US update

Published by MAC on 2007-09-21

US update

21st September 2007

The US Forest Service and Bureau of Land Management (BLM) has often been accused of lax oversight of mining companies. Now, it's claimed, these government agencies wilfully concealed for decades serious selenium * contamination from phosphate mining in southern Idaho.

New York's Attorney General has subpoened five major energy companies to disclose to shareholders their greenhouse gas emissions deriving from use of coal. Among the five is the world's biggest private coal miner, Peabody Energy.

Most people are aware that coal-fired power plants are a prime source of carbon emissions, but it's often forgotten that this source of energy also exerts a heavy toll in mercury, sulphur dioxide (S02) and nitrogen oxide (NOx) emissions. What differentiates these three point sources from C02 is their impact on communities living near, or working at, the plants - and those further afield.

Yet, despite a record fine imposed last week on one utility for S02 and NOx emissions between 2000 and 2005, which totalled nearly 20,000 tons, the company will still be allowed to emit 400 tons N0x a year. It can also purchase "allowances" (offsets) from cleaner utilities, thus enabling it to continue damaging trees and lakes and impairing the health of thousands of people.

[* Editorial note: Selenium is essential to cellular growth, but in large quantities can be highly toxic.]

Environmentalist say feds colluded with phosphate companies to cover up pollution

By Kristen Moulton, The Salt Lake Tribune

21st September 2007

A regional environmental group accused the Forest Service and Bureau of Land Management on Thursday of colluding with phosphate-mining companies in southern Idaho to cover up decades of serious pollution.

The result, said Marv Hoyt, the Idaho director of the Greater Yellowstone Coalition, is that mining continues to leach selenium into streams and the aquifer - while 17 Superfund sites from past mining go untouched.

Lynn Ballard, spokesman for the Caribou-Targhee National Forest and BLM, denied there was any collusion with the mining industry to cover up the pollution. "We've never operated that way," he said.

Mining for phosphate exposes rocks rich in selenium, which, once exposed to rain and snow, flows into streams and underground aquifers. It can build up in plants, reaching high concentrations that can kill livestock and wildlife and harm the people who eat them. The Greater Yellowstone Coalition and Caribou Clean Water Partnership released a report written by a retired federal hydrologist, who pored over thousands of documents obtained from federal agencies through the Freedom of Information Act.

Edgar Imhoff, the hydrologist, during a press conference via telephone Thursday, said he was astounded by the toxic levels of selenium found as long as two decades ago in streams near phosphate mines north and east of Soda Springs. "Given the dangers, the mining company and federal agencies had to be aware they had a serious problem on their hands," Imhoff said, referring to the owner of one of three active phosphate mines, Boise-based The J.R. Simplot Co.

Hoyt said the documents showed the federal agencies didn't just fumble their jobs. "This was something a lot more deliberate that just dropping the ball," he said. The documents did not reveal secret deals, but rather a pattern of downplaying or obscuring the gravity of the pollution, Imhoff said.

He gave examples. Imhoff said in his report that data collected by the Forest Service's Intermountain Research Station in Logan in 1990 - it showed extremely high concentrations of selenium in surface water downstream from a mine - was not shared with the Environmental Protection Agency until 1997.

It was only after animals began dying that mining companies and federal agencies began acknowledging the pollution, casting it as a newly discovered problem, Hoyt said. "People actually did know about this long before they say they did."

The Forest Service's Ballard said 1996 horse deaths prompted the Forest Service to "focus resources on a full investigation [of] what was causing the selenium impacts."

The agency also has required and received yearly water reports from Simplot, which opened the Smoky Canyon mine in the early 1980s.

He could not say whether the Forest Service considered selenium levels reported in those yearly documents as acceptable.

A Simplot spokesman could not be reached for comment.

The new report is aimed at preventing Simplot from expanding the Smoky Canyon mine near the Idaho-Wyoming state line. A final environmental impact statement is due out within 30 to 45 days and is expected to endorse mining under certain conditions. "There are mitigations placed in there that Simplot would have to do," Ballard said.

