News > News > Energy > “Bad actor.” Read Riverkeeper’s letter to DEC regarding CPV power plant permits

“Bad actor.” Read Riverkeeper’s letter to DEC regarding CPV power plant permits

March 9, 2018

Via electronic mail

Basil Seggos, Commissioner
New York State Department of Environmental Conservation
625 Broadway, 14th Floor
Albany, NY 12233-1010

Steve Flint, Division of Air Resources Director
New York State Department of Environmental Conservation
625 Broadway, 9th Floor
Albany, NY 12233-3250

Re: Grounds for modification, suspension or revocation of CPV Valley Energy Center air permit (Permit ID: 3-3356-00136/00001)

Dear Commissioner Seggos and Mr. Flint:

I am writing on behalf of Riverkeeper, Inc.—a nonprofit public interest environmental membership organization dedicated to protecting the commercial, recreational, ecological and aesthetic qualities of the Hudson River estuary, its fishery, and the entire Hudson River ecosystem, including its watershed and tributaries—to bring your attention to facts which we believe render Competitive Power Ventures (“CPV”) unsuitable to hold permits in the State of New York.  We urge the Department to consider whether to revoke or suspend the existing air state facility permit for the CPV Valley Energy Center (Permit ID: 3-3356-00136/00001), which was issued on July 25, 2013 and will expire on July 31, 2018.

I. DEC has broad authority to revoke, suspend or modify permits.

The Environmental Conservation Law’s Uniform Procedures Act authorizes the DEC to suspend, revoke or modify an existing regulatory permit. N.Y. Envtl. Conserv. Law § 70-0115; see also DEC’s Record of Compliance Enforcement Policy [hereinafter “DEE-16 Policy”] at 2 (rev. March 5, 1993) available at (describing the legal basis underlying DEC’s broad authority to revoke permits).(1) The Department’s regulations enumerate factors to consider in deciding whether to suspend, revoke or modify a permit. 6 NYCRR 621.13(a).

This regulation, 6 NYCRR 621.13(a), also discusses DEC’s broad authority to suspend or modify such permits.

DEC’s DEE-16 Policy guidance repeatedly references the Department’s authority to revoke permits in situations where the permittee or applicant is “unsuitable,” i.e., a bad actor. See DEE-16 Policy at I. It further explains that DEC’s is “command[ed]” by the legislature to “take reasonable steps to ensure that the applicant is a fit and proper person to engage in the permitted . . . activity.” Id. at III. To that end, the policy creates uniform guidance to address “whether the Department should issue permits . . . to persons who have acted in violation of the laws of New York State.” Id. at II. This guidance enumerates factors to consider as a basis for exercising DEC’s discretion in revoking a permit. Id. at IV. These factors include, inter alia, whether, in the last 10 years, the permittee or applicant has “been convicted of a crime related to the permitted activity under any federal or state law,” “engaged in conduct that constitutes fraud or deceit . . . in the permit application or supporting papers or in the conduct of the permitted activity,” or “been convicted of the crime of filling a false instrument or making a false statement to the Department or any other agency regarding compliance with the laws of any state or the United States.” Id.

The DEE-16 Policy also discusses when an individual’s bad acts may be imputed to the employer company or organization applying for a permit. The policy explains that the factors discussed above are “applicable not only to the immediate entity but to any other corporation, partnership, association or organization in which the permittee or applicant holds or has held a substantial interest or in which it has acted as a high managerial agent or director or any other individual, corporation, partnership or organization which holds a substantial interest or the position of high managerial agent or director in the permittee or applicant.” DEE-16 Policy at IV.

II. Riverkeeper believes CPV is an “unsuitable” permittee, and requests that the Department review whether its air permit should be revoked or suspended.

