The NewStandard ceased publishing on April 27, 2007.

California Power Plant May Skirt EPA Rules, Continue Fish Kills*

by Michelle Chen

One energy company is looking to get away with legally flouting the environmental regulations meant to restrict an electricity generation facility from ruining an ecosystem by sucking fish into its cooling system.

*A correction was appended to this news article after initial publication.

Aug. 11, 2005 – On the central coast of California, a placid, muted-green lagoon rests at the meeting point between freshwater and the ocean, harboring dozens of aquatic species and rare wetland habitats. The natural sanctuary of Morro Bay would almost be peaceful, if not for a boxy gray outcropping of mesh screens and smokestacks that jars the panoramic view.

For about half a century, the small surrounding community has watched the local electric power plant churn the waters of a 2,300-acre national estuary, affecting the local ecosystem in ways not yet fully understood.

"You used to see rock crabs and bullheads swimming in the water when you looked into the water. All kinds of things," wrote Joe Giannini, long-time fisherman and former mayor of Morro Bay, in a letter to the California Energy Commission in 2002. Though he couldn’t put his finger on just why the water had changed, Giannini told the commissioners, who were weighing a plan to expand the power plant, "the estuary is kind of like an empty hole now…. Just 20 years ago this place was alive and now it is dead by comparison."

Power plants like Morro Bay’s make catches a fisherman could only dream about, netting billions of fish annually as they suck in water for their cooling systems. Under a recently issued set of regulations that have drawn outcry from the environmentalist community, power plants can continue killing fish on a massive scale in the interest of preserving profits.

The EPA’s mitigation standard is lowered even further, say environmentalists, by a provision that gives power plants the leeway to abandon the reduction goals altogether in special circumstances.

According to studies by the Environmental Protection Agency (EPA), the power plants subject to the regulations collectively withdraw over 200 billion of gallons of water daily, inadvertently destroying roughly 3.5 billion fish and shellfish each year. The process, known as a "fish kill," throws off the natural balance of each surrounding ecosystem by disrupting the food chain, limiting species’ ability to reproduce for future generations, and in turn undercutting commercial fish stocks.

Last February, the EPA enacted a rule to mitigate fish kills, which covers approximately 550 power plants nationwide and is based on the federal Clean Water Act’s requirement that power plant cooling structures "reflect the best technology available for minimizing adverse environmental impact."

For plants meeting certain levels of water use, the rule mandates a 60 to 90 percent reduction in the number of fish killed through entrainment -- the sucking of organisms into the cooling system. In addition, all plants would have to reduce impingement -- the plastering of organisms against the plant’s water filter screens -- by 80 to 95 percent. These figures reflect EPA estimates of what plants could realistically achieve by implementing more protective technology, particularly special water screening devices.

The environmental group Riverkeeper contends that the benchmarks fall short of the Clean Water Act’s requirement. In a federal court brief, the group argued that the best technology available would be a "closed-cycle" cooling system, which, compared to the EPA’s standard, uses much less water and would kill up to 1,000 times fewer fish for each megawatt of energy produced.

Ecologists say the greatest damage could be the erosion of future spawn, since tiny larvae are the most heavily effected by cooling systems.

The EPA’s mitigation standard is lowered even further, say environmentalists, by a provision that gives power plants the leeway to abandon the reduction goals altogether in special circumstances. If a plant owner can prove to the regulators that meeting established standards would create an unjustifiable financial strain, the plant can implement an alternative compliance program with effects "as close as practicable" to full compliance.

One compliance measure the EPA endorses is the "restoration" of the habitat to compensate for fish kills. Historically, restoration measures have served industry as a cost-effective way to "clean up" widespread environmental harms. However, in a lawsuit Riverkeeper brought last year, a federal court ruled that the language of the Clean Water Act did not permit the use of restoration measures as a surrogate for superior technology.

Nonetheless, in back in Morro Bay, the EPA’s compliance provisions may allow electricity giant Duke Energy to keep raking the estuary’s waters for years to come. Since purchasing the plant in 1998, Duke has aimed to expand and "modernize" the facility, now operating well below full capacity, by constructing new generators.

According to Duke spokesperson Kate Perez, in considering the new federal compliance options, the company’s strategists are trying to "take a look at what we have … What kind of flexibility do we need between new technology or restoration?"

Public interest advocates say that the controversy in Morro Bay epitomizes a flawed and arguably illegal concept of regulatory “costs and benefits” that drives the EPA’s rulemaking.

In 2002, Duke floated before state officials its "Habitat Enhancement Program," which would purportedly "contribute ecological benefits substantially beyond what is necessary" to offset environmental losses, in compliance with state and federal law. The plan focuses on entrainment deaths, since Duke found that deaths through impingement would be "insignificant," and that heat discharges into the water, another problematic byproduct of cooling systems, would be readily addressed through more efficient equipment in the new facilities.

The company has proposed to boost fish populations by mitigating some of the impacts of environmental degradation unrelated to the power plant. The proposed projects largely involve removing harmful sedimentation from some areas to stabilize the land and restore depleted vegetation.

According to Duke’s estimates, the entrainment deaths of crab and fish larvae translate into an environmental "equivalency" of about 200,000 kilograms of "biomass" to be restored, at a projected initial cost of $9.7 million. Local activists opposed to the plan argue that the damage wrought by the power plant would be beyond reparation.

