updated 3/5/2009 11:03:39 AM ET 2009-03-05T16:03:39

The utility responsible for a massive coal ash spill that destroyed and damaged homes pledged  to make the affected community "as good, if not better than they were before."

Environmental regulators also approved the start of dredging to remove ash from the Emory River. Until now, officials have been stabilizing the ash and working on a plan, said Anda Ray, the Tennessee Valley Authority's top environmental officer.

Some 5.4 million cubic feet of coal ash, a byproduct of burning coal to make electricity, breached an earthen retention wall at the Kingston Fossil Plant about 40 miles west of Knoxville on Dec. 22.

The spill covered 300 acres with grayish, toxic muck, destroyed or damaged 40 homes, and stirred a national debate on regulating ash facilities around the country.

More than 100 environmental groups sent a letter Tuesday to new Environmental Protection Agency Administrator Lisa Jackson citing the Tennessee spill and calling for greater oversight.

"The disaster at TVA's Kingston plant dramatized the need for federal standards for safe disposal of these wastes, which are virtually unregulated by EPA," the letter said.

Ray said TVA, the nation's largest public utility and operator of 11 coal-fired plants, would leave such regulation to Congress, but she cautioned the ramifications should be carefully considered because coal provides so much of the nation's electricity.

TVA is spending $1 million a day on the cleanup, and estimates final recovery may cost $525 million to $825 million.

The agency submitted a corrective action plan for the project Tuesday to the state agency heading the cleanup.

TVA's 73-page plan outlines an involved process for collecting the spilled ash, disposing of it, and deciding how it will be handled in the future.

The plan's objectives include making "things as good, if not better than they were before" in the community. The utility plans to buy the properties, including lakeside homes, damaged by the ash.

The plan suggests recovered ash will be held temporarily at the Kingston site, allowed to drain and then sent to landfills or possibly recycled.

The plan also suggests TVA will end wet-ash storage at the plant and move to dry storage.

While the cleanup continues, TVA says it will work to keep potentially harmful dust under control.

The Tennessee Department of Health last week released a survey of 368 residents living near the spill that found a third of them complaining of breathing problems and about half experiencing increased stress and anxiety.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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