The Case Against Duke Energy

In the 1990s, the Environmental Protection Agency found that many plants "grandfathered" from Clean Air Act requirements, including eight Duke Energy facilities, were violating the Clean Air Act by making major investments to restore and extend the lives of old power plants without installing the required pollution control equipment and thereby enabling the emissions of hundreds of tons of pollution.

In December 2000, the EPA filed suit against Duke Energy for 29 illegal modifications made between 1988 and 2000 at eight of its coal-fired plants, including the Belews Creek, Buck, Cliffside, Dan River, CG Allen, Marshall and Riverbend plants in North Carolina and the W.S. Lee plant in South Carolina. SELC, on behalf of the Environmental Defense Fund, Sierra Club and NC Public Interest Research Group, joined the EPA in its lawsuit to force Duke to follow the law and to close the loophole of grandfathered power plants. The EPA filed similar cases against utilities in the South and Midwest.

Under the New Source Review program, if a power plant is modified and pollution increases as a result of that modification, the plant must install the best available pollution control equipment. The key issue in the Duke Energy case was how to measure pollution increases to determine if modifications resulted in an increase in pollution, triggering New Source Review and requiring stricter pollution controls.

Measurement of Emissions

Under New Source Review, a utility must install modern pollution controls whenever modifications are made that result in an increase in emissions. Since most equipment replacements and upgrades are designed to improve a plant's efficiency, allowing it to operate longer hours, these modifications can result in an increase in total annual pollution. EPA and SELC contend that actual annual pollution increases are the trigger for determining whether the facility is required to install modern pollution controls.

Industry argues for emissions to be measured on an hourly basis. Such a measurement allows plants to make modifications that result in a substantial increase in annual pollution while avoiding installing pollution controls, as long as the hourly rate of emissions doesn't increase.

Unfortunately, human health is not measured by the hour and the effects of power plant pollution do not disappear after sixty minutes. The true test of a project’s impact on air quality is its actual annual emissions, expressed in tons per year. Unfortunately, on June 15, 2005, the Fourth Circuit Court of Appeals rejected that test, failing to protect the health of millions of Southerners in the meantime.

Over the opposition of EPA, SELC sought and won Supreme Court review in 2006. Ultimately, the justices overturned the appellate court's 2005 test for measuring emission when overhauled coal-fired power plants become "new" sources that must get air pollution controls or shut down. Upon rejecting that statutory reading and finding that an annual test is required, the case now goes back to the Fourth Circuit to apply for the annual emissions test.