The environmental coalition also wants to light a fire under government agencies to force the owners of the 17 Superfund sites - including Simplot, whose Smoky Canyon mine has been declared a Superfund site - to clean up past messes.

Phosphate, used in fertilizer and animal feed, has been mined in southern Idaho's Caribou County for a century. Three of 28 mines remain active. The open-pit mines produce $5 million in mineral royalties each year. Half goes to the federal treasury, 40 percent to Idaho schools and 10 percent to Caribou County. When phosphate is mined, selenium in rock is exposed and left behind in waste dumps, where it leaches into streams and groundwater. High concentrations of selenium have been recorded for years, but when six horses had to be euthanized in 1996 after eating selenium-contaminated forage, researchers began paying closer attention. Two more horses died the next year, and since then, more than 550 sheep have died from selenium contamination.

Wildlife researchers blame selenium for mass salamander die-offs, deformed coot and Canada goose embryos and the deaths of animals such as beaver, cranes and pelicans. Fish are gone from two streams. Caribou County is home to the Grays Lake National Wildlife Refuge. Idaho health officials began warning in 2002 against children eating fish from one stream. Last year, health officials cautioned against eating the liver of elk killed near phosphate mines. Seventeen of the 28 mines have now been declared federal Superfund sites.

New York Subpoenas Five Energy Companies for Climate Risks

ALBANY, New York, (ENS)

17th September 2007

New York Attorney General Andrew Cuomo Friday sent subpoenas to five of the nation's largest energy companies, demanding that they disclose the financial risks of their greenhouse gas emissions to shareholders, specifically to the New York State Common Retirement Fund.

Attorney General Cuomo sent letters to the top executives of AES Corporation, Dominion Resources, Xcel Energy, Dynegy, and Peabody Energy seeking information about the companies' analyses of these risks and the disclosure of such risks to their shareholders as required by law.

In the case of Houston-based Dynegy, Cuomo wrote to Chairman and CEO Bruce Williamson, "We are aware that Dynegy, Inc. has announced plans to build eight new conventional coal-fired power plants across the United States.

The resulting massive increase in CO2 emissions from the operation of eight new conventional coal-fired power plants will subject Dynegy to increased financial, regulatory and litigation risks. We are concerned that Dynegy has not adequately disclosed these risks to its shareholders, including the New York State Common Retirement Fund, which is a signficant holder of Dynegy stock."

"As a result of the operation of its eight new conventional coal-fired power plants," Cuomo wrote, "Dynegy will become one of the top five emitters of CO2 in the country." He says Dynegy's emissions would increase by 200 percent, and over the 60 year life of these power plants, "might well emit 3.7 billion tons of CO2 total."

In the case of Peabody Energy, the world's largest private-sector coal company, Cuomo is seeking disclosure of the risks associated with building power plants that will generate a total of 3,100 megawatts of power, and may subject the company to increased financial, regulatory and litigation risks.

In the case of Dominion Resources, Cuomo requested information about the risks associated with the company's plans to build a 585 megawatt coal-fired power plant "without current plans to capture and sequester the resulting carbon dioxide emissions."

In the case of Xcel, Cuomo requested information about the risks of a planned 750 megawatt coal-fired power plant with no carbon capture and sequestration plans in place.

And in the case of AES, Cuomo simply said the company is "one of the nation's largest producers of greenhouse gas pollutants, including carbon dioxide." He pointed out that the company's 2006 Form 10-K, required by the Securities and Exchange Commission did not disclose projected emissions, nor evaluate the impact of upcoming greenhouse gas regulations on the company's financial picture.

In all the letters, the attorney general wrote, "Climate change is one of the most pressing environmental challenges facing the world today." He reminded the executives that emissions from U.S. power plants "constitute 30% of total U.S. carbon emissions" and that regulation of greenhouse gas emissions on the state level through the Regional Greenhouse Gas Initiative, to which New York is a Party, will begin shortly.

