The East Kentucky Power Cooperative (EKPC) is proposing to build a new 278-MW coal-fired power plant, the new J.K. Smith Unit 1, at the J.K. Smith Power Station in Clark County, Kentucky. If constructed, the plant's carbon dioxide emissions will contribute to global warming, and emissions of other pollutants, ranging from particulate matter to mercury, will harm human health and the environment in myriad ways.

To obtain additional funding from private sources for the project, the cooperative had to obtain a 900 million dollar lien accommodation from the federal Rural Utilities Service (RUS), an arm of the Department of Agriculture. RUS's grant of the lien accommodation means that if the cooperative is unable to repay all of its debts, the private funders would be paid out of the government's share, leaving the RUS -- and taxpayers -- to bear the loss. RUS granted the lien accommodation despite the shaky financial footing of the cooperative, and without first considering the environmental harm the plant will cause. Any major federal action with significant environmental impacts requires an environmental impact statement under the National Environmental Protection Act -- a report RUS has not prepared.

Earthjustice is suing on the behalf of the Sierra Club and Kentuckians for the Commonwealth.