TVA Will Buy Allowances for Pollution

KNOXVILLE, Tenn. —  In an unprecedented move, one of the nation’s biggest emitters of sulfur dioxide plans to buy pollution allowances for its coal-fired plants from one of the nation’s cleanest utilities, officials said Monday.

The Tennessee Valley Authority, the giant federal utility that operates 59 coal-fired units at 11 plants in Tennessee, Alabama and Kentucky, plans to buy sulfur dioxide emission credits from Wisconsin Power & Light Co., one of the nation’s cleanest utilities.

Under the Clean Air Act of 1990, power plants that pollute less than their prescribed ceilings can sell pollution allowances to other plants that exceed them. Sulfur dioxide emissions are linked to acid rain.

Wisconsin Gov. Tommy Thompson, utility officials and Wisconsin regulators said they would provide details of the agreement at a news conference today.

The Wall Street Journal reported Monday that the deal would involve the pollution rights to about 10,000 tons of sulfur dioxide.

The newspaper, quoting unidentified sources familiar with the multi-year agreement, said the per-ton price is about $250 to $300 a year. That suggests a transaction worth $2.5 million to $3 million.