By Erica Peterson
Kentucky’s Energy and Environment Cabinet has finalized a controversial plan to let the state’s utilities virtually self-regulate the storing of hazardous coal ash near power plants.
As details about the plan emerged over the past few weeks, Cabinet Secretary Charles Snavely defended the rules and the process, saying it included “full public participation.”
But documents obtained by WFPL News show the process was far from public and instead included more than a year of backroom meetings — under both former Gov. Steve Beshear and Gov. Matt Bevin — with representatives of the utility industry. During that time, documents show the regulations were significantly revised and weakened.
When regulators began meeting with representatives of the utility industry in September 2015, the regulations they had drafted (left) were extensive. By the time they submitted the drafts to the Legislative Research Commission in October 2016 (right), the regulations were weakened.
Environmental attorney Tom FitzGerald of the Kentucky Resources Council, who has spent more than 44 years working in the state, and oftentimes on workgroups with members of industry and regulators to craft regulations, said to his knowledge, such one-sided input from industry is unprecedented in recent years.
“I think it’s unconscionable, and I think it does not reflect well on how little value [the regulators] place on public involvement in the development of regulations that are intended to protect the public,” FitzGerald said.
Representatives from the Energy and Environment Cabinet declined an interview request. In response to emailed questions, spokesman John Mura defended the cabinet’s regulatory process.
“As a part of the pre-KRS 13A deliberative process of regulation development, it is common for the state to informally discuss regulatory matters with the regulated sector that are directly impacted by those regulations,” Mura wrote.
He also pointed to a public comment period and a public hearing held in November 2016. After public comments were received, the agency made minor changes to the rule.
Dangers of Coal Ash
Coal ash — also called “coal combustion residuals,” or CCR — is the byproduct of burning coal for electricity. It’s often stored in dry landfills or wet ponds, or recycled into products like concrete or wall boards.
But it also contains contaminants like mercury, cadmium and arsenic. And environmental advocates say that’s why it’s so important there’s adequate state and federal oversight over coal ash disposal.
“Coal ash is a toxic substance that if handled incorrectly can take human lives, can make people sick, can ruin the environment, lakes, rivers, streams, permanently,” said Earthjustice attorney Lisa Evans.
In the past decade, there have been two high-profile instances — in Kingston, Tennesee and Eden, North Carolina — where large-scale coal ash spills have contaminated miles of rivers and land. But there have also been numerous other cases where there have been smaller amounts of pollution, where coal ash has caused air problems or has leached chemicals into groundwater.
Kentucky Division of Waste Management geologist Todd Hendricks mentioned a few of those instances in public comments he made about the cabinet’s proposed coal ash rule:
“Analysis of groundwater and leachate from CCR units in Kentucky has shown elevated levels of heavy metals, sulfate, boron, and other contaminants. One facility is conducting groundwater corrective action for contamination of karst springs with arsenic leaching from an inactive surface impoundment. Hundreds of thousands of gallons of arsenic-contaminated groundwater per day are captured and pumped to the active surface impoundment for dilution and discharge through a permitted outfall. At another facility, state laboratory analysis of one recent sample of fluid (presumably leachate) flowing from the toe of a closed CCR landfill showed 9.81 mg/L of arsenic, which is 981 times the maximum contaminant level (MCL).”
Coal ash wasn’t regulated by the federal Environmental Protection Agency until 2015. But with the publication of the first-ever federal coal ash rules in the Federal Register, the EPA set out new standards designed to be incorporated into states’ existing regulatory framework.
And that’s when the Kentucky Energy and Environment Cabinet began working on the state’s version of the regulations.
Emails Show Industry-State Meetings
By its own admission, the Kentucky Division of Waste Management spent more than 1,600 hours working on the regulation in 2015, under former governor Steve Beshear.
On Sept. 3, 2015, regulators sat down with representatives from Kentucky’s utility industry. They screened a PowerPoint presentation on the current draft version of the rules. And on the 12th slide, regulators told the utility representatives that their facilities would no longer be able to qualify for a program called a “permit-by-rule” for coal ash sites. Instead, they would have to stop accepting coal ash into their landfills and ponds by Oct. 19, 2015, or get a permit for disposal.
