Operators of Large Combustion Plant (LCP) should have notified their intention to join the Transitional National Plan (TNP) by 8th May 2012. Find out more about the implications of the Industrial Emissions Directive for operators of LCP and Environmental Permit holders in the following briefing.
This briefing explains:
- The implications of the IED for 7 existing items of EU legislation;
- The workings of a Transitional National Plan (TNP) for LCP operators;
- The present uncertainty over thresholds for large combustion plant;
- The IED aggregation rule for large combustion plant;
- Derogation rules for limited life, entering the TNP and emergency operation;
- The derogation for NOx;
- The incorporation of lower Achievable Emission Limits into BREFs, and the difficulty for complex plant to meet them; and
- Implications for specific sectors.
1. Introduction to the IED
1.1 The IED came into force on the 6th January 2011 and will apply to any existing qualifying plant/installation from 6th January 2014 (except for existing Large Combustion Plant which are affected from January 2016).
1.2 The aim of the IED is to create a more level playing field across Europe for industries subject to the Integrated Pollution Prevention and Control (IPPC) directive. It is described as a recast of seven existing directives/regulations i.e. the:
- Industrial Pollution Prevention and Control Directive (IPPCD);
- Large Combustion Plant Directive (LCPD);
- Waste Incineration Directive (WID);
- Solvent Emissions Directive (SED); and
- Three regulations/directives associated with titanium dioxide manufacture.
1.3 Whilst the IED is effectively a recast of most of the above existing directives/regulations, there have been some changes made to the original IPPCD and major changes to the LCPD.
1.4 The deadline for transposition of the IED to national legislation is the 7th January 2013. In the UK, the IED will be implemented through revision of the existing Environmental Permitting (England and Wales) Regulations, or equivalent in Northern Ireland and Scotland.
1.5 To attain the main aim of creating a level playing field across Europe for affected industries, the European Commission proposes to strictly enforce transposition deadlines.
1.6 The following timescales will apply:
06/01/2011 IED came into force
08/05/2012 Deadline for UK operators of LCP to notify intent to join the TNP
06/01/2013 Transposition of the IED to national law
01/01/2014 Deadline for applications from LCP operators to “opt-out”
06/01/2014 All existing non-LCP plants to meet requirements
06/07/2015 New IPPC related activities brought under regime
01/01/2016 Existing LCPD brought under the Chapter 3 regime
2 Key provisions of the IED for Large Combustion Plant (LCP)
2.1 The provisions of the IED with respect to LCP do not apply to combustion plant used for direct heating e.g. kilns, and emission limit values (ELVs) do not apply to diesel engines or non-commercial fuels i.e. refinery fuel oil/gas. Flares or any offshore gas turbines or gas engines are also excluded.
2.2 The commission initially proposed to bring LCP in the 20-50MW thermal input under the IED regime but they have agreed to review this situation. The IED will therefore maintain the existing LCPD threshold for qualifying plant at 50MW thermal input. In the event that the commission decide to reduce the threshold and bring more plant under the regime, a decision will be made by the end of 2012, with co-decision required after this date. It would therefore be several years before plants under the existing 50MW thermal input would be affected, except through the aggregation rule.
2.3 A new aggregation rule applies to combustion plant over 15MW thermal input. All plants at or above 15MW emitting to a common stack will be aggregated for the purpose of determining if they are affected. The issue of what constitutes a common stack will be key for some plant. The definition for “common stack” applied under the current LCPD regime1 is related to the definition of a combustion plant, i.e. a combustion plant represents all boilers and process heaters venting through a common windshield. DEFRA have advised that due to issues with this definition the approach going forward will be to adopt the following criteria: if the flues are structurally dependent on each other then the stack is common.
2.4 There are several options for LCP compliance with respect to Chapter 3 provisions:
- Meet Emission Limit Values (ELVs) set in the IED;
- Apply for a derogation on the basis of:
− Limited life derogation (LLD) (17,500 hours maximum operation from 1/1/16 to 21/12/23, excluding start-up and shut-down), or
− Becoming part of a Transitional National Plan (TNP), or
− Use plant for emergency use only (less than 500 hours) available to gas turbines only;
- Short term derogations are also available to cover loss of normal fuel supply.
2.5 If a plant granted a LLD is to be operated after 2023, it must come back under the IED regime as a new plant and meet all requirements for new plant
2.6 The TNP option allows for plants to come under a national arrangement to limit emissions and stay in operation. Plants are allocated or can buy permits that can be traded. The ceiling limits will drop each year and plants must meet IED ELVs by 2023. It will be possible to drop out of the TNP at any time provided plants can meet the IED ELVs. It is also possible to join the TNP with respect to some emission limits and remain meeting ELVs for the remainder. Operators must notify their intention to join a TNP by 8th May 2012. For gas turbines the TNP allows for derogation of oxides of nitrogen (NOx) emissions only, i.e. IED ELVs for carbon monoxide (CO) must be met.
