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Utility Firm Settles Major Pollution Lawsuit

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Utility Firm Settles Major Pollution Lawsuit

Law

Utility Firm Settles Major Pollution Lawsuit

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ALEX CHADWICK, host:

From the studios of NPR West, this is DAY TO DAY. I'm Alex Chadwick.

MADELEINE BRAND, host:

I'm Madeleine Brand.

Coming up: Japan, land of cherry blossoms and Zen gardens, also home to widespread environmental degradation; the contradictions in Japanese attitudes toward nature. Our series on Climate Change continues.

CHADWICK: First, a court settlement in this country in a big pollution case about coal, electricity, smog, and acid rain. The Environmental Protection Agency, several green groups, and eight eastern states, have agreed to end a lawsuit against the company called American Electric Power. It is based in Ohio. It sells electricity to millions of people.

NPR's Elizabeth Shogren joins us.

Elizabeth, background on the case, please. It was filed eight years ago.

ELIZABETH SHOGREN: Yes, when the Clinton administration was still in power, the Environmental Protection Agency cracked down on coal-fire power plants across the eastern half of the country. It said that these power plants had been violating the Clean Air Act. They were making major changes to their plants without installing new pollution control equipment, which they said the Clean Air Act required.

Now, what happened is these cases languished for a long time under the Bush administration and that's because the Bush administration was trying to rewrite the rules that the Clinton administration was using to sue these very companies on. And so things got very mixed up and the companies saw that as a way to dig their heels in and wait, companies such as American Electric Power.

CHADWICK: Well, now they have settled. They're going to be spending billions of dollars. What exactly are the settlement terms and why now?

SHOGREN: Well, the Justice Department says this is the single largest environmental enforcement settlement ever. It's $4.6 billion that the company is going to have to spend on pollution control equipment at plants in five different states: Ohio, West Virginia, Virginia, Indiana, and Kentucky. It will also have to pay a $15 million penalty and pay $60 million on projects to clean up the environment that it helped to pollute.

CHADWICK: Well, the company has issued a statement after the settlement saying that it has not really admitted any wrongdoing and it was going to spend most of this $4.6 billion and fix up things; it was going to spend that money anyway, most of it. So is this a win for industry, do you think?

SHOGREN: Well, it's not a win for industry. The environmental lawyers I talked to who've been part of this case are very happy because this moves up the deadlines for having to put on pollution control equipment. And there is some pollution control equipment that the company wasn't going to put on at all that it's going to put on. The company counts that as $1.6 billion. It's a little bit hard to say because the prices have been going up a lot. So it's hard to say what exactly this will cost the company. So the environmental groups are happy about it. The states are very happy about it, because this will bring forward the time that they have to meet these deadlines.

The other thing about this, is this is the company saying they're going to spend us money, but there is another way out under the Clean Air Act. Instead of putting on pollution control devices, the company can instead buy credits to keep polluting. And that's something that they are able to do.

Under this clean-up they are not able to play that game. They're not able to sell the credits that they would have gotten for cleaning up to other companies. So that means that the other companies won't pollute too. And there ends up being a net decrease of pollution in the air, which ends up being a positive. So it sounds like the company is trying very hard to spin it in its direction, and of course the government and the environmental groups who want to spin - spin it in their direction as well.

CHADWICK: NPR's Elizabeth Shogren from Washington. Elizabeth, thank you.

SHOGREN: Thank you.

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