Duke Energy was hoping the N.C. Department of Environmental Quality would propose low-risk rankings for cleanup at many of the company’s 33 unlined coal-ash basins across North Carolina. Instead the state proposed intermediate classifications for every site where state law didn’t mandate a high-risk classification.

Company officials are not pleased with this result, which will force the company to excavate the coal ash at each site, Chief Executive Officer Lynn Good told a teleconference Wednesday afternoon following the DEQ announcement around midday.

Among the sites affected are basins at the James E. Rogers Energy Complex, formerly known as Cliffside Stream Station, which straddles the line between Rutherford and Cleveland counties a short distance from the South Carolina border. Duke had already begun excavation of several retired basins there, but favored a low classification for the active portion.

DEQ had suggested a “low to intermediate” classification for those in a draft proposal earlier this year. Duke and environmental groups objected to though for opposite reasons. Groups like Clean Water for North Carolina and the Southern Environmental Law Center were vocal in back high rankings at the site, which is located near the Broad River, a major source of drinking water for communities in Upstate South Carolina.

One point of contention at that site and elsewhere has been whether contaminants from the unlined storage basins are getting into the groundwater and showing up in wells on surrounding properties.

Duke spokespeople say the company’s scientific analysis has shown its facilities are having no impact on its neighbors. However, Good said Wednesday that she sympathized with neighbors who would like greater certainty their water is safe. She said the company may consider working with water utilities to extend lines into some of the adjacent neighborhoods.

Even so, Good also doubled down on the company’s assertion that it isn’t tainting groundwater. That claim has been widely disputed by environmental organizations who say Duke’s scientific analysis is flawed and used data selectively to ensure findings favorable to the company.

“Faced with overwhelming public pressure and clear proof of contamination and other hazards, Gov. (Pat) McCrory and DEQ finally acknowledged today what citizens have known for years — that all failing coal-ash pits pose a significant risk for communities in North Carolina,” senior SELC attorney D.J. Gerken said in a statement released Wednesday.

“Duke Energy’s leaking, unlined coal-ash pits pollute and pose a significant threat to clean water and communities nearby and downstream across North Carolina. DEQ had nearly three years to assess the problems with coal ash and come up with a plan to clean up these … sites.”

Katie Hicks, associate director for Asheville-based Clean Water for North Carolina, issued a statement expressing special concern about the result for the Cliffside community. Residents there participated at a public hearing in Spindale in March, at which many described fear for the safety of their water supply.

“Today’s announcement ranking the three coal-ash basins at Cliffside ‘intermediate’ comes with no guarantee that the communities living near these sites will be protected, since DEQ also announced today they’ll be asking the General Assembly to change the Coal Ash Management Act, so that they can revisit these classifications later,” Hicks said.

“Communities in Rutherford and Cleveland counties should be proud of the enormous pressure they put on state officials, which forced DEQ to acknowledge today that no site is without risk and that residents nearby deserve safe, permanent sources of water — but how can we be confident that DEQ will keep the requirements for excavation if both the agency and already actively — and vocally — seeking ways to get out of fulfilling these commitments?”

What categories mean

For sites with high categories, under the Coal Ash Management Act of 2014, Duke faces a rapid deadline to excavate coal ash. This category went only to eight basins at four sites that were predesignated as high risk under the statute, including the Asheville location. Prior to the beginning of its removal, which has been ongoing for several years, coal ash in Asheville was stored in an unlined basins dating to 1964 and 1982 that overlook Interstate 26 and the French Broad River, making any collapse of those basins a potentially catastrophic event.

The other statutory high-risk sites are the 1971 and 1984 ash ponds at the L.V. Sutton Energy Complex near Wilmington, the primary and secondary ash basins at Riverbend Steam Station in northeastern Gaston County and the primary and secondary ash basins at the Dan River Combined Cycle Station in Rockingham County near Eden and the Virginia line.

Removal of coal ash at high-risk sites must be completed by 2019.

At every site where DEQ didn’t have its hands tied by the law, the agency proposed intermediate risk classification, which will force Duke to excavate the ash and store it in lined facilities by 2024.

Low-risk sites, none of which were proposed, faced a 2029 deadline and would have allowed Duke to follow other options, such as removing water and capping the basins. Duke has argued that this is typically more cost-effective and has about the same affect on area groundwater, but has also complained that no one solution fits all of the sites. If DEQ’s proposals this week stand, all sites will have to be excavated, with none being handled through other means, such as capping or recycling.

Legal complications

After a 60-day period, DEQ said the proposals will take effect. However, the legality of that claim remains untested — the original CAMA statute set up a Coal Ash Management Commission to approve DEQ’s proposals and that board ceased to exist after Supreme Court action found it to be unconstitutional.

The constitutional issues had to do with the General Assembly not giving the governor not enough authority over the appointment of a commission that would have exercised the type of powers normally reserved for the executive branch of state government. McCrory’s case received bipartisan support from former governors who expressed concern about protecting the separation of powers in the state Constitution.

