Paying For Cleanup

The Environmental Protection Agency said Dec. 30 that it is developing new requirements for chemical companies to show they have resources to clean up environmental damage that may result from their operations. Under the superfund law, the agency said it is taking the first step to ensure that plant owners—not taxpayers—foot the bill for cleaning up damage from pollution.

In explaining its concern, the agency pointed to Vertac Chemical Co. in Jacksonville, Ark., that went bankrupt in 1986, leaving behind 29,000 drums of chemical waste and a $127 million bill to be paid by the federal government. EPA also singled out a Delaware chlorinated benzene manufacturer that folded in 2002, sticking the federal taxpayer with a cleanup bill that is expected to reach $100 million.

In all, EPA has spent some $2.7 billion through this year to clean up bankrupt chemical industry plants.

The agency noted that by law EPA is to require facility owners show "evidence of financial responsibility consistent with the degree and duration of risk" from plant operations. EPA also noted chemical plants frequently change owners as well as handle large quantities of toxic materials. The agency was backed up by a 2005 Government Accountability Office report that said chemical companies were an example of a business at risk of incurring huge environmental liabilities and then avoiding them through bankruptcy.

EPA stressed that the document was only a notice about a potential new proposed rule and the agency was seeking comments on the need and form new financial assurance requirements might take. Along with chemical companies, EPA's announcement also affects petroleum refineries and the petroleum and coal products manufacturing industry as well as the electric power generation, transmission, and distribution industry.

It is unclear when EPA might issue a full proposal for these sectors but last summer the agency issued a similar notice for the hard-rock mining industry and is planning to issue a proposal in spring 2011.

Officials with EPA and the American Chemistry Council were not available to comment at C&EN press time.