Duke Energy To Contend $25.1 Million Fine For Soiling Water Resources

Duke Energy Corp. will appeal a record $25.1 million fine imposed by the state of North Carolina for contaminating groundwater near one of its plants; a penalty that the utility describes as “regulatory overreach.”

The North Carolina Department of Environment and Natural Resources (NC DENR) imposed the fine on Duke Energy on March 10 for the poisoning of the water at the utility’s LV Sutton Steam Electric Plant in Wilmington, NC, and plans yet more fines as it looks into possible pollution at other plants.

Duke Energy’s North Carolina president, Paul Newton, issued a statement on March 24 saying it would file a formal appeal with the state’s Office of Administrative Hearings by April 9 in an effort aimed at “demonstrating the specific instances where it believes DENR acted contrary to law, exceeded its authority or jurisdiction and didn’t follow proper rules and procedures.”

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“We take very seriously our responsibility to care for the communities around our facilities,” Newton’s statement said. “That’s why we monitored groundwater at the Sutton plant, routinely shared data with the state, and voluntarily acted to ensure local residents continue to have a high-quality water supply.”

For example, Newton said, in 2013 Duke Energy agreed to spend as much as $1.8 million for a new water line to the Flemington neighborhood near the Sutton power plant after testing showed the presence of contaminated groundwater.

“Our work has been proactive and focused on the well-being of the community,” Newton said. “We took accountability and addressed the issue at Sutton ourselves.”

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Newton conceded that appealing the fine “is a difficult step, but we cannot allow this level of regulatory overreach to go unchallenged.” He added, “The actions by NC DENR send a chilling message to the North Carolina business community.”

The NC DENR issued its own statement saying the penalty levied on Duke Energy was calculated in accordance with state law. It also noted that contamination at the Sutton plant was known long before the fine was imposed, and even before February 2014, when Duke Energy spilled coal ash into the Dan River that focused regulatory attention on that particular pollutant.

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“In addition to holding the utility accountable for past contamination we have found across the state,” NC DENR Secretary Donald van der Vaart said, “we are also moving expeditiously to remove the threat to our waterways and groundwater from coal ash ponds statewide.”

The largest portions of the $25.1 million fine were levied to pay for the cleanup of four potentially toxic elements – boron, thallium, selenium and arsenic. The NC DENR said wells at or beyond a 500-foot radius around Sutton’s ash ponds exceeded state standards continuously for up to five years.

In a separate case, Duke Energy has opted not to resist federal criminal charges arising from ash contamination at six power plants, instead negotiating a $102 million settlement with prosecutors last month. The settlement will go before a federal judge in Greenville, NC, on April 16.

By Andy Tully of Oilprice.com

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