Dive Brief:

• The North Carolina Department of Environmental Quality (DEQ) on Monday ordered Duke Energy to completely excavate all its coal ash ponds in the state.

• While eight of the utility's 14 plant sites in North Carolina had been slated for full excavation and closure, the fate of the final six and their 11 ponds remained unknown until Monday. The closures were ordered after "rigorous scientific review" from the DEQ and public input from nearby communities concluded excavation is "the only way to protect public health and the environment," the DEQ said.

• One of the six plants covered in the order is the Allen plant, which was named the second most polluted in the country in a national report from Earthjustice on coal ash pollution. Duke now has four months to file a plan with regulators on how it will comply with the order. 

Dive Insight:

Duke is spending billions to address coal ash pollution at its North Carolina coal plants and will now have to spend several billion more.

The decision by North Carolina regulators echoes similar directives from state leaders and utilities in Virginia and Georgia, representing wins for environmentalists who argue the only safe way to protect groundwater from coal ash is to fully excavate the ponds and move the ash to plastic-lined pits or recycle it. Most utilities prefer the "cap-in-place" method.

"We believe that the science and the engineering support that capping is protective of the environment," Director of Policy and Environmental Communications at Duke Energy Paige Sheehan told Utility Dive.

"And that's ... the analysis that we had submitted, to the state," she added.

Following the spill of more than 39,000 tons of coal ash from the utility's Dan River plant in 2014, North Carolina lawmakers passed the Coal Ash Management Act (CAMA), amended in 2016 to direct the DEQ to examine the six of Duke's coal ash sites not slated for excavation and determine next steps. The Monday order indicates the department does not find Duke's cap-in-place closure plan sufficient for groundwater protection and the utility has until Aug. 1 to file a removal plan.

Requirements by the state under CAMA dictate three main closure options: excavation and disposal into a lined landfill, cap-in-place method, or closure in accordance with federal coal combustion residual rules (CCR), which don't necessitate a lining but have mandates on monitoring and how far away the bottom of the basin is from aquifers.

Last November, Duke's compliance filings under the federal rule revealed that 24 of its 26 coal ash ponds were in violation of CCR regulations governing disposal of the waste, including the basins' distance from nearby aquifers. The ponds at the Allen plant — the second most polluted in the country — were found to be actively leaking cobalt more than 500 times above federal safety levels into surrounding groundwater, along with eight other pollutants, including arsenic, selenium and lithium.

The only two ponds not in violation had been fully excavated.

"Across the Southeast and more, as time develops, across the country, the industry standard now for addressing unlined coal ash pits is to remove the ash," Frank Holleman, a senior attorney at the Southern Environmental Law Center, told Utility Dive, noting that the concern over many of the sites in North Carolina is their proximity to rivers and waterways.

"This ash being saturated in water is going to continue to pollute the surrounding groundwater in which it sits as well as neighboring creeks, rivers, lakes and drinking water reservoirs, even if you cover it up with a synthetic cover and plant grass on top of it because they're not getting the ash out of the groundwater," said Holleman.

The main concern for environmentalists and regulators with the cap-in-place method is that it leaves the bottom of the basin unlined and in contact with groundwater, and in many instances across the country, the heavy metal pollutants from the ash are leaching out around the site.

Duke estimates costs to comply with the new order will add $4-5 billion to the current $5.6 billion clean up, covering construction and engineering as well as transporting the actual waste, said Sheehan. For some sites, closure could take over 30 years, she noted, and the closures will involve a mix of recycling the ash for concrete and excavation and removal.

However, environmentalists also complain that utilities routinely overestimate the costs of removal.

In Virginia, Dominion Energy initially reported removal costs would be between $2.564 billion and about $6.5 billion, while estimating cap-in-place methods would cost $2 billion on the high end. After the utility was ordered by legislators to reexamine the numbers, it found removal costs went down significantly to $2.773-$3.358 billion, if a single bidder were to recycle 45% of its ash over a 15-year span, or $2.345 billion to $5.642 billion if multiple bidders were selected.

"Duke Energy has routinely exaggerated estimates of the cost" to fully excavate, said Holleman. "What we've also seen is that utilities, when they're fighting against having to clean up sites, greatly overstate the cost of excavating and greatly understate the cost of leaving the ash where it is."

The table below outlines Duke's November 2018 CCR compliance filings for the six plants subject to Monday's order.