Courts' role losing steam

Courts' role losing steam

Bush administration using other tactics to battle air pollution

BY DAVE FLESSNER
BUSINESS EDITOR

In the final days of the presidential campaign, the battle over how to clean up some of America's dirtiest coal-fired power plants is generating plenty of political fire and smoke.

Last week. an environmental advocacy group charged the Bush administration is failing to enforce clean air standards adequately, especially against the Tennessee Valley Authority. The Environmental Integrity Project said the number of civil lawsuits filed by the U.S. Environmental Protection Agency against utilities and oil companies has dropped by 75 percent under President Bush.

A major challenge to the way TVA maintains its aging fleet of coal plants appears to have stalled for four years after it was launched by the Clinton administration. As a result, critics claim the nation's biggest government utility is skirting stricter standards for new power plants and is being held to a lesser environmental standard than are private energy companies.

"The Department of Justice and EPA have gotten shy about taking polluters to court lately," said Eric Schaeffer, the former head of EPA's office of regulatory enforcement who quit his job in protest three years ago. "The case against TVA was one of the strongest on the facts. It's just too bad it's not moving forward."

Regulators in the Bush administration dismiss such criticism, noting that more cleanup actions and commitments are being made than ewr. In the past fiscal year, a record $203 million in civil penalties were paid for environmental violations.

With the exception of the TVA case, all of the cases against old coal plants filed in the final months of the Clinton adminis-

tration are moving ahead, according to Blaim Rethmeier, a Department of Justice spokesman.

"Enforcement has actually increased," he said. "We think we've achieved excellent results."

LEGAL BATTLES

TVA Director Bill Baxter said environmental progress "can hardly be measured by how often you go to court." Mr. Baxter said TVA is in the midst of a $5.6 billion cleanup of its coal plants that will reduce many pollutants by more than 75 percent by 2010.

"The air my four kids are breathing today is cleaner than what I breathed growing up in the Tennessee Valley, and it is continuing to get better," he said. "This administration has achieved significant improvement in air quality without spending years and years and millions of dollars on lawyers in adversarial proceedings."

Scott Segal, director of the industry-backed Electric Reliability Coordinating Council, said litigation often delays power plant efficiency gains that can limit pollution.

"Gratuitous bean-counting of the number of cases filed has always been a poor indicator of actual environmental performance," he said.

But environmental activists insist that EPA enforcement actions and civil lawsuits are critical to ensure that utilities and industry comply with the law. Mr. Schaeffer, who now heads the Environmental Integrity Project in Washington, D.C., said EPA staffers have referred at least 14 more cases against utilities to their bosses for legal action. But he said White House pressure is limiting enforcement actions.

In the final three years of the Clinton administration, the Justice Department filed 152 lawsuits against companies on behalf of EPA. In the first three years of the Bush administration, 36 such enforcement actions were initiated.

EPA's own inspector general warned in an Oct. 1 report that political interference at the agency has "seriously hampered EPA settlement activities, existing enforcement cases and the development of future cases."

Dr. Stephen Smith, a former Democratic congressional candidate who monitors TVA's environmental efforts for the Southern Alliance for Clean Energy in Knoxville, agrees.

"Unfortunately, I don't think the Bush administration is really serious about enforcing these clean air rules," he said. "The air may be getting cleaner, but it's still not clean enough. We still have far too many cases of asthma, lung disease and other health problems among humans and too much deterioration of our environment, especially here in the Smoky Mountains."

NEW SOURCE REVIEW

Much of the dispute over environmental enforcement concerns the way the 1977 Clean Air Act is implemented. The law requires older plants to install expensive new pollution controls when they undergo major modifications or improvements.

The Bush administration has issued new rules making it easier for plants to avoid having to meet those requirements for maintenance and modification projects. But EPA Administrator Mike Leavitt has said his agency is not backing off of enforcing the so-called NEW SOURCE REVIEW cases initiated during the final three months of the Clinton administration.

TVA was among nine utilities EPA cited from November 1999 to January 2000 for going beyond routine maintenance at their oldest and dirtiest coal plants. Older plants are grandfathered under less demanding standards than are new power plants.

TVA built most of its 59 coal-fired units in the 1940s through the early 1970s and has extended the life of the units by routinely replacing plant components as they wear out.

Former EPA Administrator Carol Browner charged that at seven of its plants TVA also installed new equipment and made major modifications that require the plants to meet stricter standards for new generation.

TVA objected to the EPA finding, however. John Shipp, vice president of environmental policy at TVA, said the action against TVA was contrary to the way New Source Review standards had been interpreted for the previous 30 years. If the order was enforced, Mr. Shipp said TVA would have trouble knowing what maintenance it could perform on many of its coal units, threatening to shut down as much as 25 percent of its coal generating capacity.

"This was never about cleaning up the air for us," Mr. Shipp said. "It was about having a workable system to ensure the reliability of our power system."

Mr. Baxter said interpreting the acceptable maintenance rules under the New Source Review standards is often "a lawyer's dream" because of their complexity and confusion.

The case against TVA for alleged New Source Review violations ultimately was rejected in May by the U.S. Supreme Court on procedural grounds. The high court upheld an appellate court ruling that said the procedure used by EPA against its sister federal agency wasn't proper.

The Department of Justice could file the same case in U.S. District Court against TVA, but so far no such lawsuit has been filed. Federal officials said they still are reviewing their options.

But the Department of Justice is continuing to pursue most of the other New Source Review cases. The government settled its dispute with Tampa Electric Co. in 2000 after the utility agreed to make further pollution reductions. The government also has reached settlements with six other utilities, including Virginia Electric Power Co., which paid a $5.3 million penalty and agreed to more than $1 billion in cleanup equipment, Mr. Rethmeier said.

To date, the Department of Justice said it has spent more than 200,000 attorney hours and $15 million in litigation support pursuing its New Source Review cases. At two trials so far, 43 witnesses and 6,500 exhibits have been presented.

Most of the New Source Review cases still are preparing to go to trial, and settlement talks are occurring in several, Mr. Rethmeier said.

The National Parks Conservation Association has sued TVA to try to force the federal utility to bring some of its coal plants up to new plant standards. But that case still is pending.

"It's very difficult for citizen groups to fight major utilities like TVA," Mr. Schaeffer said. "That's why it is so vital for the government to proceed with these cases and make sure the law is enforced."

TVA estimated it could cost more than $3 billion to clean up its oldest plants if EPA was successful in its initial complaint. But Mr. Schaeffer said such utility estimates usually are overstated and the damage caused by continuing to burn dirty coal in older plants "is far greater" than the cleanup costs, according to EPA studies.