Jackson Kelly PLLC

Energy and Environment Monitor

An Unexpected Present

January 3, 2018

By: Blair M. Gardner

            One of the pleasures of the Christmas season is the giving and receiving of gifts. The pleasure is particularly enhanced when the gift is unexpected, or when it has a unique value to its recipient. By these measures, the U.S. District Court in Lexington, Kentucky delivered a wonderful present in a decision issued on December 28.

            The case, Kentucky Waterways Alliance, et al., v. Kentucky Utilities [link], is a citizens’ suit in which the environmental groups alleged that the utility had violated both the Resource Conservation and Recovery Act (RCRA) and the Clean Water Act (CWA). Specifically, pollutants such as total dissolved solids and heavy metals (including selenium, arsenic, cadmium and lead) had leached from coal ash placed in a waste impoundment to serve KU’s E.W. Brown Generating Station near Harrodsburg, Kentucky. The waste impoundment had been constructed in the 1950’s and was not lined, meaning that no barrier exists to prevent water in the impoundment from percolating through the waste ash into the soil and eventually into groundwater. The groundwater, in turn, emerges through a series of springs into Herrington Lake, a major recreational and fishing area.

            None of these facts alleged by the environmental plaintiffs was news. The utility had determined in 2011 that it was prudent to change the method for disposing of coal ash and had commenced engineering studies and permitting to do so. Water quality testing was also conducted at locations that flowed into Herrington Lake which confirmed that some hydrologic connection did exist between the coal ash impoundment and the lake. The state was dealing with all of this through a negotiated consent order when the environmental groups brought suit late in July 2017. In bringing their RCRA and CWA claims, the groups alleged that the state’s remedial actions were inadequate and that declaratory and injunctive relief was necessary to prevent the alleged irreparable harms. The utility sought dismissal of the RCRA claim on the grounds of standing. As to the CWA claim, the utility denied that any cause of action existed because the percolation from the impoundment into the groundwater did not constitute a discharge under the act. The district court agreed as to both grounds and dismissed the action.

            The dismissal of the action for lack of standing was based on the type of relief – the declaratory judgment and injunction – requested by the environmentalists. Because it duplicated what the state had already required the utility to do, the harms alleged could not be redressed by any relief the court could enter. One remedy that the environmentalists requested, the excavation and disposal of approximately six million cubic yards of ash, was rejected by the court because it invited interference with and second guessing of the decision already made by the state.

            It was the district court’s decision on the CWA claim, however, which is as surprising as it is welcomed by anyone who defends CWA actions. The court carefully considered the allegations that the movement of pollutants from the impoundment into the lake via the groundwater constituted a “discharge,” which is a necessary fact that must be proven for a CWA cause of action to exist. The hydrologic connection provided by groundwater as alleged in the complaint is perhaps the most contentious and challenging issues in contemporary environmental law. It is the focal point of virtually all CWA litigation as well as policy issues such as the on-going dispute about what constitutes a “water of the United States.”

            The district court weighed the growing body of conflicting decisions addressing whether the nature of the pollutant that emerged in Harrington Lake constituted a discharge regulated by the CWA. It concluded that it was not for three reasons. First, the groundwater itself was not a “navigable water” as defined in the statute. Second, any seepage of pollutants from the coal ash impoundment into the lake was not from a “point source,” which is the basis for regulating discharges under the CWA. Third, such an interpretation would convert all non-point source pollution (e.g., diffused waters, surface percolation) into a point source, which the court found to be contrary to the text of the statue and the limitations that Congress had made in the act.

            Finally, this decision is significant for one additional reason. On September 20, 2017 the environmental group, Earth Justice, sent a “notice of intent to sue” to Duke Energy over coal ash facilities at three Indiana electricity generating stations.  Suit could have been commenced before Christmas. In the New Year, we will find out whether the Kentucky Utilities decision may cause the citizens to reconsider their decision to proceed with an action.

            The case is Kentucky Waterways Alliance, et al., v. Kentucky Utilities, C.A. No. 5:17-292-DCR, issued by the Eastern District of Kentucky.

This article was authored by Blair M. Gardner, Jackson Kelly PLLC.


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