Jun 22 - McClatchy-Tribune Regional News - Dave Flessner Chattanooga Times/Free Press, Tenn.

The Tennessee Valley Authority failed to alert regulators to significant duct leaks in its coal plants over the past five years to keep the power plants running, according to TVA's inspector general.

In a newly released study of the leaks, TVA's independent auditors said they recommended federal prosecutors pursue criminal actions against those who ignored potential air emission violations at the Widows Creek Fossil Plant in Northeast Alabama.

"In spite of the continuous nature and extent of the leaks, it appears that little, if any, consideration was given to reporting the leaks to the ADEM (Alabama Department of Environmental Management) John E. Brennan, TVA's assistant inspector general, said in a six-page summary of his report. "We also found no evidence that ethics and compliance issues were considered, presumably because of the emphasis on business operations."

The U.S. attorney in Alabama declined to pursue the case, Mr. Brennan said.

TVA spokesman Gil Francis said the duct leaks were repaired during a 2005 outage at the Widows Creek plant and other duct leaks at TVA's Cumberland coal plant in Tennessee and Paradise coal plant in Kentucky also have been repaired.

"TVA has implemented measures to ensure that we will not have a repeat occurrence of this event," Mr. Francis said.

Alabama air regulators still fined TVA $100,000 earlier this year for not disclosing the problem.

Ron Gore, head of the air division at the Alabama Department of Environmental Management, said his agency learned about the duct leaks from an employee at Widows Creek who blew the whistle on what he said were frequent violations of air emission rules.

"The repairs to this duct work should have been done as soon as they were noted, not after it came to our attention through a whistle-blower," Mr. Gore said. "That's why we created the fine and a substantial one."

TVA managers at the time contended the duct leaks were not significant enough to be reported to regulators or fixed right away, according to the TVA inspector general's report. The duct leaks developed after TVA installed a selective catalytic reduction system on the Unit 7 boiler at the plant in 2003. A year later, contractors discovered problems in the system, but ADEM wasn't aware of any duct leaks until the whistle-blower complained in October 2005, Mr. Gore said.

The U.S. Environmental Protection Agency also has an outstanding notice of violation against TVA for violating its air pollution rules because "numerous holes and leaks were present in the ductwork" at Widows Creek, according to Beverly Banister, EPA's regional director for air, pesticides and toxics management division.