Coal-fired power plants, chemical manufacturers and oil refineries may soon have to clean up their act, now that the U.S. Environmental Protection Agency has taken a step to close a loophole in hazardous waste laws.

Late last week, the EPA identified these industries as ones that had benefited from the loophole that, for more than 25 years, has made it easy for polluters to skip out on costly cleanups by declaring bankruptcy. EPA specifically identified coal-fired power plants, chemical manufacturers and oil refineries as industries that generate massive quantities of hazardous substances, but are not subject to requirements to set aside funds for cleanup if contamination occurs.

The EPA’s move places additional pressure on coal-fired power plants to responsibly handle the 131 million tons of toxic coal ash generated each year. In the wake of the Tennessee Valley Authority disaster, where over 1 billion gallons of coal ash was released after a dam collapsed, EPA recognized that the waste generated by coal-fired power plants poses significant risks that must be minimized and covered by the utilities.

The EPA’s action stems from a February 2009 court victory by environmental groups in which a U.S. District Court gave EPA a deadline to identify industries that fall through this loophole. Attorneys Lisa Evans and Jan Hasselman with the public interest law firm Earthjustice represented the Sierra Club and environmental groups in New Mexico, Nevada, and Idaho.

“We all learned in kindergarten to clean up after ourselves, but some irresponsible companies still haven’t learned this lesson,” Evans said. “If EPA succeeds in closing this loophole once and for all, it will force these companies to set aside enough money to clean up the messes they make and encourage them to act more responsibly in the first place.”

Since the Superfund tax levied on polluters expired in 1995, the cost to clean up contaminated sites left behind by bankrupt companies can fall to taxpayers — especially when companies are not required to set aside funds in the forms of bonds and other financial assurances. Although many industries that handle hazardous materials are subject to federal bonding requirements, coal-fired power plants, chemical manufacturers, oil refineries and other polluting industries fall through the gap between two federal laws governing hazardous waste cleanup: the Superfund law and the Resource Conservation and Recovery Act (RCRA).