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Power to Pollute -- Clearing the air
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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Updated 8/04
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