Thursday, April 3, 2014

Duke Energy: 3rd Largest Coal-Ash Spill (2014)

Duke Energy Company logo

On February 2, 2014, there was trouble brewing along Dan River located between Eden, NC and Danville, VA without anyone realizing it. Duke Energy is a company that owns coal plants produce electricity and started production in 1949. The coal-fired power production stopped in the spring of 2012. However, after production stopped, the coal ash was not cleaned up. The ashes are kept in coal ash ponds behind the plants. In this particular case, along the Dan River ("Duke"). Duke Energy reported that there were 50,000 to 82,000 tons of coal ash that spilled into the river. An estimated 27 million gallons of coal ash are moving downstream coating 70 miles of the river with 82,000 tons of toxic sludge (Lisenby, "Exclusive"). This carelessness of maintaining the coal ash ponds now becomes a huge pollution problem.
In addition, this river is a public drinking water supply for more than 18,000 people immediately downstream ("Duke"). As if the case couldn't get worse, Duke Energy not only is responsible for this pollution, but they did not issue a report to the public until 24 hours after it was discovered. A day went by without anyone being aware that their drinking water could be contaminated with such toxic waste. North Carolina Governor, Pat McCrory, is also now involved in this case due to the $1 million plus campaign contributions from Duke Energy. The governor worked for Duke Energy for more than 27 years before it closed and he became an elected state official (Ambellas). As far as resolving this issue, Duke Energy reported that it would take over two years to clean up the spill (Deike, "Duke"). The only theory that can somewhat support Duke Energy's case is individualism. Duke Energy pursued their own self-interests by not issuing a report of the spill to potentially save face of the company. Even though this backfired, the theory can still be applied for this reason. All of the other theories can further prove how irresponsible the company is and was acting and where exactly they went wrong.

Lynn Good, CEO of Duke Energy

This ash spill surely affects the company because it is of course under such scrutiny. Many previous legal issues from the past have been brought back up in relation to the current situation. Now the company is in the spotlight to see how they are going to respond to the mess; and so far it is not looking good. Cleaning up this coal ash from when when the factory was in operation was always their responsibility, but now they have to do it much sooner and faster then they had planned.
Aside from the company, the main parties that this will affect are of course the people who live nearby and use the Dan River as their drinking supply and the environment itself. About 18,000 people are located immediately downstream of the Dan River and had their water supply compromised ("Duke"). This coal ash, that turned into a mud-like substance, not only contaminated the water supply, but could potentially damage and clog pipes that lead into people's homes. In addition, the environment is also affected because the water tested positive for extremely high levels of arsenic, chromium, and lead. This study concluded that the heavy metals now in the water are very toxic and bio-accumulative, meaning that it will stay in the river, sediment, and the bodies of fish and other animals for a long time (Waterkeeper, "Water"). When analyzing Kantianism, the environmental laws that were violated will be explained further. Since the company closed back in 2012, I don't think any shareholders' of the company are of great concern. The residents living nearby and the environment itself are going to be impacted the most.

Individualism is defined as the belief that people must best serve the public by pursuing their own self-interest. It entitles people to make business decisions that benefit themselves. Friedman was one of the biggest believer and defender of this concept. Milton Friedman's view states that the goal of a business is to profit and the only obligation is to "maximize profit for the owner or the stockholders" (Salazar). In this case however, the company is no longer operating, so the stockholders' don't really come into play here.
The theory of individualism can still be applied based on the fact that the company did not issue a report until about 24 hours after the spill was discovered. A reason why the company could have chosen to do this was to potentially save their face and get it under control before reporting anything. We know that this was not at all the right move and that whether the spill was in the process or being cleaned up or not, a report would have to be issued. Residents depend on that water source for their homes and there is no way that that could remain a secret. Based on the nature of the situation, it does not or will ever benefit the public or preserve the company's self interest. Everyone loses.

Duke Energy's coal ash spill in North Carolina
Utilitarianism is defined in the book as "an ethical tradition that directs us to make decisions based on the overall consequences of our acts" (Desjardins, 24). In other words, rather than making decisions that would just benefit ourselves or just benefit everyone else, we try to make decisions that benefit everyone as a whole, including yourself. On the flip side, some decisions can have a negative affect and therefore everyone suffers the consequences including you.
This theory does not support the actions taken by Duke Energy. A report of the coal ash spill was reported nearly 24 hours after the spill. By not issuing an immediate report, shows the company's irresponsibility and is inexcusable. A security guard had first noticed the unusually low water levels in the ash pond and that lead to the discovery of the spill itself. Most of the water had escaped and contaminated the river long before anyone even noticed (Lisenby, "Breaking"). In addition, Duke Energy failed to "provide accurate and timely information to the public about the high levels of heavy metals contaminating the Dan River for days" (Waterkeeper, "Water"). This course of action does not benefit anyone, including the company.

