Consumers Energy Clean Air Act Settlement

(Washington, DC - September 16, 2014) – In a settlement with the United States, Consumers Energy, a subsidiary of CMS Energy Corporation, has agreed to install pollution control technology, continue operating existing pollution controls and comply with emission rates to reduce harmful air pollution from the company’s five coal-fired power plants located in West Olive, Essexville, Muskegon and Luna Pier, Michigan, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today. 

• Overview
• Violations
• Injunctive Relief
• Pollutant Reductions
• Health Effects and Environmental Benefits
• Environmental Mitigation Projects
• Civil Penalty
• Comment Period
• The Power Plant Enforcement Effort
• Contact

Overview of Company

Consumers Energy is Michigan’s second largest electric and natural gas utility, providing electric service to more than 6 million people in the Lower Peninsula of Michigan. The Consumers system subject to this settlement has a combined capacity of more than 2,900 megawatts (MW).

Violations

EPA began an investigation of the Consumers system as part of the Power Plant Initiative. Based upon Consumers’ response to the EPA’s Clean Air Act (CAA) Section 114 information requests and other information obtained during its investigation, EPA concluded that there were opacity and prevention of significant deterioration (PSD) violations at some of Consumers’ facilities. On March 28, 2007, EPA issued a notice of violation to Consumers for opacity violations at the Campbell, Karn, Cobb, Weadock, and Whiting facilities.  On October 20, 2008, EPA issued a notice of violation to Consumers for the Campbell, Karn, Cobb, and Weadock facilities, which alleged that Consumers performed projects that triggered PSD applicability. The EPA also alleged violations of Title V of the CAA for failure to submit an application to include all applicable requirements in Consumers’ Title V permits, as well as new source performance standard violations.

Injunctive Relief

The proposed consent decree secures injunctive relief from all 12 of Consumers’ coal-fired power units. Compliance with the settlement will reduce sulfur dioxide (SO₂) and oxides of nitrogen (NOx) by approximately 46,500 tons per year from 2012 levels.  The company estimates that it will spend over $1 billion to implement the required measures.

The settlement includes:

• Installation and operation of SCR technology to reduce NOx emissions at Campbell Units 2 and 3 and Karn Units 1 and 2, and meeting rates of 0.080 pounds per million British thermal units (lbs/mmBTU) at the Campbell units (180 days after entry) and Karn units (60 days after entry).
• Installation and operation of FGD technology to reduce SO₂ emissions at Campbell Unit 3, Karn 1 and Karn 2, meeting final SO₂ emission rates of no greater than 0.070 (lbs/mmBTU) at Campbell Unit 3 (January 2018), and 0.075 (lbs/mmBTU) at Karn Units 1 and 2 (January and April 2016). 
• Installation and operation of dry sorbent injection (DSI) at Campbell Unit 1 and Campbell Unit 2, meeting final SO₂ emission rates of no greater than 0.290 lb/mmBTU on Campbell Unit 1 (January 2017) and 0.320 on Campbell Unit 2 (July 2017).
• Retirement or refueling of Cobb Units 4 and 5 (April 2016).
• Retirement of Weadock Units 7 and 8 and Whiting Units 1, 2, and 3 (April 2016).
• Compliance with annual plant tonnage limitations for NO_x and SO_2.
• Optimization of existing particulate matter controls to meet unit-specific emissions limitations. New baghouses on Campbell Units 1, 2, and 3 and Karn Units 1 and 2.
• Commitment to install and operate, or enter long-term power purchase agreements for 400 MW of new wind power generation capacity.
• Annual surrender of any excess SO₂ and NO_x allowances resulting from actions taken under the consent decree

Pollutant Reductions

As compared to Consumers’ 2012 emissions, EPA expects the following emission reductions to result from this settlement:

• SO₂ about 38,400 tons per year
• NO_x about 8,100 tons per year

Health Effects and Environmental Benefits

The pollutants reduced under this settlement have numerous adverse environmental and health effects. Sulfur dioxides and nitrogen oxides can be converted to fine particulate matter once in the air. Fine particulates can be breathed in and lodged deep in the lungs, leading to a variety of health problems and even premature death. Other health and environmental impacts from the pollutants addressed in this settlement include the following:

• Sulfur dioxide – High concentrations of SO₂ affect breathing and may aggravate existing respiratory and cardiovascular disease. Sensitive populations include asthmatics, individuals with bronchitis or emphysema, children, and the elderly. Sulfur dioxide is also a primary contributor to acid deposition, or acid rain.
• Particulate matter – Short term exposure to particulate matter can aggravate lung disease, cause asthma attacks and acute bronchitis, may increase susceptibility to respiratory infections and has been linked to heart attacks.
• Nitrogen oxides – Nitrogen oxides can cause ground-level ozone, acid rain, particulate matter, global warming, water quality deterioration, and visual impairment. Nitrogen oxides play a major role, with volatile organic chemicals, in the atmospheric reactions that produce ozone. Children, people with lung diseases such as asthma, and people who work or exercise outside are susceptible to adverse effects such as damage to lung tissue and reduction in lung function.

