Allegheny Power 2013 Annual Report Download - page 151

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was filed on behalf of twenty-one individuals and the other is a class action complaint seeking certification as a class with the eight
named plaintiffs as the class representatives. FG believes the claims are without merit and intends to vigorously defend itself against
the allegations made in these complaints, but, at this time, is unable to predict the outcome of this matter or estimate the possible
loss or range of loss.
In January 2009, the EPA issued an NOV to GenOn Energy, Inc. alleging NSR violations at the Keystone, Portland and Shawville
coal-fired plants based on “modifications” dating back to the mid-1980s. JCP&L, as the former owner of 16.67% of the Keystone
Station, ME, as a former owner and operator of the Portland Station, and PN as former owner and operator of the Shawville Station,
are unable to predict the outcome of this matter or estimate the possible loss or range of loss.
In January 2011, the U.S. DOJ filed a complaint against PN in the U.S. District Court for the Western District of Pennsylvania seeking
injunctive relief against PN based on alleged “modifications” at the coal-fired Homer City generating plant during 1991 to 1994
without pre-construction NSR permitting in violation of the CAA's PSD and Title V permitting programs. The complaint was also
filed against the former co-owner, NYSEG, and various current owners of Homer City, including EME Homer City Generation L.P.
and affiliated companies, including Edison International. In addition, the Commonwealth of Pennsylvania and the states of New
Jersey and New York intervened and filed separate complaints regarding Homer City seeking injunctive relief and civil penalties.
In October 2011, the Court dismissed all of the claims with prejudice of the U.S. DOJ and the Commonwealth of Pennsylvania and
the states of New Jersey and New York against all of the defendants, including PN. In December 2011, the U.S., the Commonwealth
of Pennsylvania and the states of New Jersey and New York all filed notices appealing to the Third Circuit Court of Appeals which
affirmed the dismissal on August 21, 2013 and then denied petitions for rehearing on December 12, 2013. PN believes the claims
are without merit and intends to vigorously defend itself against the allegations made in these complaints. The parties dispute the
scope of NYSEG's and PN's indemnity obligation to and from Edison International. PN is unable to predict the outcome of this
matter or estimate the loss or possible range of loss.
In August 2009, the EPA issued a Finding of Violation and NOV alleging violations of the CAA and Ohio regulations, including the
PSD, NNSR and Title V regulations, at the Eastlake, Lakeshore, Bay Shore and Ashtabula coal-fired plants. The EPA's NOV alleges
equipment replacements during maintenance outages dating back to 1990 triggered the pre-construction permitting requirements
under the PSD and NNSR programs. In June 2011, EPA issued another Finding of Violation and NOV alleging violations of the CAA
and Ohio regulations, specifically, opacity limitations and requirements to continuously operate opacity monitoring systems at the
Eastlake, Lakeshore, Bay Shore and Ashtabula coal-fired plants. FG intends to comply with the CAA and Ohio regulations, but, at
this time, is unable to predict the outcome of this matter or estimate the possible loss or range of loss.
In August 2000, AE received an information request pursuant to section 114(a) of the CAA from the EPA requesting that it provide
information and documentation relevant to the operation and maintenance of the following ten coal-fired plants, which collectively
include 22 electric generation units: Albright, Armstrong, Fort Martin, Harrison, Hatfield's Ferry, Mitchell, Pleasants, Rivesville, R.
Paul Smith and Willow Island to determine compliance with the NSR provisions under the CAA, which can require the installation
of additional air emission control equipment when a major modification of an existing facility results in an increase in emissions. In
September 2007, AE received an NOV from the EPA alleging NSR and PSD violations under the CAA, as well as Pennsylvania
and West Virginia state laws at the coal-fired Hatfield's Ferry and Armstrong plants in Pennsylvania and the coal-fired Fort Martin
and Willow Island plants in West Virginia. On June 29, 2012, January 31, 2013, and March 27, 2013, EPA issued additional CAA
section 114 requests for the Harrison coal-fired plant seeking information and documentation relevant to its operation and
maintenance, including capital projects undertaken since 2007. AE intends to comply with the CAA but, at this time, is unable to
predict the outcome of this matter or estimate the possible loss or range of loss.
In June 2005, the PA DEP and the Attorneys General of New York, New Jersey, Connecticut and Maryland filed suit against AE,
AE Supply and the Allegheny Utilities in the U.S. District Court for the Western District of Pennsylvania alleging, among other things,
that Allegheny performed major modifications in violation of the NSR provisions of the CAA and the Pennsylvania Air Pollution
Control Act at the coal-fired Hatfield's Ferry, Armstrong and Mitchell Plants in Pennsylvania. A non-jury trial on liability only was held
in September 2010. On February 6, 2014, the Court entered judgment for AE, AE Supply, and the Allegheny Utilities finding they
had not violated the CAA or the Pennsylvania Air Pollution Control Act. This decision does not change the status of these plants
which remain deactivated.