1. 1 Review of the Integrated Pollution Prevention and Control (IPPC) and National Emission Ceilings (NEC) Directives Marianne Wenning DG ENV, Head of Unit, Industrial Emissions and Protection of the Ozone Layer in collaboration with DG ENV Unit on Energy&Environment EPRG, 23 April 2007

2. 2 Thematic Strategy on Air Pollution (SO2, NOx, particulate matter, VOC, NH3) Objectives: improvement by 2020 relative to 2000 Life Years lost from particulate matter47% Premature mortality from ozone10% Ecosystem forest area exceeded by acidification74% Ecosystem freshwater area exceeded by acidification 39% Ecosystem area where critical load is exceeded by eutrophication 43% Forest area exceeded by ozone15%

3. 3 National Emission Ceilings Stationary Sources -IPPC - LCP, VOC etc. Thematic Strategy on Air Pollution Air quality, health and nature protection objectives Mobile Sources - Euro 5 and 6 - Euro VI etc. Other sources and legislation Gothenburg Protocol of the Convention on Long Range Transboundary Air Pollution

4. 4 Further measures needed to meet the objectives of the Thematic Strategy on Air Pollution Total emission reductions in 2020 beyond the NEC (2010) ceilings through current legislation and additional measures

5. 5 First analysis of benefits and costs of the revised NEC in 2020 Health benefits 5-17 times higher than costs Additional benefits of reduced eutrophication, acidification etc. The impacts of energy and climate package not included. Likely to reduce costs and increase benefits. Source: Working Group on National Emission Ceilings and Policy Instruments 29-30 March 2007

6. 6 Industrial Emissions Integrated Pollution Prevention and Control (IPPC) Directive Solvents Directive (SE) Large Combustion Plants Directive (LCP) European Pollutant Emission Register (EPER) European Pollutant Release and Transfer Register (E-PRTR) Waste Incineration Directive (WI) Titanium Dioxide Directive (TiO2)

7. 7 IPPC: important tool to achieve air pollution targets l Contribution of industrial activities (mainly IPPC) to total EU emissions in 2005: 55% CO2, 88% SO2, 36% NOx, 50% particulate matter, 55% VOC l Compared to implementation of current legislation in 2020, need for further industrial emission reductions to meet Thematic Strategy 2020 targets : - 30% for SO2 - 35% for NOx - 24% for PM2.5 - 17% for VOC

8. 8 Shortcomings in implementation and enforcement Problems: l Complexities in current legal framework l Insufficient reduction of emissions due to lack of progress towards BAT l Lack of transparency on the application of the criteria related to flexibility (technical characteristics, geographical location and local environmental conditions) Effects: l Incorrect implementation (e.g. sectoral Directives used as default) or difficulties in interpretation (e.g. scope, definitions) l Lower level of environmental protection l Possible distortion of competition

9. 9 Shortcomings in implementation, some examples from case studies Case study of 30 installations: only half had all permit conditions clearly based on BAT as determined in the BREFs Sector BAT Associated Emissions Levels (BREFs) Permit conditions: Emission Limit Values (ELVs) Cement NOx 200-500 mg/m3 3 out of 4 installations : 800 mg/m3 (Waste Incineration Directive) No apparent consideration of BAT Non ferrous metals plant 1 SO2 50-200 mg/m3 ELV: 800 mg/m3 Not possible to identify rationale behind difference Non ferrous metals plants 2 and 3 Dioxins <0.1-0.5 ng/m3 No ELV No monitoring data available Pulp mill Various pollutants to water No permit conditions for releases to water Chemicals plant Benzene 5 mg/m3 ELV: 2500 mg/m3 (500x than BREF)

10. 10 Source: EEA Topic Center on Climate Change and Air, 2001 EPER data Estimated Potential Emissions Reduction from BAT Introduction in the LCP sector

11. 11 Impacts of progress towards BAT Impacts of progress towards BAT: environmental benefits expected to exceed compliance costs Example for large coal power stations:  NO x abatement annual costs €150-450m for 60- 200kt emission reduction  Health benefits of €210-1700m

12. 12 Main options to address current shortcomings BAT-based permitting and role of the BREFs l Role of the BREFs: more prominent or binding l Possible deviation from BAT/BREFs: more transparent according to criteria set in the Directive (technical characteristics of installation concerned, geographical location, local environmental conditions)

13. 13 Main options to address current shortcomings Streamlining and reduction of administrative burdens EU level: l New Framework Directive integrating IPPC and sectoral Directives => increase legal coherence, transparency and clarity l Streamline MS reporting => save administrative costs ~€1-10 million/year MS level: l Most actions at MS level to reduce administrative burden (eg combined permitting, monitoring and reporting from operators) => save administrative costs ~€10-60 million/year

14. 14 Use of NOx and SO2 emission trading (ET) l IPPC and NEC are barriers/obstacles to NOx and SO2 ET within and between MS l ET can be a cost-effective and predictable instrument for MS to reduce emissions and achieve environmental objectives l IPPC and NEC revisions could foresee the possibility for MS to opt for NOx and SO2 ET l If MS wish to use ET, they would need to follow specific future EU-wide rules (e.g. emissions cap, trading rules, geographical scope, local environmental protection) to ensure environmentally sound, compatible and enforceable schemes l Such EU-wide rules would be subject to a specific Proposal (not part of IPPC/NEC packages)

15. 15 Key questions to the EPRG 1. NOx and SO2 emission trading Valuable additional cost-effective instrument to reach 2020 ceilings subject to EU-wide rules to ensure environmentally sound, compatible and enforceable schemes? 3. Streamlining interactions IPPC & other legislation Support a single Directive on industrial emissions? 2. BAT implementation Support for more consistent permitting by placing the BREFs as the foremost point of reference or giving them a binding nature to make greater progress towards BAT and a more level playing field?