A spill of coal ash in North Carolina is heating up debate over how the Environmental Protection Agency should regulate electric utilities' handling of the material.

At issue is a proposed EPA rule governing how the coal byproduct should be stored. The EPA signaled in 2009 following a coal ash spill at a Tennessee Valley Authority-owned power plant in Kingston, Tenn., that it might treat coal ash as a "hazardous" material, a move Republicans and industry say would carry heavy costs because its use would be prohibited in construction materials.

The EPA instead is moving toward finalizing the rule as a nonhazardous waste, as outlined in a Jan. 29 order that will force final agency action by December. But wet coal ash that spilled from a Duke Energy-owned power plant into the Dan River on Feb. 9 is poised to invite fresh attention.

Senate Environment and Public Works Committee Chairwoman Barbara Boxer, D-Calif., who wants coal ash to be regulated as a hazardous material, said she will ask the EPA for an update on at-risk ponds that hold the material.

"I think we'll take another update on that list and ask for an update and call more attention to the ones that are in precarious positions that could cause all that damage," Boxer said.

Environmental groups have redoubled their efforts in the wake of the spill, calling for strong regulation from the EPA. They say that, like a January chemical spill outside Charleston, W. Va., that left 300,000 residents without drinking water for days, the Dan River coal ash spill has sullied drinking water.

"While Duke sucks up a small amount of the ash it spilled ... arsenic and other toxins are still pouring unabated into the Dan River just upstream," said Marc Yaggi, executive director with the Waterkeeper Alliance.

But industry experts contend that coal ash is not hazardous, and few believe the EPA is looking to change course.

The hazardous option was one of four the EPA floated following the 2008 Tennessee incident, noted May Wall, a partner in Winston & Strawn's environmental practice. She said the threat of the regulation put a freeze on coal ash impoundments like Duke Energy's.

"The EPA was pretty clever in the way it went about this in sending letters to utilities, saying, 'Tell us about your coal ash impoundments.' Then it would inspect them and rank them," she said. "I think utilities have already made up their minds about how to handle this."

The rule, in combination with a proposed regulation regarding water discharges from electric power plants, would all but eliminate the types of wet coal ash holding ponds that spilled in North Carolina, Wall said.

The EPA is moving toward a ruling that would require existing impoundments to be retrofitted with special liners or to stop receiving wet coal ash and close within five years.

But the North Carolina incident could cause the EPA to rewrite part of the rule, said Mike McLaughlin, senior vice president with Long Beach, Calif., environmental consulting firm SCS Engineers. He said the design of the ash basin was probably rare, but it's something the agency might want to revisit.

"I suppose that it might cause them to rethink their risk assessment yet again," he said. "It's maybe a pathway that has not been considered before."