Environmental Mitigation Projects

The proposed consent decree requires Consumers to spend at least $7.7 million on environmental mitigation projects and to complete the projects within 5 years. Under the proposed consent decree, Consumers will provide the National Park Service with $500,000 for ecological restoration or invasive species remediation in the Cuyahoga Valley National Park and the Sleeping Bear Dunes National Lakeshore Park.  In addition, Consumers must perform the following projects, each of which is described in greater detail below: (1) vehicle replacement, retrofit and fueling infrastructure; (2) renewable energy development or installation; (3) wood burning appliances; (4) energy efficiency; and (5) land acquisition, donation, and restoration.  Consumers will submit a plan to EPA, for review and approval, describing a plan for implementing the projects, the proposed amount(s) to be spent on the projects, and the schedule for implementing the projects.

Vehicle Replacement, Retrofit and Fueling Infrastructure Projects (Up to $3 million)

• Vehicle replacement project(s) would involve replacing existing gasoline and/or diesel powered vehicles (passenger cars, light trucks, and heavy duty service vehicles) with newly manufactured alternative fuel vehicles and/or compressed natural gas vehicles. Vehicle retrofit project(s) would involve the retrofitting of existing diesel engines with engines that have emission control equipment designed to reduce emissions of NOx, particulates, and/or ozone precursors. Fuel infrastructure project(s) would be designed to enhance the electric vehicle charging infrastructure or compressed natural gas fueling infrastructure in Michigan by funding creation of one or more charging stations for electric vehicles or natural gas fueling stations.

Renewable Energy (Wind Energy, Solar Photovoltaic or Anaerobic Digestion) Development or Installation Projects (Up to $4 million)

Consumers would select one or more wind energy, solar, or anaerobic digestion with nutrient recovery/removal project(s) to implement.

• Anaerobic digestion with nutrient recovery/removal project(s) would involve utilizing the biogas from animal waste to generate energy, while reducing methane emissions. Nutrients remaining after digestion would either be recovered and converted into useful products (nutrient recovery) or the farm would use nutrient removal technology to reduce or eliminate insoluble nutrients in the digested waste.
• Wind energy project(s) would involve the development of a new or an expansion to an existing wind energy and/or solar photovoltaic installation or installations in Michigan.
• Solar photovoltaic project(s) would involve the installation of conventional flat panel or thin film solar photovoltaics at a location with unrestricted solar access.

Wood Burning Appliances Project (No less than $1 million and up to $2 million)

Consumers would spend no less than $1 million and up to $2 million to sponsor a wood-burning appliance replacement and/or retrofit project that would be implemented by a pollution control agency or by a third-party non-profit organization. This project would replace or retrofit inefficient, higher-polluting wood-burning or coal appliances with cleaner-burning, more energy-efficient heating appliances and technologies. 

Energy Efficiency Projects (Up to $500,000)

Consumers would spend up to $500,000 on energy efficiency project(s) for low income residents and/or public schools to reduce or avoid emissions of criteria pollutants.

Land Acquisition, Donation and Ecological Restoration Project (Up to $ 2 million)

Consumers would spend up to $2 million for acquisition, donation, and/or restoration of ecologically significant lands.

Civil Penalty

Consumers will pay a $2.75 million civil penalty.

Comment Period

The proposed settlement, lodged in the U.S. District Court for the Eastern District of Michigan, is subject to a 30-day public comment period and final court approval. Information on submitting comments is available at the Department of Justice website.

The Power Plant Enforcement Effort

This is the 29th settlement that is part of a national enforcement initiative to control harmful emissions from power plants under the Clean Air Act’s New Source Review requirements. The total combined sulfur dioxide and nitrogen oxides emission reductions secured from these settlements will exceed 2 million tons each year once all the required pollution controls have been installed and implemented.

For more information, contact

Gregory Fried
Air Enforcement Division
U. S. Environmental Protection Agency
1200 Pennsylvania Ave, NW, MC 2242A
Washington, DC 20460
[email protected]
(202) 564-7016