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US Settlement with Minnesota Coal-fired Utility to Reduce Emissions, Fund Projects to Benefit Environment and Communities

Release Date: 07/16/2014
Contact Information: Jennifer Colaizzi, Colaizzi.Jennifer@epa.gov, 202-564-7776

WASHINGTON – In a settlement with the United States, Minnesota Power, an ALLETE company based in Duluth, has agreed to install pollution control technology and meet stringent emission rates to reduce harmful air pollution from the company’s three coal-fired power plants located in Cohasset, Hoyt Lakes, and Schroeder, Minnesota, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today. The settlement will resolve claims that the company violated the New Source Review provisions of the Clean Air Act by unlawfully constructing major modifications at its plants without obtaining required permits and installing and operating the best available air pollution control technology, as the Act requires.

EPA expects that the actions required by the settlement will reduce harmful emissions by over 13,350 tons per year, which includes approximately 8,500 tons per year of sulfur dioxide. The company estimates that it will spend over $500 million to implement the required measures.

The settlement also requires that the company pay a civil penalty of $1.4 million to resolve Clean Air Act violations and spend at least $4.2 million on environmental projects to benefit local communities. The state of Minnesota is co-plaintiff to the settlement and will receive $200,000 of the penalty.

“Reducing harmful emissions from large sources of air pollution is a national priority for EPA,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “By meeting some of the lowest emission rates in the country, Minnesota Power will continue to provide energy to communities across northeastern Minnesota, while at the same time, reducing sulfur dioxide and nitrogen oxide in the air, which can pose serious health risks.”

“Today’s settlement will require system-wide controls to reduce harmful air pollution and will benefit Minnesota residents today and for years to come,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This innovative agreement will also fund projects that contribute to renewable energy production and restore valuable wetland habitat.”

The settlement requires that the company install pollution control technology and implement other measures to reduce sulfur dioxide (SO2), nitrogen oxide (NOx), and particulate matter emissions from its three coal-fired power plants, which include nine operating units, as well as a biomass-and-coal-fired cogeneration plant which provides power and steam to an adjacent paper mill. Among other requirements, the company must install control technologies and meet emission rates that will be among some of the lowest in the country for SO2 at its largest unit and for both SO2 and NOx at the second largest unit.

In addition, the company must retire, refuel, repower, or reroute emissions at five other units, and must meet emission rates and install additional control technologies at remaining units. The company also must comply with declining system-wide annual tonnage limits for both SO2 and NOx.

SO2 and NOx, two predominant pollutants emitted from power plants, have numerous adverse effects on human health and are significant contributors to acid rain, smog, and haze. These pollutants are converted in the air to particulate matter that can cause severe respiratory and cardiovascular impacts, and premature death.

The settlement also requires that the company spend $4.2 million on projects that will benefit the environment and local communities, including $2 million to build a large-scale solar installation system to benefit a local tribe known as the Fond du Lac Band. In addition, the company will provide between $500,000 and $1 million to replace, retrofit, or upgrade wood burning appliances to reduce pollution, and $200,000 to the National Park Service to restore wetlands at Voyageurs National Park. For the remaining money, the company can select from the following four project types: land donation and restoration, electric vehicle charging stations, clean diesel projects, or installation of renewable energy.

This settlement is part of EPA’s national enforcement initiative to control harmful emissions from large sources of pollution, which includes coal-fired power plants, under the Clean Air Act’s New Source Review requirements. The total combined SO2 and NOx emission reductions secured from all these settlements will exceed two million tons each year once all the required pollution controls have been installed and implemented.

Minnesota Power provides electric service to approximately 143,000 people and 16 municipalities within a 26,000-square-mile area in northeastern Minnesota.

The settlement was lodged with the U.S. District Court for Minnesota and is subject to a 30-day public comment period and final court approval.

More on the settlement: http://www2.epa.gov/enforcement/minnesota-power-settlement

More information about EPA’s enforcement initiative: http://www.epa.gov/compliance/data/planning/initiatives/2011airpollution.html