Category Archives: Water

Discussion of water pollution, water supply and the law of water rights

Changing Cleanup Standards for Leaking USTs

Oct. 26, 2016. In June, the Department of Environmental Quality (DEQ) released new guidance on remediation of groundwater contamination caused by leaking petroleum underground storage tanks (USTs). The guidance document significantly changes the approach to remediation of high risk UST sites. Under rules adopted by the Environmental Management Commission (EMC), groundwater contamination at high risk UST sites must be remediated to meet state groundwater quality standards if that is feasible. 15A NCAC 2L.0407(b).

The new guidance directs environmental consultants to assume the cleanup standard for most high risk sites will be “Gross Contaminant Levels”, which represent contamination at levels as much as 1000 X the groundwater protection or drinking water standards. The guidance raises a number of questions about the impact of more limited cleanup on groundwater and property owners; consistency with EMC rules; and whether the new guidance should have gone through rulemaking to allow for public comment and adoption by the EMC.

UST Rules. The UST program operates under “risk-based” remediation rules that allow less groundwater remediation on sites posing a low risk to public health, safety and the environment and require more extensive remediation on high risk sites. Existing UST rules require petroleum-contaminated sites to be classified as high, intermediate or low risk based on site conditions and assign a cleanup standard to each risk classification. High risk sites must be remediated to meet the state’s groundwater protection standards to the extent feasible. The groundwater standards set limits for individual contaminants at the level safe for unrestricted use of the groundwater — including use as a drinking water supply. Intermediate risk UST sites only have to be remediated to “Gross Contaminant Levels”, which allow contamination at levels as much as 1000 X the groundwater protection standard or drinking water standard to remain at the end of remediation. Low risk sites may not require any remediation even though contaminant levels greatly exceed groundwater protection standards.

Under existing rules adopted by the Environmental Management Commission, UST risk classifications are based on a snapshot of conditions around the petroleum release and the likelihood that petroleum contamination will reach water supply wells or create some other imminent health, safety or environmental hazard. Under EMC rules (15A NCAC .0406), a UST site is considered “high risk” if:

(a) a water supply well… has been contaminated by the release or discharge;

(b) a drinking water well is located within 1000 feet of the contamination source;

(c) a water supply well not used for drinking water is located within 250 feet of the source;

(d) the groundwater within 500 feet of the contamination source could be a future water supply source because there is no other source of water supply;

(e) the vapors from the discharge or release pose a serious threat of explosion due to accumulation of the vapors in a confined space; or

(f) the discharge or release poses an imminent danger to public health, public safety, or the environment.

New DEQ guidance on high risk sites.
North Carolina Petroleum UST Rel ease Corrective Action Phase Project Management: A Calibrated Risk-Based Corrective Action Decision & Implementation Guide, effective June 1, 2016, moves away from the principle of remediating groundwater at high risk UST sites to meet state groundwater protection standards. Instead, the guidance assumes most sites classified as “high risk” can be remediated only to Gross Contaminant Levels (GCLs).

The guidance document cites data indicating that groundwater contamination plumes contract over time, reducing risk to nearby wells that have not already been contaminated. Based on state laws directing DEQ to consider factors that limit risk to nearby wells, DEQ has directed remediation companies to assume older high risk UST sites can be remediated to Gross Contaminant Levels. Under the new guidance, the key factor will be the stability of the contaminant plume. If the plume has stabilized or become sufficiently predictable for DEQ to conclude the contamination does not represent an expanding threat, the cleanup will largely rely on “monitored natural attenuation” of the contamination (natural reduction in contaminant concentrations over time) and the cleanup standard will be based on the GCLs.

A few observations about the new guidance:

♦ The guidance document acknowledges the new remediation guidelines have been driven by a lack of sufficient state funds to fully remediate even high risk UST sites.

♦ The idea of reviewing high risk classifications based on the age of the site and stability of the plume makes sense, but the new guidance appears to focus on just one risk factor — proximity of the UST’s petroleum release to existing water supply wells. The guidance shifts to much more limited cleanup as long as the plume has stabilized and/or alternative water supply is available to well owners affected by petroleum contamination.

The guidance does not appear to consider another factor listed in the Environmental Management Commission’s risk classification rule — whether groundwater within 500 feet of the UST release may be needed as a future water supply. In areas where groundwater represents the only local water supply source, the EMC risk classification rule intended to protect the groundwater as a potential water supply even in the absence of existing water supply wells. The new guidance document seems to focus solely on the potential impact to existing wells.

♦ Reliance on GCLs as the final cleanup standard means higher levels of petroleum contamination remain in the groundwater at the completion of remediation. In the absence of extended monitoring, making GCLs the default remediation standard for plumes close to existing water supply wells or in areas where water supply wells may be installed in the future transfers risk from the UST owner to nearby property owners. UST risk classifications rely on a snapshot of conditions around the petroleum release. A change in conditions can lower risk (as the guidance document assumes), but conditions can also change in ways that increase risk. Installation of a new water supply well or changed use of an existing well can affect the behavior of the contaminant plume, exposing well users to petroleum contamination. Given that possibility, greater monitoring of high risk sites remediated only to gross contaminant levels may be needed.

♦ Since the guidance document changes implementation of the UST rules, it likely would be considered a “rule” under the state’s Administrative Procedure Act. In addition to creating a presumption that gross contaminant levels will be the cleanup standard for all UST sites — a departure from the existing EMC rule — the guidance document establishes specific triggers for reexamination of an existing site classification. The new DEQ guidance may or may not be good policy, but any policy generally applicable to UST owners and operators would be considered a rule and the Environmental Management Commission has rule-making authority over the UST program. Failure to use the rule-making process also sidesteps any opportunity for comment by UST owners/operators, remediation companies, adjacent property owners or other members of the public on the potential impact of the changes.

♦ The change in UST remediation standards is only the latest step back from protection of groundwater as a water supply resource important to the state’s future. A significant number of North Carolinians rely on groundwater for water supply either; around 50% of the population drinks water from private water supply wells or well-based water systems. Farms often rely on water supply wells for irrigation and water supply for animals. In recent years, the direction of state policy has moved consistently toward less remediation of groundwater contamination because of the cost to the state or the cost to the polluter. The question is whether those cost/benefit calculations given enough consideration to the long-term costs of groundwater contamination.

The Ongoing Controversy Over Coal Ash and Well Contamination

August 21, 2016. The controversy over changing state advice to well owners near Duke Energy’s coal ash impoundments has exploded again over conflicting accounts — within the McCrory administration — of the basis for “do not drink” letters sent in 2015 and later withdrawn. Two earlier posts here and here provide background on groundwater and drinking water standards for vanadium and hexavalent chromium (the contaminant of greatest concern).

In 2015, the N.C. Department of Health and Human Services (DHHS) sent health advisory letters to the owners of wells with concentrations of hexavalent chromium (chromium 6 or Cr-6) above 0.07 ppb. The 0.07 ppb threshold represented the concentration of Cr-6 associated with an increased cancer risk of 1:1 million. In early 2016, the McCrory administration rescinded most of the letters and advised well owners that water meeting the federal drinking water standard for total chromium (100 ppb) should be considered safe to drink. The total chromium standard covers both chromium-3 and the more toxic chromium-6.

Within the last two weeks, the conflict between DHHS and the Department of Environmental Quality (DEQ) over the content of the health advisory letters again made headlines. This post describes the roles of DHHS and DEQ in groundwater contamination incidents; explains the criteria for developing groundwater standards; and makes a few observations on the implications of the conflict for future groundwater contamination incidents.

The role of DHHS in groundwater contamination incidents and development of groundwater standards. When contamination affects drinking water wells, DHHS toxicologists often advise on the potential health effects. If there is no existing drinking water or groundwater standard for the specific contaminant, the toxicologists use established protocols to assess the contaminant’s short-term and long-term health effects. Acute health effects include organ damage, skin rashes, respiratory problems and other short to intermediate term problems. Long-term health effects often focus on increased cancer risk. DHHS may also work with the Department of Environmental Quality (DEQ) to develop a health-based groundwater standard for a contaminant that has no existing numeric standard in state or federal rules. DHHS toxicologists advise rather than regulate. DEQ has responsibility for enforcement of state groundwater standards and oversight for groundwater cleanup.

