Northern Indiana Public Service Company Air Act Settlement Resources
Press Release (01/13/11) Consent Decree (PDF) 104pp, 471KB, About PDF )



### "The pollution reductions achieved in this settlement will ensure that the people of Indiana and neighboring states have cleaner, healthier air to breathe. EPA is committed to advancing its national enforcement initiative to reduce air pollution from the largest sources of emissions." - Cynthia Giles,
Assistant Administrator of EPA’s
Office of Enforcement and Compliance and Assurance. 

# Northern Indiana Public Service Company Clean Air Act Settlement

(Washington, DC - January 13, 2011) The U.S. Enviro nmental Protection Agency (EPA) and the U.S. Justice Depart ment today announced a global Clean Air Act settlement w ith Northern Indiana Public Service Co. (NIPSCO) that w ill cover all of NIPSCO’s coal-fired power plants, located in Chestertown, Michigan City, Wheatfield and Gary, In d. NIPSCO has agreed to invest approximately $600 million in pollution control technology that will p rotect public health and resolve violations of the Clean A ir Act.

The settlement will require that NIPSCO spend $9.5 million on environmental mitigation projects and pa y a civil penalty of $3.5 million. The state of Indian a has been involved in the development of this settlement and is a signatory.

On this page:

Overview of Company and Location of Facilities Violations Injunctive Relief Pollutant Reductions Health and Environmental Benefits Environmental Mitigation Projects Civil Penalty Comment Period The Power Plant Enforcement Effort Contact 

# Overview of Company and Location of Facilities

Northern Indiana Public Service Company (NIPSCO) is a corporation headquartered in Merrillville, Ind. It is the second largest electr ic distribution company in the state, with approximately 457,000 electric customers across the northern third of the state.

The combined generating capacity of NIPSCO’s coal-f ired facilities totals over 3,300 megawatts (MW) of capacity. This settlement covers NIPSCO’s four coal-fired power plants:

Bailly Station- Chestertown, Ind. Dean H. Mitchell- Gary, Ind. Michigan City Station- Michigan City, Ind. R.N. Schahfer Station- Wheatfield, Ind. 

# Violations

In September 2004, EPA issued a Notice of Violation to NIPSCO alleging that NIPSCO modified a number of its coal-fired power units wit hout first complying with Clean Air Act 

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9/12/2011 http://www.epa.gov/compliance/resources/cases/civil/caa/nipsco.htm l(CAA) pre-construction obligations that include obt aining pre-construction permits and

installing and operating state-of-the-art pollution control technology (CAA Prevention of Significant Deterioration/Nonattainment New Source Review provisions, 42 U.S.C. §§ 7470- 7492, §§7501-7515; and Title V of the CAA). 

# Injunctive Relief

The consent decree secures injunctive relief from a ll of NIPSCO’s coal-fired power units. Compliance with the settlement will reduce nitrogen oxide (NO x ) and sulfur dioxide (SO 2 ) emissions by 64,000 tons per year from 2008 levels. It will also significantly reduce particulate matter (PM) emissions. NIPSCO estimate s that the cost of the injunctive relief will be approximately $600 million.

The settlement includes:

Permanent retirement of the Dean H. Mitchell Statio n Installation of three new flue gas desulfurization systems (FGD) at Schahfer 14, Schahfer 15, and Michigan City 12 Upgrades to existing FGD’s at the Bailly Station Un its 7 and 8, and Schahfer Units 17 and 18 Upgrades to the existing selective catalytic reduct ion systems (SCR’s) at the Bailly Station, Michigan City 12, and Schahfer 14 to achie ve and maintain separate emissions rates, one on a 30-day rolling average ba sis, and the other on a 365-day rolling average basis Installation and continuous operation of selective non-catalytic reduction (SNCR) at Schahfer 15 Optimization of existing PM controls to meet unit-s pecific emissions limitations Compliance with annual system tonnage limitations f or NO x and SO 2 Annual surrender of any excess SO 2 and NO x allowances resulting from actions taken under the consent decree 

# Pollutant Reductions

As compared to NIPSCO’s 2008 emissions, EPA expects the following emission reductions to result from this settlement:

SO 2 about 46,000 tons per year NO x about 18,000 tons per year

PM emissions are expected to decline by about 4,500 tons per year, compared to NIPSCO’s current permitted PM limits.


