State board declines to hear Two Elk challenge

2014-07-11T08:00:00Z State board declines to hear Two Elk challengeBy BENJAMIN STORROW Casper Star-Tribune The Billings Gazette

CASPER, Wyo. — The Wyoming Environmental Quality Council voted 5-1 Thursday to dismiss a petition challenging the validity of a state air quality permit issued to the planned Two Elk power plant, which has yet to begin construction 18 years after it was first proposed.

The question before the council was a narrow one, but the implications of the board’s decision were potentially much broader. At issue was the council’s authority to hear third-party challenges to environmental permits issued by the state.

By denying the challenge, the council effectively upheld Two Elk’s permit and potentially set a precedent in how it handles permit challenges from outside groups.

The council, which consists of citizens appointed by the governor, oversees the Department of Environmental Quality by hearing contested environmental cases and signing off on rule changes proposed by the DEQ.

Thursday’s hearing, at the University of Wyoming School of Energy Resources, was held to consider a petition from the Powder River Basin Resource Council.

The Sheridan-based landowners group filed the challenge in hopes of forcing the Department of Environmental Quality to enforce the terms of its permit.

Under the terms of a 2007 settlement with the state, Two Elk had two years to begin construction at its proposed site outside Gillette.

A 2013 report by the DEQ, which issued the permit, found that no construction had been done at the site in the past two years, the resource council argued.

“We cannot wait for what DEQ is supposed to do,” Shannon Anderson, the group’s attorney, told the board. “We’ve been waiting for six-and-a-half years.”

The law governing the council’s power gives it jurisdiction to consider all environmental cases arising under the Environmental Policy Act, Anderson said.

She later said the group will consider a challenge in Wyoming District Court.

The DEQ and Two Elk attorneys said the law gives the council no authority to hear challenges on the validity of permits. They said state statute stipulates that outside challenges to DEQ actions should be brought in court.

A ruling in favor of hearing the challenge would open the door for outside groups to challenge every air quality permit issued by the state, the company and the state argued.

Andrew Coleman, an assistant attorney general representing the DEQ, said groups can challenge the state when it takes a final action for or against a company. But it cannot challenge an ongoing case, he said.

“This would go outside what the council was established for,” Coleman said.

Two Elk attorney Mary Throne, who also represents Cheyenne in the state House of Representatives, made a similar point.

“Sometimes there is a wrong or potential wrong that people want to right. Sometimes there is not a remedy,” Throne said. “The remedy the PRBRC is trying to take advantage of here doesn’t exist. There is no rules or procedure that would allow the EQC to hear this case.”

Council members by and large agreed.

Greybull Republican Tim Flitner said he could not recall the council ever handling a request like the Powder River Basin Resource Council’s.

The board’s role is to approve proposed rules and hear cases in which a permit has been contested, he said. Deciding on the validity of a permit would be “uncharted territory,” Flitner said.

“It looks to me that this is something I’d rather the council not get into,” he said. “We’re not the DEQ’s boss in that sense.”

Chairman David Searle was one of two members to express their frustration with the project, but he voted to dismiss the petition.

Searle, a Sheridan Republican who is Marathon Oil’s manager of government affairs in Wyoming, Montana, Colorado and North Dakota, said his reading of the law meant the challenge should be heard in court.

But he criticized Two Elk, saying the council has to consider other potential permit applicants in the area. A long-delayed project like Two Elk ties up valuable resources other companies may like to develop, he said.

Searle urged the DEQ to develop an administrative procedure that would enable it to consider challenges like the one brought by the Powder River Basin Resource Council.

“I do think the public has the right to be a watchdog of DEQ activity,” Searle said.

Two Elk was first proposed in 1996. The facility would burn waste coal from nearby mines that lacks the fuel content to make it economical to ship to power plants in other parts of the country. The project has faced a series of financing and construction delays.

Thomas Cloverman, a Daniel Republican, was the only member to vote to hear the challenge. A former engineer, Cloverman was involved in construction of three chemical plants.

“This smells strange to me,” Cloverman said. “I would like to hear why nothing has happened, and I would like to hear why DEQ hasn’t acted.”

Copyright 2014 The Billings Gazette. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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