Dec. 14, 2000—AES Corp. will pay a $17 million fine for surpassing air emissions limits at its Alamitos power plant facility but will be allowed to operate the plant without penalties during California electric power emergencies.

Under an agreement with California air regulators, AES can operate the plant while it pursues permits to install pollution control devices mandated by the environmental authorities. With California Independent System Operator desperate for megawatts to keep the lights on, officials moved quickly to reach a settlement to get the plant back in service.

AES said the plant was up and running as soon as an agreement was reached with environmental officials.

The South Coast Air Quality Management District and AES Thursday reported reaching a settlement of air pollution allegations at the plant resulting in the fine and the agreement to install selective catalytic reduction devices on four units at Alamitos. The emissions violations allegedly occurred during the third and fourth quarter of 2000. The violations, fines, and an abatement order were levied against AES in mid-November.

The 2,083 MW gas-fired generating plant was shut down after the company received the Nov. 16 abatement order, says Aaron Thomas, spokesman for AES Pacific, a unit of AES.

The settlement removes uncertainty relating to threatened court action by the management district regarding allegations AES exceeded its allowed emissions. It also allows the plant to operate during any ISO declared Stage 1,2, or 3 emergency without penalties, says Sam Atwood, spokesman for South Coast Air Quality.

The settlement also requires AES to file for permits within 15 days for the installation of the selective catalytic reduction devices. The permitting process could take as long as 6 months, says Atwood.

�We are committed to do it as quickly as possible, but we can�t control the public comment period that could delay the permits,� he says.