A U.S. District Court judge in Nashville says he will not approve the Tennessee Valley Authority's landmark $1 billion air-pollution settlement until an economic and inflation impact statement is drafted.
Judge Thomas A. Wiseman's Jan. 30 order came shortly after a letter from Barry Bosworth, director of the White House Council on Wage and Price Stability was circulated in Tennessee. The letter charged that the settlement "will impose an unnecessary cost burden on the residential and industrial users of electric power in the Tennessee Valley."
Senate Environment and Public Works Committee staff members disclosed yesterday that they are investigating whether Bosworth's intervention in the TVA settlement was improper. The timing of the judge's decision and the Jan. 10 letter was "too close to be coincidental," a spokesman said.
The intervention, committee staff member Karl Braithwaite said, "could delay the single most important (environmental) enforcement action of the decade." The settlement was agreed to by environmentalists, the Environmental Protection Agency, TVA and several affected states after six years of court fights. It would force TVA to clean up ten coal-fired power plants, eliminating a million tons of sulfur dioxide gas a year.
Bosworth's criticism of the TVA settlement comes at a time of increasingly controversial White House intervention in environmental regulation. In the last few months, White House inflation-fighters have attacked stripmine rules, smog standards, cottondust regulations and water cleanup rules.
A spokesman for the wage and price agency said yesterday that Bosworth was "performing his duty" in criticizing the settlement. "We are authorized to intervene in proceedings that have an inflationary impact. Our letter was to TVA, not to the court," he said.
Bosworth's Jan. 10 letter was addressed to E.G. Chaves of the Consolidated Aluminum Co. in St. Louis, which has been campaigning against the settlement because it would increase industrial electricity rates.
An Oct. 17 Bosworth letter to TVA Director Richard Freeman tried to change the settlement before it was approved by the TVA board in December.
"We have several major concerns with the settlement as drafted," Bosworth wrote in October. "First, the settlement specifies the exclusive use of eastern coal... Second, the amendments to the Clean Air Act would permit... an adjustment in emission limits to higher levels for two of the plants covered by this settlement... Third, the settlement stipulated methods of compliance for individual plants -- for example, the application of scrubbers -- which appear to be more costly than available alternatives."
TVA's long-term contracts for lowsulfur eastern coal, which is more expensive than western coal, "pose a serious inflationary problem throughout the coal-using regions east of the Mississippi," Bosworth wrote. Bosworth's position appears to contradict administration policy of supporting eastern coal mining.
TVA Board Chairman David Freeman said yesterday that Bosworth "doesn't know what he's talking about. It's a money-saving settlement for our consumers. This is a major cleanup effort and it's required by law." Freeman declined to speculate on whether Bosworth's letters had influenced the court.
Wiseman was unavailable for comment. He was appointed to the court a few months ago on the recommendation of Sen. James R. Sasser (D-Tenn.), a strong critic of the settlement. Sasser's press secretary, Craven Croll, said the senator had not discussed the issue with Wiseman, but that "most people suspect [Wiseman] has a copy of the Bosworth letter."
Richard Ayres, an attorney for the Natural Resources Defense Council, a party to the settlement, called Bosworth "irresponsible." His letter, Ayres said, "is the most corrupt example yet of how [White House inflation-fighters] are acting as industry's handmaidens....
"Some aluminum company writes a letter, so Bosworth replies, placing the authority of the president of the United States behind it. The settlement would remove sulfur at a cost of $45 a pound -- that's cheap. It would raise rates by 4 per cent by 1983 in an area which pays the lowest power costs in the U.S. -- less than half of what we pay in Washington," Ayers said.