UNITED STATES SETTLES WITH KANSAS ETHANOL COMPANY

WASHINGTON, DC - The Department of Justice, the U.S. Environmental Protection Agency and the State of Kansas today announced a civil settlement with the U.S. Energy Partners LLC, ethanol plant in Russell, Kansas for alleged Clean Air Act violations. The settlement mandates reductions in air pollution, including volatile organic compounds, carbon monoxide, nitrogen oxides and particulate matter from this ethanol manufacturing facility. This is the third settlement with a company in the ethanol industry following a series of settlements reached in 2002 with a group of ethanol companies in Minnesota as a part of EPA’s continuing examination of the ethanol industry. The settlement is set forth in a consent decree filed in the federal court in Kansas.

The United States and the State of Kansas allege that the facility was operating in violation of the Clean Air Act’s New Source Review (NSR) provisions. The Clean Air Act’s NSR program requires a new source of emissions to install pollution controls and undertake other pre-construction obligations to prevent air quality problems.

The agreement announced today is consistent with prior settlements and will ensure that the plant installs air pollution control equipment to greatly reduce air emissions such as volatile organic compounds (VOCs) and carbon monoxide (CO) emissions. In addition to contributing to ground-level ozone (smog), VOCs can cause serious health problems such as cancer and other effects; CO is harmful because it reduces oxygen delivery to the body’s organs and tissues. The settlement will result in annual reductions of 1240 tons of VOCs, 10 tons of nitrogen oxides (NOx), 75 tons of particulate matter (PM), 170 tons of CO, and 30 tons of hazardous air pollutants.

“This consent decree demonstrates our commitment to the reduction of harmful pollutants from ethanol plants and shows that we will work to ensure a level playing field within the industry by preventing violators from gaining a competitive advantage,” said Tom Sansonetti, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice.

"This agreement, and the pollution reductions from ethanol plants that will result, are of great importance," said Thomas V. Skinner, Acting Assistant Administrator for Enforcement and Compliance Assurance. "Ethanol is a part of our national energy strategy, and it is encouraging that the ethanol industry is acknowledging the value of compliance."

“Significant air pollution emission reductions will be achieved under this settlement,” said Jim Gulliford, Administrator for the U.S. Environmental Protection Agency, Region 7. “The cooperation of the facility and the teamwork among agencies has resulted in an agreement that ensures that human and ecological health are protected.”

Ethanol is primarily a corn product used as an automobile fuel alone or blended with gasoline. Ethanol’s high oxygen content allows automobile engines to combust fuel better, resulting in reduced tail pipe emissions. During the ethanol manufacturing process, dry mills generate gasses that emit volatile organic compounds and carbon monoxide into the air.

In 2002, then EPA Regional Administrator Skinner met with representatives from the ethanol industry to discuss recent emissions test results and proposed pollution control technology. The resulting settlements, with 12 Minnesota ethanol plants, compelled those facilities to install thermal oxidizers to reduce VOC emissions by 95 percent. Those companies also paid penalties ranging from $20,000 to $39,000.

Likewise, under this settlement, the plant will install a thermal oxidizer that reduces VOC emissions by 95 percent from the feed dryers and meet new, more restrictive emission limits for NOx, PM, carbon monoxide and hazardous air pollutants. In addition to emission control requirements valued at about $2 million, the facility will also pay a civil penalty of $30,000, which is consistent with the Minnesota settlements.

The State of Kansas, through the Kansas Department of Health and Environment teamed with the United States in the settlement negotiations to resolve the company’s alleged violations and to bring the facility into compliance.

The consent decree was lodged in federal district court in Kansas and is subject to a 30-day comment period.

More information on EPA’s ethanol enforcement initiative is available at http://www.epa.gov/compliance/civil/programs/caa/ethanol/.

###

05-007