Nov. 8--Environmentalists have a new bone to pick with Peabody Energy Corp.

The St. Louis-based company is seeking separate water-discharge permits to mine coal to feed its proposed power plant in Southern Illinois and to store the combustion waste produced at the plant on a separate piece of land.

This is causing environmental groups to again take aim at Peabody's $2 billion Prairie State Energy Campus. They argue that runoff from the waste pile could threaten local water supplies. A coalition of environmental groups already is fighting the coal- fired plant on the grounds that its emissions will foul the air.

"We think there is a very strong potential for groundwater contamination," said Kathy Andria, conservation chair of the Sierra Club Kaskaskia Group and president of American Bottom Conservancy. "Coal-combustion waste is very toxic because it is concentrated."

Andria said scientific studies have found instances of groundwater contaminated by toxins contained in combustion waste. This proposed disposal site, she said, would house fly ash, bottom ash and scrubber sludge.

The Illinois Environmental Protection Agency is poised to issue the water permits and Wednesday will hold a hearing.

Larry Crislip of the agency's mine-pollution control program said Peabody wants to store the coal-combustion waste at the site of its Randolph Preparation Plant in Randolph and St. Clair counties. As a result, the company is seeking renewal of an existing discharge permit.

Crislip said the state determined that the material could be taken to the disposal site without violating state surface or groundwater quality standards.

Peabody claims the Prairie State facility will be among the cleanest coal-fired power plants in the country and will create nearly 500 jobs in Southern Illinois.

Peabody spokeswoman Beth Sutton said the combustion byproduct is largely calcium sulfate, or gypsum, a benign material that is formed during the emissions-scrubbing process. Some of the material will be marketed for use in manufacturing wallboard as well as roofing and road-building materials, she said.

The disposal site will have a low-permeability liner, a water- quality monitoring system and a sedimentation pond, Sutton said.

The proposed Lively Grove mine in Washington County would supply coal to the adjacent power plant and will have a sedimentation pond to capture storm water. The mine is expected to produce about 6 million tons of coal a year for use at the power plant.

"These are customary permits for facilities of this kind," Sutton said.