MADISON, Wis. (AP) — A western Wisconsin utility has agreed to spend nearly $156 million to settle allegations two of its coal-fired power plants were illegally polluting the air, federal environmental officials announced Friday.
The U.S. Environmental Protection Agency filed a federal lawsuit Thursday accusing the La Crosse-based Dairyland Power Cooperative of failing to obtain the proper permits or install the best pollution control technology when it modified plants in Alma and Genoa beginning in 2004.
As a result, the plants have been releasing large amounts of sulfur dioxide and nitrogen oxides, the lawsuit said. Sulfur dioxide and nitrogen oxides convert to fine particles in the air that can cause respiratory and cardiovascular problems as well as contribute to acid rain, smog and haze, according to the EPA.
The lawsuit asked a judge to order Dairyland to obtain permits, install the pollution control technology and audit its operations and report the results to the EPA. The lawsuit also sought $32,500 in fines for every day the plants violated the Clean Air Act after March 15, 2004, and $37,500 per day for violations after January 12, 2009.
Online court records show a notice of settlement was filed Thursday, the same day as the lawsuit.
According to a statement the EPA released Friday morning outlining the deal, Dairyland will invest $150 million in pollution control technology at the plants and comply with federal emission standards and annual tonnage limitations.
The moves will reduce annual sulfur dioxide emissions by 23,000 tons and nitrogen oxides emissions by 6,000 tons from 2008 levels, improving air quality in the region as well as areas downwind, Ignacia S. Moreno, assistant attorney general for the U.S. Department of Justice's Environment and Natural Resources Division, said in the statement.
Dairyland also must spend $5 million on projects that will improve the environment and human health around the plants. The projects range from home weatherization, solar panel installation and replacing Dairyland vehicles with cleaner-burning ones.
The utility must pay $950,000 in penalties, too.
The settlement also calls for the Sierra Club to drop a lawsuit the organization filed against Dairyland in 2010 that leveled nearly identical accusations as the EPA's filing. The Sierra Club's attorneys didn't immediately return voicemail and email messages Friday.
The agreement is subject to a 30-day public comment period and U.S. District Judge Barbara Crabb's approval.
Dairyland's attorney, listed in court records as John M. Holloway of Washington, D.C., didn't immediately return a message left Friday. Utility officials issued a statement saying they did nothing wrong but wanted to avoid a long legal fight that could drive up rates. The cooperative was working on a $400 million plan to reduce air emissions before the lawsuit was filed, the statement added.
"We agreed to work toward a settlement to reduce the risk of uncertain outcomes and the accompanying additional rate pressure for our cooperative consumers," Dairyland President Bill Berg said in the statement. "Dairyland stands by its strong belief that our cooperative did not violate the law."
Dairyland provides wholesale electricity to 25 member distribution cooperatives and 15 municipal utilities in Wisconsin, Minnesota, Iowa and Illinois.