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Judge says Duke Energy must stop groundwater contamination at coal plants

A Wake Superior Court judge has ruled the state must require Duke Energy(NYSE:DUK) to take immediate action to stop sources of groundwater contamination at its ash ponds at 14 operating and retired coal plants.

“The ruling leaves no doubt, Duke Energy is past due on its obligation to eliminate the sources of groundwater contamination, its unlined coal ash pits, and the state has both the authority and a duty to require action now,” says D.J. Gerken, a senior attorney at the Southern Environmental Law Center who represented several conservation groups in the case. “This ruling enforces a common-sense requirement in existing law – before you can clean up contaminated groundwater, you first must stop the source of the contamination.”

Contaminants found in test wells around the ash ponds showed elevated levels of arsenic, thallium, boron, sulfate, nickel, iron, chromium, manganese and selenium.

Duke said it is “considering this ruling as we take another look at our management of coal ash basins.”

The N.C. Department of Environment and Natural Resources  is in charge of enforcement at the ponds. Sensitive to criticism that it has been lax in regulating the ponds under the administration of Gov.Pat McCrory, who worked at Duke, the department noted the ruling “addresses a decision made in 2012 by the Environmental Management Commission based on interpretations made under the Perdue administration.”

It goes on to say, “DENR is carefully reviewing the court’s decision.”

Unrelated to spill

The case involves all 31 of Duke’s ash ponds across the state. It would include the ash ponds at the Dan River Steam Station, where a break in a stormwater pipe under one pond spewed up to 39,000 tons of coal ash into the river.

The ruling is not related to the spill, which occurred Feb. 2. But it served to call additional attention to problems at Duke’s ash ponds and how DENR has handled those problems.

Judge Paul Ridgeway overturned a 2012 ruling by the Environmental Management Commission. Environmental groups had asked the EMC for a clarification of state law. The groups felt state law required DENR to order immediate corrective action when well tests at the coal ash cites showed contaminants were leaking into groundwater.

And the groups believed the law required DENR to make Duke eliminate the sources of the leaks so no additional contamination would occur.

EMC ruling

DENR disagreed with that interpretation. The agency had required additional testing by Duke to get more information about the leaks. The EMC ruled in favor of DENR, and the environmental groups appealed to the state courts.

Ridgeway issued an order Thursday that dismissed the claim for corrective action, saying the requirement was superseded by later regulations. But he upheld the groups on stopping additional contamination.

“As to the question … on whether operators of coal ash lagoons … must take immediate action to eliminate sources of contamination that cause a concentration of a substance in excess of groundwater quality standards… the court finds and concludes that the EMC erred as a matter of law,” Ridgeway writes. “The declaratory ruling of the EMC is reversed” on that issue.

Next steps

Gerken notes Ridgeway also has before him four lawsuits filed by DENR, at the instigation of environmental groups, seeking to force Duke to clean up groundwater contamination at the 14 sites. “In this case, he has told us what the law is,” Gerken says. “In those cases, we are asking him to enforce this law.”

In two of those cases, involving the Riverbend Steam Station and the Asheville Plant, DENR raised the ire of environmental groups this summer when it proposed a settlement with Duke. The settlement called for additional testing at the sites and proposed what the groups considered an insufficient fine of $99,112.

After the spill on the Dan River, DENR asked Ridgeway to hold off any ruling on the settlement. It later said it would have final recommendations prepared for Ridgeway in all the groundwater cases by March 21.

John Downey covers the energy industry and public companies for the Charlotte Business Journal.

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