"Any one of the several new or likely regulatory initiatives for CO2 emissions from power plants - including state carbon controls, E.P.A.'s regulations under the Clean Air Act, or the enactment of federal global warming legislation - would add a significant cost to carbon-intensive coal generation,” the letters said.

They stated, "Selective disclosure of favorable information or omission of unfavorable information concerning climate change is misleading.”

Peabody Energy shot back that the letter's claims of nondisclosure were inaccurate and were written to "advance a political agenda."

"Peabody is happy to point out our clear disclosures regarding climate change and correct the letter's inaccuracies. For instance, the letter states that we don't have climate disclosure ... but in fact we do, in multiple places in our SEC filings on Form 10-K, annual report and social responsibility report. These are all available via Internet for anyone wanting to research the company."

"In addition to advancing clean new coal generation, Peabody is a founding member of the zero-emissions FutureGen project to commercialize carbon capture and storage," the company said.

U.S. Imposes Highest Acid Rain Fine in Its History

LEXINGTON, Kentucky, (ENS)

20th September 2007

The East Kentucky Power Cooperative, a coal-fired electric utility, today agreed to pay an $11.4 million penalty to resolve violations of the Clean Air Act's acid rain program, the Department of Justice and the U.S. Environmental Protection Agency announced.

As part of today's settlement, the U.S. is seeking court-approval for the highest fine ever under the Clean Air Act's acid rain program. The Commonwealth of Kentucky joined in the settlement.

Coal-fired plants release sulfur dioxides and nitrogen oxides, which are a primary cause of acid rain that harms trees and lakes, and impairs visibility.

Nitrogen oxides and sulfur dioxides cause severe respiratory problems, contribute to childhood asthma, and contribute to smog and haze. Emissions from power plants can drift long distances downwind degrading air quality as they go.

Under the terms of the settlement, the company must take steps to reduce 400 tons of harmful emissions each year and offset another 20,000 tons of emissions released from its Clark County, Kentucky facility without a permit.

"East Kentucky Power Cooperative has agreed to install pollution control equipment as well as monitor and reduce emissions harmful to our health and the environment," said Ronald Tenpas, acting assistant attorney general for the Justice Department's Environment and Natural Resources Division. "This is an important agreement that has true benefits to the people of Kentucky."

The government estimates that the utility's Dale Generating Station emitted over 15,000 tons of sulfur dioxide and 4,000 tons of nitrogen oxide without a permit during the period from 2000 through 2005. In addition, the government alleged the utility exceeded the federal annual emission rate for nitrogen oxides.

The utility must now also apply for an acid rain permit, continuously monitor sulfur dioxide and nitrogen oxides, and install and operate nitrogen oxide controls.

These pollution controls will reduce annual nitrogen oxide emissions by approximately 400 tons per year.

Coal-fired power plants are allowed to emit sulfur dioxide and nitrogen oxides in the form of allowances, which are granted under federal or state acid rain permits based on a national annual emissions cap.

If a utility emits less, it can sell unused allowances to other utilities, or save them for use later. If it emits more, it must purchase allowances from other utilities and surrender those allowances to EPA.

In this case, East Kentucky is required to purchase and retire allowances representing 20,000 tons of emissions, which represents the company's emissions during the period of noncompliance.

Today's agreement allows the company to pay the $11.4 million penalty over six years.

Last July, East Kentucky agreed to install pollution controls estimated to cost $650 million and to pay a $750,000 penalty to resolve violations of the new source review provisions of the Clean Air Act at the Dale facility and two other plants.

Today's proposed agreement, lodged in the U.S. District Court for the Eastern District of Kentucky in Lexington, is subject to a 30-day public comment period and final court approval. A copy of the consent decree is available on the Department of Justice website at:

http://www.usdoj.gov/enrd/Consent_Decrees.html.

MAC: Mines and Communities

Themes

US update