The Baltic University

Environmental Management
book series
1. Environmental Policy – Legal and Economic Instruments

2. Cleaner Production – Technologies and Tools for Resource Efficient Production

3. Product Design and Life Cycle Assessment

4. Environmental Management Systems and Certification

Environmental Policy
Legal and Economic Instruments
Book 1 in a series on
Environmental Management

authors
Børge Klemmensen, Sofie Pedersen,
Kasper R. Dirckinck-Holmfeld, Anneli Marklund, and Lars Rydén
Environmental Policy Financing
The Baltic University environmental management
project was made possible through a grant from the
Legal and Economic Instruments Swedish International Development Cooperation
Agency (SIDA), financing the production of the four
Main Author books in the series, the four CDs with films and other
Børge Klemmensen materials, as well as several conferences.
Department of Environmental, Social and Spatial Change http://www.sida.se
Roskilde University, Roskilde, Denmark
Acknowledgement
Co-authors We are grateful to colleagues who have reviewed parts
Sofie Pedersen of the manuscript at various stages, especially Cand.
Department of Environmental, Social and and Spatial Change Per Eriksen, Roskilde University Centre and Doctor of
Roskilde University, Roskilde, Denmark Law Jonas Christensen, Uppsala University. We are
indebted to Oil & Sludge Treatment Inc., Umeå
Kasper R. Dirckinck-Holmfeld Sweden for providing data on their environmental
Department of Environmental, Social and and Spatial Change performance (Case study 1) and Mr Sebastian Schnei-
Roskilde University, Roskilde, Denmark der, Foseco GmbH, Borken, Germany for providing
material on the introduction of REACH (case study 5).
Anneli Marklund We have relied on several open sources for some of
Department of Biology and Environmental Sciences the material. The section on the European Union
Umeå University, Umeå, Sweden environmental legislation, was extracted from the
website of the DG Environment, and chapter 3 on the
Lars Rydén development of European Union environmental policy,
Baltic University Programme on several of the Commission websites.
Uppsala University, Sweden
Environmental book production
Case Studies by: This book is printed on Arctic the Volume paper from
Torgny Mossing, Umeå University, Sweden Arctic Paper. This paper is Forest Stewardship Council
Barbara Kozlowska, Technical University of Lodz, Poland (FSC) certified, i.e. the wood (mixed sources) used in
Siarhei Darozhka, Belarusian National Techn. Univ., Minsk. the production comes from forests in­dependently
Gudrun Pollack, Univ. Applied Sci. Zittau/Goerlitz, Germany inspected and evaluated according to the sustain­ability
Sebastian Schneider, Foseco GmbH, Borken, Germany principles and criteria approved by FSC.
Bernd Delakowitz, Univ. Applied Sci. Zittau/Goerlitz, Germany
Børge Klemmensen, Roskilde University, Denmark The Arctic Paper Håfreströms AB mill, which produces
the paper, is certified in accordance with the ISO
Project Leader and Series Editor 14001 standard, report their work in accordance with
EMAS and are also accredited with the ISO 9001
Lars Rydén
quality manage­ment standard.
Baltic University Programme, CSD Uppsala
http://www.arcticpaper.com ; http://www.fsc.org
Uppsala University, Sweden
All four books in the Baltic University environmental
English Editor
management series are printed by Nina Tryckeri
Donald MacQueen (Nina Printhouse), Uppsala, Sweden. Nina Printhouse
Department of English introduced an environmental management system and
Uppsala University, Sweden became certified in accordance with the ISO 14001
standard in December 2005 as part of the preparation
Production Manager/Graphic Design for the production of these books. The process is
Nicky Tucker described on page 251 in Book 4, Environmental
Baltic University Programme, CSD Uppsala Management Systems and Certification, in this series,
Uppsala University, Sweden and in a film on the CD of that book.
http://www.ninatryckeri.se
Film and CD Production
Magnus Lehman
Baltic University Programme, CSD Uppsala
Uppsala University, Sweden The Baltic University Press © 2007
Printed by Nina Tryckeri, Uppsala 2007.
ISBN 91-975526-0-7
 Summary of Contents

Preface......................................................................................................................................................................... 17

INTRODUCTION: Heading for Sustainability – Business Accountability and Public Policy. .... 19

1 Phases in Environmental Protection........................................................................................................... 27

2 Development of EU Environmental Regulation..................................................................................... 39

3 Are Environmental Management Systems Sufficient?........................................................................ 53

4 Self-regulation and Voluntary Corporate Initiatives............................................................................ 65

5 Shared Responsibilities..................................................................................................................................... 77

6 Environmental Licensing and the IPPC Directive.................................................................................. 91

7 Implementing Environmental Licensing................................................................................................. 103

8 Compliance – Monitoring and Continuous Improvement.............................................................. 115

9 Inspection, Enforcement and Court Processes..................................................................................... 127

10 Economic Policy Instruments – Taxes and Fees. ................................................................................ 137

11Market-based Economic Instruments – Emission Trading.............................................................. 149

References................................................................................................................................................................ 161

A Inspection – Environmental Inspection and Enforcement in Theory and Practice 169

B European Union Environmental Legislation 187


 C Case Studies 217

Case Study 1 Oil & Sludge Treatment Inc., Sweden..................................................................................................... 219

Case Study 2 Swedish Forest Plants Ltd, Sweden......................................................................................................... 227
Case Study 3 Tomaszow Landfill, Poland..................................................................................................................... 231
Case Study 4 Krasnoselsk Cement Factory, Belarus...................................................................................................... 237
Case Study 5 Foseco GmbH, Germany......................................................................................................................... 241
Case Study 6 Roskilde Electroplating Ltd, Denmark............................................................................................................ 251

Index........................................................................................................................................................................... 259


 Contents

Preface......................................................................................................................................................................... 17

INTRODUCTION: Heading for Sustainability – Business Accountability and Public Policy. .... 19
Self-regulation or Enforced Rules?....................................................................................................................................... 19
Tools for Environmental Management................................................................................................................................. 20
Business Charters............................................................................................................................................................ 21
Politics and Regulation within the European Union................................................................................................................. 23
EU Main Mandatory Regulation Related to Industry................................................................................................................ 23
Public-private Agreements................................................................................................................................................ 24
National Legislation. ....................................................................................................................................................... 25
Abbreviations, Internet Resources................................................................................................................................. 26

1 Phases in Environmental Protection........................................................................................................... 27

1.1 The Road Towards Regulation................................................................................................................................. 27
1.1.1 The Conflict Between Nature and Economy.................................................................................................................. 27
1.1.2 The Environment Enters the Political Agenda ................................................................................................................ 28
1.1.3 Control of Industrial Chemicals.................................................................................................................................. 28
1.1.4 Smoke and Wastewater............................................................................................................................................ 28
1.1.5 The Cost of Pollution............................................................................................................................................... 29
1.2 The Conflict Between Growth and Environmental Regulation................................................................................. 29
1.2.1 The Public-Private Dichotomy.................................................................................................................................... 29
1.2.2 The Origin of Regulation. ......................................................................................................................................... 30
1.2.3 From Control to Prevention....................................................................................................................................... 30
1.2.4 Overcoming the Dilemma – the Win-Win Option........................................................................................................... 31
1.3 Innovation and Technological Change..................................................................................................................... 31
1.3.1 The Eco-Efficiency Credo – Environment by Competitiveness . .......................................................................................... 31
1.3.2 The EU Solution – Decoupling. .................................................................................................................................. 32
1.3.3 The UNEP Solution – Cleaner Production...................................................................................................................... 33

1.4 The Fourth Era of Environmentalism – Sustainability. .............................................................................................. 34

1.4.1 The Climate Issue.................................................................................................................................................... 34
1.4.2 Sustainable Production and Consumption. ................................................................................................................... 34

1.5 Managing Hazardous Production Facilities.............................................................................................................. 35

1.5.1 Responsible Care. ................................................................................................................................................... 35
1.5.2 The Seveso Directive................................................................................................................................................ 36

Study Questions, Abbreviations, Internet Resources...................................................................................................... 37


2 Development of EU Environmental Regulation..................................................................................... 39
2.1 European Environmental Cooperation..................................................................................................................... 39
2.1.1 The Origins. .......................................................................................................................................................... 39
2.1.2 The First Pieces of Legislation..................................................................................................................................... 39
2.1.3 The Paris Declaration............................................................................................................................................... 41
2.1.4 The First Environmental Action Programmes. ................................................................................................................ 41
2.1.5 A Formal Base for European Environmental Legislation .................................................................................................... 41
2.2 The European Union Environmental Policies............................................................................................................ 42
2.2.1 The Third and Fourth Environmental Action Programmes ................................................................................................ 42
2.2.2 The Single Market................................................................................................................................................... 42
2.2.3 Towards Sustainability – the Fifth EAP . ........................................................................................................................ 46
2.2.4 Assessing the Fifth EAP............................................................................................................................................. 47
2.2.5 The Sixth EAP, 2002-2010......................................................................................................................................... 48
2.2.6 The Lisbon Agenda and the Strategy on Sustainable Development..................................................................................... 48
2.3 EU Policies and the Surrounding World................................................................................................................... 50
2.3.1 EU and External Trade ............................................................................................................................................. 50
2.3.2 EU Policies ............................................................................................................................................................ 50
2.3.3 EU in International Negotiations................................................................................................................................. 50
2.3.4 The EU Enlargement to the East. ................................................................................................................................ 50
Study Questions, Abbreviations, Internet Resources...................................................................................................... 51

3 Are Environmental Management Systems Sufficient?........................................................................ 53

3.1 Management Systems and Self-regulation............................................................................................................... 53
3.1.1 Reasons for Self-regulation........................................................................................................................................ 53
3.1.2 A Variety of Environmental Management Systems. ......................................................................................................... 54
3.1.3 The Nature of the EMS............................................................................................................................................. 54

3.2 Steps in Introducing an Environmental Management System ................................................................................. 55

3.2.1 Initial Environmental Review...................................................................................................................................... 55
3.2.2 Environmental Policy. .............................................................................................................................................. 56
3.2.3 Assessing Potential Environmental Impacts.................................................................................................................... 56
3.2.4 Planning............................................................................................................................................................... 56
3.2.5 Implementation and Training. ................................................................................................................................... 56
3.2.6 Checking, Corrective Actions and Management Review................................................................................................... 56
3.3 Comparing the Management Systems..................................................................................................................... 57
3.3.1 EMAS, ISO 14001 and the Green Network.................................................................................................................... 57
3.3.2 The Objectives of EMAS. .......................................................................................................................................... 57
3.3.3 Environmental Statements. ....................................................................................................................................... 60
3.3.4 A Comparison........................................................................................................................................................ 60
3.4 The Experiences and Effects of Environmental Management Systems...................................................................... 60
3.4.1 The Insufficiencies of EMS.........................................................................................................................................
60
3.4.2 Is Continuous Improvement Actually Occurring?............................................................................................................
61
3.4.3 External Verification by Independent Auditors ...............................................................................................................
61
3.4.4 Studies on Environmental Performance and EMS............................................................................................................
61
3.4.5 Correlations Between EMS and Environmental Performance.............................................................................................. 62
3.4.6 Environmental Management Systems and Compliance with Legal Regulations...................................................................... 63
3.4.7 The Positive Sides – Improved Overview and Financial Benefits..........................................................................................63
3.4.8 How to Ensure Improved Environmental Performance. .................................................................................................... 63

Study Questions, Abbreviations, Internet Resources...................................................................................................... 64


4 Self-regulation and Voluntary Corporate Initiatives............................................................................ 65
4.1 Voluntary Business Initiatives. ................................................................................................................................. 65
4.1.1 The Challenges of Improving Environmental Performance................................................................................................ 65
4.1.2 The Life-Cycle Perspective......................................................................................................................................... 66
4.1.3 The Communication Perspective. ............................................................................................................................... 66

4.2 Instruments Based on Corporate Responsibility....................................................................................................... 67

4.2.1 Codes of Conduct................................................................................................................................................... 67
4.2.2 Environmental Stewardship and other Codes. ............................................................................................................... 67
4.2.3 Corporate Social Responsibility .................................................................................................................................. 67

4.3 Calculating Environmental and Societal Costs. ........................................................................................................ 68

4.3.1 Sustainability Accounting.......................................................................................................................................... 68
4.3.2 Environmental Management Accounting, EMA.............................................................................................................. 69
4.3.3 The Triple Bottom Line............................................................................................................................................. 69
4.3.4 The Global Reporting Initiative, GRI. ........................................................................................................................... 69
4.4 Product-related Measures........................................................................................................................................ 70
4.4.1 Eco-design. ........................................................................................................................................................... 70
4.4.2 Extended Producer Responsibility. .............................................................................................................................. 71
4.4.3 Eco-labelling.......................................................................................................................................................... 73

4.5 Evaluating Corporate Voluntary Initiatives............................................................................................................... 73

4.5.1 The Positive Sides of Voluntary Measures...................................................................................................................... 73
4.5.2 Which Environmental Management Instrument to Choose............................................................................................... 73
4.5.3 Do Voluntary Measures Lead to Compliance?................................................................................................................ 74

Study Questions, Abbreviations, Internet Resources...................................................................................................... 75

5 Shared Responsibilities..................................................................................................................................... 77
5.1 The Background...................................................................................................................................................... 77
5.1.1 The Limitations of Control. ....................................................................................................................................... 77
5.1.2 Shared Responsibilities............................................................................................................................................. 78
5.1.3 The Choice between Self-Regulation and Authority Control.............................................................................................. 78

5.2 The EU and Business World Response...................................................................................................................... 79

5.2.1 The EU Environmental Action Programmes................................................................................................................... 79
5.2.2 The Sustainability Agenda......................................................................................................................................... 79
5.2.3 Business Action for Sustainable Development-Initiative, BASD ........................................................................................... 80

5.3 Covenants/Environmental Agreements, EA. ............................................................................................................ 80

5.3.1 Environmental Agreements versus Command-and-Control............................................................................................... 80
5.3.2 EA and the Dutch National Environmental Policy Plan, NEPP............................................................................................. 81
5.3.3 Implementing Environmental Agreements.................................................................................................................... 82
5.3.4 Experiences from the Dutch Environmental Agreements. ................................................................................................. 83
5.3.5 Upcoming Revised Dutch Environmental Policy has a Limited Role for Environmental Agreements ............................................ 84
5.4 Environmental Agreements and the EU................................................................................................................... 84
5.4.1 Evaluation of the Environmental Agreements................................................................................................................. 84
5.4.2 The Member States Survey........................................................................................................................................ 85

5.5 Experiences of Shared Responsibilities..................................................................................................................... 86

5.5.1 The Meaning of “Share”........................................................................................................................................... 86
5.5.2 Implementation...................................................................................................................................................... 86
5.5.3 Securing Compliance............................................................................................................................................... 87


 5.6 Shifting Nature of Environmental Challenges Changes the Notion of “Sharing”. .................................................... 87
5.6.1 New Trends........................................................................................................................................................... 87
5.6.2 The New Task Ahead. .............................................................................................................................................. 87

Study Questions, Abbreviations, Internet Resources...................................................................................................... 89

6 Environmental Licensing and the IPPC Directive.................................................................................. 91

6.1 Components of Environmental Law......................................................................................................................... 91
6.1.1 Modernising Regulation through Integration ................................................................................................................ 91
6.1.2 The Legal Framework .............................................................................................................................................. 92
6.1.3 National and International Legislation.......................................................................................................................... 92

6.2. Directives Related to IPPC. ..................................................................................................................................... 92

6.2.1 IPPC, EIA, SEVESO and EMAS..................................................................................................................................... 92
6.2.2 Environmental Impact Assessment . ............................................................................................................................ 93
6.2.3 Which Directives Apply?........................................................................................................................................... 93
6.2.4 Public Participation. ................................................................................................................................................ 93
6.3 The IPPC Directive................................................................................................................................................... 95
6.3.1 Regulating Industrial Activities. .................................................................................................................................. 95
6.3.2 The Base of the Directive.......................................................................................................................................... 95
6.3.3 Objectives and Principles of the Directive ..................................................................................................................... 95
6.3.4 The Integrated Approach ......................................................................................................................................... 96
6.3.5 Emission Limit Values, ELV......................................................................................................................................... 96
6.3.6 Best Available Techniques. ........................................................................................................................................ 96
6.3.7 Review, Update, and Public Participation...................................................................................................................... 97
6.4 The IPPC Licensing Procedure. ................................................................................................................................ 97
6.4.1 The Environmental Courts ........................................................................................................................................ 97
6.4.2 The IPPC Permit Application...................................................................................................................................... 98

6.5 Assessment.............................................................................................................................................................. 99
6.5.1 Key Elements......................................................................................................................................................... 99
6.5.2 BAT and BREFs. ...................................................................................................................................................... 99
6.5.3 Economic Aspects of BAT........................................................................................................................................ 100
6.5.4 The Relation between Emissions, EQSs and the Local Environment................................................................................... 101
6.5.5 Formulating Conditions in the Permit........................................................................................................................ 101

Study Questions, Abbreviations, Internet Resources.................................................................................................... 102

7 Implementing Environmental Licensing................................................................................................. 103

7.1 Balancing Rules for Environmental Licensing......................................................................................................... 103
7.1.1 Balancing Different Interests.................................................................................................................................... 103
7.1.2 Technology or Limit Values...................................................................................................................................... 103
7.1.3 Emission Limit Values, ELVs ..................................................................................................................................... 104

7.2 Best Available Technique....................................................................................................................................... 104

7.2.1 Sector or Company Standards. ................................................................................................................................ 104
7.2.2 BREFs or Continuous Improvement........................................................................................................................... 107

7.3 The Integrated Approach...................................................................................................................................... 108

7.3.1 The OECD Approach. ............................................................................................................................................ 108
7.3.2 Extending the Material Flows Perspective. .................................................................................................................. 108

7.4 Promotion of CP via the IPPC Licensing Framework .............................................................................................. 109

7.4.1 Promoting Environmental Development..................................................................................................................... 109
7.4.2 The Licensing Process as a Dynamic Cycle. ................................................................................................................. 110

10
 7.4.3 Negotiation During the Licensing Process .................................................................................................................. 110
7.4.4 Developing Conditions........................................................................................................................................... 110
7.4.5 Information......................................................................................................................................................... 111
7.4.6 The Weak Point – Lack of Systems View...................................................................................................................... 111
7.5 Licensing and Other Regulatory Instruments......................................................................................................... 111
7.5.1 Goals and Policies in the Licence. ............................................................................................................................. 111
7.5.2 Licensing Supporting EMS. ..................................................................................................................................... 112
7.5.3 Differences Between Licensing and EMS..................................................................................................................... 113
7.5.4 Development and Environmental Plans ..................................................................................................................... 113
Study Questions, Abbreviations, Internet Resources.................................................................................................... 114

8 Compliance – Monitoring and Continuous Improvement.............................................................. 115

8.1 Factors which Promote Compliance....................................................................................................................... 115
8.1.1 From Implementation to Control.............................................................................................................................. 115
8.1.2 Compliance Programme......................................................................................................................................... 115
8.1.3 The Competent Authorities..................................................................................................................................... 116
8.1.4 Role of ‘Policing’ and ‘Deterrence’............................................................................................................................ 117
8.1.5 The Role of the Market and the Public. ...................................................................................................................... 117
8.1.6 Green Networking Provides Support. ........................................................................................................................ 118
8.2 The Competent Authorities................................................................................................................................... 119
8.2.1 From the European Union to Member States............................................................................................................... 119
8.2.2 State Level Environmental Authorities........................................................................................................................ 119
8.2.3 The Regional and Municipal Level............................................................................................................................. 119
8.2.4 Power in Public Administration................................................................................................................................. 120
8.2.5 The Pros and Cons of Decentralization....................................................................................................................... 120
8.3 Compliance and Management Systems................................................................................................................. 121
8.3.1 The Scope of the IPPC Directive. .............................................................................................................................. 121
8.3.2 Compliance Typology and EMS ............................................................................................................................... 122
8.3.3 Differentiated Inspections . ..................................................................................................................................... 122
8.3.4 The Compliance Cycle . ......................................................................................................................................... 123
8.4 Monitoring ........................................................................................................................................................... 123
8.4.1 The Role of Monitoring.......................................................................................................................................... 123
8.4.2 Self-monitoring . .................................................................................................................................................. 124

8.5 Evaluation of Compliance Programmes . ............................................................................................................... 124

8.5.1 Evaluation as Feedback........................................................................................................................................... 124
8.5.2 Compliance as Continuous Improvement .................................................................................................................. 125

Study Questions, Abbreviations, Internet Resources.................................................................................................... 126

9 Inspection, Enforcement and Court Processes..................................................................................... 127

9.1 Inspection . ........................................................................................................................................................... 127
9.1.1 The Role of Inspections. ......................................................................................................................................... 127
9.1.2 Four Types of Inspections........................................................................................................................................ 127
9.1.3 The Functions of Inspections. .................................................................................................................................. 128
9.1.4 Form and Intensity of Inspections............................................................................................................................. 129
9.2 Enforcement.......................................................................................................................................................... 130
9.2.1 Enforcement Actions.............................................................................................................................................. 130
9.2.2 The Range of Response Mechanisms. ........................................................................................................................ 130
9.2.3 The Enforcement Process – Selection of the Appropriate Enforcement Response.................................................................. 131

11
 9.3 The Court Process. ................................................................................................................................................ 131
9.3.1 Appeals within the Administrative System................................................................................................................... 131
9.3.2 Protection of Citizens Rights – Rule of Law.................................................................................................................. 133
9.3.3 The Role of the Courts. .......................................................................................................................................... 133
9.3.4 Courts to be Involved in Cases of Criminal Charges. ..................................................................................................... 133
9.4 Agreements, Compensation and Damage. ............................................................................................................ 134
9.4.1 Agreements ........................................................................................................................................................ 134
9.4.2 Proportionality and the Consequences of Violations...................................................................................................... 134
9.4.3 Compensation for Damages.................................................................................................................................... 135

Study Questions, Abbreviations, Internet Resources.................................................................................................... 136

10 Economic Policy Instruments – Taxes and Fees. ................................................................................ 137

10.1 The Economy of Environmental Protection.......................................................................................................... 137
10.1.1 To Pay the Costs of Environmental Services. .............................................................................................................. 137
10.1.2 Why Economic Instruments?.................................................................................................................................. 138
10.1.3 Setting the Right Price for External Effects................................................................................................................. 138
10.1.4 The Polluter Pays Principle..................................................................................................................................... 139
10.2 Charges or User Fees........................................................................................................................................... 139
10.2.1 Charges............................................................................................................................................................ 139
10.2.2 Setting a Price for Water Services............................................................................................................................ 140

10.3 Environmental Taxes. .......................................................................................................................................... 140

10.3.1 Introducing Environmental Taxes............................................................................................................................ 140
10.3.2 Pollution Fees and Product Taxes . .......................................................................................................................... 140
10.3.3 Taxes on Waste................................................................................................................................................... 141
10.3.4 Energy Taxation.................................................................................................................................................. 142
10.3.5 Taxes on Fuels.................................................................................................................................................... 142
10.3.6 Car-related Taxes make up the Most........................................................................................................................ 143
10.3.7 Making Passenger Car Taxation Environmentally Based ............................................................................................... 145
10.4 Subsidies............................................................................................................................................................. 146
10.4.1 Subsidies as State Support..................................................................................................................................... 146
10.4.2 The European Union Subsidies Programmes.............................................................................................................. 146

10.5 Role of Environmental Economic Policy. .............................................................................................................. 146

10.5.1 Tax Revenue or Environmental Protection . ............................................................................................................... 146
10.5.2 Do the Polluters pay?........................................................................................................................................... 147
10.5.3 Taxation does Reduce Pollution of the Environment. ................................................................................................... 147

Study Questions, Abbreviations, Internet Resources.................................................................................................... 148

11 Market-based Economic Instruments – Emission Trading............................................................. 149

11.1 Making Business of the Environment................................................................................................................... 149
11.1.1 The Role of Markets in Environmental Protection........................................................................................................ 149
11.1.2 Economic Tools Using Market Mechanisms. .............................................................................................................. 149
11.1.3 A Market for Waste.............................................................................................................................................. 150

11.2 Emission Trading................................................................................................................................................. 150

11.2.1 The First Experiences............................................................................................................................................ 150
11.2.2 Trading Emissions Under the Climate Convention....................................................................................................... 151
11.2.3 The EU Obligations in the Kyoto Protocol.................................................................................................................. 152
11.2.4 EU Emission Trading Scheme (EU-ETS) ..................................................................................................................... 152

12
 11.3 Implementing Emission Trading. ......................................................................................................................... 153
11.3.1 Assessment of Allowances. .................................................................................................................................... 153
11.3.2 The Results of Trading in the First Period................................................................................................................... 154
11.3.3 Following Periods – beyond the Industrial Installations................................................................................................. 154
11.3.4 Policy Measures – the EU Linking Directive................................................................................................................ 155
11.4 Climate Policy and Sustainable Development. ..................................................................................................... 156
11.4.1 Growth Versus Emissions....................................................................................................................................... 156
11.4.2 IPCC 4th Assessment Report – Taxing Carbon............................................................................................................ 157
11.4.3 Sustainable Development and the Concept of an Ecological Tax Reform. ......................................................................... 158
11.4.4 Towards a Sustainability Regime............................................................................................................................. 159
Study Questions, Abbreviations, Internet Resources.................................................................................................... 160

References................................................................................................................................................................ 161

A Inspection – Environmental Inspection and Enforcement in Theory and Practice 169

Part 1 Theory and Framework . ...................................................................................................................... 171

1. Introduction............................................................................................................................................................ 171
2. Objects of Inspection. ............................................................................................................................................. 171
A- and B-levels ............................................................................................................................................................ 171
C-level....................................................................................................................................................................... 171
U-level....................................................................................................................................................................... 171

3. Licences – IPPC and BREFs....................................................................................................................................... 172

Environmental Inspections.............................................................................................................................................. 172

4. Authorities – Organization and Framework............................................................................................................. 173

5. Environmental Legislation....................................................................................................................................... 173
6. Law Enforcement. ................................................................................................................................................... 173
7. Quality of the Inspection......................................................................................................................................... 174
The Working Methods................................................................................................................................................... 174
Management of the Quality of Inspections......................................................................................................................... 175

8. Communication and Conflict Management............................................................................................................. 175

9. Social Skills.............................................................................................................................................................. 176
Study Questions .......................................................................................................................................................... 176

Part 2 Environmental Inspection in Practice ............................................................................................ 177

1. Introduction............................................................................................................................................................ 177
2. EU Parliament Recommendations for Minimum Criteria for Environmental Inspection ........................................... 177
3. Inspection Planning – Preparation of On-site Visits.................................................................................................. 179
4. Inspection Reports. ................................................................................................................................................. 179
5. National Legislation. ............................................................................................................................................... 181
Study Questions........................................................................................................................................................... 181
Seminar Topics. ........................................................................................................................................................... 182

13
Part 3 Students Workshops................................................................................................................................... 183
1. Student Exercise – Preparation of an Inspection...................................................................................................... 183
Seminar Topics. ........................................................................................................................................................... 183

2. Study Visit to a Local Inspection Authority. ............................................................................................................. 183

Study Questions........................................................................................................................................................... 183

3. Study Visit to an Inspection Object.......................................................................................................................... 184

Study Questions........................................................................................................................................................... 184

4. Concluding Workshop............................................................................................................................................. 184

Study Questions for a Concluding Discussion...................................................................................................................... 184
Internet Resources........................................................................................................................................................ 185

B European UnionEnvironmental Legislation 187

1. INTRODUCTION...................................................................................................................................................... 189
1.1 Basis of European Union Legislation............................................................................................................................. 189
1.2 Development of the Directives. .................................................................................................................................. 189
1.3 Framework Directives............................................................................................................................................... 190
1.4 Strategies and Policies. ............................................................................................................................................. 190
1.5 Incorporation into National Legislation......................................................................................................................... 190
1.6 Legal Follow-up. ..................................................................................................................................................... 191
1.7 Policy Areas............................................................................................................................................................ 191
1.8 Economic Instruments ............................................................................................................................................. 191
1.9 The European Economic Area..................................................................................................................................... 192
1.10 European Neighbourhood Policy............................................................................................................................... 192
1.11 Global Cooperation................................................................................................................................................ 192
2. AIR.......................................................................................................................................................................... 193
2.1 Clean Air for Europe................................................................................................................................................. 193
2.2 The Convention on Long Range Transboundary Air Pollution ............................................................................................ 194
2.3 The Air Quality Framework Directive and its Daughter Directives........................................................................................ 194
2.4 Air Quality Standards. .............................................................................................................................................. 195
2.5 Emissions from Traffic on Road, Sea and Air................................................................................................................... 195
2.6 Emissions from Industrial Sources – Large Combustion Power Plants.................................................................................... 195
3. CHEMICALS............................................................................................................................................................. 196
3.1 The Dilemma of Chemicals Control. ............................................................................................................................ 196
3.2 The REACH Regulation.............................................................................................................................................. 196
3.3 Scope of REACH...................................................................................................................................................... 196
3.4 The Implementation of REACH................................................................................................................................... 197
3.5 The Directives on Existing Substances, EINECS and ELINCS............................................................................................... 197
3.6 Plant Protection Products and Biocides......................................................................................................................... 198
3.7 POPs – Persistent Organic Pollutants............................................................................................................................ 198
3.8 Directives on Chemical Accidents (Seveso II).................................................................................................................. 198
3.9 Large Oil Spills at Sea............................................................................................................................................... 199
4. ENERGY. ................................................................................................................................................................. 199
4.1 Energy and Environment........................................................................................................................................... 199
4.2 Energy Efficiency..................................................................................................................................................... 200
4.3 Energy Performance of Buildings................................................................................................................................. 200
4.4 Cogeneration . ....................................................................................................................................................... 201

