DEQ Reaches Preliminary Agreement for the Units 1&2 Stage I & II Evaporation Ponds at Colstrip Power Plant
HELENA—The Montana Department of Environmental Quality and Talen Montana, LLC, the operator of the Colstrip Steam Electric Station (CSES), took a step forward in resolving the dispute about groundwater contamination caused by leaking ash ponds associated with Units 1&2. In an agreement-in-principle signed last week, DEQ retained approval of the Alternative 10 remedy to clean up the contamination.
In November 2020, DEQ selected a remedial alternative for the ponds (Alternative 10) that involved excavating and relocating all coal ash to a new, lined impoundment located above the water table. Talen invoked dispute resolution on Dec. 17, 2020, regarding DEQ’s selection and the amount of financial assurance required for the alternative. Following several months of dispute resolution between the parties, a good faith agreement has been reached that sets the framework for a final settlement agreement anticipated later this year.
“DEQ believes that this is a productive step forward,” said Jenny Chambers, DEQ waste management and remediation division administrator. “This agreement advances the dispute resolution process and brings us closer to a settlement to address the contamination at the Colstrip Ponds.”
The Colstrip site is a complex contamination site that is regulated under an Administrative Order on Consent (AOC). The AOC was an enforcement action taken by DEQ in 2012 that requires an investigation and remediation plan to address groundwater contamination caused by leaking ash ponds.
In the preliminary agreement, DEQ retains its selection of Alternative 10 and will secure financial assurance for this alternative. Talen will proceed on schedule with remedial design of Alternative 10 but will be allowed to concurrently evaluate a single additional alternative that must be completed within 2 years. At the conclusion of Talen’s evaluation, Talen will have the option of petitioning DEQ to amend the remedy selection for the Units 1&2 Ponds through a Request to Amend.
Allowing Talen to evaluate and design an additional alternative during the next two years will not delay remedy implementation for either DEQ’s current selection of Alternative 10, or for the additional alternative should Talen’s petition for amending the remedy be approved by DEQ, as remedial design is expected to take at least two years regardless of which remedial alternative is selected.
DEQ and Talen have participated in a formal dispute resolution process since December of 2020. Because of the complex, technical nature of issues covered during the dispute resolution process, several extensions were granted in order to thoroughly cover the issues. The agreement, or term sheet, was developed during Phase II of the dispute resolution process and summarizes key terms of an agreement-in-principle between Talen and DEQ to resolve the pending dispute.
Discussions on financial assurance throughout the dispute resolution process resulted in DEQ approval of a financial obligation of $163,324,679. This amount secures adequate resources for the selected cleanup. The amount will be reviewed annually, in accordance with the AOC, and may be adjusted as appropriate to ensure it is sufficient to cover the full cost of the remedy.
Should Talen submit a Request to Amend, DEQ will evaluate it using the same criteria DEQ has used to make other remedy decisions under the AOC. In the event significant changes are proposed to DEQ’s selected remedy, a public participation process would include a public comment period and public meeting.
This term sheet is not a final settlement agreement and does not create legally binding obligations, but it is the intent of the parties to enter into a settlement agreement to conclude the dispute resolution process. DEQ anticipates a settlement agreement will be finalized by the end of the third quarter of calendar year 2021.Tags: News and Press Release