That wasn’t the last meeting between regulators and industry representatives to discuss the coal ash rules. Emails obtained through an open records request show they met in person at least three more times — in October 2015, and April and June 2016.
State regulators shared drafts of the regulations with Tom Shaw, the environmental director of Big Rivers Electric Corporation, and Jack Bender, the attorney representing the Utility Information Exchange of Kentucky, an industry group. And both men sent regulators UIEK’s comments on the proposals multiple times, months before the agency took comments from the public.
Bender declined a request for additional comment, and Shaw didn’t respond to a voicemail message.
When regulators went into that meeting on Sept. 3, 2015, the draft CCR rules were extensive. They covered groundwater monitoring, inspections, technical specifications for recycling coal ash and plans for closing facilities.
But by the time the draft regulations were released to the public in October 2016, they didn’t contain any of those specifics. And the regulations proposed regulating the electric utilities with a “permit-by-rule” — the very mechanism that the state declared it would not use during that September meeting.
Oversight Steps for Coal Ash Removed
In the proposal released to the public in October, electric utilities wouldn’t have to apply with the state for a permit to build a landfill or pond for coal ash. Instead, the state determined the utilities would have a “permit-by-rule” and could begin constructing coal ash units without prior permitting or review by state regulators.
Right now, utilities building coal ash units need a permit from the Kentucky Division of Waste Management. The process sometimes takes years and involves professional engineers, geologists and environmental technicians. Often permits are also needed from the Kentucky Division of Water.
Under the new proposal, those wouldn’t be necessary.
The state’s approach has been modified somewhat in the final version to a “registered permit-by-rule.” This means utilities will have to register before they begin construction of landfills or ponds, but there will still not be a rigorous permitting process.
“It’s the Wild West, basically,” FitzGerald said. “You get to characterize [the project] on your own, if you do at all, you get to manage it at the location you decide, you get to control the design, the construction, the operation, the closure, the post-closure. And the only time the state is going to become involved is after you screw up. If they find out about it.”
FitzGerald said skipping a rigorous permit review process — where the utility and regulators work together to design the project — could pose myriad problems.
If groundwater monitors aren’t put in the correct locations, they might not detect water pollution. Sensitive ecological or historical sites — like Wentworth Cave on Louisville Gas and Electric’s Trimble County property — could be buried under coal ash forever.
Or, in the most extreme cases, an engineering error could lead to structural flaws in a project and result in a catastrophic coal ash spill.
Cabinet spokesman Mura wrote in an email that the state’s end product is an attempt to comply with the federal rules.
“It was the Obama EPA, after a lengthy regulation development process, that promulgated an industry self-implementing program with no permitting program and with the public/state involvement process done via posting of information on industry website(s),” Mura said.
The EPA’s rules were self-implementing but intended to be incorporated into a state’s existing framework. More recently, Congress approved the Water Infrastructure Improvements for the Nation (WIIN) Act, which directs states to work the new federal standards into existing permitting programs.
Legal Challenges Possible
It’s not illegal for regulators to consult with industry representatives before a draft regulation is released for public comment.
Instead, the Kentucky Energy and Environment Cabinet routinely seeks input from so-called stakeholders early in the process. But usually that input includes people on different sides of the issue — not just industry representatives but also people from environmental groups, landowners and others with a stake in how the regulations play out,
FitzGerald said that kind of approach — where all sides are engaged early on in the process — ensures that when the regulations are released for public comment, multiple perspectives have been taken into account.
“It is far preferable and I think much more productive and you get a much more responsible work product when you have input from all of the stakeholders,” he said. “And yet in this case, the input came solely from the regulated industry. And the result was a serial weakening of a responsible approach into one that I think is the most irresponsible approach I have seen in my 44 years of working on these issues on behalf of the public.”
Before the rule is finalized, it will need approval from two legislative committees. FitzGerald said if it wins approval, he might consider seeking judicial review.
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