Risk Management

GE Agrees to Dredge Hudson River

Dubbed one of the "most expensive industrial cleanups in history," the PCB cleanup is reportedly expected to cost $700 million.
Stephen TaubOctober 7, 2005

Decades after it was barred from discharging large quantities of polychlorinated biphenyls (PCBs) into New York State’s Hudson River, The General Electric Co. has agreed to dredge at least some of the toxic substances from the waterway.

The New York Times called the project “one of the largest and most expensive industrial cleanups in history.” The entire 43-mile job is expected to cost about $700 million and is slated to start in 2007, the newspaper reported.

In a joint announcement, GE, the Justice Department, and the Environmental Protection Agency announced a detailed plan requiring the company to begin the dredging called for by the EPA in 2002. Under the terms of the consent decree, GE will pay the EPA up to $78 million for the agency’s past and future costs. The EPA has already collected $37 million from GE through past settlements.

The dredging will be divided into two phases. In the first, which will cost $100 million to $150 million, GE will dredge the heaviest deposits of PCBs. That’s about 10 percent of the total volume of PCB-contaminated sediment slated for dredging during the full cleanup, according to the Times.

Dredging in the remaining phase, which would cover contamination that’s lighter but spread over a much bigger area, is expected to take five years and cost about $500 million, according to the newspaper. Under the arrangement, however, GE has the option to agree to conduct the second phase of the dredging. If the company doesn’t agree, the EPA stated, the agency could direct the company to perform the dredging or sue it in district court to require it to do the job or pay back the EPA if the agency performs the cleanup.

The agreement follows Ecomagination, a recent environmental thrust under GE’s current chief executive officer, Jeffrey Immelt, that includes a number of energy-efficient products, FT.com noted. GE’s previous chief executive, Jack Welch, dismissed calls to clean up the PCBs as motivated by “bad science” — the company had argued that dredging up the substance would only cause greater pollution — and spent a great deal of company money lobbying against environmental regulators.

For about 30 years ending in the 1970s, GE discharged large quantities of PCBs into the river, the Website reported. The chemicals, which are used in electrical equipment because they don’t burn, were banned from production. In 1977, PCB use was banned because of health risks that include the possibility of skin rashes, liver damage, and cancer, according to FT.com.

The cleanup agreement “is an important milestone in this complex environmental project that will result in a healthier river, providing vast economic and recreational opportunities,” says EPA administrator Stephen Johnson.

The pact marks “a significant step in removing a large amount of PCBs from the Upper Hudson River, while at the same time obtaining from GE payment of millions of dollars in past and future costs related to this Superfund site,” says Kelly Johnson, acting assistant attorney general in the Justice Department’s Environment and Natural Resources Division. “Through the agreement, we hope to avoid costly future litigation and expedite the PCB cleanup, improving the health and safety of the environment and the citizens of New York for generations to come.”