The Supreme Court yesterday let stand a lower court's ruling requiring Potomac Electric Power Co. to comply with an Environmental Protection Agency decision that could cost Pepco customers $150 million.
The justices declined without comment to review the case, which required Pepco to install costly pollution-control equipment on a new power plant at Chalk Point, Md., or to burn only expensive, low-sulfur oil at the plant.
The company had contended that because the EPA regulations requiring the stiff antipollution standards were made after Pepco had begun construction on the Chalk Point unit, it shouldn't have to comply.
The unit, long criticized by the D.C. People's Counsel because it burns expensive oil, is only used when energy is at peak demand, said Alan Kirk, a Pepco senior vice president and general counsel.
As a result of the court's decision, the plant must burn low-sulfur fuel, which as of yesterday cost $7.70 more a barrel than higher-sulfur-content fuel, Kirk said.
The company estimated the plant will burn about one million barrels of fuel a year for the next 30 years, although that volume as well as the fuel's price could fluctuate.
The decision will cost "in excess of $150 million over the life of the unit," Kirk said. Pepco customers will foot the additional costs, which don't have to be approved by the Public Service Commission, Kirk said.
It is difficult to determine how the costs will fall on customers, because the company isn't sure how often the plant will operate, Kirk said.
At issue in the case was whether the Chalk Point plant was under construction on Aug. 17, 1971, when tough new EPA pollution standards went into effect. Plants already under construction at the time that would incur significant losses if plans had to be changed were exempt from the new rules. Pepco contended it had begun construction before the 1971 date, but the Fourth Circuit Court of Appeals rejected that claim.
In other action, the court:
* Rejected a challenge to the Clean Air Act by the American Petroleum Institute, allowing the federal government to keep limits on ozone pollution blamed for urban smog.
The justices turned down appeals without comment by the institute, 15 oil companies, the States of Virginia and Oklahoma and other groups contending the standards were too stringent and were improperly adopted. The federal standards restrict the level of emission of hydrocarbons from automobiles, trucks, chemical plants and factories.
* Rejected an appeal by SCM Corp. challenging a decision that said Xerox Corp. did not violate federal antitrust laws by acquiring patents to the plain-paper copying process from a nonprofit research group.