Cancer risk as a factor in setting groundwater standards and assessing groundwater contamination. Both state and federal environmental agencies consider increased cancer risk as a factor in assessing groundwater contamination and setting goals for groundwater cleanup. North Carolina’s groundwater rules list a 1:1 million increased cancer risk as a primary criteria for setting groundwater quality standards. In 15A NCAC 2L.0202(d), the rules require a state groundwater standard to be based on the lesser of the

(1) Systemic threshold concentration calculated as follows: [Reference Dose (mg/kg/day) x 70 kg (adult body weight) x Relative Source Contribution (.10 for inorganics; .20 for organics)] / [2 liters/day (avg. water consumption)];

(2) Concentration which corresponds to an incremental lifetime cancer risk of 1×10^-6;

(3) Taste threshold limit value;

(4) Odor threshold limit value;

(5) Maximum contaminant level[the federal drinking water standard]; or

(6) National secondary drinking water standard.

Based on recent public statements by DHHS scientists, DHHS and DEQ staff in the Division of Waste Management calculated increased cancer risk associated with Cr-6 exposure using a standard protocol. The two agencies concluded that 0.07 ppb represented the break-point for the 1:1 million increased cancer risk. The DEQ/DHHS calculation of increased cancer risk associated with > 0.07 ppb of Cr-6 then became the basis for “do not drink” letters sent to well owners in 2015.

Health advisories based on groundwater contamination. DHHS has long worked with DEQ staff to advise well owners on health risks associated with groundwater contamination. Both DHHS and DEQ report to the Governor, creating a strong incentive for the agencies to agree on assessment of public health risk. Environmental and public health experts may debate the appropriate standard for a contaminant, but public conflict between the two agencies is extremely unusual and may be unprecedented.

The split between DHHS and DEQ over advice to well owners. According to DHHS scientists, the 0.07 ppb standard for CR-6 based on increased cancer risk reflected the consensus of DHHS public health experts and staff in DEQ’s Division of Waste Management. DEQ leaders, however, encouraged DHHS to advise well owners that water exceeding the 0.07 standard should still be considered safe to drink as long as Cr-6 levels did not exceed the federal drinking water standard of 100 ppb. DEQ publicly raised concerns about the DHHS health advisories in a January 2016 presentation to a legislative committee. The presentation compared the 0.07 ppb standard to the federal drinking water standard and to standards adopted by other states. Within a month after the legislative presentation, DEQ and DHHS sent new letters advising well owners that well water with Cr-6 levels below 100 ppb should be considered safe to drink because the water meets federal drinking water standards. Recent statements by state toxicologist Ken Rudo and state epidemiologist Megan Davies (who has resigned over the issue) make it clear that DHHS public health experts did not believe the existing state and federal standards for total chromium sufficiently protected human health and objected to the revised letters. The 100 ppb standard for total chromium represents an increased cancer risk orders of magnitude higher than the 0.07 ppb standard — 1:700 increased risk of cancer versus 1:1 million increased risk.

Some observations:

♦ The state’s groundwater standard remains 10 ppb for total chromium and the Coal Ash Management Act of 2014 directs DEQ to use state groundwater standards in assessing drinking water wells around coal ash impoundments. DEQ has not proposed a specific state groundwater standard for Cr-6 based on the DEQ/DHHS cancer risk calculation. As a result, the 0.07 ppb standard remains a health advisory rather than an enforceable groundwater standard. The federal drinking water standard of 100 ppb does not apply to either groundwater assessment or evaluation of well safety near coal ash impoundments.

♦ According to Secretary Donald van der Vaart, DEQ does not question the DHHS calculation of increased cancer risk associated with Cr-6. Given the gap between the total chromium standard of 10 ppb and the 0.07 ppb threshold for a 1:1 million increased cancer risk associated with chromium-6, the total chromium standard does not meet a basic criteria for a N.C. groundwater standards — which requires a groundwater standard to be based on the 1:1 million increased cancer risk — and should be reviewed.

♦ State and federal agencies routinely use the 1:1 million increased cancer risk as a criteria for developing health-based standards for permitting and to set environmental remediation goals. Both state and federal programs also recognize that there may be a need to move off the 1:1million cancer risk criteria in individual cases because it is not technically or economically feasible to meet the standard. In those instances, the agency can adjust a groundwater cleanup goal (for example) to reflect the limits of available technology.

Going forward. As a practical matter, the difference between the DHHS health-based standard and the state groundwater standard has no direct enforcement consequences for Duke Energy. For the time being, the applicable state groundwater standard continues to be the total chromium standard of 10 ppb. Under 2016 amendments to Coal Ash Management Act, Duke Energy must provide a permanent alternative water supply to all well owners within 1/2 miles of a coal ash pond which makes both the cancer risk threshold and the state groundwater standard irrelevant to decisions about alternative water supply.

Assuming no change in the state groundwater standard, the 10 ppb total chromium standard will also drive development and approval of groundwater remediation plans for areas surrounding the coal ash impoundments.

The cancer risk threshold for Cr-6 does raise questions about the adequacy of the state’s total chromium standard. The DHHS calculation of cancer risk suggests the existing total chromium does not meet one of the basic criteria for state groundwater standards — protection against a 1:1 million increase in cancer risk.

The public conflict between DEQ and DHHS raises two other questions —

Should state environmental and public health agencies inform citizens of the health risk associated with contamination that meets existing regulatory standards? DHHS public health officials felt an obligation to inform well owners of the higher cancer risk potentially associated with elevated levels of CR-6; DEQ took the position that the warnings were unnecessarily alarming if the well water met federal drinking water standards.

The other question is more technical and would inevitably come up in any reevaluation of the groundwater standard for chromium: Is there any economic or technical reason not to use the more stringent 0.07 ppb standard as the basis for assessing risk of human exposure to Cr-6 in groundwater and setting groundwater remediation goals? The choice of a standard has implications beyond the immediate controversy over coal ash impoundments and so far there has not been a practical critique of the 0.07 ppb threshold based on technology or cost. The reason behind DEQ’s objection to the DHHS 0.07 ppb threshold as a basis for health advisories still isn’t entirely clear since it appears most public water systems in the state meet the DHHS health-based standard. Those that don’t meet the 0.07 ppb standard come much closer than a number of the wells DEQ argued should be considered safe because the water meets the federal drinking water standard of 100 ppb.

Fact-Checking the History of Coal Ash Regulation in N.C.

July 27, 2016. Misunderstanding history makes it more likely the same mistakes will be made again. In that spirit, a fact-check of recent DEQ statements¹ about the history of coal ash regulation in North Carolina:

“In 2007, a previous administration changed landfill laws and specifically exempted coal-ash ponds from many environmental requirements.”

The statement seems to be referring to the Solid Waste Management Act of 2007 which amended landfill siting and construction standards. Two provisions related to coal ash landfills, but nothing in the law directly addressed coal ash ponds. Coal ash was not the main focus of the 2007 law, which responded to several controversial applications to construct new landfills for household waste and construction debris. As a result, the law focused on concerns specific to those proposals — impacts on wildlife refuges and parks; the size and height of waste disposal areas; separation from groundwater; and guarantees the landfill owner could pay for environmental remediation.

The first of two provisions in the 2007 law affecting coal ash allowed utilities to construct a lined coal ash landfill on top of an old coal ash disposal site under specific standards. The second provision exempted coal ash landfills on the site of a coal-fired power plant from some of the new landfill siting requirements. Coal ash landfills located on power plant sites continued to be regulated as industrial landfills under standards that required liners; groundwater monitoring; and setbacks from waters and wetlands. The Department of Environment of Environment and Natural Resources (“DENR”) did not request either coal ash provision.

“In 2009, the state exempted Duke Energy from having to show that its coal-ash ponds were structurally sound. If that information had been required, the corroded pipe under the Dan River coal ash pond might have been found and the spill avoided.”

In 2009, the General Assembly actually repealed a state Dam Safety Act exemption for coal ash impoundments. See Session Law 2009-390. Before 2009, coal ash ponds had been entirely exempt from the dam safety law. Repeal of the exemption made coal ash impoundments subject to the dam safety law for the first time — requiring compliance with dam safety standards; regular state inspections; and DENR review/approval of plans for expansion or repair.

DEQ’s statement may be focused on language in the 2009 legislation that allowed existing coal ash impoundments to “… be deemed to have received all of the necessary approvals from [DENR] and the Commission for Dam Safety for normal operation and maintenance”. In effect, the law allowed impoundments built before repeal of the exemption to continue to operate as if the state had permitted the original construction. Those impoundments, however, would be inspected going forward and required to comply with dam safety orders to address structural deficiencies. On balance, the 2009 legislation greatly increased rather than diminished state oversight of coal ash impoundments under the Dam Safety Act.

