der Vaart said in a statement. “Our chief goal is to protect the environment and public health while requiring corrective action to restore groundwater quality. This settlement resolves the issue of fines for past violations and allows DEQ to commit all of its resources to overseeing Duke Energy’s clean-up process.”

In March 2015, DEQ hit the utility with a $25.1 million fine against Duke Energy for groundwater contamination from coal ash at its Sutton facility. Duke Energy fought the fine, saying it was unprecedented and “regulatory overreach.”

Environmental groups and McCrory administration officials agree that under past administrations, the state did not require Duke to clean up known contamination from the ponds, which hold the leftover ash from coal that is burned to produce electricity. When DEQ issued the fine for the Sutton facility, the utility pointed out that it had gone beyond anything the state had required.

“We took accountability and addressed the issue at Sutton ourselves,” said Paul Newton, Duke Energy’s state president for North Carolina, referring to a water line Duke helped pay for a small community that lives near the plant’s ash ponds.

But while environmentalists and McCrory appointees agree that past governors did little on the issue, the environmental groups contend that McCrory would not have taken action against the utilities unless they had pressed the issue, which they did within weeks of McCrory taking office. DEQ officials said today that they would rescind a policy developed under Gov. Beverly Perdue’s administration that allowed Duke to take corrective action instead of face fines for contamination.

The controversy over the ponds, which have been around for decades, became acute when a drainage pipe under one of the ponds at Duke’s Dan River plant broke, spilling millions of gallons of contaminated water and ash into the river. In response, the legislature passed a law to clean up the ponds in August 2014; that law goes far beyond the U.S. EPA’s clean-up rules, which were released in late 2014.

DEQ said that the settlement includes $7 million in fines and penalties for past groundwater contamination at all of its 14 coal ash facilities and an estimated $10-$15 million in accelerated remediation costs. The settlement also prevents the state from incurring additional legal fees associated with protracted litigation, the agency said.