14
5. CLIMATE CHANGE................................................................................................................................................... 201
5.1 EC and the United Nations Framework Convention on Climate Change............................................................................... 201
5.2 European Climate Change Programme (ECCP)............................................................................................................... 201
5.3 EU Emissions Trading Scheme (ETS)............................................................................................................................. 202
5.4 The Community Strategy to Reduce CO2 from Light Vehicles (Cars and Vans)........................................................................ 202
5.5 European Community Action to Reduce Ozone-Depleting Substances................................................................................. 202
6. INDUSTRY AND TECHNOLOGY. .............................................................................................................................. 203
6.1 The EU Industrial Environmental Regulations and Policies.................................................................................................. 203
6.2 The IPPC Directive................................................................................................................................................... 203
6.3 Development of the IPPC Directive.............................................................................................................................. 203
6.4 Eco-Management and Audit Scheme (EMAS)................................................................................................................. 204
6.5 Integrated Product Policy (IPP) . ................................................................................................................................. 204
6.6 Implementing the Integrated Product Policy.................................................................................................................. 204
6.7 The European Union Eco-label Scheme......................................................................................................................... 205
6.8 Greening Standardisation ......................................................................................................................................... 205
6.9 Green Public Procurement......................................................................................................................................... 205
6.10 Environmental Technologies Action Plan, ETAP. ............................................................................................................ 205
7. LAND USE, NATURE PROTECTION, AND SOIL.......................................................................................................... 206
7.1 Land Use and Spatial Planning.................................................................................................................................... 206
7.2 Environmental Impact Assessment............................................................................................................................... 206
7.3 Strategic Environmental Assessment. ........................................................................................................................... 207
7.4 Nature Protection and Biodiversity. ............................................................................................................................. 207
7.5 Proposal for a Framework Directive on Soil.................................................................................................................... 207
8. NOISE. .................................................................................................................................................................... 207
8.1 The Directive on Environmental Noise.......................................................................................................................... 207
8.2 Existing Directives Relating to Noise Sources.................................................................................................................. 208

9. WASTE. ................................................................................................................................................................... 208

9.1 Strategies and Framework Directives on Waste............................................................................................................... 208
9.2 The Landfill Directive................................................................................................................................................ 208
9.3 Biodegradable Waste................................................................................................................................................ 209
9.4 Mining Waste......................................................................................................................................................... 209
9.5 Waste Incineration Directive ...................................................................................................................................... 209
9.6 Disposal of Waste Oils. ............................................................................................................................................. 210
9.7 The Disposal of PCBs and PCTs................................................................................................................................... 210
9.8 Disposal of End-of-Life Vehicles................................................................................................................................... 211
9.9 Packaging and Packaging Waste. ................................................................................................................................ 211
9.10 Waste Electrical and Electronic Equipment, WEEE Directive.............................................................................................. 211
9.11 Disposal of Batteries and Accumulators....................................................................................................................... 212
9.12 Waste Management Planning................................................................................................................................... 212
9.13 Waste Shipments................................................................................................................................................... 212
10. WATER. ................................................................................................................................................................. 212
10.1 The Water Framework Directive  ............................................................................................................................... 212
10.2 River Basin Management ........................................................................................................................................ 213
10.3 Drinking Water Directive. ........................................................................................................................................ 213
10.4 Urban Waste Water Treatment, UWWT Directive........................................................................................................... 214
10.5 Sewage Sludge. .................................................................................................................................................... 214
10.6 The Nitrates Directive . ........................................................................................................................................... 214
10.7 Priority Substances Under the Water Framework Directive............................................................................................... 215
10.8 Groundwater Directive............................................................................................................................................ 215

15
 C Case Studies 219

Case Study 1 Oil & Sludge Treatment Inc., Sweden

Environmental Performance and Conditions of Permits for a Waste Treatment Company............................................................... 221

Case Study 2 Swedish Forest Plats Ltd, Sweden

A Court Case on Permits to use Pesticides in a Plant Nursery................................................................................................... 229

Case Study 3 Tomaszow Landfill, Poland

An Integrated Permit for a Landfill according to IPPC............................................................................................................ 233

Case Study 4 Krasnoselsk Cement Factory, Belarus

ISO 14001 Surveillance Audit as Compliance Inspection........................................................................................................ 239

Case Study 5 Foseco GmbH, Germany

Implementing REACH, the New European Union . ............................................................................................................... 243
Chemicals Regulation.................................................................................................................................................... 243

Case Study 6 Roskilde Electroplating Ltd, Denmark

Voluntary Action Makes Licensing Easy.............................................................................................................................. 253

Index........................................................................................................................................................................... 261

16
 Preface

This text is part of a series of textbooks on Environmental tal problems as it results from the political policy process. It
Management. The theme of the text is the interrelation be- authorizes actions to be taken and empowers the public ad-
tween company management and environmental regulation ministration to require these actions or steps to be taken by
with the requirements and instruments formulated there. The companies and other economic entities causing the negative
approach is to start from management responsibility and op- impact on the environment. The main development in policy
tions for action and proceed to investigate the role that regula- and subsequent regulation has been the shift of focus from
tion can play in making companies take on their responsibility ‘End of Pipe’ regulation to demands for ‘Prevention and at-
and, as a minimum, comply with current regulation. source-Intervention’ to prevent pollution from originating in
Environmental management means having accepted the the first place. This approach means increasing interference
company’s impact on the environment as a management re- with internal company affairs and therefore needs a mecha-
sponsibility and subsequently made control of and action on nism to ameliorate the interplay between (external) demands
this impact a part of management duties. Making environmen- on the production activities and (internal) company decision-
tal impact part of top-level management responsibilities is cru- making on economic optimization of its production process.
cial for taking company intentions on this issue seriously. This This instrument is the Environmental Licence or Permit.
responsibility has been increasingly accepted by management Applying for the permit means describing and quantifying
over the last 15 – 20 years, with the 1992-Summit in Rio de technology and material flow and documenting steps taken to
Janeiro and the “Brundtland Report” from 1987 as focal points prevent pollution originating and to limit impact where zero
for initiating that development. We find this development of emission is not feasible. In assessing the application, the no-
great importance, and the text addresses it in some detail. tion of Best Available Technique, BAT, is important and all
Schmidheiny’s book on ‘Changing Course’ and the notion emission issue handled by allocating Emission Limit Values.
of “Shared Responsibilities” represented that growing un- The key backup of the permit represents the Environmental
derstanding. During the 1990’s the environmental codes and Inspection by the Competent Environmental Authority. At its
standards ‘Responsible Care’, ‘EMAS’ and ‘ISO 14000’ oper- best the inspection combines checks on compliance and dia-
ationalized the plea, and product-oriented standards like LCA, logue and advice to management on improvements, promoting
Eco-labelling and Eco-design came into effect. Recently lead- a constant reduction of impact and thereby preparation for the
ing multinational companies have embarked on business re- permit review. In recent years, economic and other market-ori-
sponsibility also for the climate change issue, with the CO2 ented instruments have become increasingly important, with
emissions as the main problem, declaring readiness to set up the EU-ETS as the latest market oriented instrument. Applied
binding medium- and long-term reduction targets. This is most within the area of climate change and dealing with CO2 emis-
likely going to be implemented by a ‘cap and trading’ system sions, this system will attract considerable interest in coming
of permit trading along the lines of the EU-ETS-system. years.
Environmental regulation is the formal formulation or This text deals with these developments as well as the main
transformation of the political interpretation of environmen- elements of environmental regulation and related instruments.

preface 17
The presentation and analysis are based on EU Environmental
Regulation, as the EU today includes as members all Baltic Sea
States excl. Russia and Belarus. Further, EU regulation influ-
ences regulation in a wider, global context as the EU countries
via the permanent EU institutions operate as one in all glo-
bal assemblies of environmental relevance. The presentation,
though based on EU regulation, is supplemented by examples
and cases from different member countries as well as from
non-member countries to illustrate the actual implementation
of the EU legislation as well as differences arising from those
areas not covered by EU legislation – above all the economic
instruments. The implementation can be quite different from
country to country as the directives demand compliance with
the principles but allows national discretion as to how and by
what national regulation.
Finally, a number of case studies provide very concrete il-
lustrations of the interplay between company and authority and
the role that use of voluntary instruments and other company
initiatives play in the permitting process and the consequent
inspection and control of compliance.
The author team hopes that this way of presenting and
dealing with the environmental issues including the potentials
of and need for company-authority cooperation on sound en-
vironmental management will inspire teachers and students to
include and confront the text with the situation in their na-
tional context. That includes the company level of environ-
mental management initiatives and implementation of relevant
environmental standards, the content and structure of the na-
tional legislation on permitting and inspection as well as the
structure and competence of the Competent Public Authority
on environmental regulation. The case studies will be of help
when interpreting the national legislation and the interaction
between company and authority as well as for the preparation
and conduct of own company case studies.
At the Baltic University Programme web page the teacher
will find further support for planning and conducting courses
based on this text.

Roskilde, June 2007

Børge Klemmensen

18 preface
 INTRODUCTION
Heading for Sustainability
Business Accountability and Public Policy

Business Accountability and Public Policy that something was not working properly in production. Today
The relation between business and environment is at the core it may seem obvious that it is better for business to be care-
of this text. The ultimate goal is to examine the possibility of ful with resources and make salable products from waste rather
a working concept for sustainable industrial production. The than to let it disappear through the smokestack as pollutants, and
question is in particular what role politics and policy instru- incur big fines. These insights have led to a number of business
ments may have in bridging the relation between production initiatives for better environmental management.
and environment. That bridging is necessary to create and fur- Today we thus have two kinds of regulations: Firstly rules
ther more sustainable capitalist or market economies. which authorities enforce on any activity to protect the environ-
The task for politics – and the demand on policy and pol- ment for the general
icy instruments – is huge, difficult and delicate. It is a task of interest of society. “If everything is working well with self-
bridging, a task of inspiring the industrial actors and a task of Secondly, self-regu-
imposed rules it is best. However, in real
compensating. It is also a task of showing the negative conse- lation, that is, man-
quences, a task of inducing change and a task of pointing at agement rules that life, self-regulation is not enough, and
prospective paths to be followed. Environmental Accountabil- business itself has authority control is needed.”
ity is the core challenge. The role for politics in and for the en- introduced mostly
vironment resembles that of politics in its role in creating the for the reason that it is good business. Through the entire book
“welfare society” for social security. It should compensate and we will study and analyse the relation between these two ap-
modify the damage and other problems caused by economic proaches. The first one is concerned with environmental regu-
actors, while trying to keep the notion of a sustainable society lation, with permits and control, with environmental taxes and
firmly on the agenda. fees, and with a concern that nature and people not be hurt by
any activity that an organisation, commercial or not, is pursuing.
Self-regulation or enforced rules? The second one is a set of management rules developed within
It is obvious that some rules are necessary to protect the envi- the private sector itself. It includes the management standards
ronment from the negative consequences of extraction of natu- for environment, for quality as well as for social responsibility.
ral resources and emissions of pollution. Is this a concern for It includes labels on products and business charters.
the producers, that is, the companies, or for society? For a long Obviously it is better if authorities do not see any need for
time industry regarded environmental issues as something “out regulation, that is, stay away from the so-called “command
there”, not their concern, and they acted accordingly. This was and control” approach. If everything is working well with self-
the start of environmental regulation enforced by society, ei- imposed rules it is best. However, in real life, self-regulation is
ther as absolute laws – you may not emit such a substance – or not enough, and both approaches are needed.
as fines – if you do that you will have to pay a fine. Today we see a third line developing with a culture of
Later on business started to understand that environmental cooperation between authorities and business. In this “nego-
impact was not something “out there”. It was actually a sign tiation culture” authorities and business make agreements on

introduction – heading for sustainability 19

 Figure 1 Industrial production. Large companies
typically have introduced environmental management
systems, eco-design of their products (as is the case
with Volkswagen) and other forms of self-regulation,
which all eases the authority control. The production
line for Volkswagen Polo at Volkswagen, Slovakia,
a.s., in Bratislava, Slovakia. (Photo: Samuel Kubani.
© European Commission)

how to produce with less and least possible environmental im- As of today we have two active environmental manage-
pact through technological and managerial change. On a more ment systems standards. One is the ISO 14000 series launched
general or global scale this has developed into a concept of in 1996 and most recently revised in 2004, and the other is
“shared responsibilities” with industry actively involving itself the European Union voluntary EMAS Scheme, established in
in sustainability-oriented programs, including public policy 1993 and revised in 2001.
regulation. Besides ensuring the profitability of their opera- The first formalized EMS was the British Standard 7750,
tions’ business needs regulation to make sure no one can es- established by the British Standardization Board and taking
cape from the standard conditions and thereby gain advantages effect in 1992. It was effective and used both in Britain and
in the market competition. abroad till it was withdrawn and replaced by the ISO 14001
We will deal with all three aspects or approaches to pro- standard in 1996. The changes from BS 7750 to ISO 14001
tecting the environment and, eventually, to aspire to sustain- were not significant. The most important difference is that the
able production and business practices. ISO system has world-wide coverage.
The ISO 14000 has developed into a Group of Standards
Tools for environmental management concerned with different aspects of economic activity relevant
The theme of the entire course project is Environmental Man- to the environment such as Labelling, Life Cycle Assessment
agement. Environmental Management Systems (EMS), will etc. The ISO 14001 standard is the one that includes the Envi-
consequently be the starting point for this text. As mentioned ronmental Management System.
above the text will describe the role of politics in helping to The whole idea of organising management of the environ-
promote management that takes responsibility for the impact ment as a “Standard” was brought about by the use of prod-
that the company has on the environment. A management sys- uct- and process standards like Total Quality Management
tem is an instrument for self-regulation. (TQM) and the ISO 9000-serie of standards, still very much in
An environmental management system, EMS, has two as- use. This development of standards – again – was a product of
pects. Firstly it is a managerial tool consisting of certain steps the surge in international trade and the internationalisation of
and procedures, which when followed and fulfilled will pro- production and markets with more and more subsidiaries be-
vide management with a comprehensive grip on a company’s ing placed around the globe with easy access to raw materials
environmental impact. Secondly it provides the procedures and cheap labour. The range of products and services covered
needed to have a bearing on improved company-environmen- by standards has for these reasons increased enormously and
tal relations. It comes forward most clearly in the EU EMAS the number of single standards surged. ISO – the International
Scheme, with its explicit requirement for continuous improve- Standardization Organisation for Standardization – is a private/
ment. This is backed by a demand that the company make its non-governmental organisation with global wide coverage.
environmental policy public and report annually to the general It is based on membership from a Standardization Body in
public on the results. each country (currently some 157 countries have member organ-

20 introduction – heading for sustainability

isations). The organisation of the national standardization body Business Charters
is often arranged by law or by government decree, whereby rep- The Brundtland Commission Report, putting the Sustainability
resentation and distribution of interests are regulated. There can issue firmly on the agenda from 1987, provided a push for sys-
only be one member organization from each country [ISO, 2004]. tematic approaches. That was reflected in the November 1990
The actual standards are prepared by working groups, consist- International Chamber of Commerce (ICC) Business Charter
ing of company, consultancy and government representatives, for Sustainable Development – Principles for Environmental
gathering to set up an (industrial/material – commodity/trade) Management. This document was formally launched at the
standard within an area of interest to them. There is therefore no Second World Industry Conference on Environmental Man-
system of securing “balanced representation” in the preparatory agement in April 1991. The objective of the charter is to make
process. What is provided then is a standard – a set of guidelines, the widest possible range of companies commit themselves to
a set of specified material requirements etc. – that can function as the improvement of their environmental performance. The ap-
a clear and unbiased reference for business and authorities alike plication of the 16 principles of the Charter should make sure
when contracts on deliveries are made. to have a comprehensive and integrated management set-up to
The EU EMAS Scheme is concerned with environmental ensure improvement in environmental performance. The dif-
management only. It is an EU regulation, i.e. issued by the Eu- ferent challenge of comprehensiveness, interdependence and
ropean Union and is therefore an authority-based regulation of inter-relatedness posed by the sustainability concept was well
the same order as all other EU regulations. Consequently it is understood. It was an entire new challenge compared to the,
binding for the EU member states, and would be mandatory however problematic, nevertheless single-medium or individ-
also for all citizens and legal entities alike, if it was not accord- ual-hazard problems in relation to the environment.
ing to its own ruling made voluntary for them. This means, that That we witnessed a “melting pot” in the years immedi-
the EU member states have to set up the required framework ately following the launch of the Brundtland Commission re-
for the EMAS Scheme, first of all the accreditation system for port was underlined also by the International Labour Organi-
certifiers and a database and registering system for the certifica- sation (ILO) Report commissioned by the IL-Conference in
tions made. It is then up to the companies that the Regulation 1990 and published in 1992. Being an ILO report, the starting
targets to decide whether they want to use the system or not. point was integrating and securing training and education for

Table 1. Decision Making Within ISO , International Organisation for Standardization. As other standards of the ISO, ISO 14001 was de-
veloped in a so-called Technical Committee (TC). Technical committee TC 207, prepared the ISO 14001 environmental management standards.
The main points of this process are described below. Based on: ISO, 2003. Further reading on P-members (Participating members) and other
members (O-members) in ISO/TC207, 2004.

Stage Purpose Key actors

1. Proposal The decision to develop the standard, in this P-members (Participating members, i.e.
stage in the form of a Work Item (WI) proposal representatives of national organisations) of TC
207 – agreement reached by a majority of the
P-members voting for the standard
2. Preparation Preparation of a Working Draft (WD) Working groups of subcommittees with experts
from national committees agree upon a WD
3. Committee approval Committee approval of the WD; Agreement First national hearings, then voting by P-
upon a Draft International Standard (DIS) members. Agreement on the basis of minimum
2/3 of the P-members and ¾ of all ISO members
(P- and O-members)
4. Enquiry Ratification of DIS, turning the DIS into a Final Ratification by all ISO members within 5 months,
Draft International Standard (FDIS) agreement reached by 2/3 of the P-members
and ¾ of all ISO members
5. Approval Approval of FDIS Approval by all ISO members within 2 months,
agreement reached by 2/3 of the P-members
and ¾ of all ISO members
6. Publication Publication of the standard in the languages Participation of the ISO member countries in the
of all the ISO member countries, turning the translation of the standard
standard into national standards

introduction – heading for sustainability 21

Box 1 The International Chamber of Commerce ICC Business Charter for Sustainable Development

The following 16 principles make up ICC’s Business Charter 9. Research

for Sustainable Development. They provide businesses world- To conduct or support research on the environmental im-
wide with a basis for sound environmental management. pacts of raw materials, products, processes, emissions and
wastes associated with the enterprise and on the means of
1. Corporate priority minimizing such adverse impacts.
To recognize environmental management as among the
highest corporate priorities and as a key determinant to 10. Precautionary approach
sustainable development; to establish policies, programmes To modify the manufacture, marketing or use of products
and practices for conducting operations in an environmen- or services or the conduct of activities, consistent with sci-
tally sound manner. entific and technical understanding, to prevent serious or
irreversible environmental degradation.
2. Integrated management
To integrate these policies, programmes and practices 11. Contractors and suppliers
fully into each business as an essential element of man- To promote the adoption of these principles by contrac-
agement in all its functions. tors acting on behalf of the enterprise, encouraging and,
where appropriate, requiring improvements in their prac-
3. Process of improvement tices to make them consistent with those of the enterprise;
To continue to improve corporate policies, programmes and to encourage the wider adoption of these principles
and environmental performance, taking into account by suppliers.
technical developments, scientific understanding, con-
sumer needs and community expectations, with legal 12. Emergency preparedness
regulations as a starting point; and to apply the same en- To develop and maintain, where significant hazards ex-
vironmental criteria internationally. ist, emergency preparedness plans in conjunction with the
emergency services, relevant authorities and the local com-
4. Employee education munity, recognizing potential transboundary impacts.
To educate, train and motivate employees to conduct
their activities in an environmentally responsible manner. 13. Transfer of technology
To contribute to the transfer of environmentally sound
5. Prior assessment technology and management methods throughout the
To assess environmental impacts before starting a new ac- industrial and public sectors.
tivity or project and before decommissioning a facility or
leaving a site. 14. Contributing to the common effort
To contribute to the development of public policy and
6. Products and services to business, governmental and intergovernmental pro-
To develop and provide products or services that have no grammes and educational initiatives that will enhance
undue environmental impact and are safe in their intend- environmental awareness and protection.
ed use, that are efficient in their consumption of energy
and natural resources, and that can be recycled, reused, 15. Openness to concerns
or disposed of safely. To foster openness and dialogue with employees and the
public, anticipating and responding to their concerns
7. Customer advice about the potential hazards and impacts of operations,
To advise, and where relevant educate, customers, dis- products, wastes or services, including those of trans-
tributors and the public in the safe use, transportation, boundary or global significance.
storage and disposal of products provided; and to apply
similar considerations to the provision of services. 16. Compliance and reporting
To measure environmental performance; to conduct
8. Facilities and operations regular environmental audits and assessments of compli-
To develop, design and operate facilities and conduct ac- ance with company requirements, legal requirements and
tivities taking into consideration the efficient use of energy these principles; and periodically to provide appropriate
and materials, the sustainable use of renewable resources, information to the Board of Directors, shareholders, em-
the minimisation of adverse environmental impact and ployees, the authorities and the public.
waste generation, and the safe and responsible disposal
of residual wastes. http://www.iccwbo.org/home/environment/charter.asp

22 introduction – heading for sustainability

Table 2 Regulatory Approaches to Environmental Management. ronmental regulations. Coordination and joint decision-mak-
The regulatory instruments are divided into four categories, (Abbre- ing on tax- and fiscal issues is still practically non-existent
viations: Integrated Pollution Prevention and Control, IPPC Direc-
within the EU and is, if so, normally covered by the “unani-
tive, Environmental Impact Assessment EIA Directive; Environmen-
tal Management Systems EMS, EMAS Environmental Management mous vote”-regime. These instruments are therefore in the
and Auditing System, LCA Life Cycle Assessment) hands of the member states, and they use them, but very differ-
ently. Clarification of this section of instruments for environ-
Normative based Market based mental regulations will therefore need to look at the member
state level to see the EU-perspective on this policy section.
Mandatory IPPC Directive Charges
For the remaining body of regulation of relevance to our con-
Waste Directive Tradeable Permits
Product Liability Product Taxes cern in this text, there was a lot of activity at the EU level in the
Green Reporting Effluent Taxes/Charges 90’s, and it now seems as if priorities and focus are moved to oth-
Green Accounting User Fees er areas for a while. Let us briefly picture the current situation.
Standard Setting Deposit Refunds The EMAS-Scheme was established by EU Regula-
EIA Directive tion (EEC) No 1836/93 and a second, and improved, version
(EMAS II) was issued with Regulation (EC) No 761/2001 of
Voluntary EMAS Scheme Voluntary Agreements the European Parliament and of the Council of 19 March 2001.
Life Cycle ISO 14.001 (EMS) Together with a Commission decision on recognition of the
Assessment, LCA ISO 14.031 (performance) ISO 14001-standard as largely compatible with the EMAS-
Total Quality Management Scheme, which renders extra credibility to the ISO standard,
Eco-labeling the EU-regulation on EMS will probably remain unchanged for
“Code of Conduct”
Supplier Demands some time to come (Table 1).

EU main mandatory regulation related to industry

The Integrated Pollution Prevention and Control (IPPC) direc-
all employees to have them involved in management efforts tive, issued in 1996, was the largest EU reform in the 90’s in
for environmental protection. The report takes its departure in relation to industry’s impact on the environment. The direc-
the ICC Charter principles and provides a wide and thorough tive provides an integrated approach to licensing of industrial
coverage on management issues related to controlling and im-
proving company environmental performance. But it has no
Box 2 The Seveso II Directive
mention of Environmental Management SYSTEMS and no
mention of using the Standard-concept for this purpose. Only
Scope: To prevent – if possible, otherwise reduce the
later in 1992 was the BS 7750 released.
consequences of – the occurrence of major-accident
hazards involving dangerous substances.
Politics and regulation within the European Union
Let us start with a short categorization of the policy “tool box” The companies covered by the directive must estab-
as it looks after the approximately 30 years since environmen- lish the following (companies covered by the specific
tal regulation took off. requirement in brackets):
Regulatory approaches are grouped in the two categories, • Major Accident Prevention Policy (all companies).
depending on the legal background (mandatory or voluntary), • Safety Report (only certain companies).
and the regulatory motor behind the policy instrument (norma- • Safety Management System (only certain companies).
tive or market). • Emergency Plan (only certain companies).
If we relate this overview of instruments in use to the EU-
The provisions in the directive concerning safety
level, which is now steering the environmental regulations of
management systems and emergency plans are very
the 27 member countries and influencing also others, we will similar to the demands of environmental manage-
see, that important parts of these instruments are not in use at ment systems like ISO 14001 and could beneficially
the EU-level. This is true for most of the mandatory, market be combined.
based instruments. The reason is, that fiscal political decisions
Source: http://ec.europa.eu/environment/seveso/index.htm
are exempt from the majority decision-making procedures in
the EU, which on the other hand is the norm concerning envi-

introduction – heading for sustainability 23

Figure 2 A shift towards self-regulation. In
traditional regulation, often called a Command Traditional Self
and Control Culture (left), the policy level Regulation Regulation
(authorities) monitors the environment and is
the main determinant for industrial adaptation.
In a self-regulatory situation (right) sometimes
called a Negotiation Culture, industry responds Industry Response Industry Response
directly to the environment in agreement with
the authorities.
Suppliers/ Suppliers/
Information customers Policy & Information customers Policy &
Green consumers Green consumers
& Response Stakeholders regulation & Response Stakeholders regulation
NGOs NGOs

Environment Information Environment Information

installations, singles out the potentially most dangerous for Highlighting the word “choice” in the title means focusing on
special attention and leads to major reforms of environmental implementation and the widest possible societal involvement
authorities in many of the member states, due to the integrated to make the vision come true. The approach to problem identi-
approach. The directive should have been implemented by the fication and solving is strategic and very process-conscious.
end of 1999, and although problems occurred for some coun- The EU is governed by legislation. Regulations and direc-
tries, leading to delays in the transposition and implementation, tives, and the subsequent national legislation based on these
the directive is now in use in all countries. There is no reason to legal instruments, will continue to be the base for the actions
believe, that this key piece of EU regulation on industries will taken to implement the objectives of the 6th EAP. A strategic
be revised profoundly, if at all, in the foreseeable future. approach and focus on implementation and stakeholder in-
Later in 1996 the EU Council adopted the directive on con- volvement leads to cooperative and participatory practices at
trol of major accident hazards involving dangerous substances the national level, where all implementation of EU legislation
– (labelled the Seveso II Directive) and in March 1997 the takes place. Member states, already have wide-spread and var-
Council adopted Directive 97/11/EC, amending and up-dating ied experiences of these approaches.
the Environmental Impact Assessment, EIA Directive, first is- While the 6th EAP points out new themes, new approaches
sued in 1985. will also apply to the implementation of regulations like the
With these four pieces of EU legislation during the late 90s, IPPC Directive on environmental licensing and other regu-
the broader framework and process-oriented regulation of in- lations from the 1990’s. For the industrial sector the call for
dustrial activity is updated and put in place. We will still see in increased stakeholder involvement in the implementation of
the near future a new, more content- or quality-oriented, EU environmental regulations creates opportunities for more in-
regulation for the industrial sector. This will be a major reshuf- fluence as a group and as individual companies. This involve-
fle of the regulation on chemicals, REACH, the Registration, ment is not new for the European industrial sector, which has
Evaluation and Authorisation of CHemicals. This is in line long pledged responsibility in various groupings for the im-
with the priorities of the 1992 EU 5th Environmental Action pact their operations have on the environment. At the same
Programme (EAP) Towards Sustainability, where industry as time they lobby the European Commission to reduce the re-
a sector of the economy was one of the selected target groups quirements in proposed environmental regulations. This is not
for EU intervention. The programme was revised in 1996 and contradictory. It only reflects the divisions within environmen-
prolonged until 2001. tal regulations between private and public interests.
In most of the EU-15 member countries, different kinds of
Public-private Agreements agreements between industry and government have been tested,
EU’s 6th Environmental Action Programme, Environment and some of these agreements are still active and in force. The
2010: Our Future, Our Choice was launched in July 2002 and Netherlands has developed the most elaborated use of these
covers the period till 2010. This EAP has broader, more global agreements or covenants. The principle behind the agreement
and more quality-based environmental issues as priority areas. system is that the government renounces unilateral regulations