The Dam Safety Act amendments did not cause state and federal regulators to miss critical information about the Dan River stormwater pipe that later ruptured. Both the U.S. Environmental Protection Agency (EPA) and DENR dam safety staff became aware of the stormwater pipes at the Dan River impoundment in 2009-2010. Before inspecting N.C. impoundments as part of the federal response to the TVA coal ash disaster, EPA asked electric utilities to provide information on structural conditions at each impoundment site in the state. Maps of the Dan River site that Duke Energy provided to state and federal inspectors incorrectly identified the stormwater pipes as concrete rather than corrugated metal. The error meant state and federal inspectors did not have complete and accurate information as background for the inspections, but not because the 2009 law allowed electric utilities to shield information about the impoundments — it didn’t.

Note: It later became clear that internal Duke Energy inspection reports had flagged the metal pipes at Dan River for attention as early as the 1980s. In accepting a plea deal to a large federal penalty for the Dan River spill, Duke Energy acknowledged a pattern of neglect that included failure to take the advice of its own engineers in 2011 and 2012 to do camera inspections of the stormwater pipes.

“In 2010 federal regulators required leaks from all coal ash ponds to be evaluated. No action was taken in North Carolina for three years.”

By 2010, EPA had taken several steps to get a better handle on coal ash impoundments. In 2009, EPA launched the nationwide effort to assess the structural integrity of coal ash impoundments. Based on information provided by the electric utilities, EPA did on-site inspections of eight higher risk N.C. impoundment sites in 2009-2010 including the Dan River facility. Inspectors from the state’s water quality, waste management and dam safety programs accompanied EPA on most of those inspections. Also in 2009-2010, state dam safety inspectors did an initial dam safety inspection of every coal ash impoundment as the first step in bringing those impoundments under the Dam Safety Act.

On a different track, EPA provided new guidance to states on permitting discharges from coal ash impoundments under the Clean Water Act ; the new guidance recognized that discharges could result from seeps and leaks through impoundment walls. In 2010-2012, the state water quality program began increasing groundwater monitoring requirements for coal ash ponds and revising stormwater permits for impoundment sites. It may be that state programs gave higher priority to structural impoundment problems, groundwater contamination and stormwater permitting in 2010-2012 and lower priority to addressing the water quality impacts of leaks. It is difficult to know without more information.

“In 2011 the state gave Duke Energy approval to use Sutton lake, a recreational area in Wilmington, as a dumping ground for coal ash.”

Sutton Lake has not been used for coal ash disposal. Coal ash from the Sutton Power Plant went into one of two coal ash impoundments; outlets release water from the impoundments to Sutton Lake. Another outlet releases water from Sutton Lake to the Cape Fear River. The earliest Clean Water Act permit for the Sutton Plant accessible on the DEQ website (from 1996) treated the outlet to the Cape Fear River as the permitted discharge point and applied effluent standards there. Although the permit also put water quality limits on discharges from the coal ash impoundments to Sutton Lake, the lake was regulated as a cooling pond — part of the wastewater treatment system — rather than as “waters of the State” protected under the Clean Water Act. Every renewal of the 5-year Clean Water Act permit from 1996 through 2011 continued that approach. Apparently water quality staff revisited the question of whether Sutton Lake should be treated as a cooling pond or as “waters of the State” in 2011, but decided to maintain the approach used in earlier permit renewals. In 2014, the department (now the Department of Environmental Quality) looked at the issue again and concluded — correctly, I think — that the permit should be modified to treat Sutton Lake as “waters of the State” and put effluent limits on discharges to the lake. It isn’t clear why the water quality program and the Environmental Management Commission reached a different conclusion in issuing and renewing earlier permits.

“For many years Duke Energy monitored the water under its ponds and found hundreds of samples that did not meet groundwater standards. Again, no action was taken. In fact, the prior administration created a policy instructing regulators not to fine Duke if the company said it would correct the problem.”

The state water quality program first began requiring comprehensive groundwater monitoring for coal ash constituents in 2009-2010, imposing new groundwater monitoring conditions as Clean Water Act discharge permits for the impoundments came up for renewal. The new conditions covered key contaminants associated with coal ash and required groundwater monitoring to be done under a state-approved plan to insure monitoring wells would be appropriately placed to detect violations. Given the time required to install monitoring wells and collect a full cycle of monitoring results, little data showing a groundwater standard violation related to coal ash would have been available before 2010. None of the groundwater violations cited in DEQ’s 2014 enforcement action concerning the Sutton Power Plant predate 2009; most come from the period between 2010 and 2014.

Before 2009-2010, most of the state’s coal ash impoundments operated without significant groundwater monitoring for decades. Electric utilities built many of the impoundments in the 1960s and 1970s before any environmental regulations applied. In the late 1970s, the state began issuing federal Clean Water Act permits for discharges from the impoundments to rivers, lakes and streams. Environmental regulation focused on the quality of water discharged from the upper layers of the ash ponds to surface waters rather than the coal ash itself. In the 1980s-1990s, the state began putting groundwater monitoring conditions on the discharge permits, but the monitoring focused on very basic parameters. For the Sutton Plant, those parameters were: water level, pH, chlorides, iron, arsenic, selenium and total suspended solids. Groundwater concerns had not yet focused on contaminants specifically associated with coal ash.

Groundwater concerns increased after 2000 as EPA continued to lay the groundwork for a federal coal ash disposal rule. In 2006, electric utilities began voluntarily monitoring for contaminants associated with coal ash in the face of pressure from environmental organizations and expected federal rulemaking. Most of the data from the voluntary monitoring could not be used in state enforcement actions. Under state groundwater rules, a violation exists only if the impoundment causes an exceedence of groundwater standards at or beyond a compliance boundary around the pond. (For most N.C. impoundments, the compliance boundary is set 500 feet from the edge of the pond.) Wells used by the utilities for the voluntary groundwater monitoring had not been placed to document groundwater standard violations at the compliance boundary. But based on the voluntary monitoring results, the state water quality program put broader groundwater monitoring conditions on impoundment permits and required monitoring to be done under a state-approved well-siting plan to insure the data could be used for future enforcement.

The enforcement policy mentioned in the DEQ statement refers to 2010 groundwater enforcement guidance developed by water quality staff. Since the expanded groundwater monitoring requirements applied to facilities that had operated for many years without monitoring, the water quality program developed a policy that put the enforcement emphasis on remediation of contamination rather than assessment of penalties for activities that had been unregulated or lightly regulated for much of the facility’s history.

What the fact-checked history suggests:

It is difficult to contain environmental impacts 20 to 40 years after the fact. Both state and federal regulators struggled to understand and address problems associated with a method of coal ash disposal electric utilities had already invested in and become reliant on by the time environmental impacts became a concern.

The basic arc of state and federal regulation looks like this: In the 1970s, state and federal regulators focused on discharges from existing coal ash ponds to surface waters. There was a quiet period between issuance of the first Clean Water Act discharge permits for coal ash impoundments in the late 1970s through the 1990s. Regulators assumed the electric utilities were maintaining the impoundments properly and indicators of groundwater contamination associated with coal ash had not reached critical mass. EPA began working on a federal coal ash disposal rule in the late 1990s, but abandoned the proposed rule in 2000 in the face of strong political opposition. Between 2000 and 2008, troubling data on groundwater and surface water pollution associated with coal ash ponds accumulated and the 2008 TVA spill undermined confidence in the electric utilities’ maintenance of impoundments. Both state and federal regulatory efforts accelerated in 2008-2009, leading to state permitting changes and renewed efforts to adopt a federal coal ash disposal rule. (EPA finalized the federal rule in 2015.)

The issues surrounding coal ash have not been the responsibility of any one administration or a single branch of government. The history spans multiple governors of both political parties and legislative as well as executive action. Coal ash provisions in the 2007 Solid Waste Management Act came out of direct negotiation between the electric utilities and legislators. In 2009, the General Assembly repealed the Dam Safety Act exemption for coal ash impoundments, but did not move a bill to set comprehensive state standards for coal ash disposal out of committee.

Leaps in state law on coal ash management followed specific crises — the coal ash impoundment exemption from the Dam Safety Act survived until the 2008 TVA spill put a spotlight on poor maintenance. In 2009, the General Assembly had no interest in moving comprehensive coal ash disposal legislation; that only changed after the 2014 Dan River coal ash spill .

