Mirant Mid-Atlantic Clean Air Act Settlement

On September 27, 2004, the Department of Justice and the Environmental Protection Agency, along with the Commonwealth of Virginia and the State of Maryland, announced a major Clean Air Act settlement with Mirant Mid-Atlantic (Mirant) that will eliminate almost 29,000 tons of harmful nitrogen oxides (" NOx") pollution each year from Mirant's coal-fired electricity generating plants in Maryland and Virginia. The settlement resolves federal and state claims that Mirant has violated the NOx emissions limitation set forth in the operating permit for its Potomac River plant in Alexandria, Va.

Background

• Mirant Corporation is a global energy company, with four coal-fired power plants 3,033 megawatts (MW) in the Mid-Atlantic region that are affected by this settlement:
  • the Morgantown Generating Plant in Charles County, Md.;
  • the Chalk Point Generating Plant in Prince George's County, Md;
  • the Dickerson Generating Plant in Montgomery County, Md.; and
  • the Potomac River Generating Station in Alexandria, Va.
• In July 2003, Mirant Corporation filed for Chapter 11 bankruptcy in the Northern District of Texas. No plan of reorganization has yet been filed.
• On Jan. 22, 2004, EPA issued a Notice of Violation (NOV) to Mirant alleging that the Potomac River Generating Station exceeded its NOx emissions limit for the 2003 ozone season by more than 1,100 tons. Virginia issued a NOV on Sept. 10, 2003, for the same violation.
• The Commonwealth of Virginia and State of Maryland are signatories to the consent decree.

Terms of Settlement

• SCRs at Morgantown: Install two SCRs (selective catalytic reduction devices) on Mirant Mid-Atlantic's two biggest units - Morgantown Units 1 and 2 - by May 1, 2007 and May 1, 2008, respectively, meeting a NOx emissions rate of 0.100 lbs/mmBtu on a year-round basis. SCRs are state-of-the-art NOx controls that reduce NOx emissions by approximately 90 percent.
• Low-NOx Burners and SOFA Technology at Potomac River: Install low-NOx burners and Separated Over-Fire Air technology on the Potomac River Plant's Units 3, 4 and 5 by May 1, 2005. Together, LNB and SOFA technology generally provide approximately 40 percent-50 percent reduction of NOx emissions, as compared to an uncontrolled unit.
• Ozone Season NOx Caps: Comply with a declining schedule of NOx caps (1) at the Potomac River Plant that will reduce that Plant's ozone season NOx emissions from 2,596 tons to 1,475 tons by 2010 - a 43 percent reduction at Potomac River, and (2) across all four plants in the system, that will reduce the system's ozone season NOx emissions from 19,240 tons to 5,200 tons by 2010 - a 73 percent reduction in the ozone season system-wide.
• Annual NOx Caps: Comply with a declining NOx cap that applies to all four plants in the Mirant system and will reduce the system-wide annual NOx emission from 44,946 tons to 16,000 tons by 2010 - a 64 percent reduction annually.
  # System-wide Ozone Season NOx Rate: Beginning on May 1, 2008, comply with a system-wide ozone season emission rate of 0.150 lb/mmBTU NOx.
• Civil Penalty and Environmental Projects: Pay a civil penalty of $500,000, to be split evenly between the United States and the Commonwealth of Virginia, and spend no less than $1 million in completing nine specified environmental projects designed to decrease particulate pollution in the Alexandria, Va., area.
• More Stringent than the NOx SIP Call Requirements:
  Ozone Season: The decree imposes a "hard" .150 lb/mmBTU limit, which can only be met with reductions at the four affected Mirant facilities. By contrast, the SIP Call permits Mirant to purchase NOx allowances to comply with the same limit. In addition, beginning in 2010, the decree imposes a hard NOx tonnage cap that is 950 tons less than the NOx SIP Call allocation.
  Non-Ozone Season: Unlike the SIP Call, the decree reduces NOx emissions in the non-ozone season. At Morgantown alone, these off-season reductions are nearly 5,300 tons per year. Viewed system-wide, the consent decree secures an additional reduction of at least 16,800 tons per year, beginning in 2010.
• Cost of Controls: EPA estimates that Mirant will spend approximately $133 million to comply with the specific control requirements of the settlement. Additional monies will likely be spent to control the Chalk Point and Dickerson plants in order to meet the declining system-wide tonnage caps.

For additional information, contact:

Edward Messina
U.S. Environmental Protection Agency (>2242A)
1200 Pennsylvania Ave., N.W.
Washington, DC 20460-0001
(202)564-1191
messina.edward@epa.gov