By
Margaret Newkirk and Bob Downing
Akron Beacon Journal, 1/7/2001
Nine
years ago, hundreds of Ohio coal miners gathered on the steps of
the Ohio Statehouse to rally around a proposal to give millions
of dollars in tax breaks to the state's electric companies.
It
was billed as a way to save coal miners from the ravages of the
federal Clean Air Act.
It
was April Fools' Day 1991.
The
tax break gave Ohio utilities $1 for each of the millions of tons
of dirty Ohio coal they burned.
It
was a carrot, intended to lure those utilities into making the investment
needed to allow them to keep burning Ohio coal.
Enticed
by the tax breaks, utilities would clean up and modernize the aging
fleet of power plants that had made Ohio's air emissions among the
worst in the nation and earned the state the lasting ire of its
downwind neighbors and the federal government.
The
power companies did nothing of the kind.
Instead,
they launched expensive programs to keep their old plants up and
running, while claiming to have implicit permission to break federal
clean-air laws.
They
also lavished money on lobbyists and politicians.
Those
politicians just as lavishly helped them. Citing the need to save
coal jobs, Ohio politicians lobbied Washington to lay off of the
state's power plants. They sank millions of tax dollars into developing
technology that would allow utilities to burn Ohio's high-sulfur
coal cleanly -- technologies the utilities never brought into commercial
use.
Along
the way, the politicians also created a climate that helped one
of the state's most politically well-connected coal barons make
millions even while the state's coal industry collapsed.
But
they never forced utilities to clean up.
A
little more than a year ago, as federal regulators and East Coast
states prepared for a showdown with Ohio's power plants, it came
time for Ohio's politicians to revisit the tax breaks the state's
coal miners had rallied around eight years earlier.
The
tax break had failed on all fronts.
Utilities
hadn't built cleaner plants, the state was still in trouble with
the federal government and the state's coal jobs had mostly disappeared.
Ohio
lawmakers took a look at that record and tripled the size of the
tax break.
A
few weeks later, the U.S. Justice Department took Ohio's utilities
to court.
A
decades-long fight between the federal government and Ohio's coal-burning
power plants had finally come to a head.
This
is the story of Ohio's 30-year war with the Clean Air Act. Waged
in the name of the state's coal miners, the war sacrificed public
health and the state's reputation to protect its coal-burning power
industry from demands that it modernize old power plants.
It
is the story of how Ohio became one of America's worst polluters,
and how the country's dirtiest coal-burning electric utility industry
fought to keep that distinction.
It
is a story of decades of denial and deception -- and the price Ohioans
now must pay.
The
cost to Ohio, with three power companies in the Justice Department's
cross hairs, could be staggering.
Utility
companies in two other states already have settled with the federal
government, including one company that wasn't even among those sued.
The two companies agreed to pay $1 billion and $1.2 billion respectively.
And
in a settlement last month, Cincinnati-based Cinergy Corp., one
of those three Ohio companies, agreed to spend nearly $1.4 billion
on pollution-control equipment and improvements. While denying any
guilt, it will pay an $8.5 million fine to the federal government.
The
other Ohio utilities targeted are Akron-based FirstEnergy Corp.
and American Electric Power, parent company of Canton's Ohio Power.
AEP alone has almost three times as many old, coal-fired power plants
on the hook than the power companies that have settled with the
government so far.
The
lawsuits claim the utility companies illegally kept old, dirty plants
running long past their original life spans in an effort to duck
the law.
Electric
costs could go up, if utilities are forced to either shut down old
plants or invest in cleaning them up -- although Ohio's deregulation
law requires rates to stay frozen for the next five years.
The
state's utilities have also threatened widespread power outages
or shortages.
They've
made similar threats before.
Coal
smoke a culprit
The role of Ohio's power plants in its pollution problems is almost
impossible to overestimate.
Name
the high-profile air-pollution issues of the past 30 years and coal
smoke lies behind all of them.
Acid
rain.
Smog.
Summertime
ozone air alerts.
Mercury
warnings for fish.
Dirty
power plants are even hiding in the shadows of the E-Check controversy.
