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$3B+ Deal to Upgrade 11 Power Plants

Thursday, April 14, 2011

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The Tennessee Valley Authority will pay $3 billion to $5 billion to improve pollution controls at 11 coal-fired plants and retire 18 coal-fired units in three states, under a landmark federal agreement announced Thursday (April 14).
TVA’s settlement with the U.S. Environmental Protection Agency will resolve alleged Clean Air Act violations dating to 1999 at power plants in Alabama, Kentucky and Tennessee.
The 18 units to be retired make up 16 percent of TVA’s total coal-fired power generation -- the largest retirement commitment of any company that has settled with EPA.
In addition to upgrading the 11 plants’ pollution control technology, the agreement requires TVA to invest $350 million in clean energy projects, including reducing pollution in overburdened communities and reducing energy costs for low-income communities by retrofitting low-income housing with cost-effective energy efficiency technologies.
 Johnsonville Fossil Plant

 Photos: TVA

Johnsonville Fossil Plant, on the east bank of the Tennessee River, is the oldest fossil plant in the TVA system. The plant has 10 coal-fired units.

The authority will also provide $1 million to the National Park Service and the National Forest Service to improve, protect, or rehabilitate forest and park lands that have been impacted by emissions from TVA’s plants, including Mammoth Cave National Park and Great Smoky Mountains National Park. 

Finally, TVA will pay a civil penalty of $10 million, with Alabama and Kentucky receiving $500,000 each and Tennessee receiving $1 million.  

Unlawful Modifications Alleged

The case dates to November 1999,  when EPA issued TVA an Administrative Compliance Order alleging that TVA modified a number of coal-fired units at nine plants in violation of Clean Air Act preconstruction obligations. Those obligations included obtaining preconstruction permits and installing and operating state-of-the-art pollution control technology.

TVA appealed the order to the U.S. Court of Appeals for the Eleventh Circuit, which determined that the order was not final agency action.

The new settlement resolves all past preconstruction violations as well as alleged violations of the New Source Performance Standards program and Title V of the CAA.

TVA: 9M Customers

TVA, headquartered in Knoxville, TN, operates 59 coal-fired boilers at the plants to be upgraded. The total coal-fired system capacity is about 17,407 megawatts.

TVA also operates nuclear, natural gas and hydroelectric plants. Through 56 large industrial and government customers and 155 municipal and cooperative power distributors, TVA supplies power to about nine million people across Alabama, Georgia, Kentucky, Mississippi, North Carolina, Tennessee, and Virginia. 
 Shawnee Fossil Plant
Eleven TVA plants, including Shawnee Fossil Plant 10 miles northeast of Paducah, KY, will receive pollution-control upgrades.

TVA is a corporation owned by the U.S. government, created in 1933 by the Tennessee Valley Authority Act. TVA does not receive any public tax dollars.

‘This Will Save Lives’

Once fully implemented in 2018, the pollution controls and other required actions will address 92 percent of TVA’s coal-fired power plant capacity, reducing emissions of nitrogen oxide (NOx) by 69 percent and sulfur dioxide (SO2) by 67 percent from TVA’s 2008 emissions levels, according to EPA.

The settlement will also significantly reduce particulate matter and carbon dioxide (CO2) emissions, the agency says.

In all, the improvements and actions required by the settlement will ultimately prevent 1,200 to 3,000 premature deaths; 2,000 heart attacks; and 21,000 asthma attacks each year, yielding up to $27 billion in annual health benefits, EPA says.  

"This agreement will save lives and prevent billions of dollars in health costs,” said EPA Administrator Lisa P. Jackson.

11 Plants Affected

This settlement covers:

  • Allen Fossil Plant near Memphis, TN;
  • Bull Run Fossil Plant near Oak Ridge, TN;
  • Colbert Fossil Plant in Tuscumbia, AL;
  • Cumberland Fossil Plant in Cumberland City, TN;
  • Gallatin Fossil Plant in Gallatin, TN;
  • John Sevier Fossil Plant near Rogersville, TN;
  • Johnsonville Fossil Plant near Waverly, TN;
  • Kingston Fossil Plant near Kingston, TN;
  • Paradise Fossil Plant in Drakesboro, KY; 
  • Shawnee Fossil Plant near Paducah, KY; and
  • Widows Creek Fossil Plant near Stevenson, AL.

The settlement was developed by the states of Alabama, Kentucky, Tennessee and North Carolina, as well as the National Parks Conservation Association, the Sierra Club, and Our Children’s Earth Foundation. Those parties will be signatories to a companion consent decree to be lodged in federal district court in the Eastern District of Tennessee. 

EPA is accepting public comments on this agreement for 30 days following publication of the agreement in the Federal Register.


Tagged categories: Air pollution control; EPA; Health and safety; Power Plants

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