IPPC proposal raises concern about level playing-field

The long-awaited draft EC Directive on integrated pollution prevention and control (IPPC) has finally been unveiled by the European Commission.1 Controversy has already been sparked both within industry and among Member States by the Commission's decision not to use the legislation to promote early harmonisation of national industrial pollution control standards and, at one point, even to discourage it. And although strongly influenced by Britain's integrated pollution control (IPC) regime, it is sufficiently different for British industry to take a close interest in the progress of negotiations.

The proposal has gone through several drafts since early 1991. Its legal basis is Article 130s of the EC Treaty. In the past this would have meant that it could only be adopted by unanimity, but following the entry into force of the Maastricht Treaty on 1 November it will be open to adoption by qualified majority vote.

The Commission wants Member States to bring the Directive into force by 30 June 1995, but this seems an optimistic time-table as serious negotiations are unlikely to begin until next year.

The broad objective of the proposal is to protect water, air and land against potentially more polluting industrial processes by bringing them under an integrated permitting regime and requiring them to employ the "best available techniques" of pollution prevention.

The Directive's evolution through several drafts has been described previously (ENDS Reports 207, pp 29-31 , and 217, pp 36-38 ), and here we focus on the main changes made to the text in recent months and how it differs from Britain's IPC regime.

  • Objectives: The purpose of the draft Directive is "to prevent, wherever practicable, or minimise emissions" from processes listed in an Annex I. Although "emission" is broadly defined, it is later made clear that permits for these processes should "normally at least" include release limits for substances listed in an Annex III - the equivalent of the British list of "prescribed substances".

    Britain's IPC regime goes somewhat further than this. Under the Environmental Protection Act 1990, it is a requirement not only to prevent and, where that is not practicable, to minimise releases of prescribed substances, but also to "render harmless" all residual releases of such substances as well as releases of non-prescribed substances.

    While the 1990 Act is more specific and extensive in its requirements, UK officials believe that the difference between the two is likely to be of limited significance. However, it should be noted that the EC proposal tacitly accepts at several points that pollution may be caused even if a plant is in compliance with its permit, which is clearly not the same as a requirement to "render harmless" releases from the outset. The practical implications of this difference are only likely to become clear when Member States begin laying down conditions in individual permits.

  • Noise: Under the 1990 Act, the "substances" to be controlled under IPC are not only chemical substances and preparations but also heat. However, the IPPC proposal would add noise to this list.

    In the UK, noise emissions from industry have traditionally been regulated via planning conditions, statutory nuisance legislation and noise abatement zone procedures. Bringing them under IPC would clearly be a significant departure, but it is understood that the UK is unlikely to stand in the way of the inclusion of noise in the IPPC Directive because this is apparently desired by most Member States.

  • Permitting of existing plants: In earlier drafts the Commission suggested that all existing processes should be obliged to apply for an IPPC permit by 2000. However, in the current text the requirement is that existing plants have a permit by 30 June 2005.

    A number of exceptions to this rule would apply. First, if a particular type of process - such as municipal waste incineration - is already subject to other EC rules containing permitting provisions then they would continue to apply. Secondly, where an environmental quality standard (EQS) laid down by EC legislation or, if this does not exist for a specific substance, by World Health Organization (WHO) guidelines is being breached, then existing plants would have to be permitted "as soon as possible". And thirdly, it would appear that if a process is subject to "substantial change" then a permit would have to be sought immediately.

    These provisions raise a number of important issues. One which may well concern British industry is the long period for permitting of existing plants. Under IPC, all existing processes will have been authorised by around 1997 and required to up-grade to new plant standards by 2000 or soon afterwards, giving businesses in some parts of the EC a theoretical competitive advantage of several years. It remains to be seen whether the UK will press for a permitting deadline earlier than 2005.

    Secondly, the notion that WHO guidelines should be used as a trigger for permitting poses some tricky questions. The UK is opposed to the idea on the grounds that they are purely advisory. However, this does not square with its attitude in the context of drinking water quality, where the UK is arguing that since WHO guidelines have a sound scientific basis they should replace some existing EC standards which it regards as arbitrary or unscientific.

    The UK's stance may also reflect its perception of the practical implications of using WHO guidelines in this way - notably those dealing with air quality. At EC level, EQSs for air pollutants have been set only for smoke, SO2, lead and nitrogen dioxide, whereas well over a dozen air pollutants are covered by WHO guidelines. The latter are generally quite stringent, and routine compliance with those for SO2 and ozone in particular would be very difficult to achieve at present.

    Thirdly, the Commission's attempt to define what constitutes a "substantial change" to a process is at odds with UK practice. Under the draft Directive, a substantial change would be an increase of 5% or more in the mass, concentration or rate of emission of a prescribed substance compared to that allowed by a permit, or a release of a prescribed substance not specifically controlled by a permit.