By 2009, accumulating evidence of groundwater contamination and other water quality concerns led the state water quality program to use existing permitting authority to require more groundwater monitoring around coal ash impoundments and increase stormwater requirements. Those efforts to use existing permitting tools more effectively laid the foundation for later groundwater enforcement actions.

¹The statements in bold appeared in a recent letter by DEQ Assistant Secretary Tom Reeder to the Raleigh News and Observer.

House-Senate Compromise on Watershed Rules

June 30, 2016. The House has begun debate on a compromise version of the 2016-2017 budget bill (House Bill 1030) that resolves differences between House and Senate budget proposals. The new budget bill includes a modified version of a Senate provision on watershed-based water quality rules. See an earlier post for more on the original Senate provision in Sec. 14.13 of the budget bill. The significant pieces of the compromise provision:

The scope of the budget provision has been reduced. The new version of Sec. 14.13 only applies to nutrient rules adopted for the Falls Lake and Jordan Lake watersheds.

The provision no longer sunsets existing nutrient rules. The budget provision still funds a UNC study of nutrient rules (focused on the Falls Lake and Jordan Lake rules) and directs the Environmental Management Commission to review and readopt those nutrient management rules based on recommendations from the study. But the bill no longer automatically sunsets existing rules.

The UNC study of nutrient management strategies. The budget provision now funds the study for six years at $500,000 per year ($3 million for the entire study) and has separate report-back dates for the two watersheds — December 31, 2018 for Jordan Lake and December 21, 2021 for Falls Lake. In part, the provision requires UNC to compare water quality trends in Falls Lake and Jordan Lake to implementation of the different parts of the nutrient strategies. Since a number of the nutrient rules have not yet gone into effect because of legislative delays, evaluating the effectiveness of the rules based on water quality trends will be difficult. That is particularly true for wastewater discharge limits and stormwater controls that have never been implemented or only partially implemented in the two watersheds.

Delayed implementation of the Jordan Lake and Falls Lake rules. The provision further delays implementation of the nutrient management rules until at least 2019 for the Jordan Lake watershed and 2022 for the Falls Lake watershed.

DEQ study of in-situ technologies to address nutrient-related water quality problems. The budget provision continues to require a DEQ study of in situ technologies to reduce nutrient problems — now focused on algaecides and phosphorus-locking technologies. The DEQ study will be entirely separate from the UNC study of nutrient management strategies and receives a separate appropriation of $1.3 million for a trial of in situ technologies. The final report will be due on March 1, 2018.

Exclusion of areas within the Jordan Lake watershed from stormwater requirements. The compromise budget includes a new subsection 14.13(f) that says new impervious surface added in the Jordan Lake watershed between July 31, 2013 and December 2020 (after study and readopting of the rules as required under the budget provision) should not be counted as built-upon area for purposes of developing nutrient reduction targets under the Jordan Lake stormwater rules. It isn’t entirely clear what this means.

Under federal Clean Water Act requirements, the state has an obligation to cap discharges of any pollutant causing impaired water quality. These caps (called a Total Maximum Daily Load or “TMDL”) must be approved by the U.S. Environmental Protection Agency. The Jordan Lake rules cap nutrient loading at a level necessary to address impaired water quality in the Jordan Lake reservoir; meeting the TMDL requires a reduction in nutrient loading from the baseline years of 1997-2001. The rules then allocate the reductions proportionately to the different arms of Jordan Lake and to major nutrient sources in those watersheds – wastewater dischargers, stormwater runoff from developed areas, and agricultural activities.

So the new Sec. 14.13(f) raises several issues –

The new subsection is written as though local governments in the Jordan Lake watershed develop their own stormwater nutrient reduction targets and can change the reduction target by excluding newly developed areas. In reality, the reduction targets have been based on allocation of the reductions required to meet the Jordan Lake TMDL under EMC rules and a watershed model developed by DEQ.
It assumes that the nutrient reduction target assigned to stormwater would change based on development over this 7-year time period, but the target is based on reduction from the historic baseline of 1997-2001. The one thing that changes by delaying implementation of the Jordan Lake stormwater rules is that more areas will fall under requirements for stormwater retrofits of existing development rather than stormwater rules for new development projects.
If the intent is to exclude these recently developed areas from future implementation of Jordan Lake stormwater rules for new or existing development, DEQ may have to allocate greater reductions to other nutrient sources in order to meet the Jordan Lake TMDL approved by EPA.

A new cross-reference to Chesapeake Bay stormwater measures. Another new subsection, Sec. 14.13(i), requires the state to allow stormwater measures approved by the Chesapeake Bay Commission for use in meeting the Chesapeake Bay TMDL to also be used to meet the Jordan Lake and Falls Lake TMDLs based on the same nutrient reduction credit allowed under the Chesapeake Bay program. The Chesapeake Bay Program (rather than the Chesapeake Bay Commission) maintains the Chesapeake Bay TMDL model and seems to be the gatekeeper for pollution reduction credits included in the model. Credits for nutrient removal under the Chesapeake Bay model will likely turn out to be a range based on the type of stormwater measure; the area; the volume of stormwater treated; etc. It isn’t immediately clear what — if any — stormwater measures would be authorized under this provision that are not already allowed under state rules.

A Senate Proposal on Coal Ash and Commissions

June 29, 2016. The N.C. Senate quickly brought to committee and then to the floor a new bill attempting to resolve the separation of powers conflict over appointments to the Coal Ash Management Commission, the Mining Commission and the Oil and Gas Commission. (The Governor had vetoed an earlier bill to address the separation of powers issue; see this post for background on the previous bill and the Governor’s objections.)

The new bill, a repurposed House Bill 630 , represents a compromise between the Governor’s Office, the Department of Environmental Quality (DEQ), and Senate leaders. House leaders did not participate in the negotiation and will have to vote to accept the changes for H 630 to become law. A summary of H 630 as it passed the Senate below:

The Commissions. The bill eliminates the Coal Ash Management Commission, leaving implementation of the Coal Ash Management Act entirely to DEQ. The Mining Commission and the Oil and Gas Commission remain, but those laws have been amended to give the Governor power to appoint a majority of the commission members subject to confirmation by the legislature. The bill also slightly modifies the Governor’s power to remove a commission member, adding “for good cause” to existing provisions that allow the Governor to remove a member for misfeasance, malfeasance or nonfeasance. (It isn’t clear how much “for good cause” adds to the Governor’s removal power.)

The bill previously vetoed by the Governor had amended the appointment provisions for all three commissions and clarified the Governor’s power to remove commission members. In vetoing that bill, the Governor’s Office argued that commissions operating outside the Governor’s full direction and control cannot constitutionally make executive decisions. The Governor’s Office also rejected the idea of legislative confirmation of appointees as another violation of separation of powers. Agreement to H 630 suggests the Governor’s Office has softened on those positions, but the price of the agreement may have been elimination of the Coal Ash Management Commission.

Implementation of the Coal Ash Management Act. H 630 also makes significant changes to the 2014 Coal Ash Management Act (CAMA).

♦ H 630 requires Duke Energy to provide a permanent alternative water supply to well owners within 1/2 mile of the compliance boundary around a coal ash impoundment and to well owners in areas where groundwater contamination associated with the impoundment is expected to migrate based on hydrogeologic studies.

♦ By eliminating the Coal Ash Management Commission, the bill gives DEQ complete control over the risk classification of impoundments and approval of final closure plans.

♦ The process for assigning final risk classifications to each impoundment has changed significantly:

— The bill eliminates the list of specific risk classification criteria in the 2014 law, leaving only general language on consideration of “risks to public health, safety, and welfare; the environment; and natural resources”.

— The number of impoundment sites with predetermined risk classifications has expanded from the four sites designated as High Risk in the 2014 Coal Ash Management Act to include an additional 3 sites designated by H 630 as Intermediate Risk. Impoundments classified as High Risk or Intermediate Risk under CAMA must be excavated and the coal ash removed for disposal in a lined landfill or beneficial reuse. Citizen’s suits over coal ash at the three sites designated as Intermediate Risk had ended in settlement agreements requiring excavation and removal of the coal ash in those impoundments.

— H 630 allows every other impoundment site (seven total) to be classified as Low Risk as long as Duke Energy: 1. provides a permanent alternative water supply to potentially affected well owners as required under the bill; and 2. resolves all structural dam safety issues. Under CAMA, Low Risk sites can potentially be closed by dewatering and capping the ash in place instead of removing the ash for disposal or reuse. For those seven sites, a final classification decision can remain open until Nov. 30 2018 (or Nov. 30 2019 if DEQ grants an extension) to allow Duke Energy time to complete alternative water supply projects and dam safety improvements. Impoundments that fail to meet the Low Risk criteria by those dates would automatically be classified as Intermediate Risk.

