AQM-European Experience: Addressing Industrial Air Pollution Magnus Gislev European Commission Delegation in China

Contents of the presentation 1. Background 2. EU Air Quality Legislation and National Emission Ceilings 3. EU Integrated Pollution Prevention and Control Directive 4. European taxes, charges and emissions trading 5. The new EU Air Pollution Strategy

Background to EU AQM policy 370.000 European citizens are estimated to die prematurely every year due to bad air quality Air pollution is also causing severe damage to ecosystems through acid rain and deposition of eutrophying substances Worrying trends (energy, transport) Air does not respect borders Internal EU market + global economy

Loss in life expectancy attributable to exposure to fine particulate matter 2000

National emissions ceilings EU Air Pollution Legislation Concentrations Emissions Framework Directive 1St Daughter National emissions ceilings Stationary sources Mobile Sources 2nd Daughter 3rd Daughter LCP’s Incineration VOC’s IPPC 4th Daughter Exchange Information Non-road Fuels Quality Road

EU Air Quality Framework Directive Directive 96/62: Framework obligations capacity building define zones and agglomerations Perform assessment : Measurement/modelling Inform the public Report to the Commission Management : Maintain air quality where good If Conc>Limit Value + Margin of tolerance: Prepare, implement plans and programmes

EU Air Quality Daughter Directives Air quality standards, minimum monitoring requirements, stations criteria, reference methods Directive 99/30: limit values for PM10, NOx, SO2 and lead Directive 2000/69: limit values for benzene and CO Directive 2002/3: Target values for Ozone Monitoring of ozone precursors (NO2, VOCs) Directive 2004/107: Target values BaP, HM (excluding Hg)

National Emission Ceilings (1)

National Emission Ceilings (2) Objective : To set total national ceilings for pollutants causing acidification and eutrofication and for ozone precursors for the protection of the environment and human health Reduce areas with critical loads at least 50% compared to 1990 Ground level ozone by 2/3 (health) 1/3 (eco) Management : national programme has to be prepared and communicated to the Commission implemented to stay below ceiling by 2010 NECD complementing Gothenburg Protocol under CLRTAP European Community also signed GP Revision of NECD in 2006 Measure under T/S on Air Pollution : new objectives! Burden sharing principle : EU target extensive modelling (tools upgraded within CAFE programme) Negotiations Reporting : national programme annual inventories+projections (2010)

NEC – required reductions

IPPC permit system IPPC = Integrated Pollution Prevention and Control Directive, 96/61/EC in force since October 1999 Permit Competent authorities reconsider and update permit conditions Competent authorities check compliance with permit when installation operates Operators inform competent authority regularly of the results of the monitoring of releases and without delay of any accident significantly affecting the environment Operators enable the authorities to carry out inspections within the installation, to take samples and to gather any information necessary for the performance of their duties

Scope of IPPC The IPPC Directive covers 1. Prevention of pollution caused by production selection of raw materials cleaner production processes 2. Control of pollution caused by production end-of-pipe abatement techniques It does not cover - Pollution caused by products

IPPC: Activities covered Annex I: CATEGORIES OF INDUSTRIAL ACTIVITIES Energy industries Production and processing of metals Mineral industry Chemical industry Waste management Other activities Production of pulp and paper Pre-treatment of textiles Tanning of hides Slaughterhouses and processing of food products Disposal of animal waste Rearing of poultry or pigs Printing, coating, degreasing, waterproofing etc. Production of carbon or electrographite

IPPC: Key provisions integrated, decentralised permit procedure public participation and access to information including an emission register emission limit values based on Best Available Techniques (BAT) and Environmental Quality Standards exchange of information on BAT and associated monitoring existing EU emission limit values are minimum requirements

Best Available Techniques most effective in achieving a high general level of protection of the environment as a whole developed on a scale to be implemented in the relevant industrial sector, under economically and technically viable conditions, advantages balanced against costs the technology used and the way the installation is designed, built, maintained, operated and decommissioned Best Available Techniques

