Settlement Binds Power Co. To Stop Burning Coal

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Credit National Parks Service

One of the largest U.S. electricity producers will stop burning coal at two of its power plants under a legal settlement reached with the EPA, eight states and several environmental groups.

American Electric Power agreed late Friday in federal court in Columbus, Ohio, to retire or switch to natural gas two coal-burning units at power plants in Ohio and Indiana by the end of 2015.

In exchange, AEP changed the conditions of an earlier court settlement to cap and make faster and deeper cuts in sulfur dioxide emissions,  a leading cause of acid rain. Settlement funds to the states, including New York, Vermont, Massachusetts, Connecticut, New Hampshire and Rhode Island, are increased.

Cheap natural gas and environmental regulations are causing utilities to shut down coal-fired power plants. AEP had previously planned to stop coal at one unit.

Environmentalists said the deal will ensure the company doesn't change its mind.

The Associated Press contributed to this report.