Duke Energy Pleads Guilty to Charges Under Clean Water Act

Federal investigators have finally released the results of a year-long investigation into Duke Energy coal ash spills in North Carolina. Three U.S. attorney's offices and the Department of Justice Environmental Crimes section, have filed charges against Duke Energy for dumping waste in a string of events that date back to at least 2010.

U.S. attorney's offices for the western, eastern and middle districts of North Carolina each filed criminal bills of information last week in the district courts. The charges allege violations of the Clean Water Act that include unlawfully dumping coal ash and/or wastwater and failing to maintain onsite equipment at designated Duke Energy stations.

Five Duke Energy facilities were cited by federal investigators: The Riverbend Steam Station (Gaston County); Asheville Steam Electric Generating Plant (Buncombe County); H.F. Lee Steam Electric Plant (Wayne County); Dan River Steam Station (Rockingham County); and Cape Fear River Steam Electric Plant (Chatham County), which we covered in a story last March.

Charges were filed against three subsidiaries of Duke Energy Corp. The federal cases are expected to be consolidated under the jurisdiction of the eastern district court in Raleigh, North Carolina.

The charges follow unsuccessful attempts by environmental groups to sue the energy giant, which they alleged in 2013 was responsible for polluting North Carolina waterways with coal ash and wastewater. The North Carolina Department of Environment and Natural Resources intervened in their attempts each time, saying it had jurisdiction and would take enforcement action. After the department announced that the $55 billion company would pay $99,000 in fines, environmental groups objected, accusing the DENR of brokering a "sweatheart deal." Federal investigators later stepped in, issuing subpoenas in an effort to determine whether the company received preferential consideration by state agencies.

A couple of months after the Dan River spill, we interviewed Attorney Frank Holleman of the Southern Environmental Law Center (SELC), who explained that SELC and Waterkeeper Alliance had also petitioned to be involved in the cleanup efforts. He said at the time that the groups were taking this effort as a legal step in order to "have a voice before the court to press Duke to effectively clean up" the contamination. The petitioners, he said, had lost faith in the DENR to actually enforce cleanup of the river.

"We have seen that we cannot count on the DENR to effectively enforce the law and require cleanups of these sites," said Holleman.

According to Greenpeace, which had also been pushing for cleanup, much of the 39,000 tons of coal ash that was released in Duke Energy's largest spill was never successfully cleaned up by the company -- and now sits at the bottom of the river. At the time, advocacy groups feared that the expenses from the spill would be left for taxpayers to cover.

But last week's announcement seems to be clearing some way for further cleanup of the river. In response to the charges, Duke Energy indicated that it has already set aside $100 million to cover fines and river restoration.

It has also released a list of steps it plans to take toward that aim. Improvements include "[removing] ash deposits below the Dan River plant and continuing to take direction from the U.S. Environmental Protection Agency regarding any future ash removal needs."

The company will also create a $10 million water restoration fund that will include a $1.5 million designation to "benefit waterways and help develop the economic and community vitality of the region."

Although Duke Energy stocks were up today, the company reported an 86 percent drop in earnings for its fourth quarter net income, which could be the result of the slate of state and federal investigations in 2014.

"We are sorry for the Dan River spill, and remain grateful to our friends and neighbors for your support," CEO Lynn Good said in follow-up to news of the plea bargain.

Environmental groups are hailing the announcement of federal charges and are pushing for continued improvement in the management of the company's coal ash dumps.

"Duke Energy and its executives must show the people of North Carolina that they are sorry for these crimes by moving the dangerous and polluting coal ash to safe, dry, lined storage away from our rivers and drinking water supplies,” Holleman said. SELC legally represents 12 national and state environmental groups, including Waterkeeper Alliance, Southern Alliance for Clean Energy and Sierra Club.

Image of Cape Fear River: Gerry Dincher