From: H. JOSEF HEBERT, Associated Press Writer
Published October 1, 2004 12:00 AM

EPA Report Says Pollution Case Against Utilities Jeopardized by Clean Air Changes


The Bush administration's push to ease a clean air rule hampered the settlement of pollution lawsuits against utilities, according to federal agency watchdog's report Thursday.

The Environmental Protection Agency said the findings by its inspector general were inaccurate, misleading and based on a misunderstanding of the agency's enforcement activities.

The internal report also said enforcement officials at the EPA strongly argued that the rule changes would set such lenient requirements so as to jeopardize the prosecution of many of the cases.

The changes in the clean air rule _ known as new source review _ were imposed in October. They are on hold pending the resolution of a federal suit challenging the changes.

The rule requires utilities to install new pollution control equipment whenever they make major changes at a plant or conduct maintenance that results in increased emissions.

Companies have succeeded in making the case to the government that the rules were interpreted so narrowly that they hindered expansion and routine maintenance.

Environmentalists contend the administration's changes have given utilities a free hand to pollute more under the guise of maintenance and plant expansion.

The agency said in a statement that it "fundamentally disagrees" with the report and will pursue current enforcement cases and bring new ones. On Wednesday, the EPA announced plans to act against an Indiana utility for violating the new source rules.

Jeffrey Holmstead, the EPA's top air pollution official, said in a letter responding to the 67-page report that it "fails to mention or glosses over ... evidence that is not consistent with its conclusions."

The inspector general, Nikki Tinsley, said that last year, when the EPA was debating the rule, enforcement officials and those in Holmstead's office "expressed widely disparate views of the impact of the rule change."

The report said enforcement officials argued that their "ability to obtain ... settlements or court-imposed remedies (was) ... weakened."

Three utilities involved in litigation had argued for abandoning the suits because the activities at issue "would no longer be considered a violation" under the rule change, according to the report. Also, another major utility "ceased negotiations with EPA."

Enforcement officials objected strongly to allowing utilities to avoid installing additional emission controls unless the changes cost most than 20 percent of the cost of replacing the unit, the report said. The officials said that would allow changes, in the name of maintenance, that cost up to $160 million without addressing the additional pollution that might result, the inspector general said.

"This report is further evidence that the Bush Administration has been trying to gut the enforcement of the Clean Air Act ... (and) exempt the biggest, dirtiest power plants ... from legal requirements," said Independent Sen. Jim Jeffords of Vermont, the ranking member of the Senate Environment and Public Works Committee.

Holmstead and other top EPA officials have said the changes pursued by the agency were not retroactive and would have affect the legal cases.


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