    In contrast, the UK's approach is essentially to leave it to the regulators to decide whether a change is substantial, and the Commission's choice of a 5% change in an emission is regarded as arbitrary. Nevertheless, UK officials accept that it may be necessary to have some quantitative trigger of this kind to ensure that authorities throughout the Community do give formal consideration to significant process changes.

  • Permit applications, decisions and conditions: The proposed contents of IPPC permit applications and the issues to be covered in permits are broadly in line with the IPC regime, but with one or two exceptions.

    Firstly, the draft Directive would oblige operators to include in applications a description of "the measures proposed to be taken upon the permanent cessation of the operation of the installation, in order to ensure that no harm to the environment may occur." And the authorities would be obliged to set conditions in the permit to achieve the same end.

    In contrast, IPC does not cover the post-closure phase, and there is likely to be resistance from the UK to these proposals. The Directive, UK officials argue, is essentially about the operation of plant, and post-closure issues should not be muddled into it. They also cite the practical difficulty of spelling out the details of a safe dismantling regime before a plant has even been built.

    Secondly, the draft Directive provides that permits should contain conditions on monitoring of releases, and where this is carried out by the operator or third parties the monitoring methods should be certified by an independent laboratory which is itself "in conformity with" a CEN standard, 45001. Although HM Inspectorate of Pollution (HMIP) is increasingly looking to operators to have formal quality control of their monitoring and analysis methods, in practice this is some way from being the norm in the UK.

    Thirdly, the draft provides that release limits laid down in the permit are "not to be exceeded under normal operating conditions". But it then says elsewhere that emission limits should also be set "for other than normal operating conditions." Either the Commission has got itself into a contradiction or the legal drafting will have to be tidied up to make it explicit that permits should provide for abnormal operating conditions - in which case the Directive may come into conflict with the IPC regime, which has very few parallels with this two-stream approach.

    Finally, the proposal would impose obligations on the regulatory authorities which would be new to the UK. It says that "any permit granted or amended must describe how the integrated environmental protection considerations of air, water and land have been taken into account." HMIP's current practice does not involve any public justification of its authorisation decisions of this kind.

  • BAT and EQSs: One of the most controversial features of the proposal is a section dealing with the relationship between the use of "best available techniques" (BAT) and the need to comply with EQSs.

    The problem is unlikely to be the definition of BAT, which takes into account economic considerations. Neither will it be a requirement that measures going further than BAT must be set in circumstances where BAT alone would not secure compliance with an EQS.

    Rather, the problem is the Commission's proposal that where EQSs laid down by EC legislation or WHO guidelines "are being met by lower emissions requirements than those achievable by the use of best available techniques, the competent authority may allow more emissions than would have resulted from the application of the best available techniques." An authority may only do this if the result is a "negligible increase in pollution" or if a contribution to transboundary or global pollution is unlikely to occur, and only if an EQS or a WHO guideline exists for the pollutant concerned.

    The Commission's choice of wording is not exactly clear, but its intention appears to be that businesses operating in relatively unpolluted areas should be allowed to operate to less demanding standards than those required by BAT.

    That proposal has divided not only Member States but also industry. The German authorities have reportedly responded angrily to it, and the UK - and possibly other northern Member States - can be expected to join them in arguing that pollution controls based on BAT are in principle affordable and should therefore be applied regardless of location. But some of the southern Member States may well see opportunities to attract industry to their territories in the proposal.

    Industry views are likewise split. The oil industry, for example, favours the Commission's approach, taking the line that the environment's capacity to assimilate pollutants varies in different areas and that industry should be allowed to take advantage of this. The European chemical industry federation, CEFIC, has taken the opposite line in arguing for a level playing-field, but there are known to be many dissentients from this view in the industry's own ranks.

  • Updating of permits: On the face of it the proposal has been considerably weakened in this area in comparison with earlier drafts. The Commission began by suggesting that permits should be reviewed every five years; then proposed an interval of seven years; and finally, bowing to pressure from industry, has put forward a requirement that permits should be reviewed every ten years. In Britain, IPC authorisations must by law be reviewed every four years.

    This requirement is qualified, so that permits may in principle be updated more often than every ten years. On the one hand, the proposal contains a general duty on competent authorities to update permit conditions "so that emission limit values achievable through developments in best available techniques are achieved." But on the other, it says that permits "may" be updated at intervals of less than ten years on the grounds of pollution, the availability of new techniques not entailing excessive cost, and one or two other grounds. Although the result may be better than the upgrading rules included in earlier drafts - which were based on a formula relating to the depreciation of industrial plant - it can hardly be said that Member States will be clear about their obligations on upgrading.

