Cleanup to Cost AEP $4.6 Billion

One of the nation’s largest power generators has agreed to end a years-long federal lawsuit by paying $4.6 billion.

The settlement requires American Electric Power, based in Columbus, Ohio, to reduce chemical emissions that cause acid rain by at least 69 percent in the next decade.

It also fines AEP $15 million in civil penalties and $60 million in cleanup and mitigation costs to help heal parkland and waterways.

Details were provided yesterday by two people familiar with terms of the agreement. They spoke on condition of anonymity because it had not yet been filed in federal court. Spokesmen for AEP declined to comment.

The settlement marks one of the largest government fines in an environmental case. By contrast, Exxon Mobil Corp. estimates it has paid $3.5 billion in cleanup costs, government settlements, fines and compensation for the 1989 Exxon Valdez oil spill. The company is fighting $2.5 billion in punitive fines.

Nine states, a dozen environmental groups and the Environmental Protection Agency brought the lawsuit against AEP in 1999, accusing the energy company of rebuilding coal-fired power plants without installing pollution controls as required under the Clean Air Act.

AEP has agreed to clean up 46 coal-fired operations in 16 of the plants in its eastern system – likely to include plants in Virginia.

An AEP subsidiary, Appalachian Power Co., is Virginia’s second- largest utility, serving about 500,000 customers.

Originally published by The Associated Press.

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