Duke Energy faces charges, $102 million in fines over coal ash spills

Updated 6:55 AM EST, Sat February 21, 2015

Story highlights

Federal government files criminal charges against Duke Energy over coal ash spill

The company says it has agreed to a settlement calling for $102 million in payments

(CNN) —  

A year after a massive coal ash spill into a North Carolina river, Duke Energy said Friday it would pay $102 million in a proposed settlement of nine criminal charges filed against the company by the U.S. government.

The charges, all misdemeanors alleging violations of the Clean Water Act, were filed Friday in U.S. district courts in North Carolina. A federal judge would have to approve the settlement.

The case concerns problems at several Duke Energy locations, but the major problem occurred at the Dan River Steam Station in Rockingham County, near the Virginia border.

On February 2, 2014, a leak in a 48-inch stormwater pipe at that retired plant sent about 39,000 tons of coal ash and wastewater and up to 27 million gallons of basin water pouring into the Dan River.

The utility originally said 82,000 tons of coal ash spilled, but later revised the number.

Parts of the river turned into gray sludge. Coal ash, the byproduct of burning coal, is made up of aluminum oxide, iron oxide and silicon oxide. It also contains arsenic, mercury and other metals.

Researchers from Wake Forest University who used cameras on an unmanned aerial aircraft to create a 3-D image of the spill said as many as 35 million gallons of arsenic-contaminated water and ash may have made its way into the river.

A filing of criminal information said Duke “negligently” discharged pollutants and that employees failed to “exercise the degree of care that someone of ordinary prudence would have exercised in the same circumstances with respect to the discharge of ash and coal ash wastewater. …”

The criminal charges were filed against the company, not individuals.

The $102 million in payments would be paid by shareholders, not customers, a company press release said. The company said $68.2 million would go toward fines and restitution and $34 million for community service and mitigation projects.

The company said Clean Water Act violations concerning unauthorized discharges occurred at these company facilities in North Carolina: the Dan River plant in Eden; the Riverbend Steam Station in Mount Holly; the H.F. Lee Steam Electric Plant in Goldsboro; and the Asheville Steam Electric Generating Plant. A maintenance issue occurred at the Cape Fear Steam Electric Plant in Moncure, the company said.

The agreement would include five years of probation and a court-appointed monitor to make sure Duke Energy complies with all provisions of the settlement, the company said.

Duke has apologized for the spills – both when they happened and Friday.

“We are accountable for what happened at Dan River and have learned from this event,” said Lynn Good, president and CEO of Duke Energy.