24 introduction – heading for sustainability

and instead regulates these same issues in an agreement for as needed. How, and at what level of cost, for different types of re-
long as the agreement is implemented by the industry. The sources is needed to make the PPP work is very much debated
agreements have become attractive also for governments as politically and within the academic world. While this discussion
input-oriented environmental regulations have developed and is ongoing, green taxes have been around for at least 30 years,
more resources and a wider range of qualifications are needed and are a well-established element of national environmental
on the government side for licensing and for enforcement. The policy-making. They have also proved to be viable. We will ad-
experiences with the environmental agreements, which are dress these economic instruments in Chapters 10 and 11.
normally not legally binding for industry, are mixed. Under In recent years green taxes are increasingly seen as a
the 6th EAP it will be necessary to look for alternatives, or popular way to get some of the tax burden off the shoulders
at least supplementary ways, of of working people without com-
industry involvement. One pos-
“the broader framework and process-oriented promising the tax-financed social
sible option is to try to develop welfare system in the Scandi-
and exploit a possible synergy regulation of industrial activity is now updated navian – and increasingly also
between the IPPC licensing and and put in place.” in other West European – social
the EMAS Scheme and/or the welfare states.
ISO 14001 standard and expand that also to other fields of The framework is set at the EU level in key areas while the
environmental regulation. We will address this further below, economic instruments can only be formulated at the member
primarily in Chapters 3 and 4. state level, where all implementation has to take place anyway.
As clearly stated in the 6th EAP, stakeholder involve-
National legislation ment should be at the centre of implementation. Ever since
We shall close this initial “snapshot” of the current status of the Brundtland Commission Report in 1987 there has been
environmental regulations and environmental management a move towards making industry (and other economic actors
and the role of EMS for industry by pointing to the paramount with adverse impact on the environment) more accountable to
importance of the national implementation of the EU-regula- the environment for the impact of their activities. This is also
tion. Implementation is – and has always been – in the hands understood in a wider sense, which is necessary in the perspec-
of the member states in all EU regulation areas. Many of the tive of sustainable production. This request has been taken up
directives (IPPC, EIA and many others) are so-called mini- by industry, which at the same time has been asking for more
mum directives, which means, that they provide a “floor”, be- flexibility and room to manoeuvre. If this request for wider in-
low which the member states cannot go. At the same time they volvement is not met and does not lead to tangible evidence of
do not have any “ceiling”, i.e. the member states can go further being on the track for (more) sustainable production, the ques-
than what is prescribed in the directive if they so wish. We will tion must be raised about whether we have come into a stage
address the implementation and enforcement of EU environ- of aftermath of the “environmental 1990’s”. This could be the
mental policies in Chapters 5 and 6. return to top-down, rationalist pollution control with business
Further, a very important part of the market-based instru- and other economic actors waiting for the control to arrive and
ments listed in Table 1, is completely absent in the EU regulation in the meantime doing as little as possible.
on the environment. We are talking here of the set of economic In Figure 2 we summarize ways how to consider the rela-
instruments, which are needed to make the Polluter Pays Prin- tionship between industry, regulation and environmental ac-
ciple (PPP) take effect. The Polluter Pays Principle is a core en- countability in a dynamic perspective. We will keep this view
vironmental policy principle, promoted by many stakeholders, of the over-all development in mind throughout the text as a
including (part of) business (e.g. Schmidheiney and the World sort of compass to help understand the possible wider implica-
Business Council, WBCSD), academics (e.g. von Weizsäcker tions of what we see and analyse. This model can be used for
1992 and 1994), as well as a number of economists. the evaluation of the direction the interrelationship between
Economic instruments are popular in particular with econo- industry, regulation and environmental accountability has tak-
mists belonging to the neo-classical school, for whom the mar- en in a particular country.
ket as a self-regulating, economic institution, is the core. To be
taken into account on the market, all costs must be included Børge Klemmensen
in the price. This is not automatically the case for a number of Roskilde University Centre, Denmark
natural resources, as no general ownership can be claimed. Po-
litical intervention to levy the use of these resources is therefore

introduction – heading for sustainability 25

 Internet Resources
Børge Klemmensen is an Associ-
ICC Business Charter for Sustainable Development
ate Professor at the Department of
Environmental, Social and Spatial http://www.iccwbo.org/home/environment/charter.asp
Change (ENSPAC), at Roskilde Uni-
versity Centre, Denmark. http:// ILO International Labour Organization
www.ruc.dk/enspac_en/ http://www.ilo.org/global/lang--en/index.htm
Børge Klemmensen has been
involved in research and teaching
The Eco-Management and Audit Scheme (EMAS)
on environmental issues since the
1970’s. He conducted a number http://ec.europa.eu/environment/emas/index_en.htm
of projects in the CEE-Countries in continuation of the
1989-changes in Europe including TEMPUS Projects International Organization for Standardization (ISO)
in Poland and Latvia and research projects on Green
http://www.iso.org/iso/en/ISOOnline.frontpage
Industrial Restructuring and Sectorial Studies on Clean
Technology and Technology Policy. Current research
interest is on ’soft’ policy requests like environmental ISO 9000-14000 Management Systems
accountability and corporate social responsibility. http://www.iso.org/iso/en/iso9000-14000/index.html
Boerge serves on Project Evaluation Panels for EU-re-
search Programmes and for Institutional Restructuring ISO Technical Committee 207 (ISO/TC207) on Environmental
Programmes, including the TEMPUS Programme and at Management
CBSS. He was a member of the founding committee for
his university, Roskilde University Centre, RUC, in the http://www.tc207.org/
early 70’s and has been connected to RUC since. Recent
years he has had part of his time in the private sector. INEM, the International Network for Environmental
Management
bklemme@ruc.dk
http://www.inem.org/

IPPC Directive 96/61/EC concerning Integrated Pollution

Abbreviations Prevention and Control

BS British Standard http://ec.europa.eu/environment/ippc/index.htm

EAP Environmental Action Programme
EIA Directive (97/11/EC) on Environmental Impact
EIA Environmental Impact Assessment
Assessment
EMS Environmental Management Systems
EMAS Environmental Management and Auditing System http://ec.europa.eu/environment/eia/home.htm
ICC International Chamber of Commerce
Seveso II Directive 96/82/EC on Chemical Accidents -
ILO International Labour Organisation
Prevention, Preparedness and Response
IPPC Integrated Pollution Prevention and Control
ISO International Organisation for Standardization http://ec.europa.eu/environment/seveso/index.htm
LCA Life Cycle Assessment
REACH Directive 2006/121/EC on Registration, Evaluation
PPP Polluter Pays Principle
and Authorisation of Chemicals
REACH Registration, Evaluation and Authorisation of
CHemicals http://ec.europa.eu/environment/chemicals/reach/reach_intro.
SD Sustainable Development htm
TQM Total Quality Management
The Sixth Environment Action Programme of the European
WBC World Business Council
Community 2002-2012 Environment 2010: Our Future, Our
Choice
http://ec.europa.eu/environment/newprg/index.htm

26
 Phases in
Environmental Protection 1
1.1 The Road Towards Regulation cific areas or specific animals, such as deer or bison, have been
1.1.1 The Conflict Between Nature and Economy protected by king and nobilities since medieval times. Agree-
Economic activities generate pressures on the environment. ments in villages and local societies in general on how to use
This is true for activities as diverse as millennia-old agri- a common resource are age-old. It is interesting to note that
culture and hunting and modern industrial production. Eco- uncontrolled lumbering in the early 18th century in Saxonia
nomic activities with severe environmental consequences – today’s Germany – started the thinking about long-term use
include lumbering, causing deforestation of large areas, of resources and resulted in the first publications on strategies
mining, causing disastrous pollution of surroundings, and for sustainable development.
more recently industrial production using nearby waters as
recipients of pollutants. The environmental consequences
have been serious not only for Nature and biodiversity but
In this Chapter
also for the society and its people. But still, much of this has
passed unchallenged over history. In short, someone had to 1. The Road Towards Regulation.
pay for a destroyed environment, in money or in severely The Conflict Between Nature and Economy.
reduced wellbeing, reduced health or even life. In general The Environment Enters the Political Agenda.
Control of Industrial Chemicals.
it has been the victim who paid, not those who caused it.
Smoke and Wastewater.
As the price increased, the authorities stepped in to control The Cost of Pollution.
the situation and protect its citizens. The first environmental 2. The Conflict Between Growth and
legislation is often considered to be the British Alkali Act Environmental Regulation.
from 1863. However, more wide-reaching environmental The Public-Private Dichotomy.
regulation had to wait another 100 years, to the 1960’s, as The Origin of Regulation.
From Control to Prevention.
we will see below.
Overcoming the Dilemma – the Win-Win Option.
The other side of uncontrolled exploitation of the environ- 3. Innovation and Technological Change.
ment is the use of resources. Fishing, hunting, mining, forest- The Eco-Efficiency Credo – Environment by
ing were possible for everyone as seas and forests were seen Competitiveness.
as commons. Uncontrolled use again had disastrous conse- The EU Solution – Decoupling.
The UNEP Solution – Cleaner Production.
quences. The complete eradication of a common resource has
4. The Fourth Era of Environmentalism – Sustainability.
happened from early on, and many times. The extinction of The Climate Issue.
the European megafauna was due to uncontrolled hunting. The Sustainable Production and Consumption.
disappearance of fish species, for instance wild salmon in Bal- 5. Managing Hazardous Production Facilities.
tic rivers, is another example. Responsible Care.
Not everyone saw this eradication of resources without act- The Seveso Directive.
ing. The control of common resources has a long history. Spe-

1 phases in environmental protection 27

 Thus from the very beginning we have the two sides of the
relationship between man and nature: Nature, that is the en-
vironment, as a resource and as a recipient of our waste. Man
and his/her activities has a sensitive middle place in this cycle
of material flows, a position that needs to be well understood
and carefully regulated not to be destructive.

1.1.2 The Environment Enters the Political Agenda

In the 1950’s, 1960’s and 1970’s alarms on an ongoing and
accelerated serious impacts on the environment reached the
general public. Well-known whistle blowers include Rachel
Carson’s publication Silent Spring from 1962, and the Lim-
its to Growth report of Club of Rome in 1972, as well as A
Blueprint for Survival as an ecological manifesto and others. Figure 1.1 Environmental disasters paved the way for regula-
As a consequence, pro­tec­tion of the environment entered the tions. In the 1960’s it became obvious that biocides and industrial
political agenda. The results were regulations decided by the pollutants could cause great harm to nature and ecosystems. The
white-tailed eagle almost became extinct in the Baltic Sea region.
parliaments and the creation of institutions, including envi-
Books such as Silent Spring became whistleblowers and regulations
ronmental protection agencies and ministries of environment, of environmental impact entered the political arena. (Photo: Björn
with authority to control them. Helander, © Svenska naturskyddsföreningen)
The modern area of regulation, however, did not start with
regulating pollution. It was motivated by the discovery that as culprits. When the environmental effects of the chemicals
many of the chemicals that were legally produced and sold were discovered, industry protested and had to be convinced
with the intention to control pests and weeds, were harmful to about their guilt. The traces leading to the final proof included
many more than they intended to control, entire ecosystems. dead white-tailed eagles in Sweden, and cats in Japan.
Rachel Carson’s book mostly (although not entirely) dealt Later the freons, CFCs, were added to this list of harm-
with the indiscriminate use of biocides. The regulations in the ful industrial chemicals. This time the detective story featured
1960’s and 1970’s started by the control of, or even a complete American, British and Dutch researchers in Antarctica discov-
ban on, mercury-containing anti-moulding substances, such as ering the increased UV radiation connected to the ozone hole
methyl mercury, and the insecticide DDT. Soon after several and the ozone-destroying capacity of chlorine and the CFCs.
other biocides followed. Requests were voiced for much better control and analysis
Of course industries, which produced and sold these sub- of chemicals used in society. Among the first concrete action
stances, protested. They lost their markets for a profitable prod- was a complete ban on PCB in many countries. PCB was up
uct. Quite a few users of biocides were also among the protest- to then a very extensively used chemical, appreciated for its
ers. The alternative means to control pests and weeds were less stability and un-reactivity, exactly the same properties which
efficient and less comfortable. A conflict between economic made it harmful in the environment. PCB is still present in
interests and environmental concerns was again obvious. large quantities in infrastructure, and will leak out from build-
ings and equipment for many decades ahead. A second step
1.1.3 Control of Industrial Chemicals was the gradual ban on CFC which led to the Montreal pro-
The next alarms dealt with common chemicals often used in tocol in 1987. Today, in the fall of 2006, we face the imple-
large amounts, which turned out to be extremely toxic, persist- mentation of the European Union REACH Regulation. This
ent and bioaccumulating. Best known in this group may be the directive has been slightly curtailed after forceful efforts from
PCBs, but it included many other chlorinated compounds as the industrial side to limit their responsibilities to analyse and
well as many mercury-containing chemicals. document the properties of the chemicals they are using, and
These chemicals were often difficult to identify and it was be liable for their negative environmental impacts.
equally hard to prove that they were harmful. The discoveries
of PCB in the biota of the Stockholm archipelago or methyl 1.1.4 Smoke and Wastewater
mercury in Minamata Bay in Japan, and their effects, are de- That reeking smokestacks and fouled wastewater were harm-
tective stories. Environmental chemists are the detectives and ful to nature was much less obvious than we think. It took a
heroes, while the industrial companies have a less glorious role long time to find out, and society was slow to limit it. The very

28 phases in environmental protection 1

early regulations in this area were British, not surprisingly The economic side of pollution can also be illustrated by
considering that England is the origin of industrialism. They remediation costs. As an example, Swedish EPA today uses
were made to protect people’s health, not the environment. In- several tens of million euros annually to lime acidified wa-
dustries and cities as such became places with terrible smells, ters. The remediation of polluted soil is even more costly. So-
terrible air and polluted soil. The so-called pits, a sort of bad called brownfields, polluted industrial areas, are increasingly
smelling garbage dumps, were outlawed. The handling of wa- remediated, since they often have a central place in cities and
ter, toilet waste, and solid waste were slowly set under rules. are attractive for other uses. But it is expensive. The largest
One of the origins of the modern area of emission control American foundation, the Superfund, several hundreds of bil-
is the Swedish acid rain debate. It began with consistent ar- lions dollars’ worth, was created by industry to take care of
gumentation by researchers that sulphur in oil was the origin such costs. In Europe the cost for remediation of brownfields
of acidifying sulphur oxides in the rain. By 1967 it had led to is mostly met by public funding as the company that caused
an intense debate in the general media and the parliament on the pollution is often not there any more and, if so, usually had
the causes of acidification and a will to do something about a permit or operated within the then effective environmental
it. A reason that this became a good start was that regulation regulations and therefore is not to blame. This in turn means no
was rather easy. The sulphur content for all oil to be used for liability and no obligation to share the costs of the remediation.
heating in Stockholm’s residential areas was limited already If private actors participate in the cost-sharing, it’s more of-
from 1968. The acid rain debate was one of the reasons for ten the project developer, the buyer of a former industrial site,
establishing the Environmental Protection Agency, EPA, in which he wants to develop into office facilities or housing.
Sweden in 1969. In parallel there was a disastrous acidifica- Still, it is in general the victim who pays for environmental
tion of the forests in the so-called black triangle, the forested degradation in our time. The Polluter Pays Principle is still on
area where Poland, Czechoslovakia and DDR met, combated standby, waiting for effective implementation.
much later.
The regulation of acid rain continued with efforts to limit
1.2 The Conflict Between Growth
far away sources from where a major part of airborne sulphur
and Environmental Regulation
oxides had their origin. For the case of Sweden, British and
German industry was a main source. It took ten years for a 1.2.1 The Public-Private Dichotomy
general acceptance of the role of sulphur in fossil fuels, espe- As we have seen above, the conflict between nature and
cially coal, and led in 1979 to the Convention of Long Range economy is as old as the production of commodities on some
Transboundary Pollution and successful international coop- scale for the market. Gradually the general public have turned
eration to limit sulphur exhausts. against large negative impacts from economic growth on the
environment, and support for tougher and more comprehen-
1.1.5 The Cost of Pollution sive regulation has become stronger and stronger. When the re-
The acid rain story may also illustrate the costs that other part- quirement of a certain pollution limit is set, and it is met solely
ners have for pollution caused by industry. Acid rain results in by abatement measures – so-called end-of-pipe solutions – it
acidified water and soil. The more sensitive areas in Norway means additional cost for the company. We have then a pure
and Sweden have tens of thousands of lakes and rivers devoid conflict between a private economic interest – the profit of the
of higher life because of acid rain. No fish can survive at low company – and a public interest, a clean environment. Thus
enough pH values. Thousands of km2 of forests have decreased even today at the core of the topic of environmental regulation
productivity because of acidification of soil. In cities polluted air lies a tension or conflict between doing business for profit and
is harmful foremost for children, but also for adults, and leads the protection of the environment and natural resources [Nor-
to increased lung and breathing disorders. Material damages are berg-Bohm, OECD 2001]. That very tension is what brings in
also important. Corrosion on metal surfaces, not least cars, is the state and its politics. The state is where exertion of political
great, and the destruction of stone especially calcite structures power resides (also) in a market economy, i.e. it has the role
used for many cultural objects is great. The total costs for acid of mediator of this tension. Political tools or instruments are
rain in Europe was estimated, in a 1996 study, to be 91 billion designed to regulate, and influence management to minimise
euros annually, including costs of human health, damage on ma- the environmental impact from its business activities.
terial structure and decreased crops. The costs for abatement of The role of politics in the regulation of private economic
sulphur emission were then estimated to 73 billion euros, that is, activity in a liberal market economy is particularly difficult. It
a positive balance of almost 20 billion euros annually. means crossing the conceptual “border line” between public

1 phases in environmental protection 29

and private, stirring up ideological stands and attacking what
Box 1.1 A Philosophical Root for Regulation of
business may perceive as “well-deserved privileges”.
Business
This type of intervention is intermingling with property
rights, which in most countries is secured by the constitu-
A philosophical root of
tion and considered a prerequisite to all private economic
regulations originates in
activity. The more ideological formulation is “freedom of the late 1700’s. Jeremy
man to the extent, he is not harming the freedom of others” Bentham’s “freedom of
[Bentham, 1789; J.S. Mill, 1859]. The market economy ema- man to the extent, he
nates from and refers in more direct sense to the early nine- is not harming the free-
dom of others”, and Im-
teenth century economic creed of unregulated “laissez faire”
manuel Kant’s “act so
capitalism [Heywood 1997, p 41]. It is still based on the same that you could make it
principle division of private economic interest and a public or into a general rule” mo-
political sphere for the handling of common interests, includ- tivates protection of so-
ing the protection of private interests and private property. The ciety and individual wel-
Figure 1.2 Jeremy Bentham,
discussion about demands on the CEE countries to put legisla- fare. Human population
1748-1832. (Engraving by
was then not so large
tion in place, securing (foreign) private investments as a pre- W.H. Worthington, Courtesy:
that protecting nature
condition for getting a market economy under way, underlines National Portrait Gallery)
was considered.
the relevance of this for today.

1.2.2 The Origin of Regulation

In a societal – and now more and more global – context of ated from certain, more “fundamentalist” environmental per-
market economy domination, the freedom to pursue one’s own spectives, that is a defeatist and untenable position. It makes
economic interests is seen as a guarantee for continued eco- regulations support societal standstill and backwardness.
nomic growth. This in turn leads to a higher impact on the And it means a “suicidal” burden of control and bureaucracy
environment and increased resource use. Regulation became that nobody is willing to fund. Are there ways to untie this
necessary to protect the public interest, and often to control deadlock?
direct threats to public health and environment.
The regulations to protect the environment, were and are, 1.2.3 From Control to Prevention
however, generally seen as putting a brake on, or creating ob- The principal relation between private business and politics re-
stacles to economic growth. It may even risk, nationally and lo- mains. There will still be a strong element of control and con-
cally the forcing of companies to close or lay-off workers. The tainment of environmentally damaging output from industrial
principal tension or conflict between business and the environ- and other economic activities. Still, gradually a shift in focus
ment turns into a historical conflict, not only between business in relation to dealing with – and regulating – environmental
and the environment, but, because the creation of wealth ends issues has developed in many countries. The shift is from the
up in private hands, also between economic growth as such output-side to the input-side of industrial production. Instead
and the environment. This position of being in principle and of fighting with and trying to contain ever-growing amounts of
historically adverse to growth, progress and new opportunities waste, wastewater and toxic exhaust, the focus was turned to
places environmental regulation on the defensive. investigating the options of avoiding the problems in the first
Even worse, this very principal position or role for envi- place. The focus shifted from control to prevention, from end-
ronmental politics and regulation as control and containment of-pipe to the source.
of the negative impact of business activities on the environ- This took industry into the “third era of corporate envi-
ment leads structurally, to “containment” of environmental ronmentalism” [Fraenkel, 1998]. All of a sudden the win-win
politics and regulation itself. Regulation is tied up, or locked option was at hand, i.e. the possibility that business and the
up, in a position of doing reactive control measures to mini- environment can both benefit from changes in technology, raw
mize upcoming negative impact from business activities on materials and/or auxiliary materials, regardless of whether these
the environment. It’s a position for politics and regulation changes take place solely on the initiative of management or to
of a permanent defensive stand and being placed in a role comply with regulations. The first enterprise to make that shift
of being constantly understood as setting up restrictions for and getting the win-win-benefits, even substantial economic
growth and prosperity. However positive that might be evalu- benefits, was the American company 3M, launching as early as

30 phases in environmental protection 1

1975 their now famous Pollution Prevention Pays-programme.
Box 1.2 Pollution Prevention Pays
They used the same three PPP, which is normally used to refer
to the Polluter Pays Principle. This may contain the 3M-un-
The 3M, a worldwide technology company, in 1975
derstanding – and results – but it first of all points back at the launched the concept Pollution Prevention Pays, also
control and containment-perspective, elaborated above. The referred to as the 3P.
initiative was followed by some of the chemical multi-nation-
als with Dow Chemicals Co as another well-known example. Philosophy of the 3P programme:
The 3M results of very substantial and documented pollution • It is possible to reduce environmental impact and
still increase financial payoffs, derived from the use
reductions and equally considerable cost savings paved the
of less raw materials and resources.
way for the pollution prevention drive. • It is, in the long run, cheaper to prevent than to
minimize emissions.
1.2.4 Overcoming the Dilemma – the Win-Win Option • Anticipating regulatory initiatives that could be
The potential seem enormous – and new examples are fre- expected to be imposed on the companies in the
future, lowers costs, since it is cheaper for a com-
quently surfacing all over the industrialized world [Weizäcker
pany to develop a technology in line with the in-
et al., 1997], also, since the turning point in 1990-1991, often vestment cycle of the company.
in the CEE countries. Being quite well established in a particu- • Developing technologies before they are manda-
lar company, the easy targets – phrased as “picking the low- tory could actually improve competitiveness.
hanging fruits” – were reached. It is getting harder to prove
the pay-back of the prevention initiatives taken, especially dif- Source: 3M Worldwide, 2004.
ficult with the very short pay-back periods of 2-4 years, which
most corporate investment decisions are based upon. The key
problem for the source-oriented win-win concept is that it is
based on savings which will have to be quite substantial to changes”, i.e. more profound changes as opposed to “incre-
return an investment within a short span of time, although the mental changes” [Clayton et al., 1999].
installation might go on delivering the benefits for years on.
There is little or no room for the long-term perspective on
1.3 Innovation and Technological Change
environmentally oriented investments – and return – in most
private company’s decision making. 1.3.1 The Eco-Efficiency Credo
This issue on pay back and – more generally – the influence – Environment by Competitiveness
of environmental protection measures on company competi- In general, innovation and technological change represents a
tiveness was addressed by Porter and Van der Linde (1995), more dynamic approach to pollution prevention and protec-
making the case for what they called the double dividend, i.e. tion of the environment from the corporate side, and indeed
a win for both the environment and for competitiveness. The from academia and regulators alike, gradually gaining mo-
point made by these authors was that the potential of envi- mentum over the 1980’s and continuing to do even more so
ronmental regulations increased competitiveness, while the in the 1990’s and into the new millennium. The 1992 Global
established wisdom said exactly the opposite – tightened en- Environmental Summit in Rio de Janeiro asked its Secre-
vironmental regulations meant economic burdens and thereby tary General Maurice Strong to request the Swiss billionaire
made industry less competitive. We shall return to the issue of and industrialist, Stephan Schmidheiny, to write a book, ti-
regulation further below. In relation to industry, the point for tled Changing Course – A Global Business Perspective on
the double dividend was innovation, including technical inno- Development and the Environment. The book was published
vation, which would improve productivity of the resources al- just after the summit in 1992. It was written on behalf of the
located, named innovation offsets. This could influence – and Business Council for Sustainable Development, BCSD (af-
enhance – the production output, reduce downtime and save ter mergers the World Business Council for Sustainable De-
material, reduce energy consumption etc. That is, it covers the velopment, WBCSD). Eco-Efficiency was the key concept
same issues as the source oriented savings in the win-win con- launched in this book for business’ involvement in protecting
cept. It is the need for innovation that is added and thereby the environment and – ultimately – embarking on a course set
a more comprehensive and strategic response from manage- for sustainability. The concept was further elaborated upon at
ment than the “first generation” of win-win. What is added on the first eco-efficiency Workshop in Antwerpen in 1993. The
is what in the innovation-oriented writings is called “radical core of the concept is delivering competitively priced goods

1 phases in environmental protection 31

and services while progressively reducing ecological impacts 1.3.2 The EU Solution – Decoupling
and resource intensity. EU has linked the eco-efficiency concept with the Decoupling
It is clear, that eco-efficiency focuses on the economic side concept, based on a decision at the European Council (the EU
of the “equation” while putting that in a perspective of deliver- heads of states) endorsing a strategy for sustainable develop-
ing benefits for the environment. Including the word progres- ment by decoupling economic growth from use of resources.
sively is a pledge for making these benefits continuous and In continuation, the EU-commission links the two concepts as
thereby also increasing or accumulating, i.e. steadily reducing a combined way of assessing the environmental performance
the negative impact of industrial activities on the environment of European industry.
and resources. The eco-efficiency concept has had tremendous For WBCSD, only growth is thinkable, and it becomes
influence on corporate and other business thinking acting in clear that the membership of the organisation is made up of
relation to environment and sustainable development. It takes some 160 of the world’s biggest multinational companies. At
its departure in the inevitable fact for business, at least me- the core of the eco-efficiency concept is embedded a drive for,
dium term if not every year, of a positive financial “bottom or a destined concentration and centralisation of market influ-
line”, which makes the environmental benefits conditional ence, and economic power in the world market, and thereby
upon company competitiveness and thereby economic viabil- huge potentials for wider global industrial restructuring. The
ity. It makes “no fuss” about the limits to its environmental WBCSD members will, of course, consider themselves as on
credo. The strength in this approach to the environment is its the winning side in this restructuring. And the resulting envi-
outright compatibility with core business thinking and a clear ronmental benefits have to be delivered by or via this restruc-
and openly stated stance in the discussion on growth and the turing, which is inherent in, and therefore an ongoing thing
environment. under market economic conditions. It should be underlined,

Box 1.3 Approaches to Resource-efficient Industrial Production

Eco-Efficiency Cleaner Production

Eco-efficiency is a concept developed by the World Busi- The concept of Cleaner Production was developed by The
ness Council for Sustainable Development (WBCSD) in United Nations Environment Program (UNEP) in 1989.
1992.
Definition:
Objectives: • “The continuous application of an integrated preven-
• To combine the realization of economic and environ- tive environmental strategy applied to processes, prod-
mental objectives, by focusing on producing best pos- ucts and services to increase eco-efficiency and reduce
sible products, in terms of functionality and quality, risks to humans and the environment”.
with the least possible materials, thereby preventing
unnecessary generation of waste. Objectives:
• To reach a level of resource intensity which equals a • To prevent pollution.
sustainable production, i.e. not exceeding the carry- • To reduce the environmental impact of each stage in
ing capacity of nature. the lives of products, including the disposal stage.
• To make closed circular production processes instead
Means: of linear, so that ideally no waste is generated without
• Prevention instead of end-of-pipe solutions. being reused in the cycle. (The ideal is the eco-systems
• Increasing resource-efficiency in production and us- of nature in which even the waste is an important fac-
age, by technological innovation or by building net- tor, since it the condition for further production, as the
works with shared resources. waste is reused in another cycle.)
• Recycling of waste, by using waste for raw materials
from other industries. Means:
• Alternative distribution methods, e.g. leasing in stead • Minimizing input.
of selling, with the intention to improve quality and du- • Replacing toxic chemicals with less toxic substances.
rability of products and to make products recyclable. • Changing production processes.
• Reuse and recycling.

Sources: WBCSD, 2004a; WBCSD, 2004b. Source: BSD Global, 2004.

32 phases in environmental protection 1

Table 1.1 Strategies for environmental improvements. Four strategies (out of many) are shown in the table. Several of them have developed
over the years, such as BAT originally Best Available (Cleaning) Technology used for abatement of pollution, which today stands for Best Avail-
able Technique in a more general sense. Pollution Prevention (also P2), Cleaner Production, CP and Zero Emissions are developing strongly.
The elements addressed by these strategies run from particular, such as end-of-pipe measures, to integrated. [Source: Baas, 1996 in Clayton et
al. 1999, p 15., Book 2 in this series]

Strategy Pollution
Best Available Prevention
Technique Cleaner and waste Cleaner
Elements BAT Technologies minimization Eco-Efficiency Production Zero Emission
Pollution control x
Prevention x x x x
Technological x x x x x x
Non-technological x x x x
Process oriented x x x x
Product oriented x x x x
Strategic management x x x x
Society oriented x x

that the WBCSD has documented a number of concrete cases SD was targeting industry on its home ground, predominantly
on environmental benefits from eco-efficiency projects in a USA and Europe, and focused here on the bigger companies.
number of the member companies e.g. Walking the Talk by But in projects in e.g. CEE-countries, they were also targeting
Schmidheiny, Holliday and Watts [Schmidheiny et al., 2002]. SMEs, as that is the dominant size for new, up-coming private
The book was published targeting the 2002 World Summit in companies in these countries, seen as crucial to the economic
Johannesburg. Just like – the then – BCSD and Schmidheiny’s development. UNEP focuses on the less developed part of the
first book, Changing Course, was published targeting the Earth world in accordance with its background and mission. In coop-
Summit in Rio in 1992. Timing is important. eration with UNEP UNIDO, the UN’s International Develop-
ment Organisation, established national CP Centres in quite a
1.3.3 The UNEP Solution – Cleaner Production few countries, including China, India and the Czech Republic.
UNEP, the UN Development Programme launched the concept The joint forces with the WBCSD could be seen as an effort
of Cleaner Production (CP) in 1989, i.e. a couple of years be- from UNEP to get more direct backing from the business com-
fore the launch of the eco-efficiency programme by the (then) munity in its work with industrialists in the target countries as
BCSD and after the report from the World Commission on En- well as achieving American and European business backing for
vironment and Development (Brundtland Commission) was UNEP itself. The lack of support of UNEP’s programmes was
published in 1987. Cleaner Production has the continuous ap- criticised by its US members in the UNEP’s governing body.
plication of an integrated, preventative environmental strategy In the 80’s, after starting to focus on limiting the impact on
on production processes, services and products for the benefit the environment at the source, other technology-related concepts
of man and nature as the core concern. CP puts environmental were introduced. First of these is the Cleaner Technology (CT)
benefits first, which is the key difference to the eco-efficiency concept today valid and active, first of all in Europe. The idea
concept. It is the same industry and the same production, ma- is here to focus on the production process and spot improve-
terial use, products and services they target. Many of the same ments at hand and then aim at altering a part of the processes.
practical steps and solutions, including awareness raising, This may concern, e.g., a machine or a cluster of machines and
training and communication, which are needed for bringing related processes, such as re-circulating cooling and rinsing
about the targeted outputs, are involved in both concepts. water, simplifying or avoiding completely an operation on the
UNEP declared in 1995 a joint effort with WBCSD on the material by combining them in one machine. The key differ-
promotion of the two concepts as they were seen as comple- ence to CP is the scope and the nature of the intervention and
mentary or as “two sides of the same coin”. They were target- the technological development aimed at.
ing different audiences, however, but that was in line with the The classification of the different technology oriented ini-
different role and background these organisations have. WBC- tiatives and concepts is summarised in Table 1.1.

