Consumers Energy, Michigan's largest utility, and a subsidiary of CMS Energy (NYSE: CMS), reached agreement with the U.S. Environmental Protection Agency (EPA) and U.S. Department of Justice (DOJ) that addresses alleged past violations of New Source Review and provisions of the Clean Air Act.
Consumers Energy was one of many utilities in the U.S. who were reviewed under the EPA's Coal-Fired Power Plant Enforcement Initiative. More than 25 settlements nationwide were reached under the initiative.
"Today's settlement concludes over five years of negotiation with the EPA and U.S. Department of Justice and fully resolves these issues with the government," said John Russell, Consumers Energy's President and Chief Executive Officer. "We're moving forward with our plan to continue to improve air quality, move to a cleaner generation portfolio, and provide Michigan homes and businesses with safe, affordable and reliable energy."
Under the agreement, Consumers Energy will spend more than $2 billion in upgrades at its power plants; resulting in lower mercury, sulfur dioxide, nitrogen oxides emissions and particulate matter.
In 2007 and 2008, the EPA alleged that Consumers Energy had violated federal environmental regulations, including smoke density emitted by power plants, as well as requirements to obtain certain permits and install emissions control equipment. Consumers Energy, under the settlement, has agreed to pay a $2.75 million civil penalty.
The agreement also states that the utility will retire its seven oldest coal-fired units, totaling 950-MW: three units at the J.R. Whiting Generating Complex; two at the B.C. Cobb Generating Plant; and two at the Karn/Weadock Generating Complex. These units will meet new interim emissions limits until their retirement, scheduled for April 2016. In addition, Consumers Energy will invest up to $4 million on the development or installation of renewable energy projects.
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