BAT reference document Best Available Techniques reference document on large combustion plants available on Internet: http://eippcb.jrc.es What is it? What not? Results of an information exchange on BAT, not delivered information is not reflected, BREFs need to be updated from time to time Provides competent authorities, companies, public, Commission etc. with information for their decision-making Tool to drive environmental performance A BREF does not interpret the Directive or define or alter legal obligations A BREF does not prescribe techniques nor contains suggested ELVs A BREF cannot contain detailed local considerations, trade-offs are possible, but authorities are ultimately responsible for such decisions

Pollutant Emission Register European Pollutant Emission Register (EPER) Principal emissions (37 air and 26 water pollutants  50 in total) and IPPC sources responsible Published every 3 years First occasion in February 2004 (EU-15)

Pollutant Emission Register Example: PM10 emissions in 2001 from IPPC sources http://www.eper.cec.eu.int

Pollutant Emission Register Example: 10 highest SOx emitting installations in EU (2001) CENTRAL TERMICA AS PONTES 315,000.00 t PPC S.A., SES MEGALOPOLIS A' (I, II, III) 161,000.00 t Unidad de Producción Térmica Teruel 152,000.00 t CENTRALE TERMOELETTRICA DI PORTO TOLLE 72,700.00 t CENTRAL TERMICA DE MEIRAMA 70,600.00 t EDF ENERGY (COTTAM POWER) LTD 70,500.00 t EDF ENERGY (WEST BURTON POWER) LTD 68,500.00 t Scottish Power Generation uk 68,200.00 t UPT COMPOSTILLA 61,600.00 t BRITISH ENERGY PLC 59,900.00 t

Emissions trading in Europe EU greenhouse gas emissions trading: first economic instrument at EU level National CO2 systems in UK and Denmark NOx trading in Netherlands SO2 trading in Slovakia More plans triggered by the National Emission Ceilings Directive?

Dutch NOx emissions trading scheme Introduced in the Netherlands in parallel with EU CO2 trading scheme Triggered by national ceilings of -50% by 2010 and -75% by 2020 Major considerations include: - local effects - application of Best Available Techniques - monitoring and environmental management systems - cooperation by industry and enforcement Covers 250-350 utility power plants and industrial facilities of >20 MW th Allocation based on performance standard rates (benchmarking) corresponding to -55% in 2010 compared to 1995 levels Local Aspects: studied in 2002 report by TNO>> industrial installations only in limited number of situations contributing to hot spots - local air quality Technical approach: Emissions Trading direct and effective driver towards decisions in the companies on application of Best Available Techniques Importance of Monitoring and Environmental Management Systems so far under valuated and insufficiently implemented through IPPC permit Inspection - Enforcement requires effective organisation Full involvement of industry from the start is crucial

Emission taxes and charges Sweden has highest S, N taxes in the World: SO2 tax 2 $ /kg Sweden has a NOx charge of 6 $ /kg, 99% of revenues are refunded according to useful energy output Since 1990 specific NOx emissions in Sweden have dropped by over 40% to lowest levels world-wide Other EU countries also have taxes (e.g. Denmark on SO2 and individual Spanish regions on SO2) 2 $ / kg is more than 10 times higher than French SO2 tax and the market price of permits in the US The plants subject to NOx charge now only account for 5 % of total Swedish NOx emissions (but non-fossil energy sources dominate).

Environmental taxes and charges Environmental tax bases and applications are spreading steadily in Europe Design important: exemptions, recycling of revenues in exchange for good performance Very few attempts to base tax rates on external costs Little evidence of less competitiveness Second: incentives for changing behaviour Fourth: on national level, and sectoral level; on micro level victims possible, but they may already have been in the margin

Policy mixes From optimal instrument to optimal mix Mixes are rule not the exception Many combinations found Balance of effectiveness and efficiency/costs Third bullet: ETS and VA, taxes and VA, ETS and subsidies, taxes and subs, standards and taxes, standards and ETS

New EU Strategy on Air Pollution Euro 5 for cars and vans Euro 6 for Heavy Duty Engines Revision of the National Emission Ceilings Small scale combustion Ship NOx engine standards Agriculture Revise Air quality legislation Small scale combustion Possible extension of the scope of the IPPC Directive Energy Using Products Directive for small sources Ship NOx engine standards (IMO or EU) Agriculture (NH3) N content of feedstuffs