February 28, 2014

Duke Energy could avoid coal ash lawsuit if SC bill passes

South Carolina policymakers are moving ahead with a plan that could shield Duke Energy from having to clean out polluted coal ash ponds in two areas of the state.

South Carolina policymakers are moving ahead with a plan that could shield Duke Energy from having to clean out polluted coal ash ponds in two areas of the state.

This past week, the state House voted 80-30 for a bill that will block lawsuits by citizens groups under the S.C. Pollution Control Act. The bill now moves to the Senate, which signed off on a similar bill two years ago.

“It is amnesty for polluters,” Rep. James Smith, D-Richland said.

While the bill would apply to any company, it’s particularly relevant to Duke Energy, Smith and others said.

Duke is under pressure to clean out coal ash lagoons in both Carolinas so that leaks of toxin-riddled ash are no longer threats from waste ponds. Calls for ash pond cleanups have intensified since a spill occurred last month at a Duke waste lagoon in North Carolina.

One way to require a cleanup is through a citizens lawsuit, a mechanism used to enforce environmental laws when state or federal agencies do not. South Carolina’s other major electric utilities, SCE&G and Santee Cooper, agreed to dig out coal ash ponds after settling citizens’ lawsuits filed by environmental groups.

But no suit has been filed against Duke in South Carolina, even though environmentalists have hinted that they are considering it. The company owns coal waste ponds at power plants in Darlington and Anderson counties.

Changing state law would eliminate the opportunity to sue Duke Energy under South Carolina’s pollution law, Smith said.

The Duke waste pond of most concern is along the Saluda River in Anderson County, where federal consultants have questioned the safety of coal ash dams, The State newspaper has reported. If the dams broke, ash could pollute the river that ultimately flows to Lake Murray and Columbia, according to a 2010 consulting report reviewed by the newspaper. Some groundwater contamination also has been found, records show.

Duke maintains the dams are safe, and state regulators say Duke is following the law, making it difficult for them to force the company to remove coal ash from the ponds at the Lee steam station near Williamston.

Frank Holleman, a Greenville attorney with the Southern Environmental Law Center, disputes that, saying that water pollution has occurred at the site in Anderson County. Holleman said citizen pollution suits were vital in his group’s push for coal ash cleanups at SCE&G and Santee Cooper sites, which environmentalists alleged had polluted the environment.

“That would never have happened if we didn’t have this right to sue,” Holleman said. He said that while his group also filed other lawsuits, the “state suits were where the action was.”

Holleman said the Southern Environmental Law Center, headquartered in Charlottesville, Va., has not decided yet whether to sue Duke in South Carolina.

Under pressure from South Carolina’s influential business lobby, the Legislature agreed in 2012 to limit citizens lawsuits under South Carolina’s pollution statute. But lawmakers left what many say is a gaping loophole in the 2012 law that they are now trying to close with a bill to protect businesses from citizen suits. The 2012 law still allows citizens to sue for pollution that occurred before the law passed in June of that year.

Duke Energy lobbyist Chuck Claunch said this week that his company has no position on the lawsuit bill that passed the House on Wednesday. The bill is being championed by the S.C. Manufacturers Alliance, a group of the state’s most powerful businesses, including Duke. It was sponsored by Rep. Nelson Hardwick, R-Horry.

Lewis Gossett, the alliance’s chief executive, said no one from Duke has spoken to him about the bill. Instead, Gossett said his group wants to close the loophole. He said most citizen lawsuits are filed by environmental groups rather than everyday citizens.

“Most of the environmental agenda I have to confront and deal with is about delay, about stopping progress,” Gossett said. “I represent a lot of folks who spend an enormous amount of their time complying with the regulations and statutes – and they do a lot of good things for the environment.”

Both Gossett and Rep. Jay Lucas, R-Darlington, said people have other ways to sue if they believe pollution is occurring and state regulators aren’t doing their jobs. One way is to file a citizens suit under federal law; another is through nuisance suits, Lucas said.

Holleman said federal citizens suits require a 60-day notice before they are filed; state citizens suits do not. He also said nuisance suits are harder to prove than citizens’ suits.

But Lucas, whose House district includes a Duke Energy coal ash pond, said the state should close off citizen lawsuits to be consistent with the law that it passed in 2012. Lucas, a moderate on environmental issues, said Duke has not spoken with him about the law.

Duke’s troubles in North Carolina have been a national news story. After a coal ash spill on the Dan River, news surfaced that a criminal investigation involving regulators that oversee Duke Energy was underway. Questions have surfaced over the relationship between Duke and N.C. regulators, who took action that Holleman said thwarted pollution lawsuits in the Tarheel State that could have forced cleanups.

The S.C. Legislature’s 2012 attempt to stop citizen pollution suits followed a 2011 state Supreme Court ruling that reinforced people’s rights to file such lawsuits.

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