Having reduced the criteria for Low Risk classification to just the two, the bill provides no opportunity for additional public input before DEQ finalizes those impoundment classifications.

♦ The bill gives DEQ more power over final closure plans. In addition to removing oversight by the Coal Ash Management Commission, the bill allows DEQ to determine the final closure plan rather than simply approving or disapproving a plan proposed by Duke Energy. Theoretically, DEQ could reject a Duke Energy proposal to excavate an impoundment rather than cap the coal ash in place. The bill doesn’t provide criteria for DEQ to apply in making final closure decisions. (The 2014 CAMA had directed the Coal Ash Management Commission to consider economic and technical feasibility; protection of public health, safety, welfare, the environment and natural resources; and potential impact on cost to ratepayers.)

♦ H 630 keeps existing CAMA language prohibiting approval of a cap in place closure plan unless the plan will “prevent…post-closure exceedances of groundwater quality standards beyond the compliance boundary”, but adds an alternative closure standard that may be less protective of groundwater.

Under the new alternative, DEQ could also approve a cap in place closure plan under standards in federal coal ash disposal rules. Unlike CAMA, the federal rule does not explicitly bar use of capping in place if the capped coal ash would be a continuing source of groundwater contamination, saying only that the closure plan must:

Control, minimize or eliminate, to the maximum extent feasible, post-closure infiltration of liquids into the waste and releases of CCR, leachate, or contaminated run-off to the ground or surface waters or to the atmosphere…

[40 CFR 257.100(b). This rule applies to closure of inactive coal ash impoundments, but similar language appears in closure standards for active impoundments.]

The standard in the federal rule does not clearly require a cap in place closure plan to prevent post-closure groundwater standard violations. Allowing use of the federal closure standard could be interpreted to give DEQ discretion to authorize capping in place as long as leaching of contaminants to groundwater will be “minimized” — a lesser requirement than preventing post-closure groundwater contamination beyond the compliance boundary. The challenge will be how to square application of the federal closure standard with groundwater corrective action requirements in other sections of the Coal Ash Management Act.

♦ A new section on coal ash reuse requires Duke Energy to identify three coal ash sites that would each be capable of processing 300,000 tons of ash for cement products — two sites to be identified in January 2017 and a third by July 2017. The bill directs Duke Energy to begin work on contracts/permit applications as soon as possible after identifying the sites and to begin operation within 24 months after receiving permits.

The Senate version of H 630 has now gone back to the House for a concurrence vote.

The Future of Watershed-Based Water Quality Rules

June 22, 2016. A controversial water quality provision in the N.C. Senate’s proposed budget would repeal (and perhaps replace –that is less certain) all state rules adopted over the last twenty years to address pollution problems caused by excess nutrients. Sec. 14.13 in the Senate version of House Bill 1030 further delays full implementation of the Falls Lake and Jordan Lake rules; creates a $2 million study of nutrient management programs; and repeals all existing water quality rules addressing nutrients pollution effective December 31, 2020.

The Senate Proposal. The provision requires the state’s Environmental Management Commission (EMC) to adopt new nutrient management rules based on the study results, but repeals all existing rules at the end of 2020 even if no alternative rules are in place. In addition to Jordan Lake and Falls Lake, the repeal/replace provision would affect water quality rules in the Tar-Pamlico River Basin; the Neuse River Basin; the Catawba River Basin; the Randleman Reservoir watershed; and the endangered species management plan in the Yadkin-PeeDee River’s Goose Creek watershed. It would also apply to any other riparian buffer requirements identified by the Department of Environmental Quality (DEQ). Still hoping for an alternative to rules, the Senate budget also appropriates $500,000 to study use of freshwater mussels to reduce the water quality impact of excess nutrients.

In most cases, state nutrient management rules also satisfy a federal Clean Water Act requirement to reduce the discharge of a pollutant (in this case nitrogen and/or phosphorus) causing impaired water quality. In North Carolina’s “nutrient sensitive” river basins and watersheds, the U.S. Environmental Protection Agency (EPA) has approved the nutrient reduction targets in state rules as meeting Clean Water Act requirements. To achieve the reduction targets, the rules require reductions in nutrient discharges by wastewater treatment plants and nutrient runoff from agriculture and development activities. Walking away from the nutrient reduction targets has implications for Clean Water Act enforcement and the state’s delegated water quality permitting programs.

Although the Goose Creek rules rely on similar pollution reduction tools (including riparian buffers and stormwater controls), those rules protect endangered species habitat. The rules resulted from a lengthy negotiation with the U.S. Fish and Wildlife Service which has responsibility for enforcing the federal Endangered Species Act. Repeal of the rules would likely bring both U.S. Fish and Wildlife and EPA into the conversation.

Nothing similar to the Senate provision appears in the House version of the budget or in any other legislation pending in the House. The two chambers are currently negotiating this (and other) differences between the House and Senate budget bills.

Have the Nutrient Rules Failed? The Senate provision describes the state’s existing nutrient management programs as failures. In reality, legislation has prevented full implementation of the Falls Lake and Jordan Lake nutrient rules. The rules that have been fully implemented — such as those in the Neuse River and Tar River basins — significantly reduced nutrient loading from wastewater discharges, agriculture and stormwater runoff. In judging the effectiveness of watershed-based strategies, some things to keep in mind: 1. Population growth and development in the watersheds continued to increase; and 2. Existing nutrient reduction strategies do not address all potential nutrient sources (smaller wastewater treatment plants; failing septic tanks; atmospheric deposition of nitrogen; and soil erosion).

DEQ has tracked the effect of nutrient rules in the Neuse River and Tar-Pamlico River basins; some of the results can be found here. A number of independent academic researchers have also studied the Neuse and Tar-Pamlico river basin rules. All of the studies confirm that sources covered by the rules significantly reduced their nutrient discharges. Wastewater treatment plants met the goal of reducing nitrogen discharges by 30% from the baseline years even as population and wastewater flows increased. Agriculture met or exceeded the 30% reduction goal for agricultural operations through use of Best Management Practices. A recent EMC report confirmed the value of riparian buffers as part of a watershed-based plan to reduce nutrient runoff from developed areas.

Complicating the picture is the fact that total in-stream nutrient concentrations have not consistently remained below baseline levels. A DEQ study completed in 2008 found that in-stream concentrations of inorganic forms of nitrogen (nitrates and ammonia) declined at the monitoring sites, but increases in organic nitrogen offset those reductions. The rules haven’t failed; given population growth and increased development in the Neuse and Tar-Pamlico river basins, nitrogen concentrations would have been higher in the absence of the rules. But the rules have not fully solved the problem of nutrient over-enrichment.

Opposition to the Nutrient Rules. Opposition has tended to be strongest in the communities on the Haw River arm of the Jordan Lake watershed affected by the Jordan Lake rules. (The Haw River watershed includes the cities of Greensboro and Burlington.) Since EMC adoption of the Jordan Lake rules in 2009, legislation to repeal or delay implementation of the rules has been introduced every year. Objections have focused on the cost of wastewater treatment plant upgrades to meet tighter discharge limits; expansion of stormwater programs; and the development impact of new riparian buffer requirements. To these upstream Haw River communities, the costs have no local benefit; water quality improvements benefit downstream communities. (Although many of the downstream communities have met similar requirements under the Neuse River rules for years to benefit the Neuse River estuary.)

The City of Durham and Durham County, affected by both the Falls Lake and the Jordan Lake rules, also have concerns about the feasibility and cost of meeting nutrient reduction goals.

Also in the background — riparian buffer requirements have long been unpopular with real estate developers and homebuilders in all of the river basins/watersheds where buffers have been part of a nutrient reduction strategy.

DEQ’s Position. DEQ has not taken a public position on the Senate proposal, but a February presentation by DEQ Assistant Secretary Tom Reeder to the legislature’s Environmental Review Commission questioned the effectiveness of the watershed-based nutrient rules. Reeder’s presentation tended to emphasize the cost of the nutrient rules and limited impact on instream nitrogen and phosphorus concentrations. Asked what alternative to the nutrient management rules would protect the Falls Lake and Jordan Lake drinking water supplies, Reeder responded that drinking water treatment may become more expensive. The presentation suggested little DEQ commitment to defend watershed-based nutrient rules and a willingness to shift the cost of impaired water quality to communities using Falls Lake and Jordan Lake as drinking water sources. Reeder’s presentation did not address the impacts of a failure to reduce excess nutrients on natural resources such as fisheries; recreational use of these rivers, lakes and estuaries; or compliance with the Clean Water Act.