Former CPV’s Vice President of External Affairs and Government Relations for CPV, Peter Galbraith Kelly, has been indicted on bribery charges. See Certified Complaint at 4, 5.(2) Specifically, the government alleges that Kelly bribed a state official, Joe Percoco, to take official state action to benefit CPV, and that the money for the bribe originated from CPV. Id.   Allegedly, in response to Kelly’s requests for official assistance, Percoco requested that CPV hire his wife. Id.  Kelly then caused CPV to create a “low-show” position for Percoco’s wife under which she was paid approximately $90,000 per year by CPV. Id.  In return, Percoco used his official position and influence to help CPV with specific state matters “as the opportunities arose.” Id. at 24.  According to the indictment, these bribes allegedly occurred between 2012 and 2016.   The air permit for the proposed CPV Valley Energy Center was issued by the DEC, during the time that the alleged bribery scheme was in progress.

The criminal trial for both Percoco and Kelly is currently ongoing. Credible evidence has come out at trial which indicates that CPV’s CEO also had knowledge of, and, at minimum, removed internal barriers to Kelly’s bribery scheme.  Most relevant here is CPV executive Sean Finnerty’s February 1, 2018 testimony detailing his concerns with the company’s employment arrangement with Percoco’s wife.(3) Finnerty testified that at one point he was curious about an invoice to a contractor (through which Percoco’s wife was being paid). Id. Upon following up with Kelly, Finnerty became concerned about the arrangement and asked to see the ethics opinion Kelly proffered as sanctioning the situation. Id. After explaining he was initially denied access to the ethics opinion, Finnerty stated: “That is typically not the way we did work at CPV. We were very transparent. I said I wasn’t going to approve the invoice. I wasn’t comfortable with it.” Id. Ultimately, when Finnerty would not approve the invoice, CPV CEO Doug Egan stated, “This is obviously an issue for you. I will take it out of your budget and put it into Braith’s [i.e., Kelly’s] budget. We have bigger fish to fry.” Id. After this, Finnerty was so concerned that he later met with the CPV president to discuss the matter, and emailed his notes from that meeting and the suspicious invoice to his personal email account. Id. This testimony establishes that CPV high-level executives in addition to Kelly were aware of potentially illegal activity by Kelly, and removed internal barriers that could have curtailed it.(4)

In addition, testimony from a consultant to CPV showed that in teaching materials, pamphlets, photos and tweets, CPV went out of its way to avoid indicating that Percoco’s wife, was employed by the company’s educational program.(5) This indicates that within CPV there was an awareness that the employment of Percoco’s wife was not in the normal course of business.

This testimony and a considerable amount of other evidence regarding Kelly’s scheme demonstrates that high management officials of CPV have been involved in illegal conduct, which can be imputed to CPV itself under the DEE-16 policy.  We therefore request that the Department evaluate carefully whether CPV is a suitable entity to hold permits in the State of New York and whether to revoke, suspend or modify the regulatory permits for the Valley Energy Center.


We request that DEC find that CPV is an unsuitable permittee in the State of New York and evaluate whether the appropriate response is to revoke or suspend the air permit for the CPV Valley Energy Center. We appreciate your rigorous review of this matter and request that you advise me of the outcome. Please feel free to contact me with any questions regarding this request.


Richard Webster
Legal Program Director
Riverkeeper, Inc.

cc: Thomas Berkman, NYSDEC General Counsel


  1. While not explicitly discussed for air permits, the portions of the Environmental Conservation Law addressing the DEC’s hazardous and medical waste permitting explicitly consider crimes such as bribery in considering whether to revoke a permit. See N.Y. Envtl. Conserv. Law § 27-0913(3)(d) (hazardous waste permits); id. at 27-1517(1)(d) (medical waste permits); see also id. at 27-1407 (explaining DEC can consider, among other factors, convictions such as for bribery in denying a request for participation in New York State’s Brownfield Cleanup Program).
  2. The government’s Certified Complaint—laying out the offenses and evidence—is available here,; and the grand jury’s Indictment is available here,
  3. See;
  4. The arrangement to pay Percoco’s wife was brokered by Kelly—who alone at CPV has thus far been charged with wrongdoing—and was paid for by CPV over at least a five-year period. Furthermore, it is clear from the written court filings made thus far that Kelly was acting to benefit CPV when he engaged in these illegal activities.
  5. See

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