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E-mails like ghosts that slay

RALEIGH When an administrative hearing hit the wall and stopped last week over revelations contained in e-mails that Alcoa Power Generating Inc. (APGI) surely didn't want to see the light of day, it reminded me: we're been here before.

And those joyful noises soaring over the Capital City were not the hosannas of the yuletide season. They were a lawyerly chorus celebrating juicy tidbits that entirely changed what had been a long, hard slog through the tedium of environmental rules and technical state and federal regulations dull enough to make anyone's eyes glaze over in despair.

The last time was six years ago when some damning e-mails turned up that undercut the U.S. Navy's credibility in trying to create a jet landing field in Eastern North Carolina near the East Coast's most important winter refuge for migratory waterfowl.

Hiding the truth

This time around it was the discovery of e-mails that prompted North Carolina's leading environmental agency to revoke a water quality permit it had issued Alcoa.

Lawyers for Stanly County and several environmental groups discovered that Alcoa had, at best, not told everything it knew or, at worst, shamelessly hidden from state regulators' eyes the fact that certain water quality standards in the Yadkin River were not, after all, in compliance with the company's assurances when it sought the critical state permit.

Without that permit, Alcoa cannot be relicensed by the Federal Energy Regulatory Commission (FERC) to operate hydroelectric plants at four dams along the Yadkin River in the state's central Piedmont. Alcoa got a permit to operate the power plants back in the late 1950s to provide power for its aluminum smelter at Badin. One reason the state of North Carolina supported that application back then was that Alcoa employed a lot of people at very good wages in Stanly County - as many as 1,000 workers in its heyday.

But the aluminum business has changed and so has Alcoa; it shut down most of its operations at Badin but continues to generate electricity that it sells on the market. Gov. Bev Perdue, N.C. Secretary of Commerce Keith Crisco and some key legislators want FERC to reject the license so that North Carolina can eventually operate the hydro dams and use the revenue to benefit the N.C. economy.

The e-mails that resulted in the state's revocation of what's known as a 401 certification involved dissolved oxygen levels on the Yadkin. The state cited the e-mails in its revocation notice, quoting a June 2, 2006, e-mail from Alcoa's Gene Ellis that, "The draft tube does not work" when a unit at the Narrows Dam operates at less than 20MW (megawatts) and notes, "the state does not know that.... If we even begin to suggest to DWQ (the N.C. Division of Water Quality) that the enhancements proposed by APGI for Narrows and High Rock may not allow those tailwaters to meet state standards, DWQ can't issue us a 401."

An e-mail to Ellis from another official in 2008 said he was "certain that NCDWQ would have a problem if they knew" about dissolved oxygen problems and asked, "Will it be enough to 'hide' the fact that aeration valves are not on? Who knows."

These e-mails, wrote DWQ director Colleen Sullins, show that Alcoa "intentionally withheld information material to determining the project's ability to meet the state's water qualify standards" and made it clear that the state's certification was based "on incomplete or inaccurate information." She revoked the permit.

Alcoa has 60 days to appeal or to file a new application. The company believes it did not withhold any material information, but its credibility in this case is badly fractured because of the e-mails.

This is the second major environmental case in recent years where the emergence of old e-mails seriously undermined the credibility of a major institution. They are what someone once wrote of legal advisory opinions: Ghosts that slay.

Fabricating supporting data

In late 2004, the Navy was proceeding with plans for an outlying landing field (OLF) where jet pilots could practice nighttime aircraft carrier landings. The site was in rural Washington County near the Pocosin Lakes National Wildlife Refuge, where large migratory waterfowl such as tundra swans and snow geese posed the threat of collisions to costly aircraft and highly trained pilots. The Navy wanted to change the nature of the area and scare off the waterfowl. It insisted it had made an objective decision based only on the data.

But when environmental groups sued and lawyers began going through thousands of Navy records during the discovery process, they found the same kinds of damning e-mails that stopped the Alcoa hearing. One e-mail indicated the Navy had made a highly political decision and ordered staffers to fabricate reasons to support it.

A staffer wrote an officer that he had a "very uneasy feeling about our criteria and the process" and Cmdr. John Robusto replied, "Very uneasy.... Now we have to reverse engineer the whole process to justify the outcome."

A footnote: The Navy, six years later, is still looking for an OLF site. And Alcoa is considering where, and how, to appeal. Both have a tough job ahead of them.

Jack Betts is an Observer associate editor in Raleigh: jbetts@charlotteobserver.com
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