Dominion Resources announced Tuesday that it will spend $500 million in the next decade to install air scrubbers and other environmental equipment at several of its coal-fired power plants in Virginia to meet federal air quality standards.

Standing in the shadow of the company's largest coal-fired plant in Virginia, President T. F. Farrell II said the investment will reduce sulfur dioxide, nitrogen oxide and mercury emissions by more than 70 percent. He said Dominion is doing more than required to meet standards set in March by the U.S. Environmental Protection Agency.

"We support the EPA's new rules and are taking aggressive steps to comply with them," Farrell told reporters. "We believe their reliance on market mechanisms to leverage emissions reductions is the most cost-effective approach."

Dominion, which provides electricity to 2.3 million customers in Virginia and North Carolina, operates nine coal-fired plants in Virginia, as well as four nuclear facilities and several generators powered by natural gas.

Like power companies nationwide, Dominion is under pressure from the federal government and from environmental groups to reduce the pollution pumped from smokestacks at their power plants.

The company was already committed to installing more than $1.2 billion worth of equipment to reduce pollution as a result of a settlement with the EPA in 2003. That settlement stemmed from legal action in 1999 against Dominion and more than two dozen other power companies nationwide.

"A lot of the progress Dominion is celebrating is the result of the clean air enforcement case," said Cale Jaffe, an attorney for the Southern Environmental Law Center.

But health and environmental activists hailed Dominion's announcement, saying the company has chosen to embrace environmental regulation rather than fight it.

"This is really good news. They are choosing to clean up," said Donna Reynolds, director of community relations at the American Lung Association of Virginia. Reynolds said some other power companies are putting off improvements by buying the right to pollute more from operators of cleaner power plants.

Dominion "could be out in the market purchasing emission credits and doing nothing," she said. "Those of us who filter this through our hearts and lungs will have benefits."

Dominion officials said construction of scrubbers, huge machines almost as large as the power plants themselves, is underway at some of its coal units. The $500 million will allow construction of additional scrubbers and the application of other technology between 2010 and 2015.

Once those improvements are in place, Dominion will meet or exceed the new EPA clean air standards, Farrell said.

"Dominion is proud of its long history of environmental stewardship," Farrell said. "The construction projects we announce today set a new standard in our pledge to be a national leader in the effort to improve air quality."

Farrell said the company is barred by state law from increasing household electricity rates to cover the costs of the capital construction until 2010. After that, the utility's rates will be set by competition in the wholesale market, he said.

The company has felt pressure to reduce emissions from the Virginia legislature as well as the EPA. This year, the company helped defeat a bill by Del. John. S. "Jack" Reid (R-Henrico) that he said would have imposed stiffer requirements and a tighter timetable.

"You can't solve this problem with a local solution," Farrell said at Tuesday's news conference.

Reid said he is pleased with actions taken by Dominion since his bill died in committee this year. "They're to be commended, because they have certainly taken some positive steps," he said.

But Reid said he intends to draft legislation that pushes Dominion and other power companies in the state to be more aggressive in limiting the amount of mercury released into the air. Mercury is a neurotoxin that is especially dangerous to children and fetuses.

"The mercury still is a problem," Reid said. "Legislation this year will be aimed primarily at mandating a reduction in that."

Reid said he understands the concern about trying to legislate a state solution to air pollution, which by its nature wafts across state borders. But he said he is motivated to do something in part by his wife, who has a dangerous breathing condition that is exacerbated by air pollution.

"If every state were to take the position that it's not our responsibility," he said, "we'd never get anything cleaned up."