AEP, based in Columbus, Ohio, maintains it never violated Clean Air Act rules to curb emissions, and had already spent or planned to pay $5.1 billion on scrubbers and other equipment to reduce its pollution.

Scott Cowger, spokesman for Maine's Department of Environmental Protection, said the settlement should have an impact beyond acid rain control. It will limit regional haze and ozone, and very possibly reduce mercury in the environment, he said.

Cowger acknowledged Maine was not in the suit, but not due to a lack of interest. Maine is involved in acid rain litigation against the EPA already, said Cowger, adding that the state must aim its resources where they are going to have the greatest effect.

Matthew Davis of Environment Maine said he hopes the settlement sends a message that power plant operators no longer can disobey the Clean Air Act and get away with it.

In Vermont, Attorney General William Sorrell said the new pollution control devices will reduce a lot of particulate matter that causes pollution, helping people with asthma and other conditions.

"This is a major victory for the environment in the northeastern part of the U.S.," said Sorrell. "Acid rain is a huge problem in the Adirondacks, the Green Mountains and the White Mountains."

New Hampshire Attorney General Kelly Ayotte and Environmental Services Commissioner Thomas Burack said the settlement will open the door to the largest emissions reductions ever.

"This settlement represents a huge step toward reducing the impact that Midwestern coal-fired power plants have on New Hampshire's air quality," Ayotte said.

The case against AEP began in 1999 when New Hampshire, Vermont and six other states, as well as 13 environmental groups joined the Environmental Protection Agency's crackdown on energy companies accused of rebuilding coal-fired power plants without installing pollution controls as required.