The deal, struck between environmental group San Francisco BayKeeper and Dow, lets the company back out of a previous agreement to build a ground water pumping plant to clean up the contamination, which could have cost the company as much as $100 million.

Instead, Dow says it will use bioremediation cleanup technology in which nutrients are pumped 100 feet into the ground, stimulating naturally occurring microbes that will eat away at the contaminants.

"Dow figured out a better mouse trap," BayKeeper spokesman Jonathan Kaplan said.

The cheaper alternative will cost the company between $15 million and $20 million to build and $1 million to $2 million per year for upkeep, according to Dow spokesman Randy Fischback.

In exchange, BayKeeper wanted some of the savings passed on to them. Dow has agreed to contribute $3 million to BayKeeper, the Coastal Conservancy and Ducks Unlimited Inc. to purchase or restore wetlands at Bel Marin Keys in Marin County, and in Sonoma, Solano and Napa counties.

BayKeeper sued Dow in 1997, alleging the Pittsburg plant, which now produces latex and agricultural chemicals, unlawfully discharged chlorinated solvents that contaminated ground water and eventually ran into San Francisco Bay.

In 1999, the two organizations agreed that Dow would build a plant to pump the water out of the ground, clean it up and return it. But that solution turned out to be costly, labor intensive and would have left waste to be disposed of somewhere else. The California Regional Water Quality Control Board fined Dow nearly $200,000 when it failed to follow through with those plans.

The company already has started to build "bio-walls" that will circulate nutrients -- sodium formate, sodium lactate and possibly even molasses -- in the ground water. The nutrients will stimulate bacteria that already exist at the site. The process could take from a couple of years to decades.

The one-celled bacteria, named dehalococcoides ethenogenes, was discovered by scientists at Cornell University in 1997 and feeds off of chlorinated solvents, which can be the most difficult to clean up.

The bioremediation technology, which speeds up the bacteria's feeding process, won't work at all contaminated sites, Fischback said. The bacteria has to already be present for it to work, and the ground must be made of sand or loose particles so that the nutrients can circulate with the water and bacteria.

The technology, typically used to clean spilled petroleum, has been successful at other sites throughout the nation but rarely has been attempted on such a large scale, Fischback said. The Pittsburg plant, 35 miles east of San Francisco, takes up nearly 1,000 acres.

The relatively new technology, however, leaves questions unanswered. Once the microbes have finished their work and exhausted their food supply, they could die -- and it's unclear what effect that would have on the surrounding environment.

"We realize it's cutting-edge technology and that there's some level of risk," Kaplan said. "We feel it's an acceptable tradeoff."