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Troubled Illinois coal plant never received an operating permit, ran ‘illegally’ for over a decade, lawsuit says

Editor’s note: This article has been updated to add comments from Prairie State submitted after publication.

Illinois’ largest coal plant has been operating for over a decade without ever obtaining an operating permit required under the Clean Air Act, the Sierra Club alleges in a lawsuit filed Wednesday in federal court against Prairie State Generating Company.

The required “Title V” permit sets limits on pollutants like mercury, lead and sulfur dioxide, and defines how the plant will report and monitor its emissions and any violations. Prairie State applied for the permit from the Illinois Environmental Protection Agency in 2010, but the state agency never granted nor denied the permit. The plant began operating in June 2012. Under state law, after two years of agency inaction, the coal plant was officially operating “illegally,” as the Sierra Club alleges, without the required permit. 

Prairie State had obtained a construction permit under the Clean Air Act to begin operations, but that permit is supposed to be replaced by an operating permit. Sierra Club Law Program staff attorney Megan Wachspress said that the environmental organization assumed that Prairie State had its permits. They only became aware of the gaping deficiency, she said, when Prairie State reported to state regulators that it had during April 2021 exceeded the mercury emissions limits in its construction permit, which reflected federal mercury standards.

The company had seemingly been treating the construction permit as an operating permit — even though the construction permit explicitly stated it was only valid for one year after operations began, as noted in the Sierra Club lawsuit. 

A construction permit is “clearly granted in anticipation there will be a second permit,” Wachspress said. “This is a case where there was never a basic assessment of what the operating limitations would be [or] what the monitoring and reporting requirements would be. This is a fundamental problem.”

Community and financial watchdog organizations and environmental groups have long kept a close eye on the massive, 1,600-megawatt coal plant. Under Prairie State’s highly controversial and problematic financial structure, the plant is essentially owned by nine public power agencies that serve almost 300 municipal utilities and electric cooperatives across Illinois, Indiana, Ohio, Kentucky, Michigan, Virginia, Missouri and West Virginia.The contracts have saddled small communities with debt and much higher power prices than they would pay otherwise, especially as the plant cost much more to construct than predicted. 

But despite all the scrutiny, Wachspress said the lack of an operating permit was not discovered sooner “in part because of just how weird it is. People kind of assume the basic stuff gets done.”

The lawsuit demands that Prairie State cease operations until an operating permit is in place and pay civil penalties, with $100,000 going to public health and environmental mitigation. 

No answers

The Illinois EPA entered an agreement with Prairie State in May 2022 about how it would address the mercury emissions that exceeded federal standards for rolling daily averages. The 4-page agreement refers to Prairie State’s violation of its construction permit, issued over a decade earlier, citing the mercury emissions and failure to submit semi-annual reports. The agreement says Prairie State will undertake preventative maintenance and submit reports including explanations of why the mercury exceedances occurred. 

But the state agency does not mention the lack of an operating permit. An IEPA spokesperson said the agency could not comment given the pending lawsuit. 

Prairie State declined to answer questions but provided a statement from Alyssa Harre, Vice President of External Affairs & Organizational Strategy for Prairie State Generating Company, saying the plant “is operating legally under a Prevention of Significant Deterioration (PSD) permit,” meaning the construction permit. 

“To comply with this permit, Prairie State installed and has maintained more than $1 billion in state-of-the-art emissions control technology and continuous emissions monitoring system,” Harre’s statement said. “This action by the Sierra Club’s California-based Environmental Law Program is a politically motivated attempt to circumvent the Illinois regulatory process, the consequences of which will bring instability to our electric grid to the detriment of the consumers we serve.” 

While the lawsuit does not name state regulators, Wachspress said, “it is troubling the agency didn’t avail itself of an opportunity to follow through as it said it would on the construction permit, and troubling the agency never tried to stop Prairie State from operating without a permit. This is an enforcement failure.”

Citizen lawsuits of the type filed by Sierra Club are typically meant to spark action from state or federal regulators. Such lawsuits are a crucial part of the structure of laws like the Clean Air Act and Clean Water Act, wherein regulators don’t proactively search for violations but rather rely on companies to self-report violations and on the public to raise concerns. 

In October 2022, Sierra Club sent a letter to Prairie State stating its notice of intent to sue, a process meant to potentially spark state attorney generals or other regulators to take action. But state officials have taken no action within the 60-day waiting period required between the letter and filing a lawsuit, so Wachspress said they are not expecting the government to intervene. 

Greg Hubert, a retired software professional from Naperville, Illinois, said in an online press conference that when he learned about the municipality’s contract with Prairie State, he felt it was his responsibility to keep tabs on the company. But he said that in residents’ attempts to obtain records, a confidentiality clause has been invoked and public records requests have been repeatedly denied.

“Since day one of our city’s entanglement in the Prairie State coal plant, we citizen owners,” he said, “have been blocked from obtaining information on Prairie State that any other private owners of a power plant would be allowed to see and know. The lack of an operating permit under Title V of the Clean Air Act is one more disturbing development.”

‘A black hole’

Wachspress noted that it is relatively common for companies to keep operating under expired NPDES permits that regulate water discharges under the Clean Water Act, to give agencies more time to consider renewal applications. But she and other environmental advocates said they had never heard of a company operating without ever receiving a Title V Clean Air Act operating permit, and that situation is much more “troubling” than an expired NPDES permit. 

Among other things, that’s because the operating permit is meant to enshrine the lowest emissions a particular plant is capable of achieving, and those limits are meant to be updated periodically as technology improves. The construction permit specifically said Prairie State should do testing to determine what particulate matter and sulfur dioxide limits would be set in the operating permit, the Sierra Club lawsuit notes. 

Prairie State each year emits about 25 tons of hazardous air pollutants, thousands of tons of ozone-forming sulfur dioxide and nitrogen oxides, and over 12 million tons of carbon dioxide, according to the lawsuit, making it by far the state’s biggest carbon emitter.

In addition to the other pollutants of concern, “there’s a real black hole around particulate matter emissions coming out of this plant,” said Wachspress, referencing soot linked to increased rates of cardiovascular and respiratory disease and death. “After much searching, there does not appear to be a way of tracking either the rate or quantity of particulate matter coming off this plant. That’s the sort of reporting that could be incorporated in a Title V operating permit.”

‘Clean coal’ promises 

Prairie State has long been billed as a potential “clean coal” plant, since the company has promised to implement carbon capture and sequestration. Illinois’ 2021 energy law allows the plant to keep operating much longer than other coal plants, with a mandate to close or capture all carbon emissions by 2045. Almost all other coal plants need to close by 2030. 

But carbon capture and sequestration technology has not been implemented at a commercial scale, and there is massive opposition to carbon sequestration in Illinois as evidenced by resistance to the pipeline company Navigator’s attempts to transport carbon dioxide from ethanol plants to Illinois and sequester it there.

Sierra Club Beyond Coal senior campaign representative Christine Nannicelli said Prairie State “shows how far the myth of clean coal is from reality,” and the lack of an operating permit is just one more black mark on its record.  

“The importance and urgency of getting an operating permit in place for this plant couldn’t be stronger,” she said. “No plant is above the law, especially not one of the biggest polluters in the nation.”

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