2.7 The LLD option allows for derogation on the grounds of plant operating for a limited number of hours up to the deadline in 2023. Whatever ELVs are in place in 2015 must continue to be met for the remaining operating hours. Applications to “opt out” must be made by 1st January 2014.
2.8 The ELVs set for CO for gas turbines (GTs) are anticipated to be difficult to meet for existing plant and it is expected that many older plant may not be able to attain the limits. As the TNP allows derogation only for NOx for GTs, qualifying GTs will have to opt for the LLD option and cease operation by 2023.
3 ELVs, BREFs and BAT
3.1 The ELVs set in the IED are a minimal requirement; lower ELVs will be enforced if the Best Available Techniques (BAT) Reference Documents (BREFs) currently under review identify lower achievable emission limits (AEL) as BAT. AELs identified in BREFs are therefore to be taken as ELVs for BAT. This is a much more stringent regime than is currently operated where the BREF recommends techniques and AELs but local competent authorities (CAs) are free to agree less stringent ELVs where these can be justified on a cost/benefit basis. The implication for holders of Environmental Permits is that it will no longer be possible to justify exceedence of BREF derived AELs on a cost/benefit basis. This may force operators to make investments in plant which are not in the best interest of the business and which may not significantly reduce their environmental impacts.
3.2 All new permits must be reviewed within several years of issue. Existing affected permits must also be reviewed by member state CAs within 5 years of a revised BREF being issued. As most of the BREF notes are currently under review it is anticipated that most operators will undergo more than one permit review in the first few years of holding a new permit.
3.3 The application of AELs as ELVs will present significant difficulties to IPPC activities with complex and inter-related site processes e.g. steel manufacture and sugar production. The BAT identified in the revised BREFs are likely to be for standalone plant.
3.4 There are new provisions under the IED to apply a single permit to cover several inter-related activities on one site operated by different operators.
4 Examples of the Implications of the IED for Specific Industry Sectors
4.1 Pulp and Paper
4.1.1 All UK mills are currently regulated under the Environmental Permitting (EP) regime and the main impact of the IED will be the changes to the status of the BREF documents. This will result in less flexibility for the operators in determining plant investment.
4.2.1 The IED requirements will affect the UK utilities sector with the heat and power providers most affected. Combustion plant are currently subject to up to eight separate regimes: IPPC, LCPD, WID, Carbon Reduction Commitment (CRC), Climate Change Agreement (CCA), Renewables Obligations Certificates (ROCs), Control of Major Accident Hazards (COMAH) and EUETS. For the electricity sector in particular, the stringent ELVs and continuously reducing ceilings for the TNP proposed in the IED, make investment planning very difficult. The short timescale for decisions on whether to join the TNP or opt out (taking the LLD option) is particularly challenging. Securing investment is likely to become increasingly difficult.
4.2.2 The IED sets out requirements for Carbon Capture and Storage (CCS) for any new plant greater than 300MW. In the UK, CCS is not dealt with through the EP regime but in Planning. It is anticipated that any new IED permit for plant over the 300MW threshold will have conditions for CCS.
4.2.3 The industrial utilities heat and power sector will be affected in particular by the lack of flexibility in the incoming BREF BAT requirements and the stringent application of ELVs. Industrial utility heat and power management is often driven by the need to keep permanent steam available requiring back-up boilers to be kept on stand-by for long periods. As many of these types of plant will not meet the new ELVs and are likely to be opting out via the LLD, the hours on stand-by will be critical.
4.2.4 Under the current EP regime, regulated heat and power operators have the option to apply imaginative operational management of units to minimise peak emissions and manage impact emissions, using modelling to demonstrate the insignificance of their impacts. The IED requirements for BAT ELVs are prescriptive and will limit this flexibility.
4.3.1 Most European steel manufacturing installations fall under the current PPC directive. The main impact from the switch to the IED regime is likely to arise from the change in status of the BREF documents. The combustion associated processes on an integrated steel plant, some of which will come under the new IED LCP requirements, burn a range of fuels including gases derived from the blast furnace process. Steel manufacturing combustion plants are designed to use mixed fuels with wide variation in calorific values and temporal fluctuations. Output and demand/consumption are also highly variable. Operators aim to integrate processes to minimise energy consumption and the current PPC directive allows some flexibility in achieving this. The inflexible application of BAT and BAT ELVs may require suboptimal investment in terms of plant productivity and sustainability. As European steel manufacturers operate globally this may impact on investment within Europe for this sector.
4.4.1 As for the steel industry, the sugar industry is concerned that the stringent application of BAT and BAT ELVs will limit investment options. As European sugar manufacturers operate globally this may impact on investment within Europe for this sector.
If you would like to find out more about the implications of the IED for your industry or would like advice on preparing for the implementation of the IED, please Gwenda McIntyre on firstname.lastname@example.org, David Gill on email@example.com, or Bryan Hughes on firstname.lastname@example.org or 0115 965 6700.