Home Energy company Active Energy, the company behind the pellet plant project, loses another argument in federal court

Active Energy, the company behind the pellet plant project, loses another argument in federal court


Active Energy Renewable Power occupies a 415,000 square foot building in Lumberton, Robeson County, which once housed Alamac American Knits. The company is challenging a lawsuit filed by environmental groups for alleged violations of the Clean Water Act. (File photo: Lisa Sorg)

Active Energy Renewable Power, the company behind a controversial Lumberton wood pellet plant project, suffered another legal setback this week in federal court.

Active Energy had asked U.S. District Court Judge James Dever III to dismiss a lawsuit against a citizen alleging she violated the Clean Water Act. Dever denied the company’s request, allowing the case to continue.

Winyah Rivers Alliance, an environmental nonprofit, sued the company last year. In court documents, Winyah alleges that Active Energy violated the Clean Water Act by dumping industrial pollutants into the Lumber River and Jacobs Branch without a permit.

Active Energy has denied the allegations.

In 2019, Active Energy purchased a 415,000 square foot 145 acre building on Alamac Road to build a wood pellet plant that would use a new technology called CoalSwitch.

The plant has not yet produced CoalSwitch pellets due to technical issues, as well as the lack of a ventilation permit. The company, which has a turbulent legal and financial past, operated a sawmill, which has closed.

There was already significant groundwater contamination at the site – which the company was aware of – from past uses, including a dry cleaner. Alamac American Knits also operated a factory there, but closed in 2017 after several hurricanes flooded the facility.

Contaminants include toxic solvents, such as TCE and PCE, as well as benzene, a known carcinogen.

Nonetheless, when Active Energy purchased the building and land, it voluntarily assumed the responsibility of treating all discharges in an existing on-site facility before they entered the waterways.

The lawsuit alleges that for nearly a year, Active Energy violated the Clean Water Act by rejecting stormwater pollution from its sawmill and other lumber operations without a required federal permit. This is called an NPDES, short for National Pollutant Discharge Elimination System.

Active Energy was ultimately granted a stormwater permit, but the lawsuit alleges it continues to violate the Clean Water Act.

These violations stem from the company’s failure to obtain a separate permit required for its industrial wastewater discharges. Instead of seeking its own approval, Active Energy relied on the Alamac American Knits license, which was transferred as part of a real estate transaction.

However, emails between the company and NC’s environmental quality department show that before Active Energy released wastewater, it had to update the permit.

Contaminants in discharges from the wood industry, for example, are different from those used in textiles and must be taken into account.

Company monitoring shows more than two dozen types of pollutants have entered the waterways, including zinc, copper, aluminum and total chromium.

Lawyers for Active Energy have refuted the allegations. The license the company inherited from Alamac American Knits authorized temporary releases, while state environmental regulators considered a renewal application. Active Energy lawyers argued.

Judge Dever, appointed to the bench in 2002 by President George W. Bush, did not rule that Active Energy violated federal law, only that Winyah Rivers’ case was strong enough to continue.

Winyah Rivers is represented by the Southern Environmental Law Center. Active Energy’s attorneys are Shipman & Wright, based in Wilmington.