Washington, D.C. —

A federal judge has ruled that the U.S. government violated federal law by providing approval and financial assistance to a controversial Kansas power project without environmental review and public involvement. The decision raises new questions about the future of the troubled Sunflower project, which is already in litigation over its air pollution permits.

The decision, by Judge Emmett Sullivan with the federal district court in Washington, D.C., came in response to a lawsuit filed by Earthjustice on behalf of the Sierra Club. The decision was filed under seal to protect Sunflower’s confidential business information, although a public version will be available shortly.

In the lawsuit, Sierra Club argued that the Rural Utilities Service (RUS), a branch of the U.S. Department of Agriculture, provided extensive financial support—including writing off millions of dollars of public debt—so that Sunflower could build the new power plant, which is not needed for Kansas but would send power to Colorado. These agreements left the RUS with close oversight of Sunflower’s business operations and required federal approval to proceed with the Holcomb project. Much of Sunflower’s financial struggles stem from overbuilding capacity at their existing unit, Holcomb I, which is a scenario that could be repeated if Holcomb II is constructed since neither Sunflower nor Tri-State, the Colorado partner, has demonstrated the project is needed. The lawsuit argued that, as an essentially federal project, greater environmental review and consideration of alternatives—like greater conservation and renewables—is required.

The Court agreed with Sierra Club’s positions

“With this much debt and federal support, Sunflower is effectively a ward of the federal government. As a public project, the Holcomb plant requires close public scrutiny and a meaningful analysis of alternatives and environmental risks. Without it, both taxpayers and our environment are at risk,” said attorney Jan Hasselman with Earthjustice, who argued the case for the Sierra Club.

“The Holcomb expansion will pollute the air and put our health at risk. As a ratepayer I’m troubled that Sunflower wants to take on such a risky project when they are still in debt from their last project, and I am also disappointed that the federal government would allow Sunflower to move forward with such a high-risk project without adequately considering its environmental and financial consequences,” said Lee Messenger of Garden City, Kansas.

“Sunflower, as well as many other electric co-ops, has been propped up by taxpayers for years. It’s time for the federal government to take a hard look at the risks of continuing to support the development of new coal projects that rely on dirty and outdated technology,” said Mark Kresowik of Sierra Club.

Judge Sullivan has asked for additional briefing to determine whether activities at the project should be halted until a full environmental review is conducted. That briefing will be completed by mid-June, with a decision anytime after that.

Sierra Club’s motion for summary judgment

The Court’s brief order granting the motion

The Court’s 54-page order explaining the decision has been filed under seal and will not be immediately available.