The Commonwealth of Massachusetts
Executive Department
State House Boston, MA 02133
(617) 725-4000



April 22, 2003

Shawn Feddeman
(617) 725-4025
Katie Cahill
(617) 626-1126



            Celebrating an important step toward cleaning up one of the state’s last coal-fired power plants, the Massachusetts Department of Environmental Protection (DEP) and USGEN New England (USGEN NE) today announced that they have entered negotiations to speed up the installation of new emission control equipment at the Salem Harbor Power Plant.

            Governor Mitt Romney, who has made protecting the public health and ensuring clean air a top priority, lauded the latest development.  Romney said, “We will hold their feet to the fire to ensure that this dirty power plant gets cleaned up as quickly as possible.”

            USGEN New England, a subsidiary of PG&E National Energy Group, and the DEP have agreed to request a stay of USGEN NE’s appeals regarding the October 2004 approved Emission Control Plan (ECP) and amended ECP for the facility.  Also, USGEN NE will immediately begin discussions with federal and state entities to institute a mechanism to fund the improvements needed for the emission reductions at the plant.

            “These discussions are a positive step toward resolving the issues surrounding the Salem Harbor Station power plant,” said Chris Iribe, Executive Vice President of PG&E National Energy Group.  “Together, we can work out a plan that will achieve compliance with the new air emission regulations as soon as possible, while maintaining regional reliability.”

            “It is good news for the breathing public that the current stalemate has ended,” said Cindy Luppi, Clean Water Action Organizing Director.  “Ultimately, the clean-up for all these plants will be judged by how deep the pollution reductions are and how quickly they are completed.”

            Jane Bright of HealthLink, the North Shore grassroots organization that has been advocating for Salem’s clean up since 1998, said, “This news is encouraging.  We thank the Governor and DEP for arranging these negotiations and hope they will result in meaningful reductions in disease-causing pollution soon.”

            The schedule for achieving these emission reductions will be as short as possible based on demonstrated permitting and construction constraints.  The plan will include near-term air emission reductions and other environmental improvements to begin in 2003.  The other improvements will include immediate steps to address local concerns associated with Salem Harbor’s coal unloading operations and storage.  These measures and all others necessary for full compliance will be included in a legally binding settlement agreement.  Representatives of the City of Salem, HealthLink and the Conservation Law Foundation have been invited to participate in these discussions.

            USGEN NE has already received bids for the construction and installation of control equipment needed to achieve compliance with new air emission standards.  USGEN NE is willing to file permit applications as necessary to begin to implement the plan, and to work with the Commonwealth and other parties to finalize contracts for the new emission control equipment.

            “I am encouraged by these initial discussions because any resolution that ensures the long-term viability of Salem Harbor Station and reduces emissions will be good for the hard-working taxpayers of Salem,” said Mayor Stanley Usovicz.

            Since the Salem Harbor plant is currently for sale, DEP and USGEN NE intend for the agreement to provide prospective purchasers of the facility with a secure path to achieve regulatory compliance.  The terms of the agreement would apply to the current owner or any future owner.  Any mechanism used to pay for the emission control equipment would provide for repayment from Salem Harbor’s future revenues and will have to be approved by the appropriate regulators.  To begin this process, USGEN NE shortly will be filing a notice with the Independent System Operator-New England (ISO-NE) concerning the future of Salem Harbor under Section 18.4 of the ISO-NE’s rules, initiating the formal process for the ISO-NE to determine if the facility must continue operating to assure electric system reliability.