An Indiana jury sided Tuesday with Duke Energy Corp. on four of six claims that proper pollution controls hadn't been installed at several of the company's Midwest power plants.
Both Duke and environmental groups have claimed victory in the case, which dates to 1999, when the Clinton administration launched an aggressive legal campaign against coal-fired utilities under the Clean Air Act's New Source Review (NSR) provisions.
NSR requires power plants to install modern emission controls for major upgrades that result in significant increases in air pollution. The law is aimed at ensuring that utilities do not artificially extend the lives of older, heavily polluting power plants by making significant upgrades to the facilities.
A jury in the U.S. District Court for the Southern District of Indiana found that Cinergy Corp. -- which merged with Duke in 2006 -- did not violate NSR provisions when it replaced tubing at plants in Ohio and Indiana. The jury found that Cinergy did violate the law when it replaced coal pulverizing equipment at two units at its Gallagher Station in Floyd County, Ind.
"We are pleased that after nearly 10 years of litigation, the company's position has been vindicated on the vast majority of the projects about which the government originally complained," said Marc Manly, Duke's chief legal officer. "Our employees performed work that was commonly undertaken in our industry to maintain the capability of our facilities to deliver reliable and affordable power to our customers."
Meanwhile, environmentalists also hailed the decision as a victory for curbing air pollution in the region.
The Gallagher Station has emitted 25,000 additional tons of pollution per year since upgrading the pulverizers, according to the New England-based Clean Air Task Force. Sulfur dioxide contributes to acid rain and can also cause serious health impacts.
"What's really important here is the plant we won on is an old clunker that's right on the border of Kentucky and the city of Louisville and upwind from Cincinnati, Ohio, and those people are going to breathe cleaner air," said Ann Weeks, senior counsel for the advocacy group.
Scott Segal, a utility lobbyist and director of the Electric Reliability Coordinating Council, called the case an important victory for the utility industry because most claims in utility NSR enforcement cases -- more than 80 percent, he said -- have concerned similar tube replacements.
"The Tuesday decision is further proof that case-by-case litigation is a highly inefficient way to seek improvements in environmental performance," Segal said. "With a change in leadership at EPA, now would be a good time for the agency to re-evaluate its enforcement priorities and to work more closely with industry on a cooperative basis rather than being so reliant on inflexible litigation approaches."
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