Electric utility Duke Energy Corp. (DUK) on Thursday signed a settlement agreement with the U.S. Environmental Protection Agency (EPA) related to cleanup of the coal ash released into the Dan River. Duke Energy has agreed to find and remove coal ash released into the river and reimburse current and future costs related to the incident.
"This agreement represents a significant milestone in Duke Energy's ongoing efforts to restore and monitor the Dan River and surrounding environment. Duke Energy is fully committed to the river's long-term health and well-being. River water quality has returned to normal and drinking water has remained safe," Duke Energy said in a statement.
The Dan River Steam Station ash basin release occurred on February 2, 2014 at the company's retired Eden, North Carolina-based Dan River coal-fired power plant. The coal ash normally contains heavy metals that can contaminate drinking water and harm marine life.
However, the company added that river water quality is normal and drinking water has remained safe. The Dan river provides drinking water to two towns near Virginia.
According to the agreement, the EPA will oversee the cleanup work of the river in North Carolina and Virginia and Duke Energy will reimburse the costs to EPA, including the all past EPA response costs and all future oversight costs. EPA's requested reimbursement costs to date have been less than $1 million.
The terms require Duke Energy to remove the remaining coal ash from the Dan River from the Steam Station release location to the Danville, Virginia-based Schoolfield Dam in accordance with an EPA-approved work plan.
The agreement also calls for certain penalties ranging from $1,000 to $8,000 per violation per day for failure to comply with the Agreement or up to $500,000 in the event the EPA assumes the performance of work under the Agreement.
Charlotte, North Carolina-based Duke Energy had revealed that a rupture in a 48-inch stormwater pipe beneath an ash basin at the plant caused a release of ash basin water and ash into the Dan River.
The basin was already at a lower level prior to the incident since the coal plant retired in 2012 and has not produced ash for some time. The primary basin is about 27 surface acres.
Duke Energy engineers had immediately stemmed the flow from the ash pond at Dan River Steam Station using a a temporary plug that periodically mitigated the leakage.
The company estimated at the time that 50,000 to 82,000 tons of ash was released to the river as a result of the incident. The volume of ash would fill between 20 and 32 Olympic-size swimming pools.
The company also estimated that between 24 and 27 million gallons of basin water reached the river, and it was visible several miles downstream. However, the downstream municipal water supplies remained unaffected.
DUK closed Thursday's regular trading session at $70.55, up $0.62 or 0.89% on a volume of 1.83 million shares.
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