By DAVE FLESSNER

KNOXVILLE, Tenn., Sept. 28, 2000 (Chattanooga Times/Free Press)—TVA is doubling what it spends to limit air pollution from its coal-fired power plants.

But directors of the federal utility said Wednesday they don't want to undertake an even more costly cleanup ordered by the federal government for its oldest plants.

During a board meeting Wednesday, TVA directors reiterated their opposition to an order by the U.S. Environmental Protection Agency to bring eight of TVA's oldest coal-fired power units up to today's clean-air standards. The EPA order against TVA was recently upheld by an EPA review panel, the Environmental Appeals Board. But TVA has challenged the order in federal court.

"The matter is in court and we expect to win the lawsuit eventually," TVA Chairman Craven Crowell said Wednesday.

Crowell said TVA is always open to a negotiated settlement with EPA. But after the three-member TVA board twice met with top EPA officials earlier this year, the utility decided to file an appeal with the 11th Circuit federal court in Atlanta.

"We worked many hours and spent a great deal of effort trying to seek resolution before going to court," Crowell said.

EPA and environmentalists complain that TVA has skirted the requirements of the 1977 clean air act by continuing to maintain its aging coal plants, which were grandfathered under the older, less stringent air pollution requirements.

"TVA has certainly made some improvements and they are to be applauded for that. But they have continued to burn dirty coal at plants which should have been phased out by now," said Stephen Smith, executive director of the Southern Alliance for Clean Energy.

Smith urged TVA to settle the dispute with EPA.

"The ratepayers and the environmental interests of the Valley certainly aren't served by a protracted legal battle over cleaning up these plants," he said.

Last year, TVA warned members of Congress that the EPA order could force TVA to boost electricity rates up by as much as 13 percent. But on Wednesday, TVA directors backed off of that specific number. TVA board members declined to estimate the cost of the EPA order.

TVA has already spent $2.6 billion to date on air pollution controls at its coal plants and plans to spend another $750 million to $850 million to install selective catalytic reduction systems at five of its largest plant or on its coal plants by the year 2003.

In the fiscal 2001 budget adopted by TVA directors Wednesday, the agency has budgeted $210 million for clean air improvements at its coal plants. Last year, TVA budgeted $107 million and this year TVA plans to spend $128 million.

"I think we're committed to cleaner air, to reducing emissions and remaining in compliance with all applicable regulations," TVA Director Glenn McCullough Jr. said.

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© 2000, Chattanooga Times/Free Press, Tenn. Distributed by Knight Ridder/Tribune Business News.