Kantianism came from German philosopher Immanual Kant. Kant explains that your most important duty is to only act in a way that the maxim (the intention behind actions) could be made a universal law. In other words, people should act in a way that someone could make a proper law out of it and set an appropriate example for others. (DesJardins, 38). In addition, the formula of humanity states that we act in a way that humanity should be treated. However, it states that we should treat people's rationality as valuable.
Duke Energy's actions do not reflect this theory at all. The Department of Environment and Natural Resources (DENR) filed four lawsuits against Duke Energy in 2013 claiming that there was illegal pollution leaking from the ash pits at all 14 of the company's plants in North Carolina (Waterkeeper, "Highly"). President of Waterkeeper Alliance, Robert F. Kennedy, Jr. stated that "Duke could have avoided contaminating the Dan River and poisoning Virginia's water supplies if it had removed its toxic ash heaps years ago after being warned by EPA" (Waterkeeper, "Water"). In 2009, EPA found Duke Energy's ash pond dams to be "significant hazard potential structures" and leaking beyond the pond (Waterkeeper, "Water"). Duke Energy was advised to clean up the coal ash ponds after production was stopped in 2012 but has failed to so and take responsibility to address the ongoing contamination of public water sources. Not only did Duke Energy not follow the laws already in place regarding their ash clean up, their actions certainly could not be enforced as a law. The company continued to ignore the ongoing pollution on their behalf and did not dispose of their coal ash accordingly. They also failed to notify the public immediately and have to reported any sort of time line and process as to how they are now going to clean the Dan River. It is difficult to see the company's rationality in their actions of not only neglecting the coal ash ponds, but also in reporting the spill. Although, their rationality and intentions weren't specifically stated, it is possible that the company did not have the resources to clean up like they should have.

Virtue Theory
Coal ash pulled from the bottom of the Dan River in North Carolina
Virtue ethics focuses on one's character and the characteristics that allow us to function properly, especially as businesses. The four main virtues of character are courage, honesty, temperance/self-control, and justice/fairness. All of these virtues of character are violated by Duke Energy in the way that the handled their coal ash after stopping production, informing the public on the spill, and the clean up of the Dan River. Duke Energy did not follow the proper laws on disposal of their coal ash after they stopped production in 2012. Four lawsuits didn't even seem to change their attitudes about ignoring the piles that were neglected. They were warned in several different ways to clean up and they refused to take any responsibility for their waste. Acting in such a way was not good for the company's name and is unfair that nothing significant was done about their waste compared to other companies with factories in operation.
Secondly, as stated multiple times above, Duke Energy failed to notify the public immediately after the spill was discovered. Rather, 24 hours went by before anyone got word of the contaminated public water supply. Not only is this also unfair, but it is also dishonest and irresponsible. The people that could potentially be harmed by the company's carelessness were not taken into consideration. The stackholders' section discusses the company's failure to inform the public.
Finally, the current clean up of the Dan River is reportedly going to take over two years (Deike, "Duke"). A letter from Duke's president, Lynn Good, was sent to the DENR Secretary, John Skvarla, with more details on the spill. However, Skvarla states that their plans fall short and don't say anything regarding the clean up of the nearly three dozen coal as dumps scattered throughout North Carolina. "Duke Energy should provide the information originally requested, including the estimated costs of cleanup, plans for the future and a detailed timeline" (Deike, "Duke"). This again showcases Duke Energy's irresponsibility towards this coal ash spill.

ConclusionAfter analyzing the background of the case and the ethical views, it is clear to see where Duke Energy made their mistakes. The first and foremost being the fact that the coal ash was neglected after the company stopped production in 2012. If the company had listened to the EPA and cleaned it up, this spill could have been easily avoided. Secondly, not notifying the public right away was another huge mistake. It is well known that the Dan River is the public drinking water sources for many many people. As discussed in the stakeholders section, the people the depend on this water supply and the surrounding environment are going to be affected the most.
Even though the company stopped production a couple years ago, this spill will surely hurt them financially. While the coal ash ponds should have been cleaned up according to law and regulations years ago, the company now has an even larger mess to clean. Although numbers have not been released as to how much this clean up will cost, it can be expected that it will be a significant amount because of the time it will take and the wide area affected. Lawsuits are also going to hurt them financially because of costs and that they will most likely lose their cases.


Ambellas, Shepard. "N.C. Gov. Pat McCrory to Be Subpoenaed by Grand Jury in ‘criminal Investigation’." Intellihub News., 14 Feb. 2014. Web. 28 Mar. 2014. <>.

Deike, John. "Duke Energy Announces Coal Ash Spill Cleanup Will Take 2+ Years; Emails Show Collusion Between Regulators and NC Utility." EcoWatch. Ecowatch, 14 Mar. 2014. Web. 28 Mar. 2014.<>.

DesJardins, Joseph R. An Introduction to Business Ethics. New York, NY: McGraw-Hill Higher Education, 2009. Print.

"Duke Energy Dan River Coal Ash Spill Updates: What We Know, What We Need To Know." — Catawba Riverkeeper Foundation. NetCorps, n.d. Web. 28 Mar. 2014.<>.

Lisenby, Donna. "Breaking: Duke Energy Coal Ash Spill Pollutes River and Threatens Drinking Water." EcoWatch. Ecowatch, 04 Feb. 2014. Web. 28 Mar. 2014. <>. 

Lisenby, Donna. "Exclusive: Duke Energy Ongoing Coal Ash Spill Into Dan River." EcoWatch. Ecowatch, 05 Feb. 2014. Web. 28 Mar. 2014. <>.

Salazar, Heather. Business Ethics, Economics, and Individualism. Powerpoint Slides

Waterkeeper Alliance, and Yadkin Riverkeeper. "Highly Contaminated Water Still Pouring Into Public Drinking Source on Dan River." EcoWatch. Ecowatch, 13 Feb. 2014. Web. 28 Mar. 2014.<>.

Waterkeeper Alliance, and Yadkin Riverkeeper. "Water Samples Show Disturbing Levels of Heavy Metals from Duke Energy Coal Ash Spill." EcoWatch. Ecowatch, 06 Feb. 2014. Web. 28 Mar. 2014.<>.

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