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Duke Energy North Carolina president Paul Newton. Image courtesy of Duke Energy/Youtube.

Duke Energy is appealing a $25 million civil penalty imposed by North Carolina environmental regulators earlier this month for groundwater violations at the company’s L.V. Sutton steam electric plant in Wilmington.

The North Carolina-based company said Tuesday it will “vigorously contest” the record setting fine.

“This is a difficult step, but we cannot allow this level of regulatory overreach to go unchallenged. The actions by NC DENR send a chilling message to the North Carolina business community,” Duke Energy’s North Carolina president Paul Newton said.

The fine was announced by the North Carolina Department of Environment and Natural Resources (DENR) on March 10.

Duke Energy said it will file a formal appeal with the North Carolina Office of Administrative Hearings by April 9 outlining instances where it believes the DENR acted “contrary to law” and “exceeded its authority.”

“We take very seriously our responsibility to care for the communities around our facilities. That’s why we monitored groundwater at the Sutton plant, routinely shared data with the state, and voluntarily acted to ensure local residents continue to have a high-quality water supply,” Newton said.

The Sutton plant began operation as a coal-fired electric generating station in 1954.

The three coal units were retired in 2013 as a new natural gas-fired unit came online at the site.

In August 2014, the DENR sent Duke Energy Progress a notice of violation and intent to enforce for Sutton after lawsuits were filed in 2013 to stop the violations.

Earlier this month the DENR said it determined that Duke Energy allowed coal ash contaminants to seep into the groundwater at Sutton for up to several years in some cases.

Additional fines for the violation are still possible.

Duke Energy is planning to close 32 ash basins in North Carolina starting with facilities in Asheville, Dan River, Riverbend, and Sutton.

“We are doing all we know to work constructively with NC DENR to meet North Carolina’s aggressive deadlines to close ash basins,” Newton said.

Last month Duke Energy inked a deal to settle a federal criminal probe into a 2014 North Carolina coal ash spill for $100 million.

The U.S. attorney’s office in Raleigh has been investigating a 2014 spill at Duke’s Eden plant that sent an estimated 39,000 tons of ash and toxic materials into a 70 mile stretch of the Dan River.

The proposed settlement is scheduled to go before a North Carolina federal judge for approval on April 16.