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Dow to Pay $2.5M Environmental Fine

Monday, August 1, 2011

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Dow Chemical Company has agreed to pay a $2.5 million civil penalty to settle alleged violations of federal air, water and waste regulations at its century-old manufacturing and research complex in Midland, MI.

A 24-count complaint by the Environmental Protection Agency and the Department of Justice accused Dow of violating the Clean Air Act, Clean Water Act and the Resource Conservation and Recovery Act (RCRA) at the facility.

 Dow Chemical Company

 Dow Chemical Company

Dow’s industrial portfolio includes products for marine and protective coatings.

The complaint, filed simultaneously Friday (July 29) with the settlement in the Eastern District of Michigan, accuses Dow of violating Clean Air Act requirements for monitoring and repairing leaking equipment; for compliance with regulations applicable to chemical, pharmaceutical and pesticide plants; and for failing to comply with reporting and recordkeeping requirements.

The complaint also says Dow violated the Clean Water Act’s prohibition against discharging pollutants without a permit and violated RCRA requirements for hazardous waste generators.

VOC, HAPs Reductions Ordered

In addition to paying the penalty, Dow will implement a comprehensive program to reduce emissions of volatile organic compounds (VOCs) and hazardous air pollutants (HAPs) from leaking equipment such as valves and pumps, EPA and DOJ said in a release.

These emissions—known as fugitive emissions, because they leak directly from equipment rather than being discharged from a stack—are generally controlled through work practices, such as monitoring for and repairing leaks.

The settlement requires Dow to implement enhanced work practices, including more frequent leak monitoring, better repair practices, and innovative new work practices designed to prevent leaks, the federal agencies said. The enhanced program also requires Dow to replace valves with new “low emissions” valves or valve packing material, designed to significantly reduce the likelihood of future leaks.

The changes will reduce HAPs by nine tons annually, EPA said.

Background

The case arose from four EPA site inspections between August 2005 and August 2006 and an additional inspection in March 2007.

The result, EPA said, was these infractions.

Clean Air Act. Dow violated the CAA’s National Emissions Standards for Hazardous Air Pollutants (NESHAP) at several of the facility’s process units, EPA said. Almost all of the violations alleged involve failure to comply with various NESHAP provisions related to initial compliance demonstrations, testing, monitoring, leak detection, recordkeeping, and reporting.

RCRA. The most serious RCRA violations resulted from cracks and pits in secondary containment structures for several tanks and pieces of equipment.  Secondary containment structures are ditches, walls and other types of structures intended to hold in accidental spills and releases of hazardous waste from tanks and equipment. 

Clean Water Act. In its CWA permit application, Dow allegedly failed to identify seven additional waste streams that contributed to its unpermitted outfall discharges to the Tittabawassee River. Dow also failed to update its Storm Water Pollution Prevention Plan to identify and evaluate runoff from several secondary containment structures, EPA said. 

‘Protect Communities’

“Communities near large industrial facilities depend on EPA to enforce our nation’s environmental laws and protect public health and the environment,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance.

“Today’s settlement with Dow will reduce the potential for future violations and protect communities from emissions of hazardous air pollutants.”

Assistant Attorney General Ignacia S. Moreno said that Dow’s cooperation during the investigation “set an example for responsible compliance with our nation’s environmental laws” and that the compliance program “should serve as a model for industry….”

The consent decree is subject to a 30-day comment period and final approval by the court.

Company Response

In a statement, Dow said that some of the violations involved differing interpretations on regulations and that “the general nature of many of the noncompliance allegations involved missed inspections, paperwork incompleteness and procedural issues.” Infractions were corrected immediately, the company said.

“We are committed to best-in-class performance of our Environmental, Health and Safety practices and have learned some very valuable lessons from this process,” said Earl Shipp, vice president of Michigan Operations. “We know that every detail of compliance is critical— including the administrative detail.

“While there has been no harm to human health or the environment with regard to these findings, we have taken corrective action and implemented measures to prevent recurrence.”

Dow’s vast Midland facility began operation in 1897. The 1,900-acre site contains 550 buildings and 30 production plants and employs about 3,000 people. Dow manufactures chemicals, plastic materials, and agricultural and other specialized products at the facility.

The current settlement is unrelated to cleanup activities related to extensive dioxin and furan contamination of the Tittabawassee and Saginaw rivers and Saginaw Bay. That contamination stems from past operations at the facility, and EPA and the Michigan Department of Environmental Quality have undertaken separate actions to address it.

Strong Q2

The settlement followed a blockbuster second-quarter earnings report by the chemical company, whose Coatings Materials unit promises formulators “the Coatings Innovations of Tomorrow.”

Dow reported $16 billion in sales for the quarter—the second-highest quarter in its history. Sales excluding the impact of divestitures increased 28 percent year-over-year, with double-digit gains in all operating segments and geographic areas.

Sales in emerging markets reached $4.9 billion—a new quarterly record for the company. Volume growth in these regions was 14 percent, excluding the impact of divestitures. Sales in Asia Pacific reached a new quarterly record of $2.7 billion and grew 23 percent, excluding divestitures.

Andrew N. Liveris, Dow’s chairman and chief executive officer, said the numbers signaled “another quarter of tremendous progress for Dow.”

   

Tagged categories: Dow Chemical Company; Hazardous air pollutants; Health and safety; Marine Coatings; Protective coatings; Regulations; Violations; VOC content; VOC emissions

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