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FISCAL YEAR: 2017
1. PRINCIPAL DEFENDANT: Power Plant Management Services, LLC
D.  Massachusetts  3:16-CR-30021-MGM
2. DEFENDANT: Berkshire Power Company, LLC
D.  Massachusetts  3:16-CR-30021-MGM
3. DEFENDANT: Frederick Baker
D.  Massachusetts  3:15-CR-3002-MGM
4. DEFENDANT: Scott Paterson
D.  Massachusetts  3:15-CR-3001-MGM

Western Massachusetts Power Plant Owner and Management Companies Sentenced for Tampering and False Reporting

Settlement requires companies to pay fines and payments totaling over $7 million

BOSTON – Berkshire Power Company (BPC) and Power Plant Management Services, Inc. (PPMS) were sentenced in U.S. District Court in Springfield for tampering with air pollution emissions equipment, and PPMS was also sentenced for submitting false information to both environmental and energy regulators relating to the Berkshire Power Plant (“the Plant”) in Agawam, Mass.

In May 2016, BPC (owner of Berkshire Power Plant) and PPMS (the Plant manager) pleaded guilty to felony charges that they violated and conspired to violate the federal Clean Air Act. These charges arose from air pollution monitoring equipment tampering and related false emissions reporting between 2009 and 2011. PPMS also pleaded guilty to violating the Federal Power Act, the first-ever criminal charges under this statute, for making false statements to the regional power grid administrator, ISO-New England, regarding the Plant’s availability to produce power.

According to documents filed in federal court, between January 2009 and March 2011, BPC engaged PPMS to manage the Plant, including overseeing day-to-day operations and maintenance and to act as the owner’s representative for the Plant. A PPMS employee served as the Plant General Manager and as BPC’s on-site representative.

PPMS and BPC caused staff at the Plant to tamper with the Plant’s air pollution monitoring equipment to conceal the fact that the Plant was emitting air pollutants in excess of permitted levels. This tampering was accomplished by intentionally biasing the Plant’s Continuous Emissions Monitoring System so it would show lower emissions levels than were actually being produced by the Plant. BPC and PPMS then used this inaccurate data in filing required emissions reports with the U.S. Environmental Protection Agency (USEPA) and the Massachusetts Department of Environmental Protection (MassDEP). The purpose of the tampering was to avoid lost revenues that would have resulted from reducing power production to stay within the Plant’s air pollution emissions limits, or by taking the Plant out of service to implement needed repairs of the Plant’s pollution control and other equipment.

Excess nitrogen oxide (NOx) emitted from fossil-fuel-burning power plants and mobile sources, like cars and trucks, combines in the atmosphere with volatile organic compounds emitted from industrial and residential sources to form ground-level ozone. At ground level, ozone is a respiratory pollutant that can cause many human respiratory effects, and even premature mortality, especially in vulnerable elderly persons and young children. NOx emissions also cause environmental damage to coastal waters, aquatic life, and other property, and contribute to the formation in the atmosphere of fine particulates that also harm humans, aquatic life, and vegetation.

During the course of the tampering investigation, criminal investigators also learned that PPMS made and caused staff at the Plant to make false statements to the ISO-New England, about the Plant’s availability to produce power for the New England grid. They also caused staff at the Plant to falsely claim to the ISO that the Plant was available to produce power when it was not. PPMS did this to maximize the Plant’s revenues and to minimize repair expenditures.

Acting United States Attorney William Weinreb and Massachusetts Attorney General Maura Healey made the announcement following a joint federal and state investigation into allegations that Berkshire Power Plant in Agawam, Mass., tampered with its air pollution monitoring equipment and falsely reported data to environmental and energy regulators regarding its emissions levels and its availability to produce power.

Tyler Amon, Special Agent in Charge of the U.S. Environmental Protection Agency’s Criminal Investigation Division in Boston and Commissioner Martin Suuberg of the Massachusetts Department of Environmental Protection, also joined in the announcement today. Assistance with the investigation was provided by the Massachusetts Environmental Crimes Strike Force (an interagency investigative team dedicated to developing the most significant environmental enforcement cases) and the Massachusetts Environmental Police. Assistant U.S. Attorney Sara Miron Bloom of Weinreb’s Economic Crimes Unit is prosecuting the federal case with the assistance of Dianne Chabot, USEPA Criminal Enforcement Counsel.



March 23, 2017

United States District Court Judge Mark G. Mastrioanni sentenced BPC to pay $2.75 million in criminal fines for violations of the Clean Air Act and to make a $750,000 community service payment to the American Lung Association to fund a program for the replacement of polluting wood burning stoves in western Massachusetts. Judge Mastrioanni sentenced PPMS to pay $500,000 in criminal fines for violations of the Clean Air Act and Federal Power Act and to make a $250,000 community service payment to the American Lung Association’s wood stove change-out program.

In addition to the criminal fines outlined above, BPC and PPMS have agreed to pay $3,042,563 plus interest to the Federal Energy Regulatory Commission in civil penalties and disgorgement for their misrepresentations to ISO-New England regarding the Plant’s availability to produce power.

CITATION: 16 U.S.C. 824v, 16 U.S.C. 825o, 18 U.S.C. 371, 42 U.S.C. 7413 (c)(2)(C), 42 U.S.C. 7413(c)(2)(A)
May 30, 2017
Baker was sentenced to 30 months of probation and ordered to pay a $5,000 fine. On May 3, 2016, Baker pled guilty.
CITATION: 18 U.S.C. 371, 42 U.S.C. 7413(c)(2)(C)
June 8, 2017
Scott Paterson was sentenced to serve 12 months of probation and pay a special assessment of $1,300. On February 3, 2015, Paterson pled guilty.
CITATION: 18 U.S.C. 371, 42 U.S.C. 7413(c)(2)(C)
STATUTE:
  • Clean Air Act (CAA)
  • Title 18 U.S. Criminal Code (TITLE 18)
  • Other Federal Statutes (Other)

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