  • Levelling the playing-field: Together with the imprecise formula for upgrading, the provisions allowing permit conditions less stringent than those based on BAT in unpolluted areas seem guaranteed on their own to produce disparate pollution control standards rather than a convergence of national practices. This prospect has been made even more likely by the Commission's last-minute decision not to include explicit harmonisation provisions in the proposal.

    Two years ago, the Commission's intention was to come forward rapidly with a series of "daughter" Directives laying down EC-wide standards for specific sectors of industry. It then shifted its ground, so that Member States would first have been required to submit information on their own national IPPC standards before the Commission put forward any daughter Directives.

    However, the current proposal would only oblige Member States to participate in an information exchange involving the submission of information to Brussels on national emission limits and the BAT considerations from which they were derived, beginning in 1998 and subsequently at three-year intervals. A separate information exchange between national regulatory authorities on these and related topics such as monitoring and EQSs would be organised by the Commission.

    What is no longer present is any explicit provision for the Commission to use this information as a basis for proposing daughter Directives. This, the Commission has pointed out, does not compromise its authority to bring forward such proposals, but it is nevertheless a significant omission. This was made clear by Environment Commissioner Ioannis Paleokrassas, who observed when presenting the proposal to the press that it followed the principle of subsidiarity by leaving Member States freedom to set emission limits at national level.

    His interpretation of the subsidiarity doctrine has not gone down well with Germany, which wants the Directive to be used as a means of levelling the playing-field. CEFIC is unhappy with the proposal on the same grounds. And as the Commission itself acknowledges in an "impact assessment" attached to the draft Directive, "many sectors" of industry "would have preferred the immediate agreement of emission limit values at Community level." Subsidiarity, it seems, is not to everyone's taste.

    While this argument will doubtless be conducted at the level of principle, history and realism might also be allowed a voice. The Commission has been attempting to harmonise national water pollution control standards for "black list" substances since 1976, and while its endeavours have made a considerable mark on national policies and practices, daughter Directives have been agreed since then for fewer than 20 substances. This experience suggests that aspirations to achieve the detailed harmonisation that would be needed in daughter Directives under IPPC would be thwarted by the lack of resources at the Commission to manage such a demanding programme and the difficulty of getting agreement among the Member States - although qualified majority voting might make the process easier than it was in the past.

  • Prescribed processes and substances: Two annexes list the processes which are to be subject to IPPC and the substances for which limits must be set if they are released from a process. In both cases the annexes are at variance with IPC.

    The main differences as regards processes are:

  • Existing plant subject to the 1988 Directive on large combustion plant would be exempted from IPPC.

  • Steel casting, rolling and finishing are not subject to IPC in Britain.

  • Ferrous metal foundries with melting processes with a capacity of more than five tonnes would be subject to IPPC. In Britain, many such installations are subject to local authority air pollution control (LAAPC) only.

  • Non-ferrous metal installations with a capacity of 0.5 or 1.0 tonnes - depending on the metal concerned - would be subject to IPPC. In Britain, such installations are subject to LAAPC if they have a capacity of less than five tonnes.

  • Glass manufacturing plants with a capacity of over 5,000 tonnes per year would be subject to IPPC - whereas in Britain the same threshold brings glass processes only under LAAPC.

  • All incinerators burning non-hazardous liquid or solid waste would be subject to IPPC, whereas in Britain smaller incinerators are subject to LAAPC.

  • Many textile finishing plants would be subject to IPPC. In Britain they are generally controlled by local authorities.

  • Animal rendering plants, which in Britain are subject to LAAPC, would come within IPPC if they treated more than 10,000 tonnes of carcasses annually.

  • Intensive livestock units located in areas designated as "vulnerable" under the 1991 Directive on nitrate pollution would be subject to IPPC if they had more than 100 livestock equivalents and produced more than 170 kilos of nitrogen "per hectare of spreading surface available". Such installations are not subject to either form of control under Part I of the Environmental Protection Act 1990.

  • Food canning and processing operations employing more than 50 people would be subject to IPPC. Again, these are not regulated under Part I of the 1990 Act.

  • The proposal would also catch any process not specifically listed which consumes more than 200 kilograms of organic solvents per hour. This appears likely to bring many processes subject only to LAAPC in Britain under IPPC.

    Annex III is wider in scope than the British list of prescribed substances. This is particularly the case with water pollutants. Annex III includes the generic classes of compounds on the existing EC "black list", together with nutrients and a score of "grey list" metals. In contrast, the British list contains only 23 specific substances and preparations. The practical implications of this may be substantial because under IPC releases of non-prescribed substances need only be "rendered harmless", and if the list of prescribed substances was to be extended as a result of the IPPC Directive then releases of many more substances would also have to be prevented and minimised.

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