Legal notice alleges Active Energy discharging PFAS into Lumber River; Commerce Dept concerned over wood pellet company viability

Active Energy Renewable Power, a wood pellet company beset by regulatory, legal, and operational troubles, is allegedly discharging high levels of toxic PFAS into the Lumber River, a drinking water supply for 25,000 people in Robeson County.

The company is also allegedly discharging the compounds into Jacob Branch, a tributary of the Lumber River. 

The claims were detailed in a “Notice of Intent to Sue” sent to the company by the Southern Environmental Law Center. 

Active Energy did not produce the PFAS, also known as perfluorinated and polyfluoroalkyl compounds, but SELC alleges that the company has run afoul of the Clean Water Act, since 2019, when it purchased the property on Alamac Road in Lumberton. The Clean Water Act prohibits facility owners from discharging any pollutants — including PFAS — from their property into rivers and streams without a federal permit. Active Energy’s outdated permit does not include PFAS in the list of pollutants that can be discharged.

Previous property owners, including a dry cleaning facility and a textile plant, left behind large plumes of groundwater contamination that could be the source. Textiles treated with stain-, water- or grease-resistant coatings often contain PFAS. The history of the site, “led us to be concerned about possible discharges” of PFAS, said SELC attorney Heather Hillaker.

Exposure to PFAS has been scientifically linked to an increased risk of certain cancers, thyroid disorders, reproductive problems, fetal development issues and a depressed immune system. There are at least 5,000 types of PFAS. They are found in many consumer products, including furniture, rugs, clothing, shoes, fast food containers, pizza boxes, microwave popcorn bags, and more.

The EPA has yet to regulate PFAS in drinking water, but those regulations, or lack thereof, don’t apply to rivers and streams.

Gary Shipman, an attorney for Active Energy, rejected SELC’s allegations, calling them “based upon a myth, and not the facts.”

The company has monitored for all of the required pollutants and filed those reports with the state, Shipman wrote in an email to Policy Watch.

“There is not now nor have there ever been any discharge activity at this property while owned by our client that is not expressively authorized” under the discharge permit and a separate brownfields agreement, Shipman added. The permit and the agreement both predate Active Energy’s purchase of the property.

A brownfields agreement is a legally binding pact between state environmental regulators and a developer. It details necessary actions to make a contaminated site suitable for reuse; in return, the state agrees not to sue once these actions are complete. A liability protection in the agreement passes on to all new owners so long as they adhere to the land use restrictions.

The NC Department of Environmental Quality received a copy of SELC’s notice. At press time, the department’s legal team was still reviewing the document.

Tests show high levels of PFAS

On two days in October and December 2021, Lumber Riverkeeper Jeff Currie sampled water flowing directly from Active Energy’s discharge pipe before the water entered the river. This pipe, also known as an “outfall,” is used only to discharge contaminated groundwater after it is treated at Active Energy’s onsite wastewater plant. 

Traditional wastewater treatment systems, though, can’t remove PFAS. Results showed high levels of several types of the compounds.

On the same days, Currie also sampled water directly from Jacob Branch, a tributary of the Lumber. Results showed the detection of a dozen PFAS, as well. 

SELC alleges that Active Energy is discharging PFAS-contaminated groundwater into its holding ponds. Contaminated groundwater could then seep into Jacob Branch, a phenomena known as “hydrological connection.”

(These ponds and the treatment system began under previous ownership; when it bought the property, Active Energy agreed contractually with the state to continue operating them.) 

Below are the results, according to data from the certified lab and that was included in the legal filing. For comparison, if these were drinking water results instead of surface water, more than two-thirds would exceed federal or state health advisory goals.

The EPA’s health advisory goals apply to only two types of compounds — PFOA and PFOS. People should not drink water with those two compounds whose levels exceed 70 ppt combined, according to the EPA.

DEQ has also recommended not drinking water that contains individual compounds whose levels are greater than 10 ppt.

