Coal ash river spill costs Duke Energy CEO $600K
Good’s $8.3 million compensation reduced 35% of $1.2 million base, plus incentives.
RALEIGH, NC — Duke Energy Corp. CEO Lynn Good saw her pay docked about $600,000 in the aftermath of last year’s massive spill of collected coal ash that coated 70 miles of a North Carolina river in sludge containing toxic heavy metals.
A portion of Good’s $8.3 million compensation was reduced 35% in 2014 compensation, according to a proxy statement released ahead of the company’s annual shareholder meeting in May. The compensation of four other top executives that is linked to short-term incentives was also reduced 35%.
Directors of the country’s largest electric company said the executives were docked because the spill will cost Duke Energy $192 million in cleanup, legal fees, and fines to settle a pending criminal case involving Clean Water Act violations.
“In order to hold the senior leaders of Duke Energy accountable for its financial and operational performance, these expenses were factored into the calculation” of their pay, the proxy statement said.
Good’s compensation tied to short-term incentives was cut from a potential $1.7 million in 2014 to $1.13 million. Her $1.2 million base salary makes up just 15% of her total compensation, the proxy document said.
Federal prosecutors last month filed nine misdemeanour criminal charges against Duke Energy alleging the company for years illegally leaked pollutants from coal ash dumps at five North Carolina power plants. The ash is the waste left behind when coal is burned to generate electricity. It contains such toxic heavy metals as arsenic, selenium, chromium and mercury.
Duke Energy said it has negotiated a plea agreement with prosecutors under which it will admit guilt and pay $102 million in fines, restitution and community service to settle the alleged Clean Water Act violations. If the deal is approved by federal courts, the company said the costs of the settlement will be borne by its shareholders rather than its electricity customers.
The company said it spent about $20 million to clean up the Dan River after a pipe under a coal ash pit broke in February 2014. About $70 million more went to consulting, engineering, legal and other costs in the aftermath, the company said.
Duke Energy has more than 7 million customers in the Carolinas, Ohio, Kentucky, Indiana and Florida.