Duke Energy Corporation agrees to $6 million fine for coal ash spill, North Carolina says

RALEIGH, N.C. - Duke Energy Corp. has agreed to pay a $6 million fine for a big spill that coated the Dan River with liquefied coal ashin 2014, North Carolina’s environment agency said Friday.

The fine holds Duke Energy accountable for violations of federal water protection laws during and after the country’s third-worst spill of the residue left behind after burning coal, the state Department of Environmental Quality said in a prepared statement.

The Spill at Dan River

The spill coated 70 miles of the river on the North Carolina-Virginia border in more than 30,000 tons of sludge after a pipe burst at a holding pit at Duke Energy’s power plant in Eden. Coal ash can contain toxic chemicals including arsenic, chromium and lead.

State officials originally fined Duke Energy $6.6 million for the Dan River spill, but the company contested it.

“We are accountable for what happened at our retired Dan River facility. This agreement is another important step in bringing the accident and its aftermath to a close,” the company said in a statement.

Duke Energy also challenged the environmental agency’s attempt last year to impose an unprecedented $25 million fine for persistent groundwater pollution at its closed Sutton power plant in Wilmington.

The agency later reduced that fine to $7 million and agreed it would cover groundwater contamination at all 14 coal-burning Duke Energy plants in North Carolina. Environmental groups called that a sweetheart deal for the company where Republican Gov. Pat McCrory had worked for nearly three decades.

McCrory’s environmental agency said it was forced to reduce the fine because of a policy adopted under McCrory’s Democratic predecessor that favors offenders taking corrective action over paying fines.

Attorneys for Duke Energy — a $57 billion corporation in terms of market capitalization — said DEQ had again exceeded its authority “in an effort to ratchet up the Dan River penalty to a newsworthy amount.”  

North Carolina officials began pursuing stronger regulations and enforcement of coal ash after the Dan River spill. North Carolina legislators required the company to clean up its unlined coal ash pits by 2029. New U.S. Environmental Protection Agency rules that took effect last year are expected to force similar cleanup at coal ash pits around the country.

Duke Energy denies that the 112 million tons of coal ash in its 33 storage pits are polluting water supplies. But it did admit to violations related to the Dan River spill when it pleaded guilty to federal pollution misdemeanors in May 2015 and agreed to pay $102 million in fines and restitution​, the state agency said.

Duke has said in statements and court filings that the costs of the settlements will be borne by its shareholders, not passed on to its electricity customers.  

Environmental groups have hailed the various charges against the company as vindication for their years of efforts to get regulators to hold Duke accountable for the pollution leaking from 32 coal ash dumps at 14 power plants scattered across the state. The ash, which is the waste left behind when coal is burned to generate electricity, contains toxic heavy metals.