The
ozone problems that saddled Northeast Ohio with the hated car-emissions
testing could have been better addressed by forcing power plant
cleanups, scientists say.
Nitrogen
oxide, produced by coal smoke, is one of two components of ozone.
It's one of four key pollutants found in coal plant emissions. The
others are sulfur dioxide, mercury and carbon dioxide.
The
four pollutants are linked to acid rain, smog, mercury contamination
and global warming.
Power
plants produce them in abundance, so much so that even the country's
seemingly more noxious industries struggle to keep up.
Power
plants produce 67 percent of the country's sulfur dioxide, a third
of its mercury pollution, a third of its carbon dioxide and 28 percent
of its nitrogen oxide.
Ohio's
power plants put out more sulfur dioxide and nitrogen oxide than
those in any other state in 1999.
Ohio
ranked third in the country for mercury that year, and third for
carbon dioxide.
Two
years ago, coal-burning plants were added to the U.S. EPA's Toxic
Release Inventory, a national ranking of emissions from a wide range
of industries, including the chemical, car and plastics industries.
Ohio
power plants immediately jumped to the head of the class.
Four
Ohio utilities ranked among the Top 10 air polluters in the country:
AEP is No. 2, Cinergy is No. 5, FirstEnergy is No. 6 and Dayton
Power and Light is No. 10.
``We are the worst,'' said Kevin Snape, director of the Clean Air
Conservancy, based in Cleveland Heights.
``We stink. We're No. 1. And we furiously try to maintain that lead.''
To
give Ohio's power companies their due, they have spent billions
of dollars over the past 30 years to do some level of cleaning up
their plants. And while Ohio's air emissions are still among the
worst in the nation, they are better than they used to be.
In
1978, 75 of Ohio's 88 counties failed to meet federal air standards
for four pollutants. Today, all 88 counties meet those standards,
partly because of cleanup efforts and partly because of an overall
decline in heavy industry.
Any
power plant improvements, though, came only after fierce resistance
-- resistance that continues to this day.
Ohio
and its utilities are at the forefront of a campaign to derail new
federal standards for air quality, although federal regulators now
say they have compelling evidence that the old standards are not
strict enough to protect the public health.
The
role of power plants in Ohio's problems with the EPA is not something
its politicians talked about much over the years.
Ties
between Ohio politicians and the state's coal-fired power industry
run deep, supported by friendships, favors and easy flow of coal
and utility campaign money.
``There's
been a habit of circling the wagons around utility companies,''
Ohio Environmental Council's Kurt Waltzer said.
What
politicians did talk about was jobs, or the low cost of power in
Ohio compared with envious East Coast states.
Or
E-Check.
That's
the public punching bag then-Gov. George Voinovich hauled out when
faced with a 1997 EPA order aimed at coal-burning plants.
The
new order had nothing to do with the unpopular vehicle emissions
testing, then in place in 14 counties.
That
didn't stop Voinovich.
As
he launched a national campaign challenging the new rules, Voinovich
advised his staff how to stir up the public.
``We
need to talk about (car) emissions testing,'' he wrote in a March
1997 strategy memo to his staff. ``That is the one the public hates
the most.''
Disasters
change focus
The nation's burning eyes began turning toward air in the 1950s,
after two infamous disasters.
In
1948, air pollution in Donora, Pa., killed 20 and hospitalized hundreds.
And the ``killer fog'' of London, England, killed more than 4,000
in a week in 1952.
Despite
earlier attempts, it wasn't until the Clean Air Act of 1970 that
Washington was given control over air policy.
The
act empowered the new U.S. EPA with the ability to set air quality
standards based on effects on health. States would develop plans
for implementing those standards and had the option of setting stricter
ones.
The
act created a major problem for Ohio. It targeted sulfur dioxide,
a byproduct of burning Ohio's high-sulfur coal and a key ingredient
in acid rain, blamed for destroying lakes and trees in the East.
Half
of the 15,000 coal-related jobs Ohio had in 1979 would disappear
in a few years' time, a victim of mechanization and of Clean Air
Act compliance in other states.
Michigan
alone killed an 18 million-ton market for Ohio coal in the 1970s.