# Health and Environmental Benefits

The pollutants reduced under this settlement have n umerous adverse environmental and health effects. Sulfur dioxides and nitrogen oxides can be converted to fine particulate matter once in the air. Fine particulates can be breathed in and lodged deep in the lungs, leading to a variety of health problems and even premature dea th. Other health and environmental impacts from the pollutants addressed in this settl ement include the following:

Sulfur Dioxide – High concentrations of SO 2 affect breathing and may aggravate existing respiratory and cardiovascular disease. S ensitive populations include asthmatics, individuals with bronchitis or emphysem a, children and the elderly. Sulfur dioxide is also a primary contributor to aci d deposition, or acid rain. 

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9/12/2011 http://www.epa.gov/compliance/resources/cases/civil/caa/nipsco.htm lParticulate Matter

– Short term exposure to particulate matter can aggravate l ung disease, cause asthma attacks and acute bronchitis, may increase susceptibility to respiratory infections and has been linked to heart attacks. Nitrogen Oxides

– Nitrogen oxides can cause ground

- level ozone, acid rain, particulate matter, global warming, water quality deterioration , and visual impairment. Nitrogen oxides play a major role, with volatile organic che micals, in the atmospheric reactions that produce ozone. Children, people with lung dis eases such as asthma, and people who work or exercise outside are susceptible to adv erse effects such as damage to lung tissue and reduction in lung function. 

# Environmental Mitigation Projects

This settlement also requires NIPSCO to spend $9.5 million on environmental mitigation projects to address the impacts of past emissions. NIPSCO must spend a minimum of $3.5 million of the total $9.5 million on Clean Diesel R etrofit, Woodstove/Outdoor Boiler Changeout, and Land Acquisition and Restoration pro jects. The remaining money may be spent on the Hybrid/Electric Fleet, Electric Infras tructure, and Electric to Natural Gas Conversion projects.

The Clean Diesel Retrofit Project will require NIPSCO to retrofit in

- service, public diesel engines with emission control equipment desi gned to reduce emissions of NO x and volatile organic compounds (VOCs). The Woodstove/Outdoor Boiler Changeout Project will require NIPSCO to sponsor a wood-burning stove/outdoor boiler changeout and ret rofit project. To do this, NIPSCO will provide incentives through rebates, dis counts, and in some instances, actual replacement of old, inefficient, high pollut ing wood-burning technology for newer, low emitting, energy efficient technology, i ncluding geothermal heat pumps, EPA Phase 2 hydronic heaters, or EPA-certified wood stoves and hearth appliances. The Land Acquisition and Restoration Project will r equire NIPSCO to acquire/donate and restore lands adjacent to the Indiana Dunes Nat ional Lakeshore. Restoration may include, direct reforestation, particularly of tree species that may be affected by acidic deposition. NIPSCO may spend no more than $ 2 million on this project. The Hybrid/Electric Fleet Project allows NIPSCO to elect to submit a plan for a hybrid and/or electric fleet project to reduce emissions f rom NIPSCO’s fleet of motor vehicles. NIPSCO may spend no more than $2 million on this project. The Electric Infrastructure Project allows NIPSCO to elect to fu nd creation of one or more charging stations for electric vehicles in the Northwest Indiana. NIPSCO may spend no more than $2 million on this project. The Residential and Commercial Electric to Natural Gas Conversion P roject allows NIPSCO to elect to fund the removal and replacement of electric resistance furnaces and water heaters and replace them with natural gas -fired units. NIPSCO may spend no more than $2 million on this project. 

# Civil Penalty

NIPSCO will pay a total of $3.5 million in civil pe nalties.


# Comment Period

The proposed settlement, lodged in the U.S. Distric t Court for the Northern District of Indiana, is subject to a 30-day public comment peri od and final court approval. Information on submitting comments is available at the Departme nt of Justice website. 

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# The Power Plant Enforcement Effort

The United States has filed lawsuits against a numb er of other utilities for alleged violations of the CAA. These cases seek to bring the power pl ant industry into full compliance with the New Source Review and Prevention of Significant Det erioration requirements of the CAA. This consent decree with NIPSCO represents the twen ty-first judicial settlement under the power plant enforcement effort.

The total combined sulfur dioxide and nitrogen oxid es emission reductions secured from these settlements will be about 2 million tons each year once all the required pollution controls have been installed and implemented. More information about these settlements is available at the Coal-Fired Power Plant Enforcement Initiative website. 

# For more information, contact:

Seema Kakade U.S. Environmental Protection Agency (2242A) 1200 Pennsylvania Ave., N.W. Washington, DC 20460-0001 (202) 564-2416 kakade.seema@epa.gov 

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