Possible compromises. Past studies of the Neuse and Tar-Pamlico rules suggest a need to fill gaps in the nutrient strategies, but do not provide a scientific case for abandoning watershed-based nutrient reduction strategies. Nearly seven years after final adoption of the Jordan Lake rules, opponents have not identified an alternative approach to protect drinking water and meet Clean Water Act requirements.

At the same time, the EMC’s recent riparian buffer report identified potential buffer rule changes to ease the burden on property owners while maintaining the buffer’s water quality benefits. The legislature could also look at the possibility of authorizing cost-sharing arrangements to allocate some of the upstream cost of water quality improvements to the downstream communities that will benefit. The idea surfaced briefly during development of the Falls Lake and Jordan Lake rules, but wasn’t pursued at the time.

Coal Ash, Contaminated Wells and Providing a Safe Drinking Water Supply

May 31, 2016. The previous post discussed legislative efforts to resolve the separation of powers conflict still hovering over implementation of the 2014 Coal Ash Management Act. The same piece of legislation, Senate Bill 71, also attempts to fix other problems that have developed around coal ash cleanup efforts. One of the most significant changes in Senate Bill 71 responds to concerns about contaminated drinking water wells near coal ash ponds. The final version of Senate Bill 71 approved today by both the House and Senate gives more well owners the certainty of an alternative water supply. A comparison of Senate Bill 71 to the original Coal Ash Management Act below.

2014 Coal Ash Management Act:

♦ Guaranteed an alternative water supply only to well owners located within 1/2 mile and down-gradient of the coal ash impoundment. Well testing and groundwater assessment done around the impoundments since 2014 have detected high levels of one or more contaminants associated with coal ash, including hexavalent chromium, in wells located up-gradient or side-gradient of the impoundments. Although groundwater usually follows surface topography, the underlying geology and human activity can alter the direction of flow. The alternative water supply provision in the Coal Ash Management Act did not apply to those wells.

♦ The requirement for Duke Energy to provide an alternative water supply was contingent on well sampling showing a contaminant associated with coal ash above the level allowed under state groundwater standards. The lack of a state groundwater standard for some contaminants (including venadium and hexavalent chromium) led to confusion, conflicting advice to well owners, and lack of clarity on the standard DEQ would use to require Duke Energy to provide an alternative water source. For background on the controversy over the groundwater standards see an earlier post here . Many well owners have received bottled water for months because of documented well contamination, but remain uncertain whether DEQ will require Duke Energy to provide a permanent alternative water supply.

♦ The provision on alternate water supply enacted in 2014, G.S. 130A-309.209(c), did not specifically require a permanent solution — such as connection to a public water system — rather than bottled water.

♦ Under the 2014 law, owners of contaminated wells located up-gradient and side-gradient of a coal ash impoundment might receive alternate supplies under the state’s groundwater corrective action rules,. The rules (referenced in the 2014 Coal Ash Management Act) apply to all groundwater contamination incidents and require a company responsible for groundwater contamination to address health risks created by the contamination. The corrective action rules, however, only apply to a person/company shown to be 1. responsible for contamination that 2. exceeds state groundwater standards. Two years after enactment of the Coal Ash Management Act, controversy surrounds the standards for some contaminants and groundwater studies have not yet been sufficient to determine whether the coal ash ponds caused contamination found in up-gradient and side-gradient wells.

Senate Bill 71:

♦ Requires Duke Energy to provide an alternative water supply to the owner of every well located within 1/2 mile of the compliance boundary surrounding a coal ash pond. (The compliance boundary — either 250 feet or 500 feet from the edge of the impoundment depending on its age — is the point at which exceedance of a state groundwater standard would be a violation.)

♦ For wells within 1/2 mile of the compliance boundary around an ash pond, alternative water supply would be required without regard to the location of the well in relation to the impoundment (down-gradient, up-gradient or side-gradient) or demonstration of a groundwater standard violation.

♦ The bill also requires Duke Energy to provide alternative water supply to well owners located outside the 1/2 mile perimeter, but located in an area at risk of contamination because of the projected migration of groundwater contamination.

♦ The bill expressly requires Duke Energy to provide a permanent alternative water supply source and creates a preference for connection to a public water system. The bill allows installation of a filtration system instead if extension of a water line would be cost-prohibitive. The State Water Infrastructure Authority would review Duke Energy’s alternative water supply plan for each impoundment site and make the final decision on the type of permanent water supply.

Several things are notable about the Senate Bill 71 approach. First, the bill provides certainty to well owners that would not have been possible as clearly or as quickly any other way. But the bill is also a reminder that property owners affected by groundwater contamination from other sources have a longer, more difficult and less certain road to a safe drinking water supply.

A Proposal: Insure owners of wells near coal ash sites aren’t exposed to greater health risks as a result

April 18, 2016. An earlier post discussed the confusion over “do not drink” advisories issued — and later withdrawn — for a number of wells near coal ash sites. There continues to be confusion among legislators, state agencies and the public about the correct response to high levels of hexavalent chromium (Cr-6) and vanadium in drinking water wells near coal ash impoundments. This post attempts to clarify some misconceptions and offers a proposal.

First, a clarification about individual contaminant standards. Some legislators understood presentations by the Department of Environmental Quality (DEQ) and the Department of Health and Human Services (DHHS) to mean that there are multiple, inconsistent standards for a contaminant. In fact, the state uses one standard for each contaminant to determine health risk and require groundwater remediation. But as the earlier post explained, the standard may come from Safe Drinking Water Act standards or state groundwater rules. Drinking water standards address a narrow set of contaminants likely to be found in public water systems; groundwater standards cover a broader range of extremely hazardous substances that may become a health threat because of a specific pollution incident.

State groundwater rules list health-based concentration limits for many hazardous substances, but also recognize that a pollution incident may involve a contaminant that does not yet have a groundwater standard. For those contaminants, the rules set the default standard at “non-detect” — any detectable concentration of the contaminant would be a violation. But the rules also create a process for setting an interim groundwater standard that would allow concentrations above detection levels based on an evaluation of health risk. DHHS used that process to develop the interim standards for vanadium and hexavalent chromium (CR-6) that led to “do not drink” advisories for a number of wells near coal ash facilities.

Gaps in the changing state response. DEQ and DHHS offered a two-part explanation for withdrawal of the “do not drink” letters. The two points and some additional context for each:

Levels of vanadium and Cr-6 in the wells do not violate state or federal drinking water rules. Since there is no drinking water standard for either vanadium or Cr-6, this is true as far as it goes. But the lack of a drinking water standard does not imply safety. State and federal agencies have never relied solely on drinking water standards to make decisions about mitigation of health risks at contaminated sites because drinking water standards do not cover many extremely hazardous substances. That is why the process for asking DHHS to set interim state groundwater standards exists. The question should be whether concentrations of vanadium and Cr-6 in the wells represent a significant additional health risk that can be minimized by either providing an alternative water source or remediating the groundwater.
A number of large N.C. public water systems also do not meet the DHHS interim standards for vanadium and Cr-6. The implication has been that the well water is as safe as water supplied to customers of public water systems. In recent weeks, media and public interest organizations have looked more closely at the levels of vanadium and Cr-6 in public water systems as compared to the wells near coal ash facilities. Although some N.C. water systems exceed the DHHS interim standards for vanadium or hexavalent chromium, most water systems appear to meet the DHHS standards. A WRAL news story includes a chart showing both maximum and average concentrations of Cr-6 in public water systems across the state here. DHHS set the interim standard for Cr-6 at 0.07 parts per billion, representing a 1:1 million cancer risk over a lifetime. WRAL’s analysis found that only about one-third of N.C.’s public water systems have average concentrations of Cr-6 exceeding 0.07 ppb. More importantly, those public water systems come much closer to meeting the DHHS standard than a number of the tested wells. The public water systems with the highest average concentrations of Cr-6 had concentrations less than half that of some wells tested near Buck Steam Station.

A proposal: Issuance of health advisories and steps to provide alternative water supply to well owners should be based on comparative health risk.

