20070812 Ver 2_Alcoa appeals water quality permit_20090708

Dorney, John
From: Massengale, Susan [[e-mail]]
Sent: Thursday, July 09, 2009 11:48 AM
To: [e-mail]
Subject: Alcoa appeals water quality permit
Attachments: ATT00001.c
Alcoa appeals water quality permit
Julie Rose
Wednesday July 8, 2009
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Three months ago, Alcoa celebrated when it won approval from the North Carolina Division of Water
Quality to continue operating its dams on the Yadkin River. Now Alcoa says the certificate is a bad
deal and is challenging part of it. WFAE's Julie Rose reports:
Before Alcoa can get another 50-year license on the Yadkin River, it needs the state to approve the quality of
the water running through its dams. In May, the state issued that approval in what's called a 401 certificate.
But the state also said Alcoa would have to post a $240 million surety bond to guarantee that it made
improvements to water quality on the river.
Alcoa's Gene Ellis now says the Division of Water Quality can't make that demand.
"We don't believe there's anything within the 401 regulations within the state of North Carolina to give the
state the ability to require a bond for someone requesting a certificate," says Ellis.
It's not common for the state to require a surety bond as part of a water quality certificate. Division of Water
Quality officials refused to comment on the matter because of the lawsuit. But in her original letter issuing the
water quality license, Director Coleen Sullins said the $240 million bond was necessary because of the nearly
$500 million loss Alcoa reported in March. As of late Wednesday, analysts expected Alcoa to report more big
losses for the third straight quarter.
Ironically, those losses are another reason Alcoa's Gene Ellis is arguing against the bond.
"A surety bond is a very expensive thing to finance," says Ellis. "You don't want to have to spend money on a
surety bond if you don't need to."
If the judge does decide the state can require the bond, Ellis says $240 million is far too high. But water
quality watchdog Dean Naujoks of the Yadkin Riverkeeper wants the state to be even stricter:
"Which is why we're gonna go to court and challenge this," says Naujoks. "But I just think Alcoa's being
extremely unreasonable and irresponsible that they would try to thwart any attempt by the state to really hold
their feet to the fire and force them to address water quality concerns that their dam operations have created."
Naujoks is concerned about the oxygen levels in the water. He also wants the state to consider pollution in the
lakes above the dams. Alcoa contends that is not a requirement of the certificate.
Governor Bev Perdue is also involved. She wants the state to take control of Alcoa's dams.
Until a judge rules, Alcoa's hydropower license will likely remain on hold.
Susan Massengale
Public Information Officer
DENR- Division of Water Quality
1617 MSC, Raleigh, NC 27699-1617
[phone]; fax [phone]
Please note: my e-mail address has changed to susan.massengalePncdenr.gov
E-incid correspondence to and from this address inay be subject to the
North Carolinci Public Records Law (ind inctY be disclosed to third parties.
Email correspondence to and from this sender is subject to the N.C. Public Records Law and may be disclosed to third parties.