Dutch lead discussion on greater flexibility under IPPC

A workshop of regulators and policy-makers from across the enlarged EU discussed options to amend the Directive on integrated pollution prevention and control (IPPC) at the end of April - focusing in particular on the roles of corporate-level agreements and emissions trading. There were also calls for the European Commission to issue best practice guidance in the light of a new study which has revealed a highly diverse approach to permitting across Member States.

The workshop, held in Prague, was arranged by the Dutch Environment Ministry, VROM, under its three-year ENAP programme to explore new approaches to the regulation of industrial installations. An earlier ENAP workshop, in London, looked at the role of environmental management systems in industrial regulation (ENDS Report 342, pp 20-23 ).

The ENAP process will reach its climax at a conference in The Hague in October, coinciding with the Dutch EU Presidency. Dutch officials hope to influence thinking across Member States. ENAP project partners are the UK's Environment Agency and the Czech Agency for Integrated Prevention.

Crucially, the European Commission will be issuing proposals to amend the IPPC Directive next year. The Commission is keeping its cards close to its chest in advance of a full review of the Directive's implementation expected later this year. At the very least, there are expected to be changes to the range of installations covered by the Directive, with a wider range of waste management activities likely to be affected.

In a consultation paper last year (ENDS Report 341, pp 51-52 ), the Commission set out possible options for amending the Directive, including the use of harmonised EU-wide emission limits in some areas. However, there appears to be relatively little appetite for such measures at present.

Of greater significance was the Commission's research revealing numerous ambiguities such as how the boundaries of an installation should be drawn; when a change to an installation should be considered "substantial"; how permit conditions on waste minimisation and energy efficiency should be drawn; what is meant by returning a site to a "satisfactory state"; and how to derive emission limits using the BREF guidance notes.

VROM commissioned the Institute for European Environmental Policy to analyse views and practical experience across the EU-25.1The study, designed to inform the Prague workshop, confirms the many different approaches to implementing IPPC. There are widely varying interpretations of the term "installation" and of the scope of permits - definitions which can have significant implications for environmental outcomes and the assessment of best available techniques (BAT).

VROM, along with several other national representatives, would like the Commission to draw up best practice guidance to clarify some of the Directive's terminology. The legal status of such guidance is a sensitive issue, with most workshop delegates seeking non-statutory documentation.

Some delegates argued that, while it is for the courts to determine the meaning of terms in the Directive, best practice guidance from the Commission would help to shape discussions in Member States and ultimately inform any legal proceedings.

ENAP looks set to conclude that guidance is also needed on: the scope of permits; how to address upstream and downstream issues such as raw materials and waste; and the relationship between corporate-level agreements and installation permits. The need to maintain accountability and enforceability when pursuing some of the more novel approaches to regulation could also be fleshed out in guidance.

The IEEP study found that differing interpretations of the terms "technically connected" and "directly associated" are leading to particular problems with inconsistency. These terms define the range of activities to be controlled under a single permit - for example, on-site effluent treatment plants and power plants are usually regarded as forming part of an installation.

However, a regulator from Hungary explained to the workshop how at one major petrochemicals site it was felt that issuing a single permit would be too difficult. Instead, a permit was issued for a single polypropylene process, even though all six polymer plants at the site are fed by the same cracker - and might therefore be considered to be technically connected.

In contrast, the Environment Agency has decided that the chemicals complex in Runcorn should fall under a single "mega-permit".

The majority view at the workshop was that regulators should adopt the principle of "one operator, one site, one permit". However, the IEEP survey picked up some instances where a single permit had been issued to installations run by different operators at the same site even where there is no single operator in overall control. French regulators have designed solutions involving contractual agreements between operators under a single permit to specify responsibilities.

Meanwhile, the Dutch government is floating the idea of issuing permits at corporate level which would cover numerous sites operated by a single company. Amending the Directive to allow for a corporate-level assessment, in place of the normal site-level assessment of BAT, would make it easier to fit voluntary agreements into the IPPC framework.

Negotiated agreements are already used to inform permit conditions in the Netherlands and Flanders. "It seems there is some real potential in some countries for the use of negotiated agreements for industrial estates and for dealing with chains of installations or life-cycle issues," concludes the IEEP, "though it is still unclear as to whether these should be linked formally to permits or simply done in parallel."

On the corporate approach, the IEEP concludes that in some cases it can allow environmental impacts to be addressed in a more effective way, by optimising investment across a company's activities. Lithuania, Norway and Sweden have mechanisms in place to allow corporate-level permitting, although these are only used to a limited extent.

In the UK, the Government had difficulties framing the relationship between IPPC and negotiated climate change agreements (CCAs), under which companies are entitled to an 80% discount from the climate change levy. The delicate balancing act now in place is a presumption that, where a company is party to a CCA it is deemed to have achieved BAT on energy efficiency at all participating sites.

The present wording of the Directive would make the approach more difficult to stand up in relation to permit conditions on emission limits.

Both the UK and the Netherlands are also interested in amending the Directive to mandate national trading schemes for acid gases and possibly other emissions. They claim the precedent of the EU emissions trading Directive, under which the IPPC Directive was amended to exclude site-level regulation of greenhouse gases falling under the trading scheme.

In the UK, the Government would like to use acid gas trading to implement the 2001 EU Directive on large combustion plant (ENDS Report 347, pp 43-44 ). Officials argue that the scheme could go ahead without amending the IPPC Directive - but some industry observers do not agree.

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