Ruling dumps mercury 'credits'

Environmentalists hail decision, which will affect coal plants

In a blow to coal-burning utilities and the Bush administration, a federal appeals court said Friday that the Environmental Protection Agency illegally exempted power companies from tough laws to cut mercury emissions.

The decision nixes a controversial plan by the EPA to buy and sell "mercury pollution credits," a program critics say is a multimillion-dollar giveaway to the power industry at the expense of residents near coal plants.

Conservationists hailed Friday's ruling, saying it would force utilities to install better equipment to scrub mercury from coal plant smokestacks.

The ruling adds heat to a growing backlash against building coal-fired power plants, a major source of greenhouse gases, and some said it would make it more difficult for Santee Cooper to get its $1 billion Pee Dee plant off the ground.

"It's a victory for people's health, for the environment and for everyone who fishes and eats fish from South Carolina rivers," said John Suttles, a lawyer with the Southern Environmental Law Center who helped represent a coalition of states and conservation groups that sued the EPA.

Power companies in South Carolina and EPA officials said they were disappointed with the ruling.

A Scana official said the cap-and-trade pollution credit plan for South Carolina would effectively reduce mercury pollution.

"It is still too early to say what impact this may have on our company, but whatever the final rules are for mercury emissions reductions, we will comply," said Robert Yanity, a Scana public affairs coordinator.

Santee Cooper already has scrubbers and other pollution-control equipment on its coal plants, "so we think (the ruling) will have a marginal impact," said

Laura Varn, vice president of corporate communications. "I don't see it having an impact on rates, either."

The roots of the court's decision stretch back to the 1990s, when Congress grew frustrated with the EPA's lax efforts to reduce mercury and other hazardous air pollutants.

Mercury is a potent neurotoxin linked to brain damage and other health problems. Man-made mercury pollution generally comes from the stacks of coal-fired power plants, factories, cement kilns and incinerators. It drops from the air into rivers and lakes, where it collects in the tissues of fish and other animals.

South Carolina has a severe mercury contamination problem, with warnings to avoid eating certain fish from more than 1,700 miles of rivers, mostly on the coastal plain.

For a recent series, The Post and Courier had people who eat freshwater fish from several hot spots tested and found they had unusually high levels of mercury in their bodies.

In 2000, with studies showing mercury could affect 300,000 to 600,000 newborns a year, the EPA classified mercury as a "hazardous air pollutant" under the Clean Air Act. This meant utilities had to more aggressively reduce mercury emissions, potentially costing the industry billions of dollars.

Under the Bush administration, the EPA reversed course, exempting power plants from these more-stringent rules and instead creating a cap-and-trade program in which utilities could buy and sell credits equivalent to one ounce of mercury pollution.

The cap-and-trade program enabled some utilities to avoid spending money on new equipment by purchasing these mercury credits.

Opponents say it's wrong for utilities to buy their way out of pollution problems at the expense of residents near the hot spots where studies say mercury emissions land.

In its ruling, the U.S. Court of Appeals for the District of Columbia said the EPA's move was an unlawful violation of the Clean Air Act.

The decision comes less than a year after the U.S. Supreme Court hammered the administration for failing to regulate greenhouse gases as pollutants.

In a statement, the EPA said the ruling would delay efforts to reduce mercury emissions. "Because of the court's action, the U.S. now has no national regulation to cut mercury emissions from existing power plants," Jonathan Shradar, an EPA spokesman, said in a statement.

Not true, Suttles said. The judge's ruling means utilities must now operate under the original, more-stringent rules from 2000.

He added that the ruling has major implications for Santee Cooper's proposed coal-fired power plant on the Pee Dee.

Under the previous rules, utilities that wanted to build a new coal-fired power plant had to identify the best way to reduce mercury emissions. Suttles said Santee Cooper's current plans fall short of this standard.

Varn of Santee Cooper said the ruling would have no effect on the Pee Dee plan because "it's going to be the cleanest in the country when it's built."

Fourteen states, along with conservation groups and Native American tribes, filed the lawsuit against the EPA.

South Carolina wasn't involved, choosing to follow the EPA's cap-and-trade approach.

Officials with the state Department of Health and Environmental Control were studying the ruling Friday afternoon and had no immediate comment on its effects in South Carolina.

Reach Tony Bartelme at tbartelme@postandcourier.com or 937-5554.