The discussion of health advisories issued to well owners around coal ash sites has become focused on whether public water systems meet the DHHS recommended standards for vanadium and Cr-6. That is the wrong question. Many (most) North Carolina water systems meet the DHHS standards; those that do not still provide water that is safer than water in a number of the tested wells. Environmental remediation programs exist in part to reduce health risks created by a pollution incident. To the extent well owners will be exposed to greater health risk as a result of groundwater contamination, the additional risk should be eliminated or minimized to the extent possible. The question is not whether all public water systems meet the DHHS standards. The question is whether groundwater pollution has exposed these well owners to greater health risk — and one way to answer that question is to compare contaminant levels in the well water to the nearest public water system. If the public water system provides water with lower contaminant concentrations that translate into lower additional cancer risk and less risk of acute toxicity, the well owner should be provided with advice on the higher risk of drinking the well water. And any person responsible for the contamination should be required to provide an alternative water source.

To Drink or Not to Drink: A Change in Advice for Well Owners

March 17, 2016. In 2015, the N.C. Division of Public Health (Department of Health and Human Services) sent letters advising the owners of 369 wells located near coal ash ponds not to drink their well water because of elevated levels of vanadium and chromium-6. Last week, the Division of Public Health sent letters to those same well owners to withdraw the “do not drink” advisory. Some questions and answers on the conflicting advice below.

What are vanadium and chromium-6 (Cr-6)? Both elements occur naturally in the environment and can be found in coal ash. Both may be concentrated in the air or in groundwater as a result of industrial activities. Inhalation of Cr-6 (or hexavalent chromium) has been associated with increased risk of lung cancer. In 2010, the U.S. Environmental Protection Agency began a new health study to determine whether ingestion of Cr-6 in drinking water increases other types of cancer risk. The Erin Brokovitch story of hexavalent chromium contamination in the town of Hinkley, California raised public awareness of Cr-6 as a public health issue. In Hinkley, Pacific Gas & Electric had used Cr-6 as an additive in cooling water for a natural gas compression station. The Cr-6 percolated into groundwater from unlined ponds used to store the cooling water, contaminating the town’s drinking water supply. (Levels of Cr-6 in Hinkley’s groundwater were exponentially higher than concentrations found in North Carolina wells.)

Are there drinking water standards for vanadium and Cr-6? There is no federal drinking water standard for vanadium. The U.S. Environmental Protection Agency has adopted a drinking water standard for total chromium of 100 parts per billion (ppb); the standard covers combined concentrations of chromium-3 (a nutritional element found in plant material) and chromium-6. Water systems required to meet federal Safe Drinking Water Act standards monitor total chromium levels, but not necessarily Cr-6. Nationally, only the State of California has adopted a specific drinking water standard for Cr-6. In 2014, after years of study prompted by the Hinkley contamination, California adopted a standard of 10 parts per billion for Cr-6 in drinking water — 1/10th the concentration allowed under the federal drinking water standard for total chromium.

How are N.C. groundwater standards different from federal drinking water standards? In part, the two sets of standards serve different purposes. Drinking water standards adopted by U.S. EPA under the Safe Drinking Water Act only apply to the treated water that public water systems provide to their customers. Under the law, “public water system” means any system providing water to 15 or more connections or to 25 or more people whether the system is operated by a local government or a for-profit water utility. Federal drinking water standards do not apply to privately owned water supply wells serving individual homes or businesses.

N.C.’s groundwater standards are used to identify unsafe levels of groundwater contamination; set goals for groundwater remediation; and advise well owners on use of water from affected wells. Most N.C. groundwater standards track the federal drinking water standard for the same contaminant, but in a few cases the state has adopted a more stringent groundwater standard or has adopted a groundwater standard for a contaminant that has no corresponding drinking water standard. Leading up to the well testing around coal ash ponds, N.C. had no groundwater standard for vanadium and no specific standard for Cr-6. although the state had a groundwater standard of 10 ppb for total chromium (more stringent that the 100 ppb drinking water standard for total chromium.)

How does N.C. set groundwater standards? The N.C. Environmental Management Commission has adopted state groundwater standards as rules. Since existing groundwater standards may not address every potential contaminant, the rules also create a process for developing a temporary standard — an Interim Maximum Allowable Concentration or “IMAC” — to address an unregulated contaminant. Epidemiologists in the N.C. Division of Public Health generally develop a recommended IMAC based on review of human health effects such as toxicity and increased cancer risk.

Why did the Division of Public Health send “do not drink” letters in 2015 based on vanadium and chromium-6? Since no state groundwater standard or federal drinking water standards existed for vanadium and Cr-6, DEQ asked the Division of Public Health to develop interim groundwater standards (the IMACs described above) to be used in assessing wells around the coal ash ponds. Division of Public Health calculated a standard of 0.07 ppb for Cr-6 and 0.3 ppb for vanadium. In each case, the deciding factor was the concentration associated with an incremental increase in cancer risk. The table below shows the IMAC standard compared to the federal Safe Drinking Water Act standard and the N.C. groundwater standard.

Contaminant	Fed. Drinking Water Standard	N.C. Groundwater Standard	IMAC
Vandadium	No standard	No standard	0.3 ppb
C.hromium-6	None –Total Cr 100 ppb	None – Total Cr 10 ppb	0.07 ppb

Why did Division of Public Health withdraw the “do not drink” letters? None of the well owners who received “do not drink” letters based solely on the vanadium and Cr-6 IMAC standards have well water that would violate Safe Drinking Water Act standards for a public water system. DEQ has reported that 70% of public water systems in the U.S. exceed the IMAC standards set by Division of Public Health, including several large public water systems in North Carolina. (The information, provided in a report to the legislature’s Environmental Review Commission, did not indicate how many of those systems exceeded the IMAC standard for vanadium versus Cr-6. You can find the entire DEQ presentation to the Commission here.)

The gap between the IMAC standards and Safe Drinking Water Act standards meant that well owners were being advised not to drink water that meets current drinking water standards and could lawfully be provided to customers of a public water system. As a practical matter, that also means the well owners may not have access to an alternative water supply of any better quality since the nearest public water system also may not meet the IMAC standards.

None of this means the analysis done by the Division of Public Health in developing the IMACs was wrong. Environmental and public health standards change with additional knowledge; the fact that the U.S. Environmental Protection has undertaken a new health study of Cr-6 in particular suggests some question about the adequacy of the federal drinking water standard based solely on total chromium. The standards adopted by EPA and the states also sometimes involve compromise between the most protective health-based standard and the practicalities (and cost) of meeting that standard.

Making Sense of a Coal Ash Penalty

March 8, 2016. The civil penalty for groundwater violations around Duke Energy’s Sutton Plant in New Hanover County has taken several unprecedented twists and turns. This post looks at the $25 million civil penalty for groundwater contamination at the Sutton Plant that became a $7 million civil penalty for groundwater violations at all 14 coal ash sites in the state and then a $7 million civil penalty just for the Sutton violations.

Groundwater Enforcement 101. The Department of Environmental Quality (DEQ) can order remediation of groundwater contamination and assess civil penalties for violation of the state’s health-based groundwater standards. Some contaminants (like arsenic) occur naturally; if natural “background” levels of the contaminant exceed the state standard, the background level becomes the standard. State rules allow for some exceedence of groundwater standards within the footprint of a waste disposal facility, but set a “compliance boundary” around the facility where the standards must be met. Coal ash ponds permitted before 1983 must meet groundwater standards within 500 feet of the ash pond; those permitted later have a 250-foot compliance boundary.

To assess a civil penalty for coal ash contamination, DEQ must show: 1. Contaminants in the groundwater exceed the state standard (which may require determining background levels if the contaminant occurs naturally); 2. Exceedences occur at or beyond the compliance boundary; and 3. Coal ash caused or contributed to the contamination. State law caps the maximum penalty for a single groundwater violation at $25,000. In setting the specific penalty amount within the cap, DEQ considers a number of penalty factors including the extent of environmental harm; whether the violation was intentional; and any compliance costs the violator may have avoided. Since DEQ can assess daily penalties for continuing violations, the total civil penalty may exceed $25,000 if a violation continues over a period of time.

Now a Little Coal Ash History. The state originally permitted coal ash ponds as wastewater treatment systems. The ponds receive, treat and discharge process wastewater and sometimes stormwater. A coal ash pond functions like the settling basins used in other wastewater treatment systems; the coal ash settles out of the wastewater slurry, reducing pollutants in the top layer of pond water. The utility then discharges wastewater from the top of the pond to a river, stream or lake under a Clean Water Act Permit — the National Pollutant Discharge Elimination System (or “NPDES”) permit. NPDES permits protect surface water from pollution; since groundwater was never the focus, the permits historically required very limited groundwater monitoring around coal ash ponds.

