The largest penalty a polluter has paid North Carolina should change the way one of the country's biggest chemical companies makes compounds that the U.S. Environmental Protection Agency said appear dangerous even in small amounts, the state's top environmental official said Friday.
A deal announced late Wednesday requires The Chemours Co. to pay the state a $12 million penalty, add $1 million for investigative costs, sharply reduce air emissions of the nonstick compound known as GenX, and spend millions to provide permanent replacement drinking water supplies to neighbors with contaminated water wells.
"It will change the way this company operates in the state of North Carolina if they are serious about remaining operational here," state Department of Environmental Quality Michael Regan said Friday. Further enforcement action is possible if scientists find health effects for GenX at levels lower than what the state now estimates is safe, he said.
The penalty outstrips the $7 million Duke Energy Corp. agreed to pay in 2015 for persistent groundwater contamination at its 14 coal-burning power plants in North Carolina.
Chemours also agreed to further penalties if by the end of next month it fails to cut air emissions by at least 92 percent from last year's level, and by 99 percent by the end of next year. Failing to meet next month's target could cost Chemours $350,000, while missing the 99 percent reduction goal next year could cost the company $1 million.
Chemours denied it violated any law, regulation or permit and said the deal it struck this week simply allowed it to avoid the expense and risks of litigation while addressing public concerns.
The company also agreed to conduct health studies into the risks posed by releasing GenX and other per- and polyfluoroalkyl substances, or PFAS, into the environment. PFAS are used in nonstick coatings on products ranging from pans to fast-food wrappers, as well as in firefighting foam.
There are no federal health standards for GenX, just as they are lacking for thousands of man-made chemicals. The EPA classifies GenX as an "emerging contaminant" needing research. But animal studies show GenX has the potential of affecting the kidneys, blood, immune system, liver and developing fetuses following oral exposure, the EPA said in a draft report released earlier this month. "The data are suggestive of cancer," the report said.
Blood and urine tests performed on 30 volunteers living around Chemours' North Carolina plant found no GenX, but all had in their blood at least four of the 16 similar chemicals tested, the state health department said last month.
The company on Friday repeated that GenX is less hazardous than the compounds it replaced.
Chemours has owned and operated the chemical plant south of Fayetteville for three years. The company was spun off from DuPont, which had operated the 2,100-acre (850-hectare) site for nearly half a century.
Because the flourine-based chemicals produced at the plant are so profitable, the company is spending about $100 million to all but eliminate GenX and all PFAS compounds before 2020.
GenX replaced a similar compound after neighbors of chemical-maker DuPont's Parkersburg, West Virginia, plant claimed in more than 3,500 lawsuits that the compound made them sick. A jury in July 2016 found Chemours and DuPont liable for a man's testicular cancer that he said was linked to a GenX forerunner chemical. The two Fortune 500 chemical companies last year agreed to pay nearly $671 million to settle further lawsuits.
The state environmental agency sued the company last year alleging its discharges of GenX and other PFAS violated clean-water laws. Environmental group Cape Fear River Watch also sued both the company and the state.
All those lawsuits would be dropped if this week's settlement is approved by a judge after giving the public until Dec. 21 to comment.
Unaffected by the agreement are other lawsuits by individuals, Brunswick County or the water utility serving about 200,000 people in and around Wilmington. That water service found GenX in treated drinking water consumed by households about 100 miles (161 kilometers) downstream of the Chemours plant.
A university researcher last week reported finding three previously unreported PFAS compounds in treated water distributed by the Cape Fear Public Utility Authority.
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