With no coal industry of its own, the state ordered its utilities
to switch to the low-sulfur coal found in Kentucky, West Virginia
or Wyoming.
Ohio
had that option -- although it likely would have killed the remainder
of its coal jobs.
It
also could order its power companies to invest in new plants or
pollution controls -- but that would raise electricity rates.
So
Ohio chose a third option: denial.
Utility
companies, led by American Electric Power, threw millions into lobbying
and advertising campaigns designed to make sure the Clean Air Act
got no tougher -- and were successful until the 1990 amendments
to the act were finally passed.
Meanwhile,
they kept their old plants running, producing four to 10 times as
much pollution as a modern plant would.
The
message to the public was that clean air cost jobs.
``A
shrill minority of no-growth extremists'' was former Gov. James
A. Rhodes' phrase for environmentalists.
A.
Joseph Dowd, a retired senior vice president at AEP, and the epitome
of Ohio's go-down-fighting attitude, talked about ``environmental
zealots'' out to ``destroy the Midwest'' for the sake of some lakes
and a few ``noncommercial trees.''
Or
this, from a 1970s antiEPA rally poster: ``The misguided environmentalists,
do-gooders and federal bureaucrats are saying Ohio's coal, untold
millions of tons, isn't good enough.
``You
know who'll be at that hearing. Everybody with nothing to do and
even less to lose. Out of staters telling Ohio what we can do with
our coal.''
The
other argument was cost: Ohio's utility companies have a long history
of exaggerating the admittedly high costs of complying with environmental
regulations.
The
Clean Air Act amendments of 1990 were going to raise AEP's rates
by 15 percent, the company said at the time.
For
the customers who paid the most for AEP's clean air compliance in
the 1990s, rates ended up rising less than half of that -- 5.8 percent.
Politicians fight hard
Political protection for utilities was bipartisan.
In
hindsight, it was also sometimes remarkably short-sighted.
Nationally,
the state's politicians made a name for themselves in the 1980s
by killing proposals that would have taxed other states to pay for
cleanups in Ohio, for instance.
Of
Ohio's politicians, Rhodes and Voinovich played the most prominent
roles in fighting the EPA.
Rhodes
began his second eight-year run as governor just as a court struck
down the state's first and only attempt to force power plant cleanups,
started by former Gov. John Gilligan.
By
the time Rhodes left office in 1982, Ronald Reagan was president
and Washington backed off of Ohio.
And
by the time Congress and Reagan's successor, George Bush, tightened
the law, Voinovich was headed into office.
Like
Rhodes, Voinovich brought a certain passion to the cause.
``You
got snookered by the environmental lobby,'' he penned in a note
to Bush in 1992.
Another
note complained of an ``EPA out of control! Our people out of jobs!''
And
a third began, ``Dear Mr. President. We are being screwed again
by the EPA. When will it stop? If they keep going, they are going
to shut down Ohio! Help! George.''
Voinovich
took to the clean air battle with verve. When the U.S. EPA, in late
1997, announced two new regulatory efforts designed to protect public
health by further reducing coal power plant pollution, he led a
national campaign to derail those efforts, saying they would devastate
Ohio and that their effects on health were too minimal to justify
the cost.
From
his pulpit as the head of the National Governors' Association, he
rallied national industry leaders and Midwestern and Southern governors
for a legal attack on the U.S. EPA -- an attack some environmentalists
said could gut the Clean Air Act.
In
two lawsuits, one brought by Ohio and allied states and the other
by the nation's trucking industry with Ohio's backing, the Voinovich
legal attack challenged the EPA's right to demand sharp cuts in
nitrogen oxides and ozone, as well as so-called ``fine particulate,''
which scientists believe can interfere with breathing.
Voinovich
said he caught heat for his campaign, which blocked the EPA from
implementing its new rules in the late 1990s.
His
timing couldn't have been worse.
As
Ohio's governor charged into Washington, with his fellow Midwest
governors trailing behind him, a frustrated and now legally stymied
EPA was considering its options.
The
agency was honing a new legal strategy to use against coal-fired
power plants and looking for states with some electric companies
to sue.
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