Interim Joint Committee on Natural Resources and Environment


Minutes of the<MeetNo1> 6th Meeting

of the 2011 Interim


<MeetMDY1> November 3, 2011


Call to Order and Roll Call

The<MeetNo2> 6th meeting of the Interim Joint Committee on Natural Resources and Environment was held on<Day> Thursday,<MeetMDY2> November 3, 2011, at<MeetTime> 1:00 PM, in<Room> Room 149 of the Capitol Annex. Representative Jim Gooch Jr., Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Brandon Smith, Co-Chair; Representative Jim Gooch Jr., Co-Chair; Senators Joe Bowen, Ernie Harris, Ray S. Jones II, Bob Leeper, Katie Kratz Stine, Robert Stivers II, Johnny Ray Turner, and Robin L. Webb; Representatives Hubert Collins, Stan Lee, Marie Rader, John Short, Kevin Sinnette, Fitz Steele, Jim Stewart III, and Jill York.


Legislative Guest: Representative Fred Nesler.


Guests: Bruce Scott and Tony Hatton, Energy and Environment Cabinet; George Siemens and John Voyles, LG&E; Kim Nelson, Kentucky Coal Association; Danny Gray, Charah, Inc.; and Dr. Jon Gassett, Mark Mangeot, and Margaret Everson, Kentucky Department for Fish and Wildlife Resources.


LRC Staff: Tanya Monsanto, Stefan Kasacavage, and Kelly Blevins


Report from the Division of Waste Management on the future rules governing the disposal of coal combustion residuals

Commissioner Bruce Scott and Deputy Commissioner Tony Hatton testified on coal construction residuals (CCR). Kentucky deems CCRs as a special waste. There are 20 plants, 13 landfills, and 43 ash ponds in the inventory of regulated sites. There are currently five applications for new sites or the expansion of current sites. In 2008, there were 42 million tons of coal mined and that tonnage produced 10 million CCRs. Of the 10 million CCRs, 46 percent was disposed of in landfills, 34 percent in ash ponds, and 20 percent in beneficial re-use.


            Commissioner Scott explained that at the federal level there is an open dump rule which sets general requirements and performance standards for disposal of CCRs. The United States Environmental Protection Agency (USEPA) determined CCRs are not hazardous waste; however, in June 2010 USEPA issued two different notices of proposed rulemaking under the federal Resource Conservation and Recovery Act (RCRA). One notice was under section C and the other under Section D. Section D would treat CCRs as a hazardous waste and at the time the notices were issued, it appeared USEPA would treat it as a hazardous waste. USEPA then created a new section “C” approach. If CCRs were treated as a hazardous waste then disposal would be treated very differently from how it is currently handled. It would force all waste to be landfilled. Ash ponds would be removed, and it would stop beneficial re-use of CCRs.


            After the first notices, many states responded that the non-hazardous approach under section C was poorly detailed. Several agencies including Kentucky’s environmental protection agency, the Environmental Commission of States, and state environmental commissioners submitted comments on the notices asking USEPA to address CCRs as a non-hazardous waste. All fifty states agreed that the section C approach was more desirable than deeming CCRs as a hazardous waste. There also was concern about the science and methodology that compelled USEPA initially to deem CCRs as hazardous.


            In October, USEPA issued a new regulation that predicated on suspected mismanagement of CCRs across the nation which prompted each state to investigate their CCR disposal sites. Commissioner Scott noted that investigation did not disclose reasons for Kentucky to be concerned about its CCR sites. Congress passed House Resolution (HR) 2273 and Senate Resolution (SR) 1751. Each is supported by waste management directors across the nation. Commissioner Scott stated that this legislation would treat CCRs as a nonhazardous waste that must be disposed of in permitted landfills. All state waste management directors agree there should be more regulatory management of CCRs but not declare it a hazardous waste and prohibit beneficial re-use of the product. He noted the legislation would provide improvements and enhancement to regulate CCRs. Finally, Commissioner Scott stated there will be new requirements on the management of CCRs, but the best means of accomplishing the new requirements is through congressional action rather than executive branch regulation.


            In response to a question on whether different kinds of coal contain different amount of ash, Commissioner Scott replied that to his knowledge there is no discernable difference in the amount of CCR in the different coal types. Commissioner Scott also remarked that there is a permitting process for the discharge of runoff from ponds to control for metal and toxicity in the environment.