In response to pressure for national coal ash disposal standards, companies operating coal-fired power plants began a program of voluntary groundwater monitoring in 2006 and provided results to the state. (As a voluntary program, the power companies alone decided what contaminants to monitor for and where to put monitoring wells.) By 2009, state water quality officials had become so concerned about the utilities’ groundwater data that the Division of Water Quality (DWQ) moved to put stronger groundwater monitoring conditions on NPDES permits for coal ash ponds as the permits came up for renewal. The new permit conditions made monitoring for specific contaminants mandatory and required DWQ approval of the monitoring plan so monitoring wells would be appropriately placed to identify violations at the compliance boundary.

As DWQ began adding monitoring conditions to permits, the senior manager in DWQ’s groundwater protection program issued a memo explaining how the program would take enforcement actions based on the new groundwater monitoring data. The memo applied to any facility that had operated for a long period of time before being required to do groundwater monitoring. It implicitly recognizes that imposing groundwater monitoring conditions after many years of facility operation may result in immediate detection of groundwater exceedences — giving the operator little opportunity to prevent a violation. The memo did not completely foreclose the possibility of a civil penalty for groundwater violations at these facilities, but indicated that DWQ may not issue a Notice of Violation (the first step to a penalty) as long as the operator responded to state requests for assessment and clean up of any contamination.

The Sutton Plant Civil Penalty. The Sutton Plant’s wastewater system, consisting of two coal ash ponds built in 1971 and 1984, has had an NPDES permit since 1977. For most of the system’s history, the permit only required monitoring for a limited number of groundwater quality parameters — groundwater level, pH, Arsenic, Iron, Total Dissolved Solids, Chlorides and Selenium. When DWQ renewed the Sutton Plant’s NPDES permit in 2011, the new permit required monitoring of additional contaminants (including boron, thallium, and manganese) under a state-approved monitoring plan designed to detect exceedences at the compliance boundary. In March 2015, DEQ assessed a record $25 million civil penalty for groundwater violations around the Sutton Plant. The civil penalty covered a number of different groundwater standard violations over varying periods of time. The earliest violations identified in the assessment document dated back to 2009 (for boron) and 2010 (for thallium). Most of the violations (for iron, arsenic, selenium, manganese and total dissolved solids) dated from 2012 or 2013. To reach the $25 million assessment, DEQ assessed either $1,000 or $5,000 per day (from initial detection to the assessment date) for each contaminant that exceeded state groundwater standards.

A Big — and Short-Lived — Settlement. Duke Energy appealed the penalty and several months later DEQ agreed to a settlement reducing the civil penalty to $7 million. The most notable thing about the September 2015 settlement agreement was not the penalty reduction, but the fact that the settlement would have resolved all groundwater violations (known or discovered in the future) around all 14 Duke Energy coal ash impoundment sites in the state. Southern Environmental Law Center (SELC), on behalf of several environmental organizations, challenged the settlement agreement in court. SELC’s appeal did not contest the penalty reduction for the Sutton violations, but argued Administrative Law Judge Phil Berger, Jr. had no authority to approve a settlement agreement affecting issues beyond the Sutton civil penalty. SELC particularly complained that the settlement agreement affected other coal ash enforcement cases without notice to the parties in those cases — including organizations represented by SELC. Those enforcement cases dealt with specific actions required of Duke Energy to address groundwater contamination around coal ash ponds at multiple sites.

Key provisions in the September 2015 DEQ-Duke Energy settlement agreement

♦ Duke Energy agreed to pay a civil penalty of $7 million and accelerate groundwater remediation at the Sutton, Asheville, Belews Creek and H.F. Lee plants. The settlement agreement did not set a timeline for the accelerated remediation.

♦ DEQ agreed to dismiss groundwater enforcement cases already pending in superior court related to the Sutton Plant and the Asheville Steam Station. See the SELC appeal of the settlement agreement for more on the relationship between the settlement agreement and pending enforcement cases.

♦ DEQ agreed not to issue Notices of Violation, notices requiring assessment or remediation, civil penalty assessments or to take any other enforcement actions against Duke Energy based on groundwater conditions “at any of the Duke Energy Sites” as long as Duke Energy complied with requirements of the Coal Ash Management Act related to groundwater assessment, remediation and closure of the coal ash basins. Under the agreement, the “Duke Energy Sites” included all 14 coal ash sites across the state.

♦ DEQ agreed not to change groundwater monitoring conditions in existing or future NPDES permits for the coal ash ponds unless required by court order; a federal or state law; a rule; or in response to an immediate threat to public health. Under the agreement, an “immediate threat to public health” had to involve something more than violation of a health-based groundwater standard. In effect, the settlement prevented DEQ from using its permitting authority to requiring monitoring for additional contaminants.

♦ DEQ agreed not to use groundwater monitoring data collected under either the NPDES permit conditions or under provisions in the Coal Ash Management Act for any purpose other than classification and closure of the coal ash ponds. In other words, DEQ agreed not to use groundwater monitoring data for enforcement purposes.

Reversing Direction. In February, Superior Court Judge Paul Ridgeway held a hearing on SELC’s objections to the Sutton settlement agreement. Persuaded that the settlement agreement affected the other enforcement cases already before him, Judge Ridgeway indicated an intent to take jurisdiction over the settlement agreement unless Judge Berger narrowed the scope of his order in the Sutton civil penalty case. Charlotte Business Journal has reported that Judge Berger later issued a revised order at the request of DEQ and Duke Energy. According to the article, the settlement agreement between Duke Energy and DEQ did not change, but the order approving the settlement has been expressly limited to the Sutton civil penalty case. (I have not been able to find the revised order on either the Office of Administrative Hearings or DEQ website.) As a result, the $7 million civil penalty now covers only groundwater violations at the Sutton Plant.

Signs and Portents? DEQ made several unusual decisions in assessing and then settling the Sutton civil penalty case:

The original $25 million civil penalty for the Sutton groundwater violations broke from past enforcement practices. State programs rarely impose daily penalties for newly discovered groundwater violations. Daily penalties are usually reserved for willful, intentional violations and for violators who fail to quickly address contamination once it has been detected. DEQ didn’t cite either of those aggravating factors in assessing the original $25 million Sutton penalty. To reach the $25 million total, DEQ assessed a penalty of either $1,000 or $5,000 a day (depending on the contaminant) from the date of detection to the date of assessment. (The contamination persists today and will until coal ash on the site has been removed, which everyone understands will require more time.) The question is whether DEQ’s very aggressive penalty for the Sutton violations indicates a change in enforcement policy that may affect other groundwater cases.

There doesn’t seem to be any precedent for DEQ agreeing –as it did in the original Sutton settlement — to limit its own permitting and enforcement authority to settle a civil penalty case. State agencies often settle civil penalty cases for a lower penalty amount. In the Sutton settlement, DEQ also agreed not to change groundwater monitoring conditions on Duke Energy’s NPDES permits except in very narrow circumstances. Most of those circumstances required some outside force — federal law, a court order — to compel the change. In effect, DEQ gave up the ability to use its permitting authority to require monitoring for additional contaminants. The department also agreed not to issue Notices of Regulatory Requirements (orders for assessment and remediation of contamination) or take new enforcement actions against Duke Energy based on coal ash contamination at the 14 sites in N.C. The settlement agreement was conditioned on Duke Energy complying with provisions in the Coal Ash Management Act on groundwater assessment and corrective action, but those requirements assume application of state groundwater regulations. It isn’t clear why DEQ would agree to give up use of normal groundwater enforcement tools like the Notice of Regulatory Requirements. Limits on DEQ use of groundwater data for enforcement purposes could have affected the state’s ability to address groundwater problems discovered later.

What Does it Mean? Assuming Judge Berger’s revised order has set much of the Sutton settlement agreement aside, the Sutton case is mostly interesting as an insight into DEQ’s enforcement decision-making. It is hard to identify a consistent principle that would explain both DEQ’s very aggressive use of civil penalty power in the first instance and DEQ’s willingness to give up significant permitting and enforcement authority to settle the case. The question is whether the Sutton decisions were peculiar to it or have broader implications.

SmithEnvironment Blog

Environmental Law and Policy from a North Carolina Point of View