Even so, the result may have broad implications for enforcement and oversight of coal-ash policy. McCrory, a former Duke Energy lawyer, has been criticized at times for policies that were too generous to the company, though some of these were consistent with the policies of his predecessors. Legislators expressed an interest in having an authority independent of the governor overseeing cleanup efforts.

Rep. Chuck McGrady, R-Henderson, has recently discussed legislation to reconstitute the commission in a way that would avoid the legal pitfalls of the original provision.

But even if that happens, the implications for DEQ’s proposals in the short-term remain in legally unexplored territory, which could provide cover for groups that want to take legal action to get a result more to their liking.

Prior to Wednesday’s announcement, spokespeople in both camps had told CPP that they anticipated taking legal action if DEQ didn’t do as they wanted. The option for intermediate classifications across the board appears to beg that question, though most parties Wednesday said they were still digesting the result.

Carolina Public Press talked Wednesday with Frank Holleman of the Southern Environmental Law Center who noted that the SELC has ongoing litigation against Duke under other state laws, It’s uncertain whether the organization will pursue additional action over the DEQ proposals. Holleman indicated that even though different laws were in question, a SELC victory in the existing case would likely obtain the result desired for coal ash cleanup without necessarily having to litigate over the CAMA designations.

He said more contaminants leak into the soil and groundwater with every day that goes by, which is why the high-risk classification, with the accelerated cleanup deadline, was preferable.

Duke was also noncommittal on litigation for now, while expressing strong disagreement with DEQ’s review of the evidence — the type of disagreements that could lay the groundwork for a legal dispute.

“The science and engineering demonstrate that basins should be ranked low,” Duke spokesperson Danielle Peoples told CPP. “Our focus right now is continuing our work to complete projects and submit additional information to DEQ.”

Asked about whether the lack of a coal-ash management commission was a possible legal avenue for Duke to contest the unfavorable results, Peoples said only that Duke would “meet the requirements of the law.”

Duke did take exception to the SELC’s characterization of its ongoing legal actions against the company.

“SELC has its own agenda and it has nothing to do with what is best for North Carolina,” Peoples said. “The group wants to take credit for North Carolina adopting the most expensive, most disruptive and unnecessary closure option. Every day that goes by allows for more thoughtful policy and common-sense approach to this issue.”

The state has not given Duke permission to pass on cleanup costs to customers, but Duke has indicated that it will likely seek such permission because creation of the ash basins was part of the normal process of generating power.

Change the law?

DEQ’s announcement also called for the General Assembly to revise CAMA to provide for later review and greater flexibility, including a review of the current proposals after 18 months.

Holleman criticized this request as evidence of DEQ failing to hold Duke Energy accountable for its polluting actions. His colleague, Gerken, pointed to a suspected political strategy of bait and switch in DEQ’s suggestion of changing the law.

“Asking permission to change its story in 18 months allows Gov. McCrory’s administration to say one thing to get through the election this fall, all subject to revision after the election,” Gerken said.

“The General Assembly required the administration to calculate coal-ash risks as they exist today. It’s past time for the Governor and DEQ to stop stalling for Duke Energy and to require real action now. It’s past time for Duke Energy to clean up its leaking, unlined coal-ash sites that threaten North Carolina’s communities, rivers and drinking-water sources.”

Duke Energy officials agree with DEQ on the need for additional flexibility to change proposed designations as the situations evolve at the various sites. But they believe the agency already can do that on its own and DEQ is mistaken in seeking any changes to the law.

But the company recognizes that varying interpretations of the law exist on this point. “We are asking for legislators to clarify this,” Peoples told CPP.

DEQ’s proposal to change the law may also not be sitting well with residents who have been hoping for clarity on what happens next.

Cliffside-area resident Roger Hollis commented on the situation in a statement released by Clean Water for North Carolina.

“The 18 months that DEQ is asking for, to review the current classifications is just a way for them to stall so that Duke Energy can repair the dams and allow time for the upcoming election to be over,” Hollis said.

“Until we have trucks excavating our coal ash and waterlines run to homes with contaminated private wells, we at Cliffside are not convinced by the new but possibly temporary classifications.”

More coverage

Carolina Public Press has been following developments in the state’s coal-ash policies for some time. Following are links to other recent articles from CPP:

Advocates blast regulators on proposed coal-ash classifications (Jan. 5, 2016)

Speakers object to prioritizing sites coal-ash cleanup (March 2, 2016)

State reverses, says contaminated wells OK (March 9, 2016)

Residents: Cliffiside coal ash not ‘low risk’ (March 15, 2016)

Is coal ash to blame for illness? (April 4, 2016)

Duke Energy’s claims about coal ash challenged (April 21, 2016)

Bill would gag health officials about contaminated wells (May 4, 2016)

Rep. McGrady wants more oversight for coal ash (May 11, 2016)

Expect DEQ to face lawsuits over coal ash (May 16, 2016)

Editor’s note: A shorter version of this article appeared on Wednesday, May 18. The version here has been expanded to include additional material.