            In response to questions about the basis of the newest regulation that caused state environmental commissioners to investigate the CCR disposal sites, Commissioner Scott responded that there are 39 cases in which the Sierra Club has requested hearings on specific sites, and three of those sites were identified in Kentucky. Commissioner Scott stated that the Sierra Club is making a claim that the management of CCRs at those sites constituted a damage case. If the claim is successful, USEPA would be forced to regulate CCRs as hazardous.


            In response to a question about the process for developing new federal rules and whether the process is the same as in the state of Kentucky, Commissioner Scott replied that federal rule changes and administrative regulation changes are the same in that each undergoes a fixed process of development, review and approval. However, the rulemaking process at the federal level is very complex and cumbersome. Commissioner Scott explained that the Congress does not oversee rule development.


            In response to a question on whether coal ash was fed to livestock, Commissioner Scott said no. However, Commissioner Scott noted that research is currently being done using CCRs in gardening, and it could be considered a beneficial re-use.


            In response to a comment on the breadth of ways CCRs are used by industry, Commissioner Scott agreed that CCRs are used in bioconversion and road construction materials. Those materials can save up to $6 billion per year for the state of Kentucky. CCRs can also prolong the life of concrete.


Presentation from electric utilities regarding coal combustion residuals and utility concerns about the future regulation of coal ash ponds

Mr. George Siemens and Mr. John Voyles, representing Louisville Gas and Electric (LG&E), presented electric utility concerns about future regulation of CCRs. Mr. Voyles discussed the dike failure at the Kingston, Tennessee coal ash pond, and he believed that a ruling on that dike failure may come in 2012 or 2013. Regardless of whether USEPA deems CCRs as hazardous or non-hazardous, there will be new regulatory controls over the waste. The main difference in the two notices is whether CCRs will be treated as hazardous. If CCRS are deemed hazardous then it would remove CCRs from beneficial re-use, increase federal oversight of CCR disposal sites, and require new financial assurance and bonding on permitted facilities.


            Mr. Voyles stated that Kentucky has a beneficial use plan for CCRs. CCRs have been used in synthetic gypsum, roof granules, and mine stabilization. LG&E has had a 40 percent re-use of CCRs; however, after USEPA’s rulemaking actions, the beneficial re-use has dropped to 20 percent. In the future, ash ponds will be required to have liners or will be closed; however it is more likely that CCRs will be disposed of in dry storage. As a state, Kentucky has gone towards new liners and better design of ash ponds and landfills. There will be a new process for water ponds which will require liners and new permitting requirements. LG&E would expend $1.2 to $1.3 billion on CCR management.


            Mr. Voyles also noted that there are slight differences in coals based on ash, sulfur, external factors which can change the CCRs produced from its combustion. Coal ash content can vary from Wyoming coal to Kentucky coal.


            In response to a question about whether the generators can burn coals with different sulfur characteristics, Mr. Voyles responded that plants can burn high sulfur coal at ten percent ash and three percent sulfur. LG&E’s Trimble County plant burns less sulfur coal by permit.


Discussion on coal ash management and reuse by representatives from Charah, Inc.

            Mr. Danny Gray, president of Charah, Inc., a coal ash recycling company based in Louisville, handles ash in 23 states. Mr. Gray explained that CCRs include fly ash, bottom ash, gypsum, and slag. Each one of those residuals is slightly different. CCRs can be used in wallboard, cement, and in forage crops. CCRs are a high volume waste, and Mr. Gray cautioned that approximately 140 million customers will stop using CCR recycled products as a result of CCRs being deemed a hazardous waste. There is a stigma with the designation. There are strict ASTM standards for re-use of CCRs.


            In response to a question about the different types of residuals, Mr. Gray explained that when coal is combusted some particles are heavier and fall to the bottom of the boiler. Bottom ash is coarse and falls to the bottom of the boiler. Fly ash is a fine, powder-like residual that goes out with exhaust. Potted gypsum is beneficial to agriculture as a replacement for soil sulfur.


            Representative York commented that CCRs are useful in concrete and will reduce other natural resources which are required to be mined.


            In response to a question about where the recycled products from CCRs are used, Mr. Gray replied that CCRs are a commodity that Charah, Inc. does export to Panama and Puerto Rico.


            There being no further business the meeting was adjourned at 2:30 pm.