trending Market Intelligence /marketintelligence/en/news-insights/trending/y7vnP9UdCZT3CjWji9xUBA2 content esgSubNav
In This List

New NC coal ash law eases basin closure requirements

Blog

Insight Weekly: Labor market recovery hurdles; power market integration; nonbank M&A hunt

Blog

ESG & Technology: Impacts and Implications

Blog

Q&A: Q2'21 Power Forecast: Overheated Power Markets are Here – Who Wins, Who Loses, and Why?

Blog

Essential Energy Insights - October 2021


New NC coal ash law eases basin closure requirements

will no longerbe required to excavate and remove coal ash from all of its North Carolinaimpoundments if it meets certain requirements laid out in a new state law.

Gov.Pat McCrory signed a bill July 15 that reopensthe evaluation process for seven of Duke Energy's 14 coal ash sitesas long as the company provides permanent drinking water to nearby residents,makes required dam safety repairs and meets certain recycling mandates.

Thegovernor vetoed asimilar bill in June.

"Theprevious bill only required a plan to provide water connections with nodeadline for actually installing them and it had no requirements for fixingdams or recycling coal ash," McCrory said in a July 15 news release. "Thenew law protects the environment while also protecting consumers from higherelectricity prices."

Thenew legislation requires Duke Energy to establish "permanent replacementwater supplies" no later than Oct. 15, 2018, for residents with drinkingwells within a one-half-mile radius of coal ash impoundments, unless theproperty is separated by a river or similar body of water.

Thelaw also directs the state's Department of Environmental Quality to classifyimpoundments as "low risk" if Duke Energy has established permanentreplacement water supplies for affected residents and rectified anydeficiencies related to dam safety. Low-risk impoundments must bedewatered and covered with a low-permeability cap system. These sites must beclosed no later than Dec. 31, 2029.

Inaddition, the law promotes the beneficial reuse of coal ash by requiring DukeEnergy to recycle 300,000 tons of ash annually at a minimum of three sites foruse in construction products.

DukeEnergy has been advocating forflexibility in ash basin closure rules, with executives voicingconcerns over rising costs, safety and meeting strict excavation deadlines.

InMay, DEQ released proposedclassifications for Duke Energy's coal ash basins, finding that 25impoundments not already ranked as "high risk" by a 2014 should be classifiedas "intermediate risk." The classifications meant all impoundmentswould be excavated and closed no later than Dec. 31, 2024.

DEQand Duke Energy said they would ask the General Assembly to reconsider riskclassifications based on work that is either planned or underway that couldchange the risk posed by the ponds.

"Theflexibility in the law ensure[s] that science provides the right solution tosafely close each ash basin," Duke Energy spokeswoman Paige Sheehan saidJuly 18.

Sheehanadded that Duke Energy has "publicly supported the need for updates andimprovements" to the 2014 state law, known as the Coal Ash Management Act.

FrankHolleman, senior attorney for the Southern Environmental Law Center, said thestate General Assembly "gutted the key provisions" of the Coal AshManagement Act in order to "bail out" Duke Energy.

"Gov.McCrory, by signing this bill, has put the demands of Duke Energy's lobbyistsahead of the views of the public of North Carolina and ahead of the clean waterof North Carolina," Holleman said in a July 18 interview.

Thenew law eliminates the Coal Ash Management Commission the governor in March afterwinning a battle withlawmakers over appointments to the oversight panel and challenging itsregulatory authority.

BothHolleman and Sheehan noted that Duke Energy is under an ongoing U.S. EPAcivil investigationand is under probation related to coal ash management as part of last year'sfederal plea agreement.

DukeEnergy and the SELC also have reachedcourt-approved settlements that require the company to ash at seven sites, butthe environmental agency has pending enforcement actions at the remaining sites.