March 24, 2006

Dominican Republic sues AES for dumping ash

NEW YORK (Reuters) - The Dominican Republic has filed a
lawsuit against power generator AES Corp. in a Virginia federal
court, alleging that the company and its contractor conspired
with corrupt government officials to illegally dump coal ash.

The suit, filed Thursday in an eastern Virginia court, says
the conspiracy was formed to dump ash from an AES plant in
Puerto Rico onto Dominican beaches at far lower cost to the
company than it would otherwise have to pay for disposal.

"We think that the allegations are false and have no merit
and we will defend the company vigorously against the charges,"
said Robin Pence, an AES spokeswoman.

The suit also lists Silverspot Enterprises, a Florida
company that purportedly transported the waste for AES, as a
defendant. Silverspot officials were not available for comment.

According to the suit, AES and its contractors dumped
30,000 tons of coal fly ash waste in the Manzanillo coastal
area, and another 27,000 tons of waste on the beaches of Samana

The ash, the government said, has led to skin lesions,
breathing difficulties and decreased tourism and contributed to
six deaths. By dumping illegally on the beaches, the government
said, AES was able to spend as little as one-sixth of what it
would otherwise cost to dispose of the ash.

The Dominican government actually concedes in the suit that
its own courts are inadequate to seek justice from AES, the
largest direct foreign investor in the Dominican economy.

"Plaintiff will not view this Court's exercise of
jurisdiction over this action as an affront or intrusion into
the sovereign affairs of the Dominican Republic," the suit