Coal ash could cost Duke Energy up to $10B

April 22, 2014 | By Barbara Vergetis Lundin

Duke Energy has laid out its response to the North Carolina Joint Environmental Review Commission (ERC) on the Dan River coal ash incident and its short- and long-term actions to address coal ash across the state.

Dan River. Credit: Wikimedia Commons

Duke Energy takes full responsibility for the Dan River incident, and has taken and will continue to take significant steps on the site and in the river, according to Duke Energy's North Carolina State President, Paul Newton.

According to Newton, Duke Energy will continue to work constructively with federal and state experts from the U.S. Environmental Protection Agency (EPA), U.S. Fish and Wildlife Service, Virginia Department of Environmental Quality and North Carolina Department of Environment and Natural Resources (NCDENR) to monitor the river and evaluate additional remediation efforts.

As a result of Duke Energy's recently completed $9 billion power plant fleet modernization program, the company has retired more plants than any other time in its history, according to Newton. The company says it had always planned to permanently close its ash basins as it retires units, following existing industry norms and compliance expectations of state and federal regulators.

Duke is preparing a comprehensive, longer-term ash basin strategy that involves intensive analysis at all of its coal plant sites that begins next month -- with closure strategies recommended for each site -- and will be completed by the end of the year.

The key guidelines that will help determine site-specific closure strategies include the proximity of the ash basins to downstream drinking water intakes and downstream groundwater sources used for drinking water, as well as community considerations (such as traffic), potential environmental and health impacts, cost-effectiveness and amount of time it takes to complete the project.

Newton said the combination of the company's previous plans, and its more recent actions are estimated to cost approximately $2 billion to $2.5 billion. If the company were required to convert to all-dry ash handling systems, the costs would increase by $1 billion to $2 billion. These steps, added to the total excavate and remove approach, would collectively cost a total of $7 billion to $10 billion, not including costs associated with financing, inflation and increases in operating and maintenance expenses.

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