ANNAPOLIS, Md. (AP) — Constellation Energy has agreed to spend more than $340 million to improve water quality at Maryland’s Conowingo Dam, which flows into the Susquehanna River and eventually ends up in the Chesapeake Bay, the nation’s largest estuary, officials announced Thursday.

The agreement clears the way for the re-licensing and continued operation of the dam’s hydroelectric facility on the Susquehanna, which is the largest source of renewable energy in Maryland.

“This agreement will lead to real improvements in water quality in the biggest tributary of the Chesapeake Bay, while securing the future of one of our state’s largest clean energy producers," Gov. Wes Moore said.

The agreement marks an end to wrangling over who is responsible for addressing pollution in sediment that gets stuck in the dam and ends up being released downstream and into the bay.

The Maryland Department of the Environment issued an initial certification for the Conowingo Dam in 2018, but legal challenges led to a 2019 waiver of that certification and a settlement that required Constellation Energy to invest in improvements valued at $230 million. The terms were dependent on the facility’s receipt of a 50-year federal license, which it got but that was challenged by environmental groups.

An appeals court vacated that license in 2022 after siding with the environmental groups who argued that Constellation’s license should require the company to mitigate the dam's water quality impacts.

The deal announced Thursday was negotiated in partnership with Waterkeepers Chesapeake and Lower Susquehanna Riverkeeper Association to meet enforceable water quality standards, the governor’s office said.

The terms include about $88 million for pollution reduction and resiliency initiatives, including shoreline restoration, forest buffers, fish passage projects and planting underwater grasses that produce oxygen, stabilize sediments and provide habitat for countless species. Another $78 million will be spent on trash and debris removal to add to efforts that already clear an average of about 600 tons of debris each year.

It also includes funding to improve passages for fish and eels, a new freshwater mussel hatchery, invasive species management, and a study on the scientific and economic viability of dredging the dam to remove trapped sediment.

A Revised Water Quality Certification will be filed with the federal government for the dam’s license to be renewed, the governor's office said.

“Today’s announcement marks 16 years of tremendous effort and perseverance by our organization to assure Conowingo Dam is relicensed with proper conditions that protect the health of the Lower Susquehanna River and Chesapeake Bay,” said Lower Susquehanna Riverkeeper and Lower Susquehanna Riverkeeper Association Executive Director Ted Evgeniadis.