Dec 16 - McClatchy-Tribune Business News Formerly Knight Ridder/Tribune Business News - Michelle Cole The Oregonian, Portland, Ore.

Bowing to public pressure, Oregon's Environmental Quality Commission endorsed tough new mercury controls Friday for coal-burning power plants in the state.

The rules, stricter than standards set recently by the federal Environmental Protection Agency, will require Portland General Electric to cut 90 percent of the mercury emissions from its coal-burning power plant in Boardman by 2012.

PGE's Eastern Oregon plant is the only coal-burning power plant in Oregon, but the rules also would apply to other plants that might be built.

DEQ officials said the 90 percent reduction standard will be the toughest for any plant burning coal from the west. An earlier version of the rule gave PGE as many as 12 years to cut mercury by 60 percent.

"I'm glad that Oregon is going beyond the standard set by the EPA," commission Vice Chairman Bill Blosser said Friday.

The commission, which sets policy for the state Department of Environmental Quality, voted 3-1 for a mercury reduction plan that was written and then rewritten by DEQ staff after the agency received more than 2,000 public comments.

The majority of the individuals and environmental organizations submitting comments argued that the DEQ's rules didn't go far enough to counter a persistent and toxic pollutant.

Mercury collects in the food chain -- especially in fish -- and causes neurological damage and birth defects. Some forms of the compound fall out of the air quickly, while others can travel thousands of miles around the globe.

In Oregon, about 89 percent of the mercury in the environment comes from global sources -- for example, power plants in China, said Andy Ginsburg, head of DEQ's air quality division.

PGE's Boardman plant, averaging about 200 pounds a year, is Oregon's second-largest industrial contributor of mercury in the environment. The state's largest mercury contributor is the Ash Grove Cement Co. in Durkee, which emitted an estimated 1,538 pounds in 2005.

The EPA recently concluded that it would be too expensive for cement kilns to control mercury emissions. But Ginsburg said DEQ staff eventually will bring a proposal to the commission to reduce mercury emissions from the Durkee plant as well.

On Friday, commission members spent about an hour pressing DEQ staff about one of the more controversial aspects of the new rules: the buying and selling of mercury "credits" as allowed under federal rules.

PGE wanted the credits to offset the costs of installing mercury control equipment at the Boardman plant.

Environmental groups strongly opposed such credits, contending that PGE should not make money from controlling pollution that it should be cutting back anyway. They also stressed that the credits merely shift releases of the toxic compound from plants that clean up their act to others that don't, putting some communities at greater risk.

Sixteen states have rules or are adopting rules that do not allow trading or credits.

In an attempt at compromise, Oregon's new rule will allow PGE to earn credits for the first six years for reducing the mercury its plant emits. It could sell those credits until 2018 to dirtier power plants in other states that would then be cleared to continue polluting. Credit trading would not be allowed after that.

PGE could earn an estimated $1.2 million a year by selling the credits, which would help offset the cost of installing mercury controls the state estimates will cost about $11 million a year.

The full cost will be passed on to ratepayers, with the average PGE residential customer paying as much as $4.80 more a year.

PGE is "satisfied" with the new rule, Mark Fryburg, a company spokesman said Friday.

But it was not tough enough for Judy Uherbelau, an Environmental Quality commissioner from Ashland. She voted "No."

"This trading program just passes along the problem," she said. "It doesn't solve the problem."