Discharge into the Lumber River

All levels are in parts per trillion (ppt)

Oct. 13, 2021

Number of PFAS detected: 9 

Number of PFAS with individual levels above 10 ppt: 9

Range of individual levels: 553 to 4,060 

PFOA level: 2,100 

PFOS level: 520

Sum of PFOA and PFOS levels: 2,620

Sum of all PFAS levels: 19,880

Dec. 14, 2021

Number of PFAS detected: 12

Number of PFAS with individual levels above 10 ppt: 12

Range of individual levels: 230 to 4,000 

PFOA level: 1,190

PFOS level: 310

Sum of PFOA and PFOS levels: 1,500

Sum of all PFAS levels: 14,781

Water directly from Jacob Branch

Oct. 13, 2021

Number of PFAS detected: 12 

Number of PFAS with individual concentrations above 10 ppt: 5

Range of individual concentrations: 2.93 to 41.3 

PFOA: 35.4

PFOS: 41.3

Sum of PFOA and PFOS: 76.7

Sum of all PFAS: 158 ppt

Dec. 14, 2021

Number of PFAS detected: 12

Number of PFAS with individual concentrations above 10 ppt: 5

Individual concentrations: 1.58 to 34.5

PFOA: 34.5

PFOS: 30.5

Sum of PFOA and PFOS levels: 65

Sum of all PFAS levels: 155 

The Lumber River and Jacob Branch already contain PFAS, which are widespread in the environment. However, the concentrations in samples upstream from Active Energy are much lower than those downstream from the facility or than from water discharging from the pipe. 

Upstream of the pipe, for example, total PFAS levels were only 47 ppt; at the pipe, they were 300 times greater. 

Likewise, results for Jacob Branch also showed stark differences between upstream and downstream levels.

Regardless of the source, once PFAS enter the drinking water supply, they are difficult to remove without advanced treatment systems. In August 2019, the NC PFAST network, a group of scientists that monitor the compounds in drinking water, detected eight types of PFAS in Lumberton’s water that had yet to be treated by the city’s treatment plant.  (The Environmental Working Group, which also monitors PFAS and other contaminants in drinking water, found similar results.)

The total concentration in untreated water was 56.6 ppt; PFOA and PFOS levels was 19.4, below the recommended 70 ppt threshold. However, new science from the EPA suggests that threshold is too lax.

The SELC is representing the Winyah Rivers Alliance, an environmental nonprofit group.

A growing list of troubles

Active Energy is based in England, and is a publicly traded company on the London Stock Exchange.

In 2019, the company announced it would build a wood pellet manufacturing plant in Lumberton at the site of the former Alamac American Knits factory. Robeson County was awarded a $500,000 building reuse grant from the NC Department of Commerce to be disbursed to the company.

That money has not been distributed, in part because the company has met none of the required benchmarks, including the 50 jobs it was supposed to create.

Active Energy had planned to manufacture CoalSwitch wood pellets, heralded as a “game changer” for utilities. The technology creates a wood pellet — made from timber largely cut in southeastern North Carolina — that can be burned alongside coal or as a standalone fuel in traditional power plants with no loss of heat. 

Utilities that use CoalSwitch pellets wouldn’t have to spend millions of dollars to retrofit their facilities. And because the manufacturing process uses steam to explode the pellets to remove some contaminants, they burn cleaner at the power plant than coal.

However, the manufacturing process for wood pellets emits significant air pollution. Those emissions prompted many Lumberton residents to oppose the plant, which is located in a predominantly Native American community.

So far, the plant has never made a single pellet for sale in North Carolina. In 2021, the company altered its engineering plans and emissions estimates without permission from the state, in violation of its air permit. 

Active Energy has yet to refile for an air permit in North Carolina, according to state records.

Facing a deadline to fulfill a contract for the pellets, Active Energy moved some of its pellet operations to Maine. But that plant shut down last fall because of an irreparable equipment failure. The company has also closed its sawmill business at the Lumberton site.

According to Commerce Department records obtained under the Public Records Act, Active Energy had planned to share its Lumberton plant with a second business, Sunstrand, based in Louisville, Kentucky. It used hemp, flax and other fibers to make different materials, such as animal bedding. 

Sunstrand, however, declared bankruptcy in 2020.

And in a federal lawsuit filed last year, former high-ranking Active Energy employees alleged the company owes them thousands of dollars in back pay.

The employment litigation “raised concerns about the vitality of the company” among Commerce Department officials, according to internal emails. 

The $500,000 building reuse grant expired last April. However, “because the county remains in support of the project,” the department agreed to extend to April 2023, an email reads. 

Because of project delays and “concerns over recent negative press,” the Commerce Department must approve job creation and other final documents before any funds are released.

If Active Energy fails to meet its benchmarks by next April, the $500,000 would stay with the Commerce Department’s Rural Economic Development Division.

In a notice to investors this week, the company said it “continues to review all its options” in Lumberton.