Maryland, Seven Other States Split AEP Settlement Funds

Funds to be Used for Clean Air and Green Energy Projects

BALTIMORE, MD (April 8, 2008) – Maryland Attorney General Douglas F. Gansler announced today that Maryland and seven other states will divide $24 million to be used for energy efficiency and air pollution reduction projects as a result of a federal Clean Air Act settlement with American Electric Power (AEP), the nation’s largest power company.

AEP power line repair: Photo by Arek Taylor (CC)

Each state will establish a process for determining how their share of the project money will be distributed. Potential projects include supporting the construction of “green” buildings, installing solar and other renewable energy systems, purchasing pollution control technologies, and investing in energy efficiency and conservation programs.

In October 2007, a coalition of states and environmental groups, led by New York, and the federal government reached a settlement with AEP over Clean Air Act violations. As a part of the settlement, AEP is required to pay the eight states a total of $24 million over the next five years to fund energy efficiency and air pollution reduction projects. The states have agreed to allocate the funds in the following manner: Connecticut ($1.8 million), Maryland ($1.2m), Massachusetts ($3.1m), New Hampshire ($1.2m), New Jersey ($4.2m), New York ($9.5m), Rhode Island ($1.2m), and Vermont ($1.8m).

“Today’s settlement demonstrates the states ability hold power companies accountable for the damage they have done to the environment and to our communities,” said Attorney General Gansler. “My office will work together with the Department of the Environment to develop targeted projects that will reduce pollution and increase energy efficiency.”

The funding announced today adds to the historic clean air benefits that resulted from the settlement with AEP in October 2007. The settlement requires the company to invest nearly $5 billion to upgrade its “eastern fleet” of 16 power plants and cuts over 800,000 tons of air pollution yearly, the single greatest reduction of air pollution ever attained from a Clean Air Act enforcement action. Air pollution emissions from these 16 power plants threaten human health, are linked to increases in asthma attacks and lung diseases, and are also primary contributors to acid rain, which has severely damaged lakes, forests, and wildlife.

In addition to the funds distributed to the eight states, under the settlement, AEP is also required to pay $15 million in civil penalties and $36 million to fund various environmental improvement projects, including $3 million to reduce nitrogen pollution in the Chesapeake Bay.

Source: Maryland Attorney General

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