With its creation last week of a $10 million fund for Carolinas waterways, Duke Energy followed the pattern set by other utilities in atoning for high-profile coal ash spills.
Duke’s splash into the Dan River was the nation’s third large ash spill in less than a decade. Like the Tennessee Valley Authority and Pennsylvania’s PPL, Duke repeated apologies, made community gifts and pledged to close its ash basins.
Why, as evidence grew that ash ponds are problematic, did it seem to take public embarrassment to prod the largest U.S. utility to act?
Duke says the spill only accelerated pond closings that began years ago, as it retired coal-burning power plants and shifted to natural gas. Half of Duke’s Carolinas coal fleet has shut down in the past five years.
The company’s approach “gets us out of the business of having to store ash in wet ponds and move to not only all-dry handling systems but all-dry storage systems,” said John Elnitsky, Duke’s ash strategy chief. “It’s really a question of what is the right way to get there and what do those closure solutions look like.”
Industry critics say ash ponds, in which particles sluiced out of power plants settle to the bottom, were the cheapest options for utilities willing to bear their risks. Closing them without excavating ash near waterways, which a new North Carolina law may allow, doesn’t end those risks, advocates say.
“Wet disposal of coal ash is a recipe for disaster” because of its tendency to soak into groundwater or leach from dikes, said Jennifer Duggan, managing attorney at the Environmental Integrity Project.
The group’s review of groundwater data at 30 power plants found contamination above federal drinking water standards at 82 percent of test wells over the past four years. Contamination has been detected around ash ponds at all 14 of Duke’s coal plants in North Carolina.
The Environmental Protection Agency has identified proven or potential environmental damage from ash at 133 sites, including nine in North Carolina, and is evaluating 73 more sites.
“The evidence of damage is growing every day,” Duggan said. “I think it’s becoming much harder for industries to ignore, especially since there are affordable and viable alternatives.”
Federal rules coming out in the next year may force utilities to store ash in the dry form that is widely seen as safer for the environment.
Signs before the spill
Well before the Feb. 2 Dan River spill, Duke’s ash was stirring a broth of environmental and legal challenges.
In a concession last year, Duke agreed to pay for a new water line to a Wilmington community in the path of contamination flowing its way.
North Carolina’s environmental agency, reacting to the threat of citizen lawsuits, filed actions last year that cite tainted groundwater and contaminated seepage from all 14 of Duke’s North Carolina coal plants.
And while South Carolina’s two major utilities settled citizen lawsuits by agreeing to excavate ash near rivers, Duke has fought two similar suits for more than a year.
State-owned Santee Cooper is closing ponds at three plants in a $250 million initiative that will recycle most of the ash. S.C. Electric & Gas, which settled a lawsuit in 2012, is also closing its ponds and will recycle or landfill the ash.
Frank Holleman, the Southern Environmental Law Center attorney who sued all three utilities, said Duke took a “much more bureaucratic, delay-prone, indecisive approach” than the smaller South Carolina utilities.
“The utilities are different from other corporations in that they are large, bureaucratic monopolies,” Holleman said. “Inside their jurisdictions, they act almost as self-contained governmental entities. It’s very hard for an institution like that to change.”
Duke’s ash-related troubles escalated after the Dan River spill. A federal grand jury began a criminal probe. Legislators made ash a focus. Hefty state and federal fines are likely.
Stubborn or deliberate?
Duke’s ash policies are typical across the power industry, said Lisa Evans, an attorney for the national law firm Earthjustice.
Evans, who has probed ash issues for years, said she is hard-pressed to think of a utility that took substantial action before being sued or experiencing a spill.
“Knowing what I know about the potential for great harm to public health and the environment, why wouldn’t their attorneys have prompted them to do the right thing and get away from that problem?” Evans said. “I see this again and again.”
Duke maintains it’s not stubborn, just deliberate in making changes.
The company began capturing fly ash, the fine particles that go up a smokestack, in the 1950s. Ash, mixed with water, was stored in ponds. Then clean air standards began pushing old coal plants into retirement.
“Those ponds were a very cost-effective and efficient way to filter the water systems that were being used to get the fly ash that otherwise would have been in the air,” Elnitsky said. “As technology advanced and we were able to retire those coal plants, then we got to the point where it was reasonable to close those ash basins.”
Most of Duke’s fly ash is now handled in dry form. Coarse bottom ash is still stored wet in ponds at most power plants.
Legislation passed in August gives Duke until 2029 to close all 33 of its North Carolina ponds. It orders that ash be removed at four power plants but allows low-risk ponds at other plants to be capped without excavations.
Duke, which earned $2.7 billion in 2013, has estimated the cost of removing all ash at up to $10 billion. Duke has indicated it will ask for state approval to pass pond-closure costs to customers.
Jim Roewer, executive director of the Utility Solid Waste Activities Group, an industry organization, said utilities need time to find alternatives to ash ponds. The ponds typically handle other forms of waste such as stormwater.
“The conversion from wet to dry ash isn’t something that can happen overnight,” Roewer said. “If all the stars align, you might get it done in seven to 10 years, but more likely you’re looking at 10 years or longer.”
Forcing the industry’s hand?
Upcoming federal ash rules could force the industry’s hand.
In December, the EPA will decide whether ash should be regulated like hazardous waste. That outcome would drive up disposal costs – by $110 billion over 20 years, industry groups say – and phase out ash ponds.
Rules to be issued in September on wastewater discharges from power plants could further limit the use of ponds. Power plants are responsible for more than half of the 1.8 billion pounds of toxic metals that coal-burning industries discharge each year.
Some utilities aren’t waiting for the EPA.
Midwestern utility giant American Electric Power, which generates 61 percent of its power from coal, began closing its ash ponds several years ago. All but one of the power plants that will continue to operate past 2016 handle fly ash in dry form.
The reason was practical, said spokeswoman Melissa McHenry. “It’s more about getting on it sooner rather than waiting until everybody is trying to get the same contractors,” she said.
Glimpse of the future
Through June, Duke had spent $20 million on its cleanup of the Dan River. Working under EPA oversight, contractors vacuumed up about 3,000 tons of ash and sediment – leaving up to 36,000 tons in the river.
The Tennessee Valley Authority recovered all but 500,000 of the 5.4 million cubic yards it spilled into the Emory River, in eastern Tennessee, in 2008. The spill focused federal attention on ash hazards.
The TVA added $43 million in community grants to its $1.2 billion in cleanup costs. It’s now midway through a $2 billion phaseout of its ash ponds.
“It was something that was already being discussed, but the Kingston event was certainly something that accelerated that decision,” said spokesman Jim Hopson.
But TVA’s ash story may not be over. The Environmental Integrity Project reports groundwater contamination at all 11 of the TVA’s coal-fired power plants.
In Pennsylvania, PPL’s Martins Creek power plant lost 100 million gallons of ash slurry in 2005. The utility vacuumed up the ash and placed it in a basin that also began leaking, said Tracy Carluccio, deputy director of the Delaware Riverkeeper Network.
“It was, frankly, out of stupidity and a bad decision by PPL and the state to allow it to happen,” Carluccio said. “It makes them look like Keystone Kops.”
PPL spent $28 million on the cleanup of the Delaware River and paid a $1.5 million fine. The utility now handles ash in dry form and recycles most of it.
“Fundamentally, it changed the way we designed the basins but also prompted us to get out of the use of disposal basins,” said company spokesman George Lewis. “It made us look at things in a new way.”
Nearly a decade after ash smothered the bottom of 9 miles of the longest undammed river on the East Coast, Carluccio said, local fishermen say the fish are finally coming back.