Ecologists say the greatest damage could be the erosion of future spawn, since tiny larvae are the most heavily effected by cooling systems. A 2001 environmental impact study estimated that the proposed facility would swallow approximately 17 to 33 percent of surveyed fish larvae in the estuary.

The grassroots community group Coastal Alliance on Plant Expansion (CAPE) has petitioned various state regulatory authorities to halt the expansion plan, filing its most recent protest with the California Public Utilities Commission in March. The plan is still in flux, as Duke’s lease for the site has been held up in renewal negotiations with the city, and the Central Coast Regional Water Quality Control Board is expected to issue a ruling in the coming months. But last August, Duke’s program won the approval of a key regulatory body, the California Energy Commission.

According to CAPE Co-President Jack McCurdy, "This is a perfect example of how the regulators are bowing to industry."

In a report that ran counter to the Energy Commission’s final decision, the Commission staff wrote that it would be extremely difficult to set concrete targets for compensating for the plant’s environmental impact, because there is little "baseline" data to indicate what the habitat would be like without the destructive cooling system.

The report cautioned that by failing to account for other environmental factors impacting the area, such as invasive species and hard-to-measure types of pollution, the restoration plan "may result in a fraction of the intended benefits that would accrue in a more pristine environment."

Local environmentalists diverge on the value of Duke’s restoration program, weighing the plant’s indeterminate potential impact against other immediate ecological issues.

"They’re saying, if we add more fish, then we can keep on killing fish at the rate at which we’re killing them," said Andrew Christie, coordinator of a local chapter of the Sierra Club. Dismissing this logic, he noted a similar mitigation plan for a neighboring PG&E power plant, which, by banning fishing in some areas to make up for entrainment, would be "making the fishermen pay for the damage."*

Other activists view the restoration measures as a useful opportunity to address pervasive environmental problems, even though it may never be known whether it directly compensates for fish kills. Dan Berman, director of the Morro Bay National Estuary Program, a local conservation initiative, said that Duke’s proposal was tempting to environmentalists who have long sought to undertake their own large-scale restoration projects.

"It’s a dangerous path when you choose… to make up for impact, instead of avoiding it," Berman said. But he added, "Sometimes it’s the only way to go, because impacts are coming, and they’re here."

Public interest advocates say that the controversy in Morro Bay epitomizes a flawed and arguably illegal concept of regulatory "costs and benefits" that drives the EPA’s rulemaking. According to government dockets, the EPA loosened the provisions of an earlier draft rule shortly after closed-door meetings with industry lobbyists and officials from the White House Office of Management and Budget.

In a statement explaining the published rule, the EPA argued that imposing a stricter environmental standard would impose excessive, possibly impracticable costs on the industry, so the agency lowered the standards to ensure economic viability.

Critics say that overall, environmental cost projections are arbitrary at best. Tufts University economist Frank Ackerman, who has researched the role of cost-benefit analysis in environmental policy, said, "The whole process turns on these assumptions about things that you can’t measure."

The role of economic cost in determining the "best technology available" is the crux of Riverkeeper’s pending federal lawsuit. In the opinion of Reed Super, senior counsel with Riverkeeper, by prioritizing cost issues, the EPA violates its own mandate. "The Clean Water Act does not require -- it does not even allow, in our view -- a cost-benefit analysis to be the decision-making criteria," he said.

Legal ambiguity has not stopped the industry from capitalizing on the rule’s financial "flexibility." Defending its restoration plan with a battery of economic analyses and reports, Duke has stated that implementing technology that could dramatically reduce fish kills would be "inefficient and prohibitively costly relative to the benefits."

The Energy Commission staff cast doubt on Duke’s cost-benefit analysis, noting that in ruling out options for better cooling technology, the company had used unrealistic estimates of costs and the limits on technical feasibility. The staff also concluded that the costs of habitat restoration had probably been vastly underestimated, recommending a doubling of the proposed base funding level to $19.4 million.

The manipulation of economic data by the EPA and industry analysts, Ackerman remarked, is "just a roadblock being thrown up in the face of people who want to regulate power plants and save the fish."

As the political storm surrounding the rule descends on Morro Bay, calculations of costs and benefits become muddled in the hushed but troubled waters of the estuary. For the stewards of the coastline, only the flow of time will reveal the true price of environmental degradation.

Tom Laurie, a general contractor and longtime observer of the local ecosystem, said that the community has already gathered many lessons from the estuary since the power plant first opened its jaws fifty years ago. Back then, he said, "Nobody except a few ‘crackpots’ who called themselves ecologists cared what an estuary looked like under water.  Nobody knew how important the things you couldn't see with the naked eye could be."


Minor Change:

*The quote from Andrew Christie about the proposed fishing ban misstated the background of that initiative, which does not pertain to Duke's plant. This restoration measure in fact relates to a neighboring plant owned by PG&E, which has similar impacts on the habitat. The reference to Duke has been removed.

Also, the description of Tom Laurie as general contractor has been corrected from the original.

 | Change Posted August 12, 2005 at 18:48 PM EST

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The NewStandard ceased publishing on April 27, 2007.

Michelle Chen is a staff journalist.

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