1 phases in environmental protection 33

 1.4 The Fourth Era of Environmentalism
Box 1.4 Sustainable Production – Sustainability
and Consumption
1.4.1 The Climate Issue
The 1992 Earth Summit in Rio de Janeiro was a major event
From the Chairman’s summary report of the Oslo
Roundtable conference in 1995. and a major step forward for the protection of the environment,
nature and natural resources. The most important outcome
“Making the transition to sustainable production
and consumption patterns will require courage, de-
from a business and environmental management point of view
termination and a strong political will. Our final docu- was probably the endorsement of the notion of – or the concept
ment reflects the need to make progress. I would like of – sustainability itself. This meant first of all a commitment
to highlight the following priority areas: to run private business in a way that keeps it within the car-
rying capacity of the Globe, and doing so in a way that does
• First, sustainable production and consumption
not limit the opportunities for coming generations compared
will involve long-term structural change to our
economies and our lifestyles. Together we must to our living conditions [Brundtland Commission, 1987].
address the volumes, patterns and distribution of The second outcome of profound influence on private busi-
consumption. ness is the Convention on Climate Change in 1992, followed
by the Kyoto Protocol from December 1997 and the subse-
• Second, governments must take responsibility for quent international agreements and treaties on the climate
putting the necessary framework in place: ecologi-
cal tax reform is essential to reduce environmental
change issue. This sets limits on the combustion of fossil fuels
damage and stimulate employment. to reduce the discharge of CO2, and put constraints also on a
few other so-called “greenhouse-gases”.
• Third, governments and business should use their While the climate issue is allocated immense attention,
purchasing power to influence the overall pattern although the concrete results at the global level in terms of
of demand for goods and services through the
firm and accepted limitations are until now very limited, less
introduction of environmental strategies for pro-
curement. effort and resources are assigned to the issue of sustainability
and achieving sustainable production in all sectors. That
• Fourth, strengthened international cooperation is probably has to do with the very wideranging consequences
vital for fair and sustainable production and con- of sustainability in combination with the widespread un-
sumption on a global basis. We need to reverse the
certainty and confusion about what sustainability really
trend of declining aid flows, accelerate the transfer
of green technologies and establish trade prefer- means – to a company and to a sector. The very significant
ences for environmentally friendly goods and serv- amount of literature and discussions on the issue is therefore
ices from the developing world. not yet reflected in concrete and substantial initiatives that
are beyond the concepts of eco-efficiency, Decoupling and
• Fifth, business must bear its full share of the re- Cleaner Production mentioned above. They are seen as rep-
sponsibility for change: in future, all goods and
services should be made, used and disposed of
resenting the entrance to the fourth era of environmentalism,
within the limits of nature. and they are embracing more of the elements, characteris-
ing this fourth Era. This includes elements like Zero Waste
• And finally, people themselves are a force for posi- ambitions, Holistic/System thinking, Industrial Ecology and
tive change. They need practical tools that are at- Technology Transfer and Vision on Sustainability. This goes
tractive and cheap to enable them to live sustain-
hand in hand with or implies that environmental issues are
ably. In particular, citizens have a right to know the
environmental impact of the goods and services increasingly becoming an integrated part of corporate strate-
they consume.” gic management.

1.4.2 Sustainable Production and Consumption

A vision of Sustainable Production and Consumption was
agreed on at the Ministerial Round Table in Oslo in 1995. The
“add on” compared to CP and eco-efficiency is the compre-
Source: Berntsen, 1995.
hensiveness and the encompassing of the entire commercial
system and its interrelations.

34 phases in environmental protection 1

Figure 1.3 The World Summit on Sustainable Development (WSSD) in Johannesburg 2002. At the conference sustainable production and
consumption became a main topic, and was part of the Plan of Implementation, the main document from the final session, shown here. (Photo:
IISD/ENB Leila Mead)

The 2002 Earth Summit in Johannesburg confirmed the A decisive event in getting this issue on the agenda was the
commitment to sustainability, but did not add much to that part Bhopal catastrophe. The US Chemical Giant Union Carbide
of the global dialogue and mutual obligations. It seems, how- had placed a chemical factory in Bhopal in India, producing
ever, that it has boosted the activity on corporate Sustainable methyl isocyanate as an intermediate in a biocide production.
Development Reporting for the enterprises. It can be seen part- In December 1984 some 60,000 litres of this very dangerous
ly in relation to the Social Responsibility Reporting and partly compound was accidentally released into the air over the town,
as a continuation of the reporting in relation to an EMAS ver- causing immediate death of some 1,500 people and injuring
sion of EMS and the Green Accounting report, which is man- thousands more, including blinding a huge number of people.
datory in some EU-countries. It was a wake-up call regarding the risks and corporate negli-
gence, of the magnitude of what Pearl Harbor was for the US
in the Second World War. There had to be immediate and pro-
1.5 Managing Hazardous Production Facilities
found changes in corporate environmental practices and risk
1.5.1 Responsible Care management.
At the close of the section focusing on the business side – and The chemical industry reacted quickly with the Canadian
business side constraints – of the protection of the environ- Chemical Producers Organisation moving first and launching
ment, the Risk Management Issue related to hazardous pro- a Responsible Care programme, which is still in existence and
duction sites should be mentioned. It is an important issue, now comprises chemical industries in more than 40 countries,
first of all for people and neighbourhoods, often in third world including all major producers. The programme has been de-
countries, but sometimes also with a much more wide-ranging veloped and expanded and matters like the application of the
impact. It is a different type of issue compared to that of sus- precautionary principle to the chemical industry have been
tainable industrial development. Where the latter is dynamic, taken up in recent years. At the heart of the Responsible Care
process-oriented and revolving, hazardousness is a one-off, programme is still the risk management issue, which the Bho-
static event, even if it might have long-term effects. pal disaster exposed was lacking in 1984.

1 phases in environmental protection 35

 A key element of the programme is a Code of Practice,
Box 1.5 The Responsible Care Initiative
which in a few points, comprising all stages in the life cycle
of a chemical product, gives the directions and the type of pre-
The Guiding Principles of the paredness and precautions to be taken in relation to emergency
Responsible Care Programme situations, whether they occur during the production, during
Our industry creates products and services that make transportation or during the wholesaler/distributor’s handling
life better for people around the world — both today of the product. They require every facility to have detailed and
and tomorrow. The benefits of our industry are ac- elaborated instructions, procedures and emergency plans for all
companied by enduring commitments to Responsible stages. The protective aspect is in the forefront throughout the
Care® in the management of chemicals worldwide.
Code, including the relation to the neighbourhood with which
We will make continuous progress toward the vision
of no accidents, injuries or harm to the environment Community Awareness Programmes must be established.
and will publicly report our global health, safety and
environmental performance. We will lead our compa- 1.5.2 The Seveso Directive
nies in ethical ways that increasingly benefit society, However important these measures are, the Responsible Care
the economy and the environment while adhering to
programme is first and foremost a programme for manag-
the following principles:
ing and protecting against risks to people, society and nature
• To seek and incorporate public input regarding which poisonous and dangerous production can represent. As
our products and operations. mentioned before, the perspective is thereby different com-
• To provide chemicals that can be manufactured,
pared to the CP, Eco-Efficient and Sustainability programmes,
transported, used and disposed of safely. discussed above.
Problems with accidents in chemical factories, leading to
• To make health, safety, the environment and re-
dangerous discharges of chemical compounds or products had
source conservation critical considerations for all
new and existing products and processes. been experienced in Europe eight years earlier than the Bhopal
event. Here it was an accident in which extremely toxic dioxin
• To provide information on health or environmen-
was released from the Icmesa factory in the town of Seveso in
tal risks and pursue protective measures for em-
ployees, the public and other key stakeholders. Northern Italy. No deaths were recorded, at least not immedi-
ately, but many people were affected, and vegetables and ani-
• To work with customers, carriers, suppliers, dis-
mals destroyed. It led to the so-called Seveso Directive, issued
tributors and contractors to foster the safe use,
transport and disposal of chemicals. by the European Union in 1982, and therefore binding for all
member states. A revised version of the directive, the Seveso II
• To operate our facilities in a manner that protects
Directive, was issued in 1996.
the environment and the health and safety of our
employees and the public. The directive focuses on the chemical plant and its pre-
paredness in case of emergencies and has a number of pre-
• To support education and research on the health, cautionary measures to be observed. It also establishes limits
safety and environmental effects of our products
and processes.
to the amount of the most dangerous chemical products or
compounds at the site at any time. In Europe the Seveso ac-
• To work with others to resolve problems associ- cident led to a political intervention, setting compulsory or
ated with past handling and disposal practices.
mandatory standards for that type of hazardous installations.
• To lead in the development of responsible laws, In Canada and the US, the Responsible Care Programme and
regulations and standards that safeguard the com- its Code of Conduct continues to be an important instrument
munity, workplace and environment.
for the chemical industry. These are different approaches, and
• To practice Responsible Care® by encouraging represent a good set-off for taking a look at the historical de-
and assisting others to adhere to these principles velopment of environmental regulations.
and practices.

Source: American Chemistry Council, 2004.

36 phases in environmental protection 1

Study Questions Abbreviations
1. Give some examples of how an uncontrolled use of lim- BCSD Business Council for Sustainable Development
ited resources has led to disastrous consequences such as BSD Business and Sustainable Development
destruction of the resource in old times and the present. CEE Central and Eastern Europe
2. List a few early (around 1960’s) environmental impacts CFC Chloro Fluoro Carbon
and describe the first regulations implemented to deal CP Cleaner Production
with them. CT Cleaner Technology
3. Describe the shift from control of pollution to prevention DDR Deutsche Demokratische Republik (former East
and how it was motivated. Germany)
4. Explain the concept of the double dividend and how it EMAS Eco-Management and Audit Scheme
was interpreted in a business context EMS Environmental Management Systems
5. Describe the origin, content and use of the eco-efficiency EPA Environmental Protection Agency
concept. OECD Organisation for Economic Co-operation and
6. Describe the origin, content and use of the Cleaner Pro- Development
duction concept. PCB Polychlorinated biphenyls
7. Find out what decoupling means and how it can be measured. PPP Pollution Prevention Pays (more often Polluter Pays
8. What is the fourth era of environmentalism? Principle)
9. The Sustainable Consumption and Production concept REACH Registration, Evaluation and Authorisation of
was a key concern at the Johannesburg Conference. De- CHemicals
scribe its origin and what it stands for. UNEP United Nations Environment Programme
10. Risk management became a key issue after several serious UNIDO United Nations Industrial Development
industrial accidents. Explain what accidents and what Organization
measures were implemented to deal with each of them. WBCSD World Business Council for Sustainable
Development

Internet Resources
Pollution Prevention Pays programme of 3M
http://solutions.3m.com/wps/portal/3M/en_US/global/
sustainability/s/governance-systems/management-systems/
pollution-prevention-pays

World Business Council for Sustainable Development

http://www.wbcsd.ch/templates/TemplateWBCSD5/layout.
asp?MenuID=1

Industry Canada’s Business and Consumer Site on eco-

efficiency
http://strategis.ic.gc.ca/epic/site/ee-ee.nsf/en/Home

UNIDO’s Cleaner Production Homepage

http://www.unido.org/doc/4460

UNEP Division of Technology, Industry and Economics (DTIE)

Cleaner Production Activities
http://www.uneptie.org/pc/cp/home.htm

1 phases in environmental protection 37

The Eco-Management and Audit Scheme (EMAS)
http://ec.europa.eu/environment/emas/index_en.htm

Bhopal Information Centre

http://www.bhopal.com/

The Bhopal Medical Appeal

http://www.bhopal.org/whathappened.html

Seveso II Directive 96/82/EC on Chemical Accidents -

Prevention, Preparedness and Response
http://ec.europa.eu/environment/seveso/index.htm

Responsible Care® Programme

http://www.responsiblecare.org/

The BSD Global Guide: helping business to do better by

doing good
http://www.bsdglobal.com

38 phases in environmental protection 1

 Development of EU
Environmental Regulation 2
2.1 European Environmental Cooperation 2.1.2 The First Pieces of Legislation
2.1.1 The Origins The original European Economic Community (EEC) was
Today the European Union plays a major role in environmen- deeply rooted in the post Second Word War military-strategic
tal legislation in its member states. Many even consider this situation in Europe. Its creation should be seen as an effort to
a main reason for the existence of the Union: Environmen- reduce the risk of war caused by division of economic power
tal concerns do not stop at national borders and thus requires and weapons production. The so-called Common Market was
international cooperation. At its beginning in 1957 the origi- thus a peace project among its original six members Belgium,
nal constellation of states were, however, not at all concerned the Federal Republic of Germany, France, Italy, Luxembourg
with the environment. This was typical for the first post WWII and the Netherlands, all countries that had suffered from the
years. The early awareness of environmental impacts was about
neighbourhood problems, and focussed on health, or some lo-
cal nuisance upsetting people. What went beyond this, the no- In this Chapter
tion of “environmental problems” as a complex and inherent
issue in our societies, was not developed until the 1960’s. 1. European Environmental Cooperation
The Origins
In the US the start is dated to 1962, the year Rachel Car-
The First Pieces of Legislation
sons published her pioneering book, Silent Spring, document- The Paris Declaration
ing the environmental damage caused by early agricultural The First Environmental Action Programmes
chemicals. The late 60’s and early 70’s saw the first USA envi- A Formal Base for European Environmental
ronmental legislation starting with the National Environmen- Legislation
tal Policy Act in 1969. The establishment of the Federal Envi- 2. The European Union Environmental Policies
The Third and Fourth Environmental Action
ronmental Protection Agency in 1970 belongs to the legacy of Programmes
that book [Fraenkel, 1998]. In Europe environmental concerns The Single Market
were widespread and established by end of the 60’s [McCor- Towards Sustainability – the Fifth EAP
mick, 2001; Gouldson and Murphy, 1998]. Several countries Assessing the Fifth EAP
organised their governmental administrations to work with The Sixth EAP from 2002-2012
The Lisbon Agenda and the Strategy on Sus-
environmental protection around 1970. The Swedish Environ-
tainable Development
mental Protection Agency (EPA) and the corresponding unit at 3. EU Policies and the Surrounding World
the governmental office have been working since 1969. Poland EU and External Trade
created its Ministry for Territorial Management and Environ- EU Policies
mental Protection in 1972. But in most European countries EU in International Negotiations
The EU Enlargement to the East
such reforms came later. In Germany for example the corre-
sponding Ministry was not created until 1986.

2 development of eu environmental regulation 39

war. French-German hostilities had caused the major Euro- The tricky matter for EU in these early years of environ-
pean wars for more than two centuries. mental regulation was the lack of any formal authorization in
The EEC thus did not have a mandate for environmental the Treaty of Rome for the EC/EU to act on environmental
legislation, and the first pieces of legislation in the area had issues. Environmental regulation in the EU was then often
quite a different background and platform. The first legislation referring to the “sweep all”- clause in the Rome Treaty, Arti-
dealing with an environmental issue was a Euroatom directive cle 235. Another reference was to Article 100, which gave the
from 1959 on protection of employees and the general public Council the right to issue directives to bring contradicting leg-
from radiation. The next actions were two directives on vehi- islation in member states in line. Already then, therefore, the
cle emissions and noise in 1970 and in 1972. The Union was at reasoning was, that environmental regulation could be used
that time focusing on the creation of a larger common market, as a “hidden” protection against competition and therefore a
and the reason behind these first two pieces of legislation was barrier to free trade in the European market. The European
efforts to prevent Germany and France from making a tougher Court supported the right for the Council of Ministers to use
regulation of their own, which might have created problems Article 100 as the base for harmonizing environmental law in
for Italian and Dutch car producers. the interest of the common market. Article 100 in the Rome

Box 2.1 Principles of EU Environmental Regulation

The European Union Treaty adopted in Nice (article 174 er, there may be certain exceptions and special arrange-
EC) has listed the basic principels of EC legislation. They ments, in particular for transitional periods, provided
are summarised here and further disussed in the chapters. that they cause no significant distortion to international
trade and investment. Without prejudice to the applica-
The Principle of Prevention: tion of the provisions of the Treaties, this principle should
“The best environment policy consists in preventing the be stated explicitly and the arrangements for its applica-
creation of pollution or nuisances at source, rather than tion, including the exceptions thereto, should be defined
subsequently trying to counteract their effects. To this at Community level. Where exceptions are granted, the
end, technical progress must be conceived and devised need for the progressive elimination of regional imbalanc-
so as to take into account the concern for protection of es in the Community should also be taken into account.”
the environment and for the improvement of the quality (2nd EAP, already mentioned in the 1st EAP)
of life, at the lowest cost to the Community. This environ-
ment policy can and must go hand in hand with eco- The Subsidiarity Principle
nomic and social development, and also with technical “In each category of pollution, it is necessary to establish
progress.”(2nd EAP, but already menitoned in the 1st EA) the level of action (local, regional, national, Community,
international) best suited to the type of pollution and to
The Principle of Early Consideration of Possible Envi- the geographical zone to be protected. Actions likely to be
ronmental impacts: most effective at community level should be concentrated
“The effects on the environment of all the technical plan- at that level; priorities should be determined with special
ning and decision-making processes should be taken into care.” (2nd EAP, already mentioned in the 1st EAP, Title II)
account at the earliest possible stage. The environment
cannot be considered as an external medium which har- The Subsidiarity and Proportionality Principles
asses and assails man; it must rather be considered as “The subsidiarity principle is intended to ensure that de-
an essential factor in the organization and promotion of cisions are taken as closely as possible to the citizen and
human progress. It is therefore necessary to evaluate the that constant checks are made as to whether action at
effects on the quality of life and on the natural environ- Community level is justified in the light of the possibilities
ment of any measure that is adopted or contemplated at available at national, regional or local level. Specifically, it
national or Community level and is liable to affect these is the principle whereby the Union does not take action
factors.” (2nd EAP, but expressed already in the 1st EAP. This (except in the areas which fall within its exclusive com-
principle later developd into the Environmental Impact As- petence) unless it is more effective than action taken at
sessment, EIA, Directive)) national, regional or local level. It is closely bound up with
the principles of proportionality and necessity, which re-
The Polluter Pays Principle: quire that any action by the Union should not go beyond
“The cost of preventing and eliminating nuisances must, what is necessary to achieve the objectives of the Treaty.
as a matter of principle, be borne by the polluter. Howev- (Article 5 in the EU Treaty – referred to in EUROPA 2004)

40 development of eu environmental regulation 2

Treaty thus remained as the platform for environmental legisla- Commissions DG III to work on environmental issues, a Com-
tion up to 1981. mittee on the Environment in the European Parliament and a
decision to ask the Commission to draft an EC Environmental
2.1.3 The Paris Declaration Action Programme (EAP) [McCormick, 2001].
In the wake of the 1972 UN-Stockholm Conference on the Hu- The Paris declaration thus constitutes the birth of a Euro-
man Environment, the European Community Summit in Paris pean-wide environmental policy.
in October 1972, also including the three coming new member
states, Denmark, Ireland and the UK, agreed on a statement 2.1.4 The First Environmental Action Programmes
which took cooperation between the member states beyond the This first EC-EAP was ready and endorsed in November 1973
economic and political spheres. It said: and the second EAP drawn up and adopted in 1977.
“Economic expansion should be accompanied by environ- The problems with the Treaty’s legal authorization to actu-
mental protection so as to achieve a genuine improvement of ally turn the EAP into legislation persisted. A number of prin-
the quality of life.” ciples, still central to EU environmental policy, were reformu-
This statement recognises that the main aim of the EC lated from the first EAP and made more precise and operable,
– economic development – was not an end in itself and that a version which has been standing ever since. Among these
the protection of the environment should be given more at- were the principle of early consideration of possible environ-
tention. The Commission was therefore asked to develop an mental impact to make prevention easier (a forerunner for the
environmental policy for the Community. In practical terms, Environmental Impact Assessment, EIA, directive), the Pol-
the decision led to the establishment of a minor unit within the luter Pays Principle, Joint action by the EC-countries on the
international scene, and application of the subsidiarity princi-
ple in applying pollution control.
Box 2.2 The First Environmental Action Some of these principles were applied in the first direc-
Programme, 1973-1976 tives, which were created in the period under the second EAP.
Thus directives were issued on water quality, air quality (di-
Objectives: rective on limits to SO2 and particulates, as well as a directive
- Prevent, reduce and as far as possible eliminate on lead concentration in the air), waste handling, labelling and
pollution and nuisances. packaging of dangerous substances, as well as regulating dis-
- Maintain a satisfactory ecological balance and en- charge of dangerous substances into surface waters.
sure the protection of the biosphere.
- Ensure the sound management of and avoid any
exploitation of resources or of nature which cause
2.1.5 A Formal Base for
significant damage to the ecological balance. European Environmental Legislation
- Guide development in accordance with quality re- The first signs of change to a proper formal base for environ-
quirements, especially by improving working con- mental legislation were seen in the early 1980’s. The first step
ditions and the settings of life.
came with some institutional changes within the European
- Ensure that more account is taken of environmen-
tal aspects in town planning and land use. Commission in connection with Greece taking up EU-mem-
- Seek common solutions to environmental prob- bership in 1981. On that occasion, the previous “environmen-
lems with States outside the Community, particu- tal unit” got the status of a Directorate General in its own right,
larly in international organizations. named DG XI and covering “Environment, Nuclear Safety and
Civil Protection”.
Three categories of action:
Next step took place at the level of the EU-Treaty. The
- Action to reduce and prevent pollution and nui- change of the treaty in 1986, the Single European Act, taking
sances.
effect on 1st July 1987, gave the environment its “own” chap-
- Action to improve the environment and setting of
life. ter in the Treaty, placed as Article 130R-T. This laid down the
- Community action or, where applicable, common Community competence “to preserve, protect and improve the
action by the Member States, in international or- quality of the environment” as long it could be done better on
ganizations dealing with the environment. the community level than on the level of member states (the
so-called subsidiarity principle).
Source: Council of the European Communities, 1973.
The 4th EAP was adopted in 1987 after the Single Euro-
pean Act with the Chapter on the Environment was agreed

2 development of eu environmental regulation 41

upon. Now the Community institutions, the Council, the Com- With these measures the platform for a common environ-
mission and the Parliament for the first time had a specific mental policy and regulation had been created. In 1990 the
and direct legal authority to act. This gave the Commission, European Environment Agency was established and, finally,
which has the power to propose new EU-legislation, a clear placed in Copenhagen. The main purpose of the agency was to
and strong base for environmental policy-making, which it had provide the Commission with systematic and reliable informa-
lacked so far. Finally, from 1989 the DG XI had a portfolio, tion on the European environment as a base for the Commis-
only on Environment, while until then, the portfolio also had sion’s policy making and prioritizing.
included Transport.
2.2 The European Union Environmental Policies
Box 2.3 Important Dates in European Union
2.2.1 The Third and Fourth
History
Environmental Action Programmes
The third EAP was adopted in 1983 and in this period the
1957 Belgium, (West) Germany, France, Italy, Lux-
embourg, the Netherlands of the European character of the regulation decided on started to show a more
Coal and Steel Community decide to form an preventative and source-oriented approach. A more distinct
economic community (EU-6). feature was the notion of the need to make environmental con-
1957 Adoption of the Treaty of Rome; the Euro- cerns an integral part of all European Community policies.
pean Economic Community, EEC, is formed. Lack of proper control in 1982 of hazardous waste from the
1972 Declaration of Paris including the importance
of environmental protection.
Seveso-accident some years earlier made control of member
1973 Entry of Denmark, Ireland and the UK (EU-9). state implementation a priority.
1973 First EC-Environmental Action Programme A directive of major importance from this period – and
(EAP). still in force as amended in 1997 – is the EIA-Directive, Di-
1981 Directorate General of Environment, DG XI, rective 85/337/EEC of 27th June 1985. It is aimed at secur-
formed.
ing a comprehensive and holistic assessment of the likely or
1981 Entry of Greece (EU-10).
1986 Entry of Spain and Portugal (EU-12). possible impact on the environment of major public and pri-
1987 Single European Market Treaty adopted. vate projects as a precondition for authority acceptance of the
1989 The fall of the Berlin Wall project. A key element in the directive is the involvement of
1990 German Unification, Unified Germany in the the general public by mandatory public hearing procedures
Union. prior to decision-making.
1992 Single European Market into force.
1993 Maastricht treaty into force; this establishes
the European Union. 2.2.2 The Single Market
1993 The Fifth EAP – Towards Sustainability The changes in the 1987 treaty on the Single European Market
1995 Entry of Austria , Finland and Sweden (EU-15). were, of course, mostly concerned with the provisions needed
1997 Amsterdam treaty adopted. for establishing the single market for goods, service, capital and
1999 The European Single Monetary policy begins
people. The major new element to that end was the introduc-
and the Euro is introduced.
2000 The Lisbon agenda for modernising the Euro- tion of the Qualified Majority Voting (QMV), included in Arti-
pean economy is adopted. cle 100 A (now Article 95), to be used on all issues, related to
2001 Adoption of the Treaty of Nice. making the single market work. This had major influence also
2001 A EU Strategy on Sustainable Development. on the environmental policy making in EU. Article 100 A in
2001 The Sixth EAP – Our Future, Our Choice
section 3 stated that all Commission proposals on measures to
2004 Entry of Estonia, Latvia, Lithuania, Poland,
Slovakia, Czech Republic, Hungary, Slovenia, further the internal market related should be based upon a “high
Cyprus, Malta (EU-25). level of protection” of health, safety, environment and the con-
2005 Carbon Emission Trading Scheme starts sumer. It meant a high degree of integration of environmental
2007 Entry of Romania and Bulgaria (EU-27) concerns into all important policy areas. The QMV-system was
2007 The REACH Regulation implemented introduced into environmental policy with the Environmental
See further: The history of the European Union
Chapter of the Treaty only with the Maastricht Treaty of 1992.
http://europa.eu/abc/history/index_en.htm The purpose of the Single Market project and the use of Ar-
ticle 100 A was to promote trade, competition and economic
growth within the EU. This raised mixed feelings on the side

42 development of eu environmental regulation 2

of environmentalists. A clash between environmental concerns clause is the provision of scientific evidence, supporting the
and trade promotion was inevitable on many occasions. The national policy. It has become clear over the years that the EU,
trade and economic perspective prevailed as the single mar- compared to the national level, actually is an environmentally
ket was top-priority these years. Although the problem and “progressive” forum for policy making. The integration in the
the contradictions in many cases were not solved, Section 3 Union has gone very far due to the internal market. This makes
of Article 100 A was still an important element in this process separate, more environmentally advanced or progressive poli-
of substantial policy development within the EU. It combined cies in one or two countries difficult, as trade organisations
the integration principle with a demand for a high level of en- will point to loss of competitive strength.
vironmental protection. In an introductory note, the Commission presents the new
The relative success on the side of the environment of (4th) EAP with the following reflections:
this concept is indicated by the fact, that the “opt-out clause”, “It is no longer seriously contested that environmental
established in Article 100 A, section 4 never played any ma- protection policy has a central part to play in the whole cor-
jor role and today is hardly referred to. The clause made it pus of Community policies and that environmental protection
possible for a country to “opt out” of a piece of policy-mak- needs to be taken into account as a fundamental factor when
ing related to the internal market, with environmental policy economic decisions are taken. Continuing – and in many cas-
implications. If the country cannot accept the EU regulation es growing – problems of environmental deterioration have
due to higher environmental standards in that country in this convinced the Commission that the establishment of strict
particular area they can refuse. The key requisite to use the standards for environmental protection is no longer merely

Box 2.4 The Third Environmental Action Programme, 1982-1986

Objectives: Combating transfrontier pollution

Integration of the environmental dimension into other Dangerous chemical substances and preparations; e.g.
policies. the supplementing and application of council directive
79/831/EEC of 18 September 1979 amending for the
Environmental impact assessment procedure
sixth time directive 67/548/EEC on the approximation of
Reduction of pollution and nuisance if possible at source,
the laws, regulations and administrative provisions relat-
in the context of an approach to prevent the transfer of
ing to the classification, packaging and labelling of dan-
pollution from one part of the environment to another.
gerous substances (9).
Combating atmospheric pollution
Waste management
Reduction of NOX, heavy metals and SO2 inter alia by im-
including treatment, recycling and re-use and in particu-
plementing council directive 80/779/EEC of 15 July 1980
lar toxic and dangerous waste, including transfrontier
on air quality limit values and guide values for sulphur di-
transport of such waste and the review of the list of toxic
oxide and suspended particulates (5)
or dangerous substances and materials in the annex to
Combating fresh-water and marine pollution council directive 78/319/EEC of 20 March 1978 on toxic
Implementing council directive 76/464/EEC of 4 May and dangerous waste (10).
1976 on pollution caused by certain dangerous substances
Clean technology
discharged into the aquatic environment of the commu-
Encouraging the development of clean technology, e.g.
nity (6) and council directive 78/176/EEC of 20 February
by improving the exchange of information between
1978 on waste from the titanium dioxide industry (7).
member states.
The action programme of the european communities
of 26 June 1978 on the control and reduction of pollution Others
caused by hydrocarbons discharged at sea (8). Protection of areas of importance to the community
which are particularly sensitive environmentally.
Combating pollution of the soil
Cooperation with developing countries on environ-
Environmental protection in the mediterranean region,
mental matters.
paying particular attention to the specific aspects of that
Action specific to certain industrial sectors and to en-
region when giving practical application to the action
ergy production.
programme.
Combating Noise pollution
Reduction of noise pollution caused by means of transport. Source: EurLex, Official Journal C 46, 17/02/1983.

2 development of eu environmental regulation 43

Box 2.5 The European Union Institutions and EU Environmental Policy

The institutional structure of the Union has developed over The Qualified Majority Voting system in case of disa-
its entire history, but four institutions have been and are greement meant overruling one or more countries within
fundamental. These are the European Council, the Eu- the single market clause. Therefore an “escape” or “opt-
ropean Commission, the European Parliament and the out” clause was established for environmental issues with-
Court of Justice. The division of power between these is in the single market decision-making area. This was used
important for the function of the Union. It has, however, if a country had e.g. a special regulation on use of a cer-
changed considerably over the years. The EU or EEC in- tain chemical and that national regulation now was con-
stitutions should not be confused with other European in- flicting with a new piece of EU-regulation. Then that state
stitutions. Of special importance is the Council of Europe, could maintain its regulation, if the Commission could en-
which was formed in 1949 by ten original member states. dorse, that the regulation was considered not to be “hid-
It has been a forum for political debate and most impor- den” restrictions on the “free movement of goods” within
tantly protection of human rights. the EU. Use of this clause is therefore very restricted and
never had any real influence, as member states were very
The EU headquarter in Brussels reluctant to test the limits.
The headquarters of the Union has since its origin been The clause is still there but no longer has the same
placed in Brussels. This is quite symbolic for a union political position, as the QMVoting since 1992 has applied
whose original task was to bridge the Germanic and Ro- also to environmental policy decisions in the EU.
man cultures of Europe. Brussels is bilingual, and half of
its population speaks French and the other half Flemish, The Commission
a fact which has caused many conflicts over the years. The European Commission is the executive office of the
An exception is the location of the European Parliament Union. It is run by a President, who presently is the former
which is divided and the meetings take place partly in Portuguese Prime Minister José Manuel Barroso, and the
Brussels and partly in Strasbourg. commissioners. From 2004 the Commission has been
made up by one commissioner from each member state.
The European Council The Commission is assisted by a civil service made up of
The European Council is the meeting of the acting and elect- 17 Directorates General (DGs), one for each specific policy
ed heads of government. In most countries this is the Prime area, and 21 services (for such issues as budget, translations
Minister, but in France, the constitution makes the President etc), These are mainly based in Brussels and Luxembourg.
the acting head of government. European Council meetings The DGs together have several thousand employees.
take place once in each six months period with extra meet-
ings called in between when need may be. These meetings The DG Environment, DG XI
are hosted by the country chairing the council, that is, the The DG Environment is based in Brussels and has around
member state having the presidency of the Union. 550 employees. The Commissioner for the DG Environment
The highest, formal decision making body of the Un- is Stavros Dimas from Greece. The organisation of the DG
ion is The Council of Ministers. The so-called general council consists of – in addition to the office for the Director-Gen-
consists of the ministers of foreign affairs of the members eral – the following seven offices, called directorates:
states. All the other ministers, including the ministers of
- Directorate A: Communication, Legal Affairs & Civil
environment, have their own council meetings to discuss
Protection.
and decide on matters in their field of competence.
- Directorate B: Protecting the Natural Environment.
- Directorate C: Climate Change & Air.
The Union and its member states
- Directorate D: Water, Chemicals & Cohesion.
The division of power between the Union and its mem-
- Directorate E: International affairs & LIFE.
ber states is crucial, and has been debated all along. In
- Directorate F: Resources.
practice it is not possible to overrule a member state in
- Directorate G: Sustainable Development & Integration.
important issues. In the 1970’s the Council took a deci-
sion to this effect, which has continued to be valid. After DG Environment has, as the other DGs, a detailed
the enlargement of the Union in the 1990’s, unanimity in homepage where updated information can be found. See:
all issues has not been realistic any longer and the “veto” http://ec.europa.eu/dgs/environment/directory.htm
of individual members is limited to issues of crucial impor-
tance to the members. In addition there is a principle of The European Parliament
not regulating an issue on the Union level if it is better to The European Parliament is elected by the inhabitants of
do so on the national level. This principle of subsidiarity the member states in direct elections each five years. To-
has been practiced since the 1980’s. day there are 785 members of parliament representing

44 development of eu environmental regulation 2

 tal protection, transport safety and multilingualism. They
span Europe – Dublin to Stockholm, Warsaw to Lisbon
– providing services, information and know-how to the
general public. With more than 2,500 staff and signifi-
cant budgetary resources, the agencies and their activities
have become central to the operations of the EU and play
a key role in the implementation of its policies.
The European Environment Agency is the EU body dedi-
cated to providing sound, independent information on
the environment. It is the main information source for
those involved in developing, adopting, implementing
and evaluating environmental policy, and also the gen-
eral public. It is located in Copenhagen. The EEA provide
information and assessments of the state of the environ-
ment and trends in it, together with pressures on the
Figure 2.1 European Parliament. First session in Strasbourg. environment and the economic and social driving forces
(Credit © European Community, 2007) behind them. It also covers policies and their effectiveness
and possible future trends and problems using scenarios
492 million citizens in the 27 member states (in 2007). The and other techniques (from the EEA website).
election to the parliament takes place every five years. The To collect information the EEA has created the European
last election was run in 2004 and the next will be 2009. environment information and observation network (Eionet).
The European Parliament has since the dramatic chang- The Eionet works in close cooperation with national envi-
es in 1999 in the Commission strengthened its status and ronment agencies, environment ministries or correspond-
has the right to review, and has to accept, the legislation ing institutions in the member countries. It is responsible for
of the Union. Its influence thus is important in the field of coordinating national networks involving about 300 institu-
Environment. It is also taking initiatives to new legislation. tions in all. To support data collection, management and
The members of the European Parliament, MEPs, or- analysis EEA has in addition established and work closely
ganise themselves in groups according to traditional po- with five European topic centres covering water, air and cli-
litical divides. The groups are e.g. the European People’s mate change, nature protection and biodiversity, waste and
Party (Christian Democrats), which presently is the larg- material flows, and terrestrial environment.
est group, the Socialist Group, presently the next largest
group, the Alliance of Liberals and Democrats for Europe, The European research institutions
and so on. European Union legislation is developed using a consider-
able arsenal of research. Some of this is published data but
The European Court the Union also has its own organizations. The Commission’s
The European Court of Justice, ECJ, judges on matters of Directorate-General for Research has established a Joint Re-
interpretation of European Union law. ECJ consists of 27 search Centre (JRC) to support EU policy makers in the con-
Judges and 8 Advocates General. Most common cases ception, development, implementation and monitoring of
are the Commission’s claims that member state has not policies to tackle trans-national and global problems.
implemented a EU Directives, and member states’ claims The JRC has seven different institutes in five separate
that the Commission has exceeded its authority. During sites in Belgium, Germany, Italy, the Netherlands and
2005, ECJ treated 798 cases on environmental law. A Spain: Especially relevant for environmental legislation
2007 example is when the Commission took Poland to is the Institute for Environment and Sustainability, in Is-
court over a road construction in a nature-protected area pra Italy, the Institute for Energy (IE), and the Institute for
in Augustow in North-east Poland. Prospective Technological Studies (IPTS) both in Seville,
Spain. The main centre is in Ispra in north Italy.
European Union agencies The European IPPC Bureau, housed in Seville, has the
The European Union has a number of institutions for vari- task to catalyse an exchange of technical information
ous technical and other purposes. A Community Agency on best available techniques under the IPPC Directive
is a body governed by European public law set up by an 96/61/EC. This information is used to create reference
act of secondary legislation. The present 28 EU agencies documents (BREFs). These must be taken into account
were set up to accomplish very specific technical, scien- when the competent authorities of Member States deter-
tific or managerial tasks, such as to promote environmen- mine conditions for IPPC permits.

2 development of eu environmental regulation 45

an option; it has become essential. Moreover, the Commission in Stockholm in 1972. There was an extensive planning proc-
is also convinced that, when account is taken of the growing ess prior to the Rio Summit and the results were by far the
public demand for improved standards of environmental pro- most concrete and far reaching yet on the Environmental and
tection and for environmentally friendly goods – both within nature resource issues. The key concept, stemming from the
the Community and worldwide – Community industry will not Brundland Report and prevailing across all discussions were
be successful unless it increasingly gears itself towards the the notion of “Sustainability/Sustainable Development”.
meeting of such standards and the production of such goods. The relation of the 5th EAP to the Rio Summit is clearly
High standards of environmental protection have thus become stated:
an imperative – and an economic imperative at that.” [Official “The fifth environmental action programme was produced
Journal C 328, 07/12/1987 / P. 01-44] as the Community’s main response to the 1992 Rio Earth Sum-
mit which called on the international community to develop new
2.2.3 Towards Sustainability – the Fifth EAP policies as outlined in Agenda 21, to take our society towards
The title of the 5th EAP, taking effect on the 1st of February 1993, a sustainable pattern of development. The programme was to
shows yet another shift in the political context and the agenda, start this process within the Community, identifying objectives
set for the environmental policy making. The single most in- which required action at Community, national and local levels.
fluential factor is the publication in 1987 of the Brundtland Central to the programme was the recognition that environmen-
Report Our Common Future, which was initiated to form the tal legislation in itself is not sufficient to improve the environ-
background for the planned 1992 Earth Summit in Rio de Ja- ment. Developments in areas that create environmental pres-
neiro, Brazil. That summit was planned as the 3rd Summit on sures, such as transport, energy or agriculture often outweigh
the Environment, held every 10 years with the first being held the benefits of new regulations. Economic activities therefore

Box 2.6 The Fourth Environmental Action Programme, 1987-1992

With the 4th EAP the political context changed, to the recognizes that:
Treaty of Rome. This changed EU Environmental Policy - the protection of the environment can help to im-
fundamentally. From the 4th EAP we quote: prove economic growth and facilitate job creation;
The Council of the European Communities welcomes
recalls that the Single European Act lays down that: - the Commission’s intention of working closely with in-
- action by the Community relating to the environment dustry, trade unions and interested non-governmental
shall be based on the principles that preventive action organizations in the drawing-up and implementation
should be taken, that environmental damage should of environmental policy and programmes;
as a priority be rectified at source, and that the pol-
luter should pay, underlines
- environmental protection requirements shall be a - the particular importance it attaches to the implementa-
component of the Community’s other policies, tion of the Community legislation and
- within their respective spheres of competence, the invites
Community and the Member States shall cooperate - the Commission to review systematically the application
with third countries and with the relevant internation- and the practical effects of existing Community policy
al organizations; and to provide regular reports on this to the Council
Whereas it is necessary, in accordance with the Treaty and the European Parliament so that an assessment of
as amended by the Single European Act, to avoid the the effectiveness of such a policy can be made and, inter
adoption by the Member States of divergent measures alia, useful guidelines for future proposals determined;
likely to bring about economic and competition distor- declares
tions in the common market; - that, in view of the foregoing, and on the basis of past
recalls, finally, that: achievements, it is important for Community action to
- the Commission, in its proposals on health and envi- concentrate on the following priority areas while ob-
ronmental protection, takes as a basis a high level of serving the respective powers of the Community and
protection as laid down in the relevant provisions of the Member States (a list of areas follows).
the Single European Act; Source: European Union, (1987)

46 development of eu environmental regulation 2

have to take better account of environmental objectives in ad- environment and protecting the world’s natural resources. The
dition to a strengthening of environmental policy. This requires outlook is that new environmental standards will not keep pace
commitment by societal stakeholders and citizens as well as by with the growing demand, for example, for transport, consumer
the Member States and regional and local authorities. A broad- goods or tourism. The perspectives are particularly bleak for
er range of instruments should provide information, incentives climate change if trends in the main energy-consuming sectors
and support with a view to influencing decisions which affect cannot be reversed. At the same time, it is increasingly clear that
the environment. In order to focus action, the fifth programme damages to the environment have costs to society as a whole,
identified a number of environmental priority themes and objec- and conversely that environmental action can generate benefits
tives up to the year 2000, and pointed to five key sectors with an in the form of economic growth employment and competitive-
important impact on the environment and to which particular ness.” [Global Assessment, p. 7, EU, Luxembourg 2000]
attention should be given in terms of integrating environmental
concerns.” [Global Assessment, Preface, p. 7]
Box 2.7 The Fifth Environmental Action
2.2.4 Assessing the Fifth EAP Programme, 1993-2000, Towards Sustainability
A number of very important directives were decided upon dur-
ing the period of the 5th EAP. In the context of this book first of The objective of the 5th EAP is to set forward suggestions
on solutions or prevention of environmental problems
all the IPPC-directive should be mentioned (Council Directive
in the following areas:
96/61), together with the Council Regulation no. 1836/1993
on the EU-EMAS Scheme, amended and updated by Council - Climate change.
- Nature and biodiversity.
and Parliament Regulation no. 761/2001 and with the Eco-
- Acidification and air quality.
­labelling, Council Regulation no. 880/1992, amended and - Urban environment.
substantially updated by Council and Parliament Regulation - Costal zones.
no. 1980/2000. - Waste management.
The 5th EAP was put up for a thorough review by Parlia- - Management of water resources.
ment and Council decision in 1998, reiterating the approach
The programme furthermore outlines 5 especially impor-
and strategies used so far but underlining the need for more tant sectors in which action should be taken to deal with
efforts put into the implementation of current regulation. The environmental issues in the above-mentioned areas:
review should include a global assessment of the 5th EAP as a
- Industry.
whole and use the opportunity to put forward proposals and - Energy sector.
ideas for policy objectives and priorities, relevant to meet the - Transport.
challenges in the – then – upcoming new millennium. In reality - Agriculture.
this part of the obligation meant a first input to a new, 6th EAP. - Tourism.
The review with the global assessment of the 5th EAP Towards
The suggested policy instruments in the programme
Sustainability was published in 2000 and the proposal for the could be subdivided into 7 overall instruments:
6th EAP in 2001.
- Improvement of environmental data.
The global assessment concludes, that the results have
- Scientific research and technological development.
been visible and recognizable, e.g. in areas like reduction of - Sectoral and spatial planning.
trans-boundary air pollution, better water quality and phase- - The economic approach: Getting the prices right.
out of ozone depleting substances. At the same time there is - Public information and education.
still a lot of concern for the overall situation for the state of the - Professional education and training.
environment and with pressures on the environment expected - Financial support mechanisms.
to grow even further in some areas in the years to come (EEA, The programme stresses that solutions can only be
State of the Environment Report), despite progress in some reached through a holistic approach, with the usage of
sectors like Industrial production: several instruments, a combination of traditional regu-
“Less progress has been made overall in changing econom- latory instruments and market-based instruments.
ic and societal trends which are harmful to the environment. The
Sources: European Commission 2003b; European Com-
commitment by other sectors and by Member States to the pro-
mission 2003c.
gramme is partial, and the patterns of production and consump-
tion in our countries prevent us from achieving a clean and safe

2 development of eu environmental regulation 47

2.2.5 The Sixth EAP, 2002-2010 natural resources. The difficulty is, that demands for changes
The lesson from the 5th EAP is first of all the need to see envi- to make this possible unavoidably become in essence political.
ronmental policy in the wider context of environmental, social Still, short of sustainable development, much improvement
and economic objectives. They must be pursued in a coordi- in the protection of the environment have been achieved by
nated and mutually compatible way. Only a holistic and com- means of the policy and the regulation based on that.
prehensive approach can realistically reach out for sustainable This holistic or integrated approach to the environmental
development. These will finally imply fundamental societal problems was further developed in the 6th EAP (Box 2.8).
and economic changes, which cannot be brought about along According to the 6th EAP, environmental improvements are
the lines and within the trends pursued so far. mainly needed in four areas:
This is where the dichotomy between economic growth • Climate change.
and accompanying increased material consumption, and • Nature and biodiversity.
sustainability surfaces again. Human or anthropogenic activ- • Health and quality of life.
ity need to stay within the carrying capacity of nature at large, • National resources and waste.
maintaining bio-diversity and avoiding depletion of crucial
In all these areas forceful legislation has developed since it
was adopted in 2003. The climate change is pursued through
Box 2.8 The Sixth Environmental Action the implementation of the Kyoto protocol, and emission trad-
Programme – Our future, our choice ing introduced in 2005, Concern for biodiversity through the
development of the Natura 2000 programme, Health aspects
According to the 6th EAP, environmental improve- through the REACH Regulation implemented adopted in De-
ments are mainly needed in four areas:
cember 2006 after a long period of negotiation, and Resource
- Climate change. and waste management through a series of measures to make
- Nature and biodiversity. the Union a recycling society, especially by improved waste
- Health and quality of life.
- National resources and waste.
management.

To reach a solution or a minimisation of the environ- 2.2.6 The Lisbon Agenda and the Strategy on
mental problems the European governments are facing, Sustainable Development
in the above mentioned areas, the programme outlines The development of environmental protection has, however, in
seven strategies for environmental improvement:
the first years of the 21st century, been competing with other
- Clean Air for Europe. policies. Foremost of these is the Lisbon Agenda. In March
- Soil protection. 2000, EU leaders in Lisbon adopted a ten-year programme
- Sustainable use of pesticides.
aimed at revitalising growth and sustainable development
- Protection and conservation of the marine envi-
ronment. across the Union. The Union “set itself a new strategic goal for
- Waste prevention and recycling. the next decade to become the most competitive and dynamic
- Sustainable use of natural resources.
- Urban environment.

The programme underlines that environmental prob- The EU Environmental Action Programmes
lems should be dealt with in a holistic approach, with
the focus on cooperation between government, in- First Environmental Action Programme 1973-1976
dustry and other stakeholders. A holistic approach is
necessary, due to the number of stakeholders and the Second Environmental Action Programme 1977-1981
complexity of environmental issues. Continued efforts Third Environmental Action Programme 1982-1986
of integrating environmental concerns into regulation
of the economic sectors and the effective application Fourth Environmental Action Programme 1987-1992
of the “polluter pays” principle and full internalization
Fifth Environmental Action Programme 1993-2000
of environmental costs onto polluters are closely inter-
Towards Sustainability
linked and remain key priorities.
Sixth Environmental Action Programme 2001-2010
Source: European Commission, 2003a. Our Future, Our Choice

48 development of eu environmental regulation 2

Figure 2.2 European Commission. Meeting of the 27 Commissioners. (Credit © European Community, 2007)

knowledge-based economy in the world, capable of sustain- at EU level to attain these objectives. These measures were
able economic growth with more and better jobs and greater updated and developed in the 2005 strategy review. They in-
social cohesion.” cluded measures
The Lisbon agenda had four parts: economic, social, envi- • To break the link between economic growth and use of
ronmental renewal and sustainability. In reality the economic resources.
development dimension of the Lisbon Agenda definitely has • To halt the loss of biodiversity by 2010. The EU will have
got the upper hand. In face of a weak economic development to promote sustainable production and consumption and
in the old EU European Commission President José Manuel ensure effective protection of biodiversity, particularly
Barroso announced in February 2005 a relaunch of the Lisbon through Natura 2000.
Strategy as a “Partnership for Growth and Jobs”, simplifying • To break the link between economic growth and transport
targets and reporting procedures, and with a single National growth and do more to develop environmentally friendly
Reform Programme (NRP) for each country. transport. The share represented by road transport in 2010
Many warned that the targets on social policy and the envi- should not be higher than in 1998. The strategy envisages,
ronment were taking a back seat, in the push to make Europe among other measures, infrastructure charging, and pro-
more business-friendly. motion of alternatives to road transport and less polluting
In parallel the Commission worked out a strategy to sup- vehicles.
port the Sustainable Development goal. This was launched in The revised strategy also covered the combat of social ex-
May 2001 in Gothenburg, Sweden, as ”A Sustainable Europe clusion and poverty and mitigate the effects of an ageing soci-
for a Better World: A European Union Strategy for Sustainable ety, fight against world poverty, particularly by increasing the
Development”. The strategy identifies six unsustainable trends amount of aid provided to less favoured countries, improving
on which action needs to be taken, in many ways confirming the cohesion and quality of development aid policies and pro-
the 6th EAP. The strategy lists a range of specific measures moting better international governance.

2 development of eu environmental regulation 49

2.3 EU Policies and the Surrounding World regulations not able to pay back for the regulated. Prevention
2.3.1 EU and External Trade as the main approach to reducing environmental impact is then
not possible. The discharge-oriented regulation with “end-of-
The 1992 Maastricht treaty now had a separate chapter on the
pipe” handling of resulting pollution is crucial in these cases
environment (chapter 7), but the single market establishment
and will also contribute to reducing costs.
still had a substantial, although indirect, influence on envi-
ronmental policy making in the EU. Technical standards and 2.3.3 EU in International Negotiations
specifications as well as the definition of what is to be con-
The Union has developed in a world, which has become more
sidered as goods and what is not, was decided upon under the
and more interdependent on many issues including the protec-
umbrella of the single market to secure the harmonization of
tion of the environment. The global environmental issues have
trade conditions for the largest possible amount of goods.
been mostly the domains of the United Nations. In relation to
The priority was the single market, and therefore trade
the UN the European Union has for quite some time taken a
considerations would most often prevail over environmental
rather proactive role, pushing the development towards better
considerations concerning a given type of products, if there
regulated environmental matters and hopefully a better world.
was a clash between the two. However an additional interest-
Important areas include international conventions, e.g. those
ing aspect is that requirements on material and goods sold in
on climate change, biodiversity protection, international waste
the Union are influenced by requirements established by the
trade, air pollution, etc. Thus the EU Birds Directive has its
Union. This is most clear when a number of major companies
parallel in the Ramsar Convention. The directive on air pol-
in the Union have adopted the policy that providers should be
lution and the large power plants has its corresponding regu-
environmentally certified.
lation in the the United Nations Economic Commission for
The REACH Regulation, which will be implemented in
Europe, UNECE, Convention on Long Range Transboundary
2007, will also lead to substantial consequences for trade part-
Air Pollution, to which EU is a partner.
ners outside the Union. All imported chemicals above a certain
The European Union has in international negotiations been
tonnage will have to be registered and assessed according to
acting as one partner. In this way the Union has a considerable
the Directive.
influence in global contexts. It has been especially clear in the
Climate Convention and negations on implementation of the
2.3.2 EU Policies Kyoto Protocol.
The policy comes from EU and takes effect first of all but not
only within the EU-member states. The EU influences the 2.3.4 The EU Enlargement to the East
whole European region and due to its size and strength also In addition it should be mentioned, that implementation of – cur-
influences the global discussion and rule making on issues like rent and future – regulation into the regulation of the member
climate change and protection of bio-diversity. The very suc- states remains a high-priority area – and should be reinforced
cessful EU environmental policy and legislation was at first with more tough and effective follow up on member state com-
seen as “pushing around” private business and other private pliance by the Commission. The accession of ten new member
interests, threatening European competitiveness and thereby states in 2004, and two more in 2007 makes implementation a
economic viability of important companies and whole indus- very important task anyway, as these countries have very sub-
trial sectors. Areas here are the IPPC and the EMAS regulation stantial changes to make in the field of environmental protec-
the environmental impact of industrial processes and sectors tion. In addition the three countries of the European Economic
like automobiles, parts of chemicals (pesticides, biocides and Area (EEA) – Iceland, Liechtenstein and Norway – have agreed
ozone depleting substances), pharmaceuticals in animal pro- to implement almost all of the EU legislation.
duction and food etc. Along this way much of this policy has The implementation of the European Union environmental
been accepted and turned into economic benefits by improving policies in the new Member States in Central and Eastern Eu-
internal company management of resources and waste. rope have, since 2004, been and still is a major task for the Un-
The policy has also had technology implications. New ar- ion. It is supported by very substantial economic programmes.
eas of business have been opened up to serve and supply the The most important are the structural funds, the LIFE pro-
technology and the products needed to achieve these aims. We gramme and the so-called Norwegian Financial Mechanism
have the so-called “win-win” situation for environmental reg- – funding from the three EEA countries – together providing
ulation, paying back for the regulated entities. But that is not several hundred billion Euros for the period up to 2013.
– and cannot be made the case – in all areas. There will also be

50 development of eu environmental regulation 2

Study Questions Abbreviations
1. Give a short description of the origin of the European BREF Best Available Techniques Reference Document
Union and describe the motives behind its formation 50 EAP Environmental Action Programme
years ago. EC European Community
2. Explain how the environmental issues entered the agenda EEA European Environment Agency
of the Union. List a few key dates and policy initiatives. EEC European Economic Community
3. List the most important principles behind environmental EIA Environmental Impact Assessment
legislation in the Union. EionetEuropean environment information and observation
4. Describe the policy behind the Single European Market, network
when it was implemented and its consequences for EU EMAS Eco-Management and Audit Scheme
environmental legislation. EMU European Monetary Union
5. Describe the enlargement of the Union and give years for EPA Environmental Protection Agency
the accession of the countries in the Baltic Sea region. DG Directorate General
How many countries are today adopting EU legislation? IE Institute for Energy
6. Explain the meaning of the connotation 85/337/EEC. IPPC Integrated Pollution Prevention and Control
7. Explain how disagreements on environmental legislation IPTS Institute for Prospective Technological Studies
are managed in the European Council, especially if or JRC Joint Research Centre
how unequal standards of environment are accepted. What MEP Member of the European Parliament
is the QMV and when can it be used. QMV Qualified Majority Voting
8. Make a diagram of the European Union institutions and REACH Registration, Evaluation and Authorisation of
how they related to each other in the field of environmen- CHemicals
tal legislation. WWII Second World War
9. Describe the changes and new features introduced in EU
environmental policy and legislation in connection with
the fifth EAP in the mid 1990s. Describe in particular the Internet Resources
Framework Directives and Integrated Permits. European Union official web portal (English version, all EU
10. Describe the changes and new features introduced in EU languages available)
environmental policy and legislation in connection with http://europa.eu/index_en.htm
the sixth EAP at the turn of the century 2000. Describe in
particular the four priority areas, and how they have been The History of the European Union
addressed, and the seven strategies for environmental http://europa.eu/abc/history/index_en.htm
improvements. (See also the Section on European Union
Environmental Legislation at the end of the book). Website of the European Parliament
11. Outline how the European Union has become a main http://www.europarl.europa.eu/
partner in a number of global organisations and partner
to several global environmental conventions. In what Website of the European Commission
way are these implemented in the Union and its Member http://ec.europa.eu/index_en.htm
States? (See also the Section on European Union Environ-
mental Legislation at the end of the book). Website of DG Environment
http://ec.europa.eu/dgs/environment/index_en.htm

Activities of the European Union environment

http://europa.eu/pol/env/index_en.htm

Title XIX Chapters 174-176 of the European Treaty

concerning Environment
http://eur-lex.europa.eu/en/treaties/dat/12002E/htm/C_
2002325EN.003301.html#anArt175

2 development of eu environmental regulation 51

EU legislation in force on environment
http://eur-lex.europa.eu/en/repert/index_15.htm
(See also an extensive collection of links in the Section of EU
Environmental legislation)

Fifth Environmental Action Programme

http://ec.europa.eu/environment/actionpr.htm

Sixth Environment Action Programme

http://ec.europa.eu/environment/newprg/index.htm

52 development of eu environmental regulation 2

 3
Are Environmental
Management Systems
Sufficient?

3.1 Management Systems and Self-regulation

In this Chapter
3.1.1 Reasons for Self-regulation
Increased pressure from stakeholders has led to increased 1. Management Systems and Self-regulation
company awareness of the environ­men­tal impacts of their pro- Reasons for Self-regulation
A Variety of Environmental Management Systems
duction activities. Serious incidents in e.g. the chemical and
The Nature of the EMS
petrochemical industries have underlined the potentially very 2. Steps in Introducing an Environmental
high risk for the environment of some types of production. In Management System
addition it has become clear that an ever increasing production Initial Environmental Review
in volume and use of material makes over-exploitation of natu- Environmental Policy
ral resources likely, and a dramatically increasing waste prob- Assessing Potential Environmental Impacts
Planning
lem certain. The implications of these trends have been widely Implementation and Training
understood among company managements and a number of Checking, Corrective Actions and Management
different initiatives have been taken. The introduction of envi- Review
ronmental management systems is one of the most important 3. Comparing the Management Systems
of these voluntary initiatives. EMAS, ISO 14001 and the Green Network
The Objectives of EMAS
Along with the growing awareness of the environmental
Environmental Statements
impacts of industrial activity, a shift has developed in the un- A Comparison
derstanding of where the solutions were to be sought. In short, 4. The Experiences and Effects of Environmental
that shift can be characterized as a shift from dilution and end- Management Systems
of-pipe treatment, i.e. output-oriented measures, to reduction The Insufficiencies of EMS
Is Continuous Improvement Actually Occurring?
and prevention of (negative) environmental impacts occurring
External Verification by Independent Auditors
in the first place, i.e. input-oriented measures. This has hap- Studies on Environmental Performance and EMS
pened over the last 15-20 years alongside with intensified dis- Correlations Between EMS and Environmental
cussions on the notion of sustainability. Performance
The shift has at the same time changed focus for the solu- Environmental Management Systems and Com-
tions from technical installations to managerial responsibilities. pliance with Legal Regulations
The Positive Sides – Improved Overview and
Prevention and reduction of impact imply integration of the Financial Benefits
measures to be taken into the comprehensive decision-making How to Ensure Improved Environmental
on production planning and process control. Thereby, it be- Performance
comes an integrated part of key management responsibilities.

3 are environmental management systems sufficient? 53

3.1.2 A Variety of
Environmental Management Systems 1.
Initial Environmental
During the 1990’s different managerial support systems were Review
developed to handle this responsibility. The European Union
EMAS scheme and the ISO 14000 series are the two last- 2.
ing, international environmental management support system Environmental
Policy/Vision
standards. In addition, there are environmental management
schemes made by local or regional organisations and authori-
7. 3.
ties, e.g. the Green Network in Denmark and the Stockholm Corrective Assessment
City EMS for SME’s in the City, as well as sector-oriented Actions

schemes like the chemical industry’s Responsible Care Pro-

gramme (Box 1.5, Chapter 1). These all play an important
4.
role in current company environmental management across 6. Analysing and
the industrialised world. In 2005 the number of 14001 cer- Auditing Planning

tificates approached 100,000 in the world, while the number

of ISO 9000 certificates was 900,000. In 2004 the growth in 5.
Implementation
the number of certificates was over 30%. It is thus becoming
a very significant aspect of environmental work in all kinds
Figure 3.1 Environmental management. An Environmental Man-
agement System is a process which is repeated every 1-3 years. It
consists of the 6 steps shown. When the system is first put in place
Box 3.1 EMS for Local Authorities and other an initial review is made.
Non-industrial Organisations
of organisations, but most significantly in industry. Today it
is standard to introduce the two systems together linked with
Environmental management system is mainly used in
a health and safety management system and make them an
industry, but increasingly so also for local and region-
al authorities and their partial activities. This is very Integrated Management System (IMS). At the same time the
much needed. A local authority is often a very consid- number of companies having a certified EMAS scheme is go-
erable activity. For example the six largest economies ing down slightly.
in Sweden are local and regional authorities. Only in In this chapter we will focus on environmental manage-
7th place do we find large industrial companies such as ment systems. We will ask whether these are sufficient to guar-
Ericsson, or Vattenfall.
antee compliance with environmental law and regulations, or,
Much work in a local authority is in the service sector if not, what role these management systems then might have in
such as child and elderly care and schools. But those supporting legal compliance and good environmental perform-
activities also have a considerable environmental im- ance. First, there is an introduction to environmental manage-
pact. ment systems and the elements included in such a system.
Secondly, the environmental management schemes EMAS,
When Lund University carried out a complete environ-
mental review it turned out that the material flows ISO 14001 and Green Network are compared and discussed.
were of the same size as the largest industries in the Thirdly, there is an overview of experiences with environmen-
city. But still these activities are not controlled to the tal management systems in Europe – focussing on EMAS.
same extent as for industries. There is no EIA, IPPC
regulation nor licensing requirements, mostly because 3.1.3 The Nature of the EMS
they are not generally perceived as environmentally
problematic. Nevertheless they must, of course, abide An environmental management system is a set of guidelines,
by all applicable environmental regulations and the which instructs workers and management how to prevent pol-
activities are quite often checked by environmental lution, handle resources, and reduce emissions, waste and
authorities. wastewater from the production. As shown in Figure 3.1, the
equation is simple: Inputs equal outputs including products. In
A much more detailed treatment of the same issues is
other words, input which is not a part of the produced prod-
found in Book 4 in this series.
ucts is transformed into waste, emission or wastewater, which
can have a negative impact on the environment. Furthermore,

54 are environmental management systems sufficient? 3

 reducing inputs by increasing resource efficiency generates
A cost savings for the company and makes some environmental
Emission to air investments feasible.
Input Output Environmental management is a continuing process in which
the company sets up objectives, targets and action plans for the
Raw materials company’s environmental state followed up by auditing and cor-
rective actions. It should include all parts of the company and in-
volve the whole staff and management to be fully implemented.
Auxiliry substances Production Products
Environmental management systems are by far most commonly
used by industry but can be used by all kind of organisations, in-
Energy cluding public authorities and state and local government institu-
tions like universities, schools, hospitals and within elderly care.
In the following, the main elements and steps in environmental
management systems are presented; the exact amount of steps
Solid waste Wastewater
& hazadous waste
and scope of each step varies from system to system.

3.2 Steps in Introducing

an Environmental Management System
B
3.2.1 Initial Environmental Review
Production processes
Input Output The first step is to make an initial environmental review of
of ceramic tableware
the organisation. The environmental review is an extensive
Raw materials
(clay) & water
Body mixture accounting of all the environmental aspects concerning the
organisation’s activities, products and services. The term en-
vironmental aspect refers to anything, which may result in an
Gipsum & Gipsum moulds actual environmental impact. This is the input and output of
Moulding
water (moulds) (disposed)
the organisation, e.g. the use of natural resources and raw ma-
terials (including energy); emissions to air; release to water;
Clay (recycled in impact on surrounding communities (noise etc.); use and con-
Water Shaping
body mixture) tamination of land; solid and other wastes (especially hazard-
ous); transport; and risk of environmental accidents.
LPG (energy
CO2, cracked non-fired Figure 3.2 B shows, as an example, an overview of the
Drying and (recycled) and fired
for the kiln) firing input and output of ceramics production, which is a system-
bisque (disposed)
atic approach to get an overview of the material flow in each
process of the production. By adding the figures of the input
Glaze, colour Wastewater containing
pigments & water
Glazing
glazes & pigments
and the output, the mass balance can be calculated. The mass
balance can reveal which processes cause the most spillage.
Combined with a screening of the environmental hazards of
CO2, cracked the output, this is an instrument that is able to point out the
LPG Firing
ceramic (disposed)
targets of the action plan.
The review must also contain information on the indirect
environmental impacts of the activities of the organisation and
the management structures in place to deal with these impacts.
When health and safety aspects are integrated in the environ-
Figure 3.2 Environmental review. A. An environmental review
mental management system, there will be further aspects to
of a company looks at all flows, that is input and output, and lists
all emissions and other potential impacts. B. Input and output in investigate, e.g. the risk of accidents, chemical exposure, oc-
ceramic production. Input of natural gas (LPG), gipsum, clay and cupational load, noise and vibration. Throughout such an in-
water is turned into products, emissions (CO2, wastewater etc), or is ventory inexpedient procedures or use of materials in the com-
recycled. In this production energy use is one of the largest impacts. pany are often discovered.

3 are environmental management systems sufficient? 55

3.2.2 Environmental Policy vironmental assessment process and can be seen as a repeated
Secondly an environmental policy should be written. The process between these two steps, where the impact assessment
policy should reflect the environmental values of the organi- and the best available techniques are linked.
sation and contain its overall aims and principles as a basis Based on analyses and considerations carried out in the
for developing the environmental objectives and targets. The planning process, a detailed plan of action is created. In the
environmental policy is decided upon by the management of environmental action plan responsibilities, deadlines, compe-
the company/organisation and should as a minimum be known tences and control of tasks for the implementation process are
by the employees and made available to the public. In more defined. Due to their great knowledge of the existing proce-
proactive organisations, the management will take into ac- dures, the employees working within the target areas should
count the views of business partners, shareholders, employees be involved in the planning process. The involvement can also
and stakeholders when deciding the policy. be seen as a training aspect, which provides insight into the
new techniques and technologies. The action plan contains the
3.2.3 Assessing Potential Environmental Impacts procedures of the environmental management system.
In the light of the environmental review, the organisation as-
sesses the emissions and ranks them by their potential envi- 3.2.5 Implementation and Training
ronmental impacts. There are different assessments or score A very important part of the implementation process is the
systems that can be used to rank emissions by their impacts on training of employees. If a target in the action plan is to lower
the environment. the use of resources, it might imply new production proce-
First of all, the organisation must ensure that it complies dures, which should be properly introduced to the workers
with the national environmental legislation by creating an over- at the production line in question. Another core issue is the
view of the relevant environmental laws and regulations. Fur- maintenance or change of the procedures for coordination and
ther environmental performance improvements can take off by communication between the departments. It must be ensured
using checklists or environmental impact assessments. The en- that new procedures are established when old procedures are
vironmental assessment can furthermore be combined with an proven insufficient. Thus, it is clear that to improve environ-
economic assessment when ranking the different target areas. mental performance, the environmental management system
The economic assessment can be used as an argument when the must be fully integrated into daily management structures of
environmental manager presents the potential environmental the company.
objectives and targets to the management of the organisation.
It is very important, that the management chooses an as- 3.2.6 Checking, Corrective Actions
sessment system that matches the size and capacity of the or- and Management Review
ganisation. The main purpose of an environmental manage- The environmental management system must not only contain
ment system is to reduce the environmental impacts of the procedures for improving the environmental performance. It
organisation’s activities and not to create an extensive admin- also must include procedures for monitoring the performance,
istrative apparatus. Bearing that in mind, a way of prioritising in order to measure whether the improvements fulfil the set
environmental objectives and targets, is to start with the im- objectives and targets. This checking is called an internal audit
provements that are significant but also economically feasible, which can be carried out by an employee within the compa-
and then to invest the profit in less feasible environmental im- ny or an external consultant. (An internal auditor should not,
provement. Furthermore, some trade organisations have made however, audit his own area of environmental management
checklists containing the most common impacts related to the routines). The audit must be followed by corrective actions
type of production or service in question, including examples when necessary in order to fulfil the targets of the environ-
of best practice in reducing the impacts. mental action plan.
In addition to the audit, the company could be verified by
3.2.4 Planning an external certification body in order to receive a certified/
After the management and the environmental manager have registered environmental management system. An external
agreed on a set of environmental objectives and targets, an ac- verification process is repeated normally every third year.
tion plan must be made. First, an analysis should be carried out, Finally the management of the organisation must periodi-
in order to identify how the objectives could be reached, e.g. cally review the audit results; the environmental policy; objec-
changes in the production process or investments in cleaner tives and targets; and the environmental management system as
technology. This planning process is closely linked to the en- a whole, in the light of the ever-changing market conditions.

56 are environmental management systems sufficient? 3

Figure 3.3. EMAS certification. The Benecke-Kaliko plant in Eislingen, Germany received its EMAS II certificate in December 2006 after an
eco audit. Over the last six years the company has been able to reduce its solid waste by 200 tonnes. (Photo: ContiTech. http://www.contitech.
de/ct/contitech/themen/kommunikation/presse/061220_benecke/presse_de.html)

3.3 Comparing the Management Systems 3.3.2 The Objectives of EMAS

3.3.1 EMAS, ISO 14001 and the Green Network The objectives of EMAS are to promote continuous improve-
In 1993, EU launched a voluntary EU regulation called Eco- ments in the environmental performance of companies or or-
Management and Audit Scheme (EMAS) which was revised in ganisations and to prevent pollution, to provide the incentive
2001, when it became EMAS II. EMAS covers organisations for companies to pass on relevant information to the public,
operating in the European Union and the European Economic and to comply which the environmental regulations. It is the
Area (Norway, Iceland and Liechtenstein), that is, a total of 30 intention that environmental improvements will be provided
countries. In 2005 the number of EMAS registered organisa- through the establishment as well as implementation of envi-
tions was approximately 3,500. ronmental management and audit systems.
The private organisation, International Organization for The objective of ISO 14001 is to prevent pollution and to
Standardization (ISO), developed an environmental manage- promote continuous improvements of the procedures of the
ment system named ISO 14001 in 1996 (renewed in 2004). environmental management system. ISO 14001 is designed
As mentioned, the ISO is a worldwide federation of national as a framework with the potential to organise environmental
standardization bodies with more than 100 member bodies, management in the company in a systematic way. The verifier
which makes the ISO 14001 global. The ISO 14001 standard is mainly checking if the management system is maintained
is recognised by the European Commission as a stepping-stone and improved, and only secondarily or not at all checking the
towards participating in EMAS. improvements in environmental performance.
Along with the two international standards a number of Compliance with legislation is not a direct requirement, as
schemes exist, developed by local organisation as part of a lo- long as the target of the action plan is to obtain compliance.
cal environmental programme. Green Network in Vejle Coun- The international schemes are developed in order to
ty, Denmark, will serve as an example of such a programme strengthen and certify the environmental management proce-
for the comparison (Table 3.1). dures of the company, which requires comprehensive docu-

3 are environmental management systems sufficient? 57

Box 3.2 Three Management Systems – ISO 14001, EMAS and the Green Network

EMAS ISO 14001

The very core of the EMAS is to a large degree similar to The main requirements of ISO 14001 can be subdivided
ISO 14001. The content of ISO 14001, can also be found into 5 steps, constituting a process which, when followed
in EMAS. There are some differences between the two repeatedly, should lead to continual improvement:
EMS standards, though. EMAS differs from ISO 14001 by
supplementing some add-ons with the scope to improve 1. Environmental policy.
continual environmental improvement. 2. Environmental plan.
3. Environmental management program.
The main add-ons in EMAS (compared with) ISO 14001 4. Auditing and corrective action.
are: 5. ManagementInitial
review.
Environmental Review

• The demand for an Initial Review, to identify activities

of the companies which should be focused on by the Environmental Policy
EMS (only a recommendation in ISO 14001). and Programme
• An Environmental Statement is required by companies
participating in EMAS, to communicate the environ- Environmental
Corrective Actions
mental issues of the company and its effort to improve Management System
environmental performance (only recommended in
ISO 14001).
Environmental Audit
• Organisations registered with EMAS must prove (in
the environmental statement) that continual environ-
mental improvement is being made in every period of
a review (ISO 14001 only requires continual systems The Green Network Environmental Statement
improvement, though recommending environmental The idea behind Green Network’s work is for the individual
improvements). member companyValidation
to be in aand
position to undertake its own
Registration
environmental management tasks and to attain tangible
In spite of the different names of the phases of EMAS and goals in the environmental area – both in relation to the
ISO 14001 the content of the phases is quite similar. external environment and to the workplace environment.
The environmental management work is actively
backed up by the individual company’s environmental
authority, which within an agreed-upon framework will
provide guidance to the company. An important tool in
Initial Environmental Review this process is the Green Network’s environmental state-
ment manual.
In addition to the work with environmental state-
Environmental Policy ments, Green Network offers its members courses, con-
and Programme ferences, projects and exchanges of experiences, via its
Industrial Environment Club.
Environmental Green Network covers Vejle County and the Munici-
Corrective Actions
Management System pality of Middelfart. The public authorities involved in the
co-operation are the Municipalities of Fredericia, Horsens,
Environmental Audit Kolding, Middelfart and Vejle, Vejle County and the Dan-
ish Working Environment Service.
In addition to its public-sector members, the network
counts a continually increasing number of manufacturing
Environmental Statement
companies, educational institutions, consultants, other
municipalities, etc. among its members.
Validation and Registration The scheme of Green Network in Vejle County has
been running for 10 years now, and there are currently
about 250 members including 190 companies.

Source: Green Network, 2004.

58 are environmental management systems sufficient? 3

mentation to enable auditing. The objective of the local scheme ment may not be completely objective, but do establish an over-
is to introduce local companies to environmental management, view of the material flow and the waste streams in the company,
which means that the focus is on the learning process and tan- which is an important initial step that enables the company to
gible results rather than comprehensive monitoring and docu- target significant environmental problems. Both schemes state
mentation. The scope and objective are slightly different but so that the company may freely choose methods of impact as-
is the range of the standards. Each of the three environmental sessment. ISO 14001 requires that the company as a part of
management systems is significant, as is shown in Table 3.1. the environmental management system establish a procedure
The ISO 14001 is recognised by the EMAS regulation to to localise environmental aspects of the product, activities and
be an appropriate environmental management system within services that have significant environmental impacts.
the EMAS, meaning that the EMAS goes beyond the require- In EMAS, the environmental policy must promote com-
ments of ISO. The Green Network scheme places itself be- pliance, continuous environmental improvements and – along
tween EMAS and ISO 14001 requirements. The EMAS and with ISO 14001 – pollution prevention, while the Green Net-
Green Network schemes require an initial review, which is only work scheme does not have any direct demands to the contents.
recommended in ISO 14001. The initial review and the assess- On the other hand, the Green Network requires that the envi-

Table 3.1 Comparison of EMAS, ISO 14001 and Green Network. (Green Networks Conditions for Membership)
Action & aspects EMAS ISO 14001 Green Network
1. Initial Review Verified initial review. No, but recommended. Yes (must follow manual).
2. Environmental Yes, including a commitment Yes, including a commitment to Yes.
Policy to continuous improvements & pollution prevention. Before review: management
pollution prevention. approved project plan, incl.
budget, timeframe etc.
After review: Management
approved environmental priorities
and approach.
3a. Assessment/ Yes. Yes, vague formulation. Yes, according to environmental,
Prioritising technical & economic aspects.
3b. Plan Yes. Yes. Yes.
4. Implementation Yes. Yes. Yes.
5a. Audits Frequency (min. every 3rd year) Audits of the EMS (frequency or Internal.
& methodology of audits of methodology not specified), can
the EMS and of environmental be carried by internal or external
performance can be carried by auditor.
internal or external auditor.
5b. External Required every 3rd year with Periodically surveillance and Required within first 3 years of
Verification yearly surveillance related to reassessment (normally carried membership. After that every 2nd
environmental statement. out respectively once a year & year.
every third year).
6. Environmental Yes, every 3rd year with yearly No, but communication Yes, available to the authorities.
Statement updates. Publicly available. recommended. Environmental Information must go 5 years back.
policy must be publicly available.
7. Commitments & Employee involvement Environmental training. Continuous environmental
Requirements & training; continuous Continuous improvements of improvement process.
improvements of environmental EMS.
performance & compliance.
8. Contractors and Required influence over C&S and Relevant procedures are No requirements.
Suppliers they must comply with company communicated to C&S.
policy.
9. Range EU and the European economic Global. Local (Vejle county, Denmark).
area.

3 are environmental management systems sufficient? 59

ronmental policy of the company reflect the significant envi- EMAS could be expected to deliver clear results in relation to
ronmental issues related to the production or services. This environmental performance.
criterion, along with objectives of environmental improve- However, examined more closely, it becomes clear that
ments and less administration, gives the possibility of using even EMAS is characterized by a lack of sufficient require-
the resources more focused in the implementation. Therefore ments to ensure environmental improvements. Vague formula-
the scheme is appropriate for companies that have just started tions and a lack of minimum criteria in the EMAS regulation
out with environmental work and small companies with scarce
resources. Box 3.3 Environmental Statement
3.3.3 Environmental Statements
The environmental statement is an instrument for
EMAS and the Green Network require that the company issues communication between the organisation and its
an environmental statement every third year. The statement is stakeholders. It allows the public to detect if a com-
addressed to the organisation’s stakeholders e.g. neighbours pany/an organisation fulfils its objectives and targets.
and customers, and must present the emissions related to the
production. In the environmental statement, the organisation While making the environmental review ahead of the
statement, a lot of companies/organisations obtain
must describe the environmental efforts and achievements. knowledge about resource use and emissions from the
The organisation should also provide the public with informa- production. The following is the minimum require-
tion on the environmental performance in the environmental ments as presented in the EMAS regulation:
statement. Furthermore the organisation is urged to have an
open dialogue with the stakeholders. • A description of the organisation and a summary
of its activities, products and services and the or-
The statement is intended to be an important document for
ganisation’s relationship to any parent organisa-
the stakeholders to gain knowledge about the environmental tions.
state of a company. There are no demands on the comparabil- • A brief description of the environmental manage-
ity of the environmental statements. ment system and the environmental policy.
• A brief description of all significant direct and in-
3.3.4 A Comparison direct environmental aspects which results in sig-
nificant impacts.
EMAS is the most ambitious environmental management sys- • A description of environmental objectives and tar-
tem of the three. The requirements for employee involvement gets in relation to the above.
and training and measurable environmental performance im- • A summary of the data available on the perform-
provements are very explicit and more radical than in either ance of the organisation compared with its envi-
ISO 14001 or the Green Network. Involvement and training ronmental objectives and targets, and also a de-
scription of other factors regarding environmental
are important if the system is going to be properly adopted
performance.
by employees in the company, while implementation to some
extent is a matter of changing routines and organisation of the The EMAS regulation holds criteria for environmen-
labour, which also includes a change of habits. The Green Net- tal performance reporting. The criteria should secure
work holds similarities to EMAS but is the easiest applicable. that the organisation uses existing relevant indica-
tors so that the environmental data gives an accurate
ISO 14001 is the only environmental standard that is issued
appraisal of the performance. It must be possible to
globally, which is an advantage in a globalised economy. compare the performance year by year and compare
the performance with sector, national or regional
benchmarks.
3.4 The Experiences and Effects of
Environmental Management Systems A point through all the requirements in both the state-
3.4.1 The Insufficiencies of EMS ment and the performance reporting, is that the de-
scriptions should be written in a clear and unambigu-
On the face of it, the requirements and recommendations in ous language. This, together with the comparable
ISO 14001 and EMAS may seem sufficient to ensure improved datasheets, will enable the stakeholders to communi-
environmental performance in the companies introducing such cate with the organisation.
management systems. As mentioned, especially the require-
Sources: EMAS; Green Network.
ments of the EMAS regulation seem to be sufficient. Being
the most demanding environmental management standard, the

60 are environmental management systems sufficient? 3

constitute possible barriers to improvements of environmental ment and the entire EMS. The company may choose verifiers
performance, by leaving room for different interpretations of from all over the EU. It could be feared that some verifiers will
the requirements. Experience show that the requirements are interpret the requirement for continuous improvement rather
in fact not always implemented in conformity with the inten- vaguely, to ensure the largest possible spreading of EMAS, in
tions of the regulation. order to create a market for their services, and to be competitive
Being voluntary, EMAS is firstly to a large degree depend- in relation to other verifiers. It is, however, also possible that
ent on the willingness of the companies to implement the re- companies will prefer verifiers that they look upon as reliable,
quirements in conformity with the intentions. Secondly, the to increase the reliability of the environmental statement.
requirements themselves are characterized by vague formula- The verifier’s report to the management is confidential, but
tions and a lack of minimum criteria for the requirements that breaches must be reported to the relevant national authority. It is,
form the backbone of EMAS: however, doubtful if breaches will be reported in all cases. Experi-
ences from England show that companies do not necessarily lose
• The requirement for continuous improvement.
their EMAS verification when a breach is identified [Gouldson
• The requirement for externally verification by independ-
and Murphy, 1998]. Other studies show that withdrawal of cer-
ent verifiers.
tificates happens only rarely [e.g. Dahlström and Skea, 2002].
• The requirement for an externally verified environmental
According to the EMAS Regulation, Annex 5, the verifier
statement.
should not make his/her own analyses of the environmental
impacts of the company. The verification should be based, in
3.4.2 Is Continuous Improvement Actually Occurring? principle, upon the company’s own information, derived from
Fully in conformity with the wording of EMAS, though not in e.g. internal auditing of the system and presented in the envi-
conformity with its intentions, the requirement for continuous ronmental statement.
improvement may be interpreted as incremental improvements For the reason of comparison across companies, a com-
in areas of focus, while the overall environmental performance mon standard for the quality of the data in the environmental
is not necessarily improved, possibly even worsened. The pos- statements is crucial. However, no criteria on data standards
sibility of a worsening of the environmental performance is due have been established. Companies may, for instance, choose
to the fact that when the focus of the EMS is moved away from to publish the environmental data in index figures, which are
earlier focus areas, companies might cause more environmen- relative and only describe a development over time, not giv-
tal problems in that area than before the focus in earlier years. ing any specific quantitative information about environmental
It is important to understand that companies that take such ac- performance in comparison to other companies.
tion would still not be committing any breach of the formal
requirements of EMAS – or for that matter ISO 14001. 3.4.4 Studies on
Since EMAS holds no specific minimum criteria for what Environmental Performance and EMS
could be considered an environmental improvement, compa- It is important to keep in mind that the lacking requirements of
nies might themselves define criteria for environmental im- EMAS and other management standards and the insufficient
provement. In fact there will be no lower limit for what could implementation of the requirements in the companies, do not
be considered an environmental improvement. An EMAS necessarily mean that companies get no environmental ben-
registered company could improve very little environmentally efits from introducing an EMS.
and still keep its registration, since no breaches of the EMAS Cases prove that some companies actually experience im-
regulation would be committed. proved environmental performance after having implemented an
EMS – at least according to representatives of the companies in
3.4.3 External Verification by Independent Auditors question [e.g. Hillary, 2000]. Furthermore, a study by Marinova
The lack of minimum criteria for continuous environmental and Altham in 2000 shows that improvements in environmental
improvement means that it is the responsibility of the external performance derived from implementation of Cleaner Technol-
verifier of the EMS to determine whether or not the company ogies are in fact related to the implementation of an EMS.
is engaged in continuous improvement. The question is, however, whether the companies would
According to the EMAS regulation, the company must have made the environmental improvements, irrespective of
have the EMS externally verified by an independent verifier. It whether an EMS had been introduced. Many studies have been
is, however, the responsibility of the company itself, however, conducted to uncover the correlation between EMSs and envi-
to choose which verifier should verify the environmental state- ronmental performance. Two studies are, however, especially

3 are environmental management systems sufficient? 61

interesting, because of the large data set they are based on.
In one study, carried out by Clausen et al. 2002, case stud-
ies and telephone interviews were conducted with 1,277 Ger-
man EMAS-registered facilities. In another study carried out
by the MEPI, referred to in Hertin et al. 2003, case studies
were conducted of 274 firms and about 400 production sites in
six industrial sectors in Austria, Belgium, Germany, Italy, the
Netherlands and the UK.
The overall conclusion of both studies [Clausen et
al., 2002; Hertin et al., 2003] is that the researchers were un-
able to identify any clear overall statistically significant corre-
lation between EMSs and environmental performance. Some
significant correlations were found on specific performance
indicators, but only a few. For most performance indicators,
no correlation was found. Furthermore, the few correlations
that were discovered were not all confirming the hypothesis
that EMSs improve environmental performance. Some of the
analyses of performance indicators actually showed a negative
effect on environmental performance in 1) companies with an
EMS compared to companies without; 2) companies with an
EMS compared to the average industry level; and in 3) compa-
nies before and after the introduction of an EMS.
The studies were unable to identify any significant correla-
tion between EMSs and environmental performance, thereby
suggesting that environmental improvements are not necessar-
ily initiated by the adoption of an EMS.
The outcome of the studies indicates that the effects of EMSs
on environmental performance are unpredictable; and that Figure 3.4. EMAS certificate. An example of an EMAS certificate,
in this case for the main campus of the Technical University of
EMSs do not guarantee improved environmental performance. Dresden, Germany. (http://www.tu-dresden.de/wwbwlbu/forschung/
It seems that the effects of EMSs depend on the implementation abgeschlossene_projekte/emas_tud/inhalt.htm)
of the system in the company and supposedly external factors
like characteristics of the company adopting the system.
tems with the purpose to provide environmental improvements
3.4.5 Correlations Between EMS beyond regulatory compliance, indications of non-compliance
and Environmental Performance could constitute serious harm to the reputation of EMS.
Studies also indicate that companies, which adopt an EMS, are The use of EMSs is, however, a new practice. Such systems
usually “picking the low-hanging fruits”, that is, they are mak- have only been in use since the mid 90’s, and the knowledge
ing the environmental improvements, which are easiest and of the effects of the systems is therefore rather limited. Both
most economically attractive. The question is whether such ISO 14001 and EMAS were developed in the 90’s, and EMAS II
improvements would have been made anyway. These compa- was introduced as late as in 2001. So, naturally, our knowledge
nies are experiencing difficulties in continuing environmental about the effects of EMS, and companies certified according to
improvements after having “picked the low-hanging fruits”. these two management standards, is even more limited. Thus,
Experience even shows that many companies withdraw from the studies have not been able to investigate long-term effects
the EMAS system when the “low-hanging fruits” have been of the systems, which may prove to be substantial.
picked [e.g. Giessel and Veen, 2004]. Another possible explanation of the recent studies’ inabil-
Some studies actually indicate that the presence of an EMS ity to prove a correlation between EMS and environmental
in a company does not even guarantee legal compliance. Even performance could be insufficiencies of the analysis models
when it comes to EMAS registered companies, violation of reg- used in the studies. The missing correlation may in fact be due
ulations is not rare [e.g. Dahlström and Skea, 2002]. Being sys- to analysis models that do not include all relevant data.

62 are environmental management systems sufficient? 3

3.4.6 Environmental Management Systems 3.4.8 How to Ensure
and Compliance with Legal Regulations Improved Environmental Performance
One of the most often voiced reasons for a company to in- As already mentioned, the success in adopting an EMS is to
troduce an EMS is to assure compliance with environmental a large degree dependent on the way it is implemented in the
regulations. The management of the company want to be sure company. In spite of the pitfalls mentioned above, EMSs have
that no surprises will come when authorities come to check in fact the potential to provide improved environmental per-
their performance. However, as already mentioned, the im- formance, but it depends on a full implementation of the EMS.
plementation of an environmental management system does The implementation of systemic requirements is of course im-
not in itself lead to compliance, even if, for natural reasons, portant, but in order to get real environmental benefits of the
companies with EMS and certified companies are much more system, a full integration of environmental considerations in all
seldom found to have neglected a regulation. If it happens, of the activities and all levels of the company is a necessity.
authorities are more willing to negotiate on how to achieve Fully implemented, an EMS could contribute substantial-
compliance without paying penalties for a company that has ly to a better environmental performance, but this is still not
introduced a management system. commonplace today [e.g. Clausen et al., 2002]. If the EMS
is thought of by the company as just another instrument to
3.4.7 The Positive Sides gain profit, and environmental considerations are not entirely
– Improved Overview and Financial Benefits integrated into all activities of the company, the environmental
A general conclusion from many studies [e.g. Clausen et al., benefits of introducing an EMS are not necessarily identifi-
2002] is that EMSs do provide the company introducing such a able. A study by Hamschmidt from 2000, referred by Hertin
system with a better overview of the environmental impacts of et al., 2003, indicates that other motives than improved envi-
all the activities of the company in question. This knowledge is ronmental performance are often dominant when companies
primarily derived from greater data collection, which is system- adopt EMSs. This could perhaps be a barrier for the integra-
atised quite effectively by an EMS like EMAS or ISO 14001. tion of environmental considerations into all activities.
The improved data collection also allows for a greater Previous experiences with cleaner production have shown
insight into what regulation the specific company is covered four important elements to make a successful implementation
by, which is very relevant for the company, simply to be able of cleaner production in an enterprise. The same certainly ap-
to comply with the formal requirements [e.g. Dahlström and plies to the environmental management systems:
Skea, 2002]. Surprisingly, companies without an EMS tend Management commitment: The management of the compa-
not to have an overview of the relevant legislation but only ny must be devoted to the implementation, which means that
fragmented knowledge, gained because of specific campaigns it ought to be involved in following up on the environmental
on the subject from regulatory bodies or trade unions; or be- policy, the actions taken etc.
cause of customer and other shareholder demands. Employee involvement: The management should use the
Studies show that EMSs are able to provide essential data experiences from the employees in the production, because
on environmental performance as well as relevant legislation. they have the every day experiences and tacit knowledge about
It is, however, important to note that gaining knowledge does the production processes.
not necessarily mean that actions are taken in the light of the Cost awareness: In order to make the most environmen-
knowledge. If the company chooses to act upon the knowledge tally and economically efficient experiences, the management
gained and starts meeting regulatory requirements, it must be must have information about costs. Experiences from SMEs
assumed that the company will improve its environmental per- show that resources are wasted because the management does
formance. In this way, an EMS could indirectly contribute to not have the proper cost information.
a better environmental performance. However, such a correla- An organised approach: To implement CP-solutions it is
tion has not yet been proven in any study. necessary to establish procedures that make possible identifi-
Studies [e.g. Clausen et al., 2002] also indicate financial cation, implementation and evaluation [Berkel, 1999a].
advantages in introducing an EMS in a company. The mar-
ket response is not overwhelming, but some positive effects
on company competitiveness have been identified, and the
payback time of some of the investments in the EMS is quite
short, which makes it profitable for at least some companies to
invest in such a system.

3 are environmental management systems sufficient? 63

Study Questions Abbreviations
1. List some reasons for self-regulation instead of authority CP Cleaner Production
regulation of an activity. EMAS Eco-Management and Audit Scheme
2. Describe in brief, or with a diagram, how an EMS works. EMS Environmental Management Systems
3. Compare the three EMS of ISO 14001, EMAS-II and the IMS Integrated Management Systems
Green Network, and give reason for introducing each of ISO International Organization for Standardization
them. IVM Institute for Environmental Studies, Free University
4. Enumerate the tools an environmental management sys- of Amsterdam
tem has to assure correction of environmental shortcom- LPG Liquid Propane Gas
ings. MEPI Measuring Environmental Performance of Industries
5. What will determine if an EMS will achieve its objectives? (an IVM project)
Comment particularly on continuous improvement.
6. Describe in what way, and in what situations, the introduc-
tion of an EMS will lead to compliance with regulations. Internet Resources
7. Compare the roles and tasks of authority control and Institute for Environmental Studies (IVM), Free University of
external audit for certification of an EMS: Amsterdam
8. Describe the role and structure of an Environmental http://www.ivm.falw.vu.nl/Research_projects/index.cfm/
Statement as well as Environmental Reporting in an EMS.
Does it support compliance? The Eco-Management and Audit Scheme (EMAS)
9. What are the results of research on EMS in industry? Did http://ec.europa.eu/environment/emas/index_en.htm
it, and if so in what way, improve environmental perform-
ance? ISO Management Systems ISO 9000/ISO 14000
10. Summarize in three sentences what roles EMSs may have http://www.iso.ch/iso/en/iso9000-14000/index.html
in environmental regulation.
Green Network
http://www.greennetwork.dk/page61.asp

US Environmental Protection Agency on EMS

http://www.epa.gov/ems/

UK Environment Agency on EMS

http://www.environment-agency.gov.uk/business/444251/
466235/?version=1&lang=_e

EMAS Environmental Statement Library

http://ec.europa.eu/environment/emas/es_library/library_
en.htm

64 are environmental management systems sufficient? 3

 4
Self-regulation and
Voluntary Corporate
Initiatives

service need to be understood in order to know when the most

4.1 Voluntary Business Initiatives
significant impact occurs. Is it during the production phase or
4.1.1 The Challenges of Improving Environmental the use phase, or perhaps at the end-of-life? For which of these
Performance different phases is it most important to achieve improvement?
This chapter will review a number of voluntary corporate ini- Upstream and downstream environmental impacts become
tiatives that have been developed partly as private sector ini- dominating in the life of the products.
tiatives and partly as a joint industry – government ventures. Secondly in space: the globalised economy of today forces
The objectives of the initiatives vary considerably in scope and the company to ask which actor in the chain is the one that is
influence across the subjects, countries, and regions. They go
from supply-chain management, over product development
and operational standards, to reporting standards and consum- In this Chapter
er information systems. They are still developing.
As the companies establish environmental management 1. Voluntary Business Initiatives
systems in order to minimise environmental impacts caused The Challenges of Improving Environmental
Performance
by internal production processes, other environmental man-
The Life-Cycle Perspective
agement concepts have been developed to address two other The Communication Perspective
issues. Firstly, the problem related to managing the environ- 2. Instruments Based on Corporate Responsibility
ment performance of the suppliers or entire life cycle of the Codes of Conduct
product, and secondly, the communication of the environmen- Environmental Stewardship and other Codes
tal performance from the suppliers to the consumers (often Corporate Social Responsibility
3. Calculating Environmental and Societal Costs
a company) or from the company to customers as illustrated Sustainability Accounting
below. Environmental Management Accounting, EMA
The global division of labour has increased the risk of en- The Triple Bottom Line
vironmental dumping, since the enforcement and the level of The Global Reporting Initiative, GRI
environmental regulation varies globally. Corporations that 4. Product-related Measures
Eco-design
seek to prevent environmental dumping as an effect of their
Extended Producer Responsibility
outsourcing strategies must include the suppliers in their envi- Eco-labelling
ronmental management. They do this by setting up standards 5. Evaluating Corporate Voluntary Initiatives
for environmental performance and working conditions at the The Positive Sides of Voluntary Measures
suppliers, called “codes of corporate conduct”. Which Environmental Management Instru-
The challenge an organisation or company is facing today ment to Choose
Does Voluntary Measures Lead to Compli-
when striving to improve its environmental performance is thus
two-fold. First in time: the entire life cycle of the product or

4 self-regulation and voluntary corporate initiatives 65

 Life Cycle of the product – from cradle to grave
Raw material, auxiliary materials, energy and other inputs

End
Supplier Supplier Company Consumption of life Figure 4.1 The life cycle perspec-
tive. During the entire life cycle of
Disposal a product material flows (from up
to down) impacting on the environ-
ment takes place. The extraction of
raw materials is most important for
a copper cable, but the consump-
tion phase for e.g. a car. Recycling,
Solid & hazardous waste, emission to air, wastewater not shown here, should be promoted
whenever possible.

causing the most impact. Is it resource extraction, supplier’s bottle. During the 1990’s it was further developed by the So-
production or the use phase? Again, what role does each one ciety of Environmental Toxicology and Chemistry (SETAC),
of these have in the efforts to achieve improved environmental which defined standards etc needed. It is today established as
performance? How can it be controlled? an important tool for larger industries.
Both eco-design and Life Cycle Assessment, LCA, is treat-
4.1.2 The Life-Cycle Perspective ed in detail in book 3 in this series.
A number of tools are available to systematically review and
find environmental improvements for existing products, prod- 4.1.3 The Communication Perspective
uct development. One of the most comprehensive of these is The eco-design reviews and LCA results are not well suited
eco-design or design for the environment, DfE. It is a concept for information about environmental performance of a product
that addresses the product’s environmental performance from to the average consumer. They are too detailed and technical.
cradle to grave by changing the design of the product. In an Therefore a series of simplified tools for communicating en-
eco-design the impact of the product in several different as- vironmental profiles of products to the customers have devel-
pects, such as resource use, transport, toxicity, waste etc, is oped. These are eco-labels. Eco-labels exist in a large variety
reviewed over its entire life cycle. Ways to improve the prod- of shapes. Some of them use criteria formulated and moni-
uct in all these different aspects is then made. Eco-design is a tored by governmental agencies. Most of them are established
managerial tool that can be used by all companies. Experience by NGOs or as a business undertaking in trade organisations.
is that a product development using eco-design most often also Another way of communicating the environmental per-
leads to improved economy. Eco-design, pioneered by Delft formance of the company is green reporting, that is, environ-
University of Technology in the Netherlands, has been much mental reports, together with economic reports.
promoted by UNEP in the so-called Promise Manual first pub- Also the results of codes of conduct, that is the social per-
lished in 1997 and further developed since. formance of the company, needs to be communicated to the
A technically more advanced tool for studying the environ- customers, or in general to the stakeholders of an organisation.
mental impact during the life cycle of a product is Life Cycle Otherwise they would loose an essential part of their meaning.
Assessment, LCA. In an LCA the entire material flows con- The reports of a company have the increasingly important task
nected to the life cycle of the product is quantitatively assessed. of building trust and goodwill. For this reason a number of
Typically the environmental impacts of several hundreds of tools for social reporting have developed. These are in most
materials are measured. LCA was pioneered by beverage com- cases based on company initiatives and thus part of the culture
panies, which wanted to see which was more environmentally of self-regulation and voluntary corporate initiatives that is in
friendly, a recyclable glass bottle or a non-recyclable plastic focus in this chapter.

66 self-regulation and voluntary corporate initiatives 4

4.2 Instruments Based on Corporate investigate which organisations developed codes of conducts,
Responsibility what objectives the codes set for themselves and by which
means these objectives should be addressed. According to the
4.2.1 Codes of Conduct
workgroup the codes were mainly made by (multinational)
Along with growing global trade and production, a number
companies (148), but some were made by industry and trade
of companies, shareholder associations, unions and intergov-
associations (92); partnerships of stakeholders, such as unions
ernmental organisations have established codes of corporate
and NGOs (32); and international organisations (4).
conduct. The codes of conduct state the corporate policy on
Environmental stewardship (145) was the second most fre-
environment, labour conditions etc. They were established to
quently mentioned issue in the survey, next to labour stand-
respond to the societal concerns about the level of safety and
ards (148). Consumer protection was mentioned in 117 cases,
working conditions and the environmental impacts of the com-
bribery in 56 cases, competition in 50 cases, information dis-
pany activities [OECD 2001].
closure in 45 cases, science and technology in 26 cases and
Several attempts have been made to make common codes
taxation in 1 case [OECD 2000].
of conduct by trade associations and intergovernmental or-
According to the OECD investigation, the coverage of
ganisations, in order to prevent the dumping of environmental
the codes varies much. Some codes mention the environment
standards and working conditions, which tends to be one of
briefly, while other codes (26) are completely devoted to the
the negative effects of global production. The United Nations
subject. The three most common attributes discussed in the
Centre on Trans-national Corporations made a draft in 1988,
environmental stewardship [OECD 2000] are:
and in England a proposal on a common national code of con-
ducts was made. It seems, though, that these common standard • Compliance with the law.
codes are not fully accepted, and still an increasing number of • Openness to community concern.
organisations make their own codes of conduct. These include • Environmentally friendly products and services.
IKEA and Nike. Some enterprises adopt very broad codes of
In 51% of the codes it was stated that the code is an at-
conduct made by institutions like the UN. The codes of other
tempt to protect or enhance the reputation of the enterprise or
companies are much more specific and related to the problems
its products. For larger companies their public reputation is a
connected only to their area of business [OECD 2000].
valuable asset. The code of conduct is a way to make a state-
A code of conduct is a statement that must be followed by
ment about the ethical issues related to the production and is
management instruments, such as EMAS and ISO 14001, and
a part of the concept of corporate social responsibility. Fewer
guidelines on best practices to be fully implemented. Depend-
codes described how the code should be enforced, and only
ing on the company’s activities, the implementation could take
one enterprise mentioned that two suppliers have been exclud-
place within the organisation itself and/or at the suppliers. Inter-
ed as a result of non-compliance with the code [OECD 2000].
nal and external implementations bring different challenges and
It remains to be investigated whether companies actually
require to some extent different sets of instruments. The man-
implement their codes on their suppliers or if it is just a piece
agement of a corporation or company has the power to allocate
of paper for suppliers to sign that free the corporations from
the necessary resources when it is an internal implementation
their legal responsibility but with no actual practical implica-
of a code of conduct. When the implementation is taking place
tions. The enforcement of the codes may be a future challenge
in an external company, a supplier, there are other managers in
for the companies, if they want to live up to the corporate so-
charge who may not be devoted to the code of conduct, which
cial responsibility that they have declared by making a code
can put a brake on the implementation. A similar situation can
of conduct. Additionally, a public monitoring of this process
develop in a large multinational corporation, which is charac-
should make sure that the companies are committed to and
terized by geographical as well as cultural differences dividing
fulfilling their own standards.
the corporate head from the divisions in other countries. Fur-
thermore, the implementation of the code of conduct will com- 4.2.3 Corporate Social Responsibility
pete with the purchasing and financial departments’ demand for
The need for organizations in both public and private sectors
price reductions, the production manager’s lack of time etc.
to behave in a socially responsible way is increasing in society.
This has led to the development of the notion of Corporate
4.2.2 Environmental Stewardship and other Codes Social Responsibility, CSR. It is based on the understanding
In 1998, 246 codes of conduct from organisations in OECD that an organisation or company has responsibility for the ef-
countries were reviewed by an OECD workgroup in order to fect of its activity in the surrounding world. A widely quoted

4 self-regulation and voluntary corporate initiatives 67

 a certain ethical standard. Basic standards include legal com-
pliance, e.g. human rights, respect for workers rights, and re-
specting environmental regulations, but it may also consider a
company’s CSR. Social performance may also be considered
when selecting providers of goods and services. Ethical invest-
ments represent an increasing share of all investments, e.g. in
Sweden alone some 20 billion dollars in 2004.
It is no surprise that CSR has grown exponentially in the
last decade. It is important to say that more often than not com-
panies that have a well-developed CSR programme underline
that this is good business. It is profitable in economic terms
contrary to conventional thinking.
CSR is starting to be included in the general management
Figure 4.2 Corporate Social Responsibility. Koffie Kàn is a small- agenda. There is an array of different opinions as to the right
scale Coffee Roasting House in Belgium that strives to minimise the approach ranging from strict legislation at one end to complete
company’s impact on the environment, while at the same time giving freedom at the other. Government regulation in this area is in-
support to small-scale farmers in social development projects in Hon- creasing, and sometimes international, such as EU, legislation.
duras and Mexico. In 2002 Koffie Kàn was honoured with the Solidar- ISO, the International Organization for Standardization, has
ity award [http://www.koffiekan.be]. (Photo: © Co-op Fairtrade)
decided to launch the development of an International Stand-
definition (World Business Council for Sustainable Develop- ard providing guidelines for social responsibility (SR) to be
ment) states, “Corporate social responsibility is the continuing published in 2008 as ISO 26000. It will be voluntary to use,
commitment by business to behave ethically and contribute to that is, will not include requirements and not be a certification
economic development while improving the quality of life of standard. ISO says “Our work will aim to encourage voluntary
the workforce and their families as well as of the local com- commitment to social responsibility and will lead to common
munity and society at large.” guidance on concepts, definitions and methods of evaluation.”
The organisation Business for Social Responsibility (BSR)
defines corporate social responsibility as “achieving com-
4.3 Calculating Environmental and Societal
mercial success in ways that honour ethical values and re-
Costs
spect people, communities and the natural environment.” A
variety of terms are used when talking about CSR: business 4.3.1 Sustainability Accounting
ethics, corporate citizenship, corporate accountability, and The first experiments with “green accounting” were carried
sustainability. In this sense, CSR is viewed as a comprehensive out in the 1970s by enterprises trying to calculate how they
set of policies, practices and programs that are integrated into were obliged to take societal responsibility. The statements
business operations, supply chains and decision-making proc- were called corporate social accounting or social responsibil-
esses throughout the company and includes responsibility for ity accounting. Among the large number of problems related
current and past actions as well as future impacts. to these accounting systems were the lack of detail and com-
CSR is linked to sustainable development, and many ar- monly accepted standardisation of the systems, which made a
gue that CSR obliges companies to take not only business in- comparison of statements nearly impossible for stakeholders.
terests into account, but also all dimensions of sustainability, In the early 1980’s, the number of experiments declined, but
in particular environmental and social aspects, in addition to in the late 1980’s the environmental movement returned and
economic ones. the development of green accounting is still going on in many
Corporate responsibility has a moral background but also forms [Ulhøi 1997]. The most recent initiatives are EMA (En-
a very factual one. It reflects an increased importance of fac- vironmental Management Accounting) and GRI (Global Re-
tors other than the purely economic, including environmental porting Initiative), both sponsored by the UN.
performance, the situation of the workers, the concern for the Along with the Brundtland Report in 1987 several attempts
customers, and the society in general. “Society” in this context were made to develop sustainability accounting systems. One
is often meant to include all the stakeholders of a company. of the efforts was a continuation of the social responsibility ac-
Another factor is the increased role of so-called ethical counting from the 70s. It balances up the economic, social and
investing. Financiers prefer to invest in companies that have environmental activities of a company to identify if they are

68 self-regulation and voluntary corporate initiatives 4

sustainable or un-sustainable. This has lead to attempts at cal- information. Environmental management accounting, on the
culating the societal cost of the un-sustainable activities [Ulhøi contrary, is first and foremost a decision-making instrument,
1997]. The problems related to these efforts are mainly to set which can be used by the company management to prioritise
the scope of the impact assessment, and calculate the value environmental tasks and investments.
of the irreversible environmental impacts on nature. There is, EMA can be used also by other organisations, e.g. local
however, no self-evident scope of impact studies, which makes authorities.
it difficult to calculate the costs of impacts.
4.3.3 The Triple Bottom Line
4.3.2 Environmental Management Accounting, EMA A relatively established type of sustainability accounting is
For environmentalists conventional accounting practices have the Triple Bottom Line. The “triple” refers to the economic,
several shortcomings. They hide environmental costs, e.g. in environmental and social aspects of sustainability. The phrase
overhead accounts; they often allocate environmental costs in- was coined by John Elkington, co-founder of the business
correctly; they see environmental costs as fixed when they may consultancy SustainAbility in 1994. It was later expanded and
actually be variable; they do not account for volumes (and thus articulated in his 1998 book “Cannibals with Forks: the Triple
costs) of wasted raw materials correctly; and, especially they Bottom Line of 21st Century Business”.
do not include relevant environmental costs in the accounting One example of how it is applied is the Novo Nordisk, a
records at all. Danish medical company that produces insulin and devices
As good environmental and sustainability management by related to diabetes care. Since 1991, the company has worked
business and other organisations become increasingly impor- on developing green accountings. The report on the triple bot-
tant, good accounting and financial management techniques tom line from 2001 contains a financial report and social and
have developed. Environmental Management Accounting, environmental accounts. The idea of the triple bottom line is
EMA, is among the most widely practiced. It primarily sup- also said to represent profit, people and planet; the thought is
ports the information needs of the organisation’s own manage- that the enterprise or organisation can reveal a truer image of
ment, but is also used for company reporting. its assets through the combination of the three accounts. The
The concept combines the environmental and economic environmental report describes the key environmental per-
accounting of the company into one tool. Environmental man- formance indicators. These are input of raw materials; pack-
agement accounting is an instrument that is used to describe aging energy and water; and output in the form of air emis-
the environmental efficiency or performance of the company. sions, liquid and solid waste and the total amount of products
Here the mass balance is an inventory of the activities car- produced. The indicators of the mass balance are compared
ried out in the company. The environmental management ac- with the mass balance from previous years [Novo Nordisk
counting is an instrument to support managerial decisions. For 2002]. On the basis of the account it is possible to conclude
example it provides economic cost assessments when making whether the enterprise is more or less eco-efficient than the
new investments. previous year.
EMAN, a network of researchers, policymakers and busi- Legislation mandating a Triple Bottom Line is under con-
ness promoting EMA, defines EMA as “the identification, sideration in some countries, but most argue that businesses
collection, estimation, analysis, internal reporting, and use of should be able to voluntarily adopt a “Triple Bottom Line” as
materials and energy flow information, environmental cost in- part of their bylaws.
formation, and other cost information for both conventional
and environmental decision-making within an organization”. 4.3.4 The Global Reporting Initiative, GRI
As an example Novo Nordisk’s environment report ac- The GRI, Global Reporting Initiative, is perhaps the most
counts for environmental costs and investments which sum- recognised format for reporting in which economic, environ-
marise the costs of running the environmental department; the mental and social aspects are all covered, that is, sustainability
costs of waste water treatment; biomass management; costs of reporting guidelines. GRI, created in 1997, today works with
handling and disposal of solid waste; energy taxes and reme- ISO and UNEP. The GRI is supported by many important or-
diation costs for polluted sites, so-called brown fields. ganisations, such as Business for Social Responsibility (BSR).
The environmental manager too often performs green ac- BSR writes “the independent Global Reporting Initiative’s
counting without any connection to other parts of the company. Sustainability Reporting Guidelines (GRI), which promote
But green accounting alone is not efficient in supporting man- disclosure on a broad set of management policies and perform-
agerial decisions, as it was developed only to provide green ance indicators, have emerged as an important benchmark for

4 self-regulation and voluntary corporate initiatives 69

many companies’ CSR reporting. Globally, some government There are several different names for the concept of envi-
agencies and even stock exchanges have begun requiring more ronmental improvements through product design, e.g. Design
public disclosure of companies CSR performance.” for Environment, DfE, Life Cycle Design and Eco-design. In
The Global Reporting Initiative’s (GRI) vision is that re- the end these are essentially the same process and based on the
porting on economic, environmental, and social performance original work of Delft University of Technology in the Neth-
by all organizations becomes as routine and comparable as erlands. In general, eco-design is a set of techniques to reduce
financial reporting. GRI accomplishes this vision by develop- environmental impact from each of the different aspects of a
ing, continually improving, and building capacity around the product, such as material used, transport and packaging, func-
use of its Sustainability Reporting Framework. An internation- tion, recycling etc. It differs from traditional design by add-
al network of thousands of organisations from business, civil ing environmental awareness to aesthetics and functionality as
society, labour, and professional institutions create the content criteria for success.
of the Reporting Framework in a consensus-seeking process. A work paper from a team at the International Organisation
BSR has helped lead the development of CSR reporting as of Standardisation, ISO, suggests three eco-design strategies:
a professional discipline. Staff has participated in collabora- 1) Strategy for optimising the function of the product; 2) strat-
tive efforts by entities such as the Global Reporting Initiative egy for conservation of resources, reuse, recycling and energy
(GRI), AccountAbility and the U.K. Company Law Review to recovery; 3) Strategy for prevention of pollution, waste and
develop and refine CSR reporting guidelines and standards. other effects [ISO 2001]. The three strategies involve different
The Guidelines should be used as the basis for all report- instruments but by following one of the strategies the results
ing. They are the foundation upon which all other reporting will overlap.
guidance is based, and outline a core content for reporting that As implied, there are innumerable factors that motivate en-
is broadly relevant to all organizations regardless of size, sec- terprises to use eco-design. The motivation can be the wish for
tor, or location. The Guidelines contain principles and guid- an easier end-of-life treatment; reuse/recycling of the product
ance as well as standard disclosures – including indicators – to or the materials; or solving environmental impacts related to
outline a disclosure framework that organizations can volun- the product initiated by legislation. Other drivers can be the
tarily, flexibly, and incrementally, adopt. The guidelines from expectation of new market shares by promoting sustainable
2002 have in 2006 been replaced by Guidelines v3.0. Proto- products or, as already mentioned, cost savings by reduced re-
cols are the “recipe” behind each indicator in the Guidelines source and energy use.
and include definitions for key terms in the indicator, compila- One of several factors that can promote eco-design is the
tion methodologies, intended scope of the indicator, and other response to new or expected regulations. Innovation will then
technical references. be concentrated on complying with the new demands. An ex-
In 2006 more than 1,000 companies reported according ample is Siemens Mobile Phones that tries to respond to the
to the GRI guidelines, most of them large, or very large. For demand for lead-free soldering in electronic equipment by ex-
some time there have also been guidelines for public institu- perimentally launching 10,000 lead-free telephones.
tions, to make it possible for local authorities in particular to Another objective of eco-design is to enable the producer
adopt a uniform set of principles for sustainability reporting. to achieve systematic improvements of the function performed
by the product or effects of the product, whether motivated
by legislation or other factors. The most radical perspective is
4.4 Product-related Measures
to rethink – not redesign – the product or service by starting
4.4.1 Eco-design out with the function of the old product and the expectations
Eco-design is a tool to improve the environmental performances on the new product or service. This strategy could make com-
of a product, just as the environmental management systems aim pletely new solutions possible that do not result in as great
at improving the environmental performances of the company. environmental impacts as the old product.
Eco-design addresses the whole life cycle of the product. Yet another possible strategy is redesign. Redesign can be
While eco-design focuses on the product, there are other based on a life cycle assessment or screening, which points out
tools focusing on other parts of the manufacturing process. the most problematic environmental impacts of the product.
Thus Cleaner Production, CP, deals with the production proc- The concept of the product remains the same but substances and
ess itself. Supply-Chain Management is looking in particular material can be substituted or production processes changed.
on the resources used for the manufacturing. Waste manage- At the end of an eco-design process, the environmental
ment is geared towards the end of the life of the product. performance of the new solution should be evaluated, e.g. by

70 self-regulation and voluntary corporate initiatives 4

 4.4.2 Extended Producer Responsibility
The material flows in Europe and the world have resulted in a
crisis of waste. Material flows were largely linear, giving rise
to enormous waste heaps. The 1970’s saw the first strict efforts
to reduce waste flows, implemented in Germany. Today there
are increasingly stricter regulations on waste in all of Europe,
and costs for sending waste to landfills are increasing. A most
important strategy for waste management is recycling.
Conventionally the local municipality has the responsibil-
ity to take care of waste. This is now being reconsidered. With
the increasing amount and complexity of waste, the OECD and
the EU Commission have introduced the concept of Extended
Producer Responsibility, suggesting that the producer holds the
responsibility for a product after its end use. In other words, the
producer is obliged to ensure a reasonable waste treatment. This
means that the company that manufactures, imports and/or sells
products and packaging is required to financially or physically
be responsible for the products after their useful life. They may
take back spent products and manage them through reuse, recy-
cling or in energy production. Another possibility is to delegate
this responsibility to a third party, a so-called producer respon-
sibility organization (PRO), which is paid by the producer for
spent-product management. In this way, EPR shifts responsibil-
Figure 4.3 Eco-design. Eco-design and Life Cycle Assessment ity for waste from local government to private industry, obliging
have become standard tools in many large and small industries. producers, importers and/or sellers to internalise waste manage-
These tools have contributed to reduced material weight, environ- ment costs in their product prices [Hanisch, 2000].
mental impact and improved recyclability of many standard cars.
Extended Producer Responsibility has been implemented
In the future we may see cars with advanced technology, such as
this Daimler Chrysler using a fuel cell powered electric motor. The in many forms, which may be classified into three major ap-
driver is the Czech commissioner for science and research Janes proaches:
Potocnik. (Photo © European Community)
• Regulatory
• Negotiated
comparing the new and the original product. The solution of
• Voluntary
one problem can easily be the cause of other environmental
impacts, which need to be avoided. In the EU’s WEEE-directive (waste of electrical and elec-
The scope of eco-design embraces the whole life cycle – tronic equipment), the environmental producer responsibil-
also called the product chain – of the product from extraction ity, including demands for recycling of more than 50% of the
of raw materials, production, use, and finally the end-of-life products, is an example of the regulatory approach. To respond
treatment. The efficiency of eco-design varies a lot, depending to the legislation, enterprises can use the eco-design strategy,
on the strategy and the product type. Often radical rethinking for example by selecting the materials used in the product on
of the product is far more eco-efficient than redesign [Brezet the basis of their recycling potentials. In this way it is possible
2001]. For example it is more radical to use mobile telephones to reduce the use of virgin raw materials. This could also be
instead of building an entire conventional land-based phone beneficial to the companies as it saves the costs of resource ex-
system. This is now being done in several countries in Africa. traction. Depending on the expected regulation, the enterprise
Replacing a product with a service is another example, such can use one of these three eco-design strategies.
as when a car company leases the cars instead of selling them. In Sweden much waste management is the result of a ne-
Shared use of products is a further possibility such as joining a gotiation between industry and the government. In response a
car pool instead of using a private car, multitude of waste management companies have developed.
A more detailed treatment of eco-design is given in Book They have organised waste collection stations in cities, collect
3 in this series. and return e.g. glass, paper, and plastics etc back to industry as

4 self-regulation and voluntary corporate initiatives 71

Box 4.1 Eco Labels

The Flower is the official EU eco-label award, introduced in The Swan is the official Nordic eco-label and was devel-
1993, inspired by the Swan. So far, more than 250 licenc- oped by the Nordic Council of Ministers in 1989. The
es have been awarded products in 23 product groups. eco-label of the Swan can be found on more than 800
products within 70 product groups in Scandinavia.
Objectives:
To assist consumers in their shopping choices, identifying Objectives, Means and Criteria:
which products are environmentally preferable, thereby Objectives, means and criteria are quite similar to the
enabling the consumers to act for the benefit of the envi- ones of the EU Flower. A main difference compared to the
ronment, by purchasing environmentally sound products. Flower it that the awards are reviewed every year.
To make manufacturers compete in developing the
most environmental sound products as a result of the Product groups:
greater focus on environmental issues by the consumers. Adhesives; Audiovisual equipment; Automatic dishwash-
ing detergent; Batteries (primary and rechargeable);
Means: Building materials; Car care products; Car wash installa-
Creating, upgrading and maintaining a common EU-wide tions; Cleaning products; Cleaning services; Closed fire-
eco-label with clear, regularly updated criteria that have to places for biofuel; Closed toilet systems; Coffee filters;
be met by manufacturers. (Criteria are set by the Eco-label- Composts; Compressors; Copying machines/printers/fax
ling Board with representatives of different interest groups.) machines; Cosmetic products; De-icers; Detergents for
textiles; Dishwasher detergents for professional use; Du-
Criteria: rable wood (Alternative to conventionally impregnated
Should guarantee the lowest possible impact on the en- wood); Filmforming floor care products; Flooring; Furni-
vironment through the entire life cycle of the product in ture and fitments; Grease-proof paper; Hand towel roll
question, without lacking behind compared to similar services; Hand washing up liquid; Hotels; Industrial clean-
products, in terms of quality, duration and functionality. ing and degreasing agents; Kitchen appliance and equip-
ment; Laundries; Lawn movers; Light sources; Lubricat-
Product groups: ing oils; Marine engines; Microfibre cloths and mops; Oil
All purpose cleaners; Clothing, bed linen and indoor tex- burner/boiler combinations; Outdoor furniture; Packag-
tiles; Copying and graphic paper; Dishwashers; Dishwash- ing paper; Paper envelopes; Personal computers; Photo
ing detergents; Hand dishwashing detergents; Hard floor finishing services; Printed matter (brochures, catalogues,
coverings; Laundry detergents; Light bulbs; Mattresses; magazines); Printed wiring boards; Printing paper; Sani-
Paints and varnishes; Personal computers; Portable com- tary products; Shampoo/conditioner; Small heat pumps;
puters; Refrigerators; Shoes; Soil improvers; Televisions; Solid biofuel boilers; Supermarkets and grocery stores;
Tissue paper; Tourist accommodation service; Vacuum Textiles; Tissue paper; Toner cartridges; Washing ma-
cleaners; and Washing machines. chines; Vehicle tyres; Windows; Working machines, park
and garden; and Writing instruments.

(Further reading: European Eco-label catalogue)

Source: http://www.eco-label.com/default.htm Source: SIS Ecolabelling 2004 ; http://www.svanen.nu/Eng/

72 self-regulation and voluntary corporate initiatives 4

material recycling. A minimum level of recycling for various Though the idea of eco-labels is to guide the consumer to
waste categories was agreed on with the government, which products with certain environmental characteristics, the jun-
has been achieved. In particular the recycling of aluminium gle of different labels sometimes tends to confuse more than
beverage cans, using deposits, has been very successful (more provide guidance. Both the schemes of the EU and the Nordic
than 90%). Council are evaluated and tightened up every third year. It has
been discussed if the award schemes can be used as a regulato-
4.4.3 Eco-labelling ry push to urge companies to improve the environmental per-
formance of their products. The problem is, on the other hand,
An eco-labelling award scheme is a market-based instrument
the desire that as many producers as possible should apply for
that should stimulate both the supply and demand of products
the eco-label. The experience from the EU eco-labelling on
with reduced environmental impacts. An eco-label provides the
textiles shows that the committee evaluating the criteria choos-
consumer with an easier way to find ecologically or environ-
es to keep the criteria at the same level, so that more producers
mentally friendly products. The idea is to provide the consumer
would apply for the eco-label. If this is a general tendency it
with enough information to act in an environmentally sound way
speaks against the eco-labelling schemes as a regulatory push.
without creating an information overload that will only serve to
The eco-labelling schemes then do not motivate the producers
confuse the consumer even more. The other objective with the
to improve the environmental performance of products.
eco-labelling scheme is to attract companies to take environ-
mental precautions in their product chain, because the scheme
provides the companies with recognizable information about the 4.5 Evaluating Corporate Voluntary Initiatives
characteristics of the product, an environmental brand. Informa-
4.5.1 The Positive Sides of Voluntary Measures
tion about products is one of the cornerstones both according to
Corporate voluntary initiatives are interesting from a policy
the economic theoretical understanding of an open market with
perspective because companies have the power to improve
free competition, and the concept of the political consumer.
their environmental performance by changing the organisation
The eco-labelling award schemes are voluntary and are of-
of production, the demand to suppliers, and investing in en-
ten based on a multi-criterion approach. The latter means that
vironmentally sound technologies. Voluntary instruments can
the criteria are selected from life cycle considerations, which
serve as strategic management systems for implementation of
can be a combination of energy savings, material-efficiency,
these improvements with regard to the economy and specific
and reduced amounts of hazardous substances or heavy met-
technical possibilities of the company. Even if corporate self-
als. An example of a label that only has a single criterion is the
regulation cannot replace legislation, the implementation of
US energy-star on electric and electronic equipment, which
voluntary initiatives is partly motivated by the pressure from
demonstrate the products with a low level of energy demand
environmental regulations. In addition, voluntary initiatives
in the use phase.
are motivated by a need to build corporate images. Finally it
The eco-labels are awarded by independent third-party or-
may allow a company to manage the flow of resources with-
ganisations that check if products meet the criteria of the scheme.
in the corporation as a whole, at single production sites, and
Other types of schemes exist, with various labels and criteria.
through linkages to the supply chain.
The International Organization for Standardization (ISO) has
A certificate or a corporate code of conduct does not by
identified three broad types of voluntary labels, of which eco-
itself lead to environmental improvements. Only by a thorough
labelling could be categorised under the Type I group:
implementation throughout the whole company, from the man-
• Type I -- a voluntary, multiple-criterion based, third party aging director to the worker on the floor, can it contribute to en-
program that awards a license that authorizes the use vironmental improvements. It is an ongoing development proc-
of environmental labels on products, indicating overall ess, which does not stop but rather begins when implementing
environmental preference of a product within a particular the environmental management instruments. In order to benefit
product category based on life cycle considerations. from voluntary initiatives, it is of great importance for the man-
• Type II -- informative environmental self-declaration claims. agement to realise and commit to this continuing process.
• Type III -- voluntary programs that provide quantified en-
vironmental data of a product, under pre-set categories of 4.5.2 Which Environmental Management Instrument
parameters set by a qualified third party and based on life to Choose
cycle assessment, and verified by that or another qualified Environmental management instruments can be used to change
third party [GEN]. the perception of the relation between environmental problems

4 self-regulation and voluntary corporate initiatives 73

 and solutions, by changing the way the company manage their
Box 4.2 Reports on Voluntary Instruments in
resources, product development, purchase etc. The applied
Press
management instruments, like environmental management
systems, codes of conduct and eco-design can maintain the
Xerox Saved $2 Billion Through Eco-Design and
focus on the environmental issues that must be addressed. In
Manufacturing [www.greenbiz.com]
addition, tools like input-output balances, environmental man-
Japanese Eco-Design May Help Businesses Meet agement accounting, and life cycle assessment can be used
New EU Standards [www.edie.net/news/news_story. to reveal the financial side of the company’s environment, or
asp?id=6285&channel=0#] the main environmental impacts of the production, and of the
product from cradle to grave.
Novo Nordisk: Companywide Commitment to Tri-
ple Bottom Line Safe [Climate Case Study, 2003]
Common to these voluntary instruments is that they can
serve as indicators of the corporate environmental management
Future 500 Upgrades Software Tool for Better CSR approach. A more thorough analysis of the environmental man-
Strategy, Reporting [www.greenbiz.com] agement initiatives can determine whether the corporate initia-
SAN FRANCISCO, June 15, 2005 – The Future 500, a tives address the most significant environmental problems of
nonprofit network of major corporations and NGOs,
the company, or if they are only image building. Furthermore,
has released the third version of its Global Citizenship
360, a software process designed to promote better CSR a study can reveal if the initiative improves the environmental
strategy and performance and help improve GRI and performance of production and products. Global Citizenship
sustainability reporting. 360 has developed a software that can be used to study the
Currently used by over 75 auto, food, beverage, bank- relevance and effectiveness of the instruments a company uses
ing, energy, and electronics companies in 60 countries (See further Box 4.2). It can also be used to study a company
worldwide, Global Citizenship 360 (GC360) helps compa-
nies measure, report, and improve performance against the without environmental schemes, to locate what type of envi-
Global Reporting Initiative (GRI), Dow Jones Sustainability ronmental approach the company should choose.
Index, FTSE4Good, Global Compact, ICCR, and 16 other
standards. With a built-in GRI reporting framework, the 4.5.3 Do Voluntary Measures Lead to Compliance?
GC360 aligns a total of 20 sets of standards with the GRI For their effect, voluntary measures are totally dependent
guidelines to drive further value from GRI reporting efforts.
on management intensions and the kind of use management
Formerly known as the CAP Gap Audit, the GC360
software also includes an analysis tool for performance makes of them. Whether under the heading of corporate re-
assessment, information management, trend analysis, sponsibility, accounting principles or product responsibility
and strategy creation. there will always be a business element, or perspective, in
setting up the measures in the first place. It may be cost re-
Report Examines Companies’ Success in Applying
ductions, image nursing or improved stakeholder relations,
GRI Economic Performance Indicators [www.green-
biz.com] including relation to public authorities. Except for the cost
SAN FRANCISCO, Calif., Dec. 6, 2005 – Business for So- reduction purpose, these business perspectives will, however,
cial Responsibility has released a new report that reviews only work if there is substance to the environmental and cor-
how well the Global Reporting Initiative (GRI) Economic porate responsibility side of the initiative in the eyes of tar-
Performance Indicators have been applied by 33 com- get groups and stakeholders. Setting up voluntary measures
panies, including GE, McDonald’s, Novo Nordisk, Shell,
Starbucks, and Toyota. Reporting on Economic Impacts
without the intention to make them work can easily become
evaluates how the Economic Performance Indicators have counterproductive for the company. Voluntary measures are
been used and proposes recommendations for updating at the same time expensive, or very expensive, to establish,
the GRI Guidelines. and the cost reductions often aimed at as a central element
BSR’s new report addresses direct, indirect, and local to the initiative will only be met if they are effectively im-
economic impacts based on the most recent sustainability
plemented and maintained. In these latter two aspects lies an
reports released by a cross-section of companies. For each
of these dimensions, Reporting on Economic Impacts ex- implicit push towards fulfilling the environmental and social
plains BSR’s findings and conclusions, the implications responsibility aims of the measures. This in turn will support
for Guideline revisions, and recommended changes to compliance, which will always be a built-in minimum in any
ensure the clarity, comparability and assurability of the voluntary measure.
GRI Economic Performance Indicators.

74 self-regulation and voluntary corporate initiatives 4

Study Questions Abbreviations
1. Describe the most important stages in the life cycle of a BSR Business for Social Responsibility
product and the environmental impacts, which may be CP Cleaner Production
caused by each of them. CSR Corporate Social Responsibility
2. Explain the concepts of environmental stewardship and DfE Design for the environment
corporate social responsibility (CSR) and argue for or EMA Environmental Management Accounting
against that these should be adopted by business. EMAS Eco-Management and Audit Scheme
3. Describe what issues are addressed in a code of conduct. GEN Global Eco-labelling Network
4. What instruments do companies use to communicate their GRI Global Reporting Initiative
environmental performance and social responsibility to ICCR Interfaith Center on Corporate Responsibility
their stakeholders? ISO International Organization for Standardization
5. Explain how environmental accounting and other forms LCA Life Cycle Assessment
of sustainability accounting may help companies to reach OECD Organisation for Economic Co-operation and
the goal of sustainable business. Development
6. Describe the concept of Triple Bottom Line and how it PRO Producer responsibility organization
became a success in the business world. SETAC Society of Environmental Toxicology and Chemistry
7. Describe the different forms of sustainability report- SR Social responsibility
ing and what role they play for the companies and the UNEP United Nations Environment Programme
stakeholders, in particular customers, owners and public WBCSD World Business Council for Sustainable
authorities. Development
8. Describe in brief how the eco-design of a product is WEEE Waste of electrical and electronic equipment
conducted, and what issues are addressed in the re-design
of a product.
9. What are the reasons for a company to start working with Internet Resources
eco-design? European Environment Agency’s guide to LCA
10. Describe the most common types of eco-labels of prod- http://reports.eea.europa.eu/GH-07-97-595-EN-C/en
ucts and what information they provide.
11. What are the reasons for companies to start using eco-la- Environment Canada’s website of life cycle management
bels on their products? http://www.ec.gc.ca/ecocycle/en/whatislcm.cfm
12. List the most important voluntary regulatory instruments
in the field of environment and sustainability used by ma- IKEA Code of conduct
jor business and other organisations such as municipali- http://www.ikea-group.ikea.com/corporate/responsible/
ties; describe the role they have in achieving compliance conduct.html
with environmental legislation.
Corporate Social Responsibility (CSR) web pages of the
European Commission
http://ec.europa.eu/enterprise/csr/index_en.htm

International Institute of Sustainable Development, IISD, on

CSR standards
http://www.iisd.org/standards/csr.asp

CSR Europe
http://www.csreurope.org/

Business in the Community – UK Network of 700 companies

site of CSR
http://www.mallenbaker.net/csr/

4 self-regulation and voluntary corporate initiatives 75

Business for Social Responsibility, BSR
http://www.bsr.org/

Environmental Management Accounting (EMA) Research and

Information Centre
http://www.emawebsite.org/

The Environmental and Sustainability Management

Accounting Network, EMAN
http://www.eman-eu.net/

Global Reporting Initiative, GRI

http://www.globalreporting.org/Home

European Union Eco-label Homepage

http://ec.europa.eu/environment/ecolabel/index_en.htm

European Eco-label Catalogue

http://www.eco-label.com/default.htm

The Swan Ecolabel

http://www.svanen.nu/Eng/

Global Ecolabelling Network (GEN)

http://www.gen.gr.jp/index.html

Pre Consultants Eco-design

http://www.pre.nl/ecodesign/default.htm

The Global Citizenship 360

http://www.future500.org/audit

GreenBiz.com
http://www.greenbiz.com

Edie
http://www.edie.net

World Business Council for Sustainable Development,

collection of case studies
http://www.wbcsd.ch/templates/TemplateWBCSD2/layout.
asp?type=p&MenuId=MTYx&doOpen=1&ClickMenu=Lef
tMenu

76 self-regulation and voluntary corporate initiatives 4

 Shared Responsibilities
5
5.1 The Background
5.1.1 The Limitations of Control In this Chapter
The 1987 launch of the notion of sustainability by the Brundt- 1. The Background
land Commission was a kind of summary and logical conse- The Limitations of Control
quence of the previous 20 years of experience: it was clear that Shared Responsibilities
control of the pollution was insufficient. Any kind of control The Choice between Self-Regulation and
Authority Control
had resulted in extra costs while the problem remained, albeit
2. The EU and Business World Response
in a different physical form. We may control the wastewater at The EU Environmental Action Programmes
the outlet and treat it to remove the dirt before dispatching the The Sustainability Agenda
water to the river or the sea. But the dirt, taken out, will then Business Action for Sustainable Development-
have to be dealt with somehow. The only possible response Initiative, BASD
is prevention of pollution instead of control. You will have to 3. Covenants/Environmental Agreements, EA
Environmental Agreements versus Command-
address the source of the pollution, which means the point of and-Control
production whether that is industrial manufacturing, farming EA and the Dutch National Environmental
or production of electric power. It includes all sectors of life, Policy Plan, NEPP
also the private consumption, where e.g. reduction in use of Implementing Environmental Agreements
energy, whether electricity or petrol, is of the same importance Experiences from the Dutch Environmental
Agreements
for the pollution prevention.
Upcoming Revised Dutch Environmental Policy
Addressing the source of the pollution means more in- has Limited Role for Environmental Agreements
terference with private – first of all business – interests and 4. Environmental Agreements and the EU
decision-making. One needs to go into the details of how Evaluation of the Environmental Agreements
an activity works. Mandatory regulation would still form The Members State Survey
the backbone of environmental protective measures, but the 5. Experiences of Shared Responsibilities
The Meaning of “Share”
source-oriented, pollution prevention approach cannot be put Implementation
into practice without business involvement – and consent. Securing Compliance
This is the background to a growing interest for shared re- 6. Shifting Nature of Environmental Challenges
sponsibility. Changes the Notion of “Sharing”.
In this chapter we will first take a closer look at the al- New Trends
The New Task Ahead
ternative, the call for business-authority cooperation in Eu-
ropean, international and global fora. We will then focus on

5 shared responsibilities 77
the covenants – environmental agreements between govern- could a researcher or an industry do with this technology? Fears
ment and industry on reduction goals for certain substances or for diseases caused by genetically engineered microorganisms
products within an agreed time frame – and finally the related spreading in the population and concerns for animal welfare
procedures of reporting and documentation. This has been the were raised. The research community responded with a mora-
most common and concrete form of truly “shared responsibili- torium of several years, around 1976-80. During that time risk
ties”, as it is based upon the contract form and, therefore, is a research was conducted and strict guidelines for research were
market-based instrument. outlined and committees to control them were organised. As a
result authorities found no reason to intervene with legislation
5.1.2 Shared Responsibilities and control. Industry research, e.g. in the pharmaceutical in-
Shared Responsibilities is an expression widely used for the dustry, followed the scheduled devised by universities closely.
last decade in the environmental policy context. It refers to an
understanding amongst national and international politics and
businesses, of mutual responsibilities for the fate of the global Box 5.1 The Johannesburg Earth Summit
environment. Both politicians and business are expected to act
in support of this understanding, where possible jointly, or at
least in some sort of cooperation. The goal is to combine ef-
forts and forces for efficient protection of the environment.
The previous chapters demonstrated how increased busi-
ness environmental awareness has been materializing in a
number of concrete steps in areas not subject to mandatory
regulation. The introduction of Environmental Management
Systems, EMS, is the key example. Another case is eco-label-
ling. Here the framework is established by law, but the use is
either voluntary or leaves considerable room for adaptation to
the specific needs of the particular organisation or company.
Thus there are several examples of how business has ac- Figure 5.1 WSSD in Johannesburg 2002. The third Ple-
cepted a responsibility for the protection of the environment nary meeting. (©UN Photo 2002.)
and natural resources. This is true even if that responsibility
The Rio+10 summit in Johannesburg 2002 had two
comes as a result of different kinds of pressures. These pres- main purposes:
sures include the threat of new and enlarged mandatory regula- • Reaffirming Agenda 21 and other initiatives from
tions from authorities, actions by grass root organisations and the Rio conference and later conferences and fill-
other citizen pressure groups, or thirdly through the market by ing in holes that have impeded the implementation
consumer and customer requests. process of such initiatives;
• Agreeing on new goals and targets for certain areas.
In the balance between self-regulation and regulation by
outside authorities, self-regulation is often the better alterna- An Action Agenda was agreed upon, setting targets in
the following areas:
tive for a company. It gives the company or organisation larger
freedom to choose how to deal with an issue; it is less resource • Water and sanitation
demanding and may lead to increased good will and accept- • Energy
• Health
ance in society. We will now look at this more closely.
• Agriculture
• Biodiversity & ecosystem management
5.1.3 The Choice between Self-Regulation and • Finance, trade and globalization
Authority Control
Of specific relevance for the topic of this chapter
In several areas the need for some kind of regulation has grown is one of the agreed goals within the area “Finance,
during the last few decades. In very many of these cases self- trade and globalisation”. The participating countries
regulation has been the outcome. A few examples will illus- commit themselves to “Actively promote corporate
trate the reason for this choice. responsibility and accountability”.
Introduction of gene technology during the 1970’s spurred
Source: UN 2003
a heated debate on ethics, in particular on safety and risks on
one hand, and respect for genetic integrity, on the other. What

78 shared responsibilities 5
Legal control, with formal rules, permits, reports, monitoring programme stresses the efforts to secure more effective imple-
visits etc., was by all considered to be avoided by all means. mentation of the already existing policies as a main task for
Another example is found in the media world. Many years all member states for the programme period. The combina-
back a news articles in tabloid papers publishing unfounded tion of dialogue and the agreed goals for reduction of adverse
pejorative statements about individuals, raised the request environmental impact may open for an even wider use of the
that freedom of expression, established in the constitution in covenant at the national level, where the implementation takes
several countries, needed to be limited. The press responded place. We shall look more closely into the experiences and
by establishing internal committees, which were to handle likely developments below.
complaints on news media for unethical publishing. The legal
right for freedom of expression remained unchanged. Very few 5.2.2 The Sustainability Agenda
court cases on news media have taken place. The Rio Summit in 1992 made the concept of sustainability
Several other groups in society have during the last few the focal point for all efforts to improve and secure the envi-
decades institutionalised self-control within their profession. ronment. The Johannesburg Summit September 2002, the 10th
It is for any such activity a better alternative than authority year follow-up on the Rio Summit, confirmed sustainable de-
interventions and reduction of the professional activities by velopment as the core of the efforts and the notion, by which all
stricter legal control. Now we see a similar strategy developing initiatives and policy-making should be interpreted and grad-
in the area of industrial production and environmental impact. ed. In 1992 the concept of sustainability had elements of “a
need for fundamental restructuring”. In the 10 years since, the
concept had been included in mainstream business vision and
5.2 The EU and Business World Response
agendas. Sustainability had been taken over – if not hi-jacked
5.2.1 The EU Environmental Action Programmes – by global corporate business with the acceptance of an ap-
The concept of shared responsibilities is very clearly reflected plause from key international government organizations.
already in EU’s 5th Environmental Action Programme Towards
Sustainability from 1992, launched in time for the up-coming Box 5.2 Sharing Responsibilities in a
1992 Earth Summit on Environment and Development in Rio Competitive World
de Janeiro [Box 2.7, p. 45]. With this programme, the European
Union recognised that the approaches used and measures taken The April 1996 Inter­national Conference on ”Sustain-
till then were not enough to deal with the expected growth of able Industrial Development: Sharing Responsibilities
the world economy. Achieving balance between economic ac- in a Competitive World” was organized jointly by the
tivity, global equity and protection of the environment required, the Government of the Nether­lands, the Dutch Busi-
ness Association, the EU-Commission, the OECD and
it was said, a sharing of the responsibilities among politics, au-
the United Nations. The following quote is part of a
thorities, and private business. It was in addition asking also the longer summary of the conference, written by the
individual citizen to include these considerations in the choices Dutch chairman of the conference, Ruud Lubbers:
they were making for themselves and their families. [Towards
Sustainability, p 3]. The same participatory approach domi- The conference embraced the concept of eco-efficiency as
nates the Agenda 21 document from the 1992 Summit. a central objective of Sustainable Industrial Development.
However it was also stressed that improving ecoef-
The demand was seen to cut across all areas of the EU- ficiency is more than just developing and applying new
programme, but has in addition got its own chapter in the pro- technology. Equally important is to find new ways of do-
gramme. A number of areas, initiatives and actors are men- ing business by linking together different industries, to
tioned here, but without allocation of resources and ways of set up joint ventures between public utilities and private
action to put them into practice. Much of this will have to take industries, to establish financial structures that will en-
sure a fair distribution of costs and benefits in combining
place at the national and regional/local level.
efforts to improve eco-efficiency. It is worth stressing that
Covenants are environmental agreements between gov- emphasizing the significance of institutional approaches
ernment and industry. It is one of the instruments mentioned for economic efficiency is very much in phase with mo-
within this area. dem concepts in economic theory.
The EU’s 6th Environmental Action Programme repeats the
Source: Lubbers 1996
need for cooperation and dialogue, but does not refer specifi-
cally to the covenant or any other concrete steps and means to
help this cooperation and process of dialogue. However, the

5 shared responsibilities 79
 An example of this development is the April 1996 Inter- The concluding remarks pointed to the need for a holistic
national Conference on “Sustainable Industrial Development: view and an integrative approach to achieve sustainability.
Sharing Responsibilities in a Competitive World”. The confer- It is not surprising – and fully understandable – that busi-
ence was jointly organized by the Government of The Nether- ness organisations promote business interests in all possi-
lands, the Dutch Business Association, the EU Commission, the ble areas, including the issue of sustainability. The problem
OECD and the United Nations. The report from the conference is that the incommensurability and reciprocally conflicting
(Box 5.2) was sent to the United Nations Secretary General. character of the different suggestions for actions provided is
The conference embraced the concept of eco-efficiency as not even mentioned. It may be summarised as the conflict be-
a central objective of sustainable industrial development. More tween growth and sustainability. This conflict is not hinted at
efficient resource use would reduce pollution at the source and either by government representatives, political leaders, NGO-
be better business. The conference also called upon more in- representatives, or by academia, frequently present or invited
ternational cooperation at e.g. the EU policy level to enhance for presentations at these different occasions and conferences
the scope of this concept. The conference saw covenants as like those mentioned here. There seems to be a consensus on
a possible framework for the partnership between the private mainstream thinking and understanding of economics, poli-
and the public sector. It pointed to the Dutch experiences as a tics and broader societal issues by all organisations and indi-
model for that solution. Further the conference pointed at the viduals participating in these discussions, making all papers
need for improving SMEs environmental management capa- and policy documents look very much the same. This under-
bilities, especially to make SMEs have access to technology lines the very ideological nature of the issue of sustainability
and share expertise between corporate business and SMEs. It itself, which in turn affects the proposals and the documents
is especially relevant since SMEs often serve as suppliers to provided to that end. It requires that scholars, studying these
the big companies. issues be on the alert.
In 2005 the WBCSD took a fresh look at its strategy so far,
5.2.3 Business Action for Sustainable Development- where the organisation had been active raising awareness of
Initiative, BASD business and distributing information on the numerous impor-
tant issues linked to sustainable development, summarised in
In October 2001 in Paris the World Business Council for Sus-
Box 5.3. However important still, the
tainable Development (WBCSD) and the International Cham-
“members boldly decided it’s no longer enough to study
ber of Commerce (ICC) jointly organised a strategy meeting
[the] issues ... [WBCSD] must now work with new partners
called Business Action for Sustainable Development Initia-
to develop and advocate solutions and to manage [the] issues.
tive, (BASD). It was a cooperative venture for the run-up to
It needs to help put in place framework conditions that will
the Johannesburg Summit. The idea was to make sure that
allow business to play an evermore effective role in managing
the business voice was heard in a strong and cohesive manner
natural resources and alleviating poverty.” [WBCSD Annual
in Johannesburg and that business had its proper place at the
review 2005 – From Awareness to Action]
2002 World Summit.
The WBCSD talks about “a major turning point in its op-
Focus of the WBCSD Presidential address to the meeting
erations” (op. cit.) The council and its members wanted to take
was a 10-Point Vision document on “The business case for
on a much more active and implementation oriented role in the
sustainable development”. It summarised the current thinking
efforts of bringing Sustainability about. It wanted to imple-
on sustainability in the organisation. The prime condition for
ment the new strategy.
making this vision for a sustainable society come true was said
to be shared responsibility among governments, business and
civil society. The roles were indicated accordingly: 5.3 Covenants/Environmental Agreements, EA
• Business should provide safe and sustainable products. 5.3.1 Environmental Agreements versus Command-
• Government should create the right political framework and-Control
for the market economy, which at the same time should The core of an environmental agreement, EA, also called a
promote sustainability. covenant, is a written statement, entered into by the govern-
• Civil society should provide sound advice to consum- ment and the relevant industrial organisations and/or individu-
ers and help them select the right products and make the al companies on implementation of specified government poli-
right choices in their own lives as a way of supporting cies on the reduction of pollution from that sector. The EAs
sustainability. are seen as a way of broadening the set of policy instruments

80 shared responsibilities 5
available and in particular to be able to meet the expectations 5.3.2 EA and the Dutch National Environmental
in the concept of shared responsibilities, whereby business is Policy Plan, NEPP
invited to have a say, and at the same time expected to take on There is a great variety in the ways environmental agreements
greater responsibility for protecting the environment. are conceived as well as in their content and their scope among
The agreement is seen as the core element in a programme the different EU countries. EAs have been used for more than
to improve the effectiveness of policy implementation in an 20 years, but in the present round and understanding they took
industrial sector. The member companies might be expected off in the late 1980’s. It began with the Dutch National En-
to look more favourably upon obligations, that are taken on vironmental Policy Plan (NEPP) from 1989 and an updated
by agreement instead of issued as an “order” or command in a NEPP+ already from 1990.
command-and-control culture. The overall idea of this new legislation was to set up a
strategy for achieving sustainability by the year 2010, with
intermediate milestones for each area by 1995 and by 2000.
Sustainability is defined for the purpose by a broad range of

Box 5.3 The Business Case for Sustainable Development

Ahead of the Johannesburg Summit 2002, the World change throughout the corporation.” “The goal is
Business Council for Sustainable Development presented unification of vision from shop floor to boardroom.
in the paper “The Business Case for Sustainable Devel- This requires new systems of rewards. It requires hard
opment” their vision for a sustainable society. In the pa- looks at corporate basics, such as the product portfo-
per, the vision of WBCSD is subdivided into 10 so-called lio and relations with suppliers and customers.”
‘building-blocks’ that, when put together, constitutes the 6. From dialogue to partnerships: “Business has much
business contribution to a sustainable society. experience with stakeholder dialogue, but still too lit-
tle with the next step: practical partnerships composed
1. The market: “Sustainable development is best of players in different sectors.” “Progress toward sus-
achieved through open, competitive, rightly framed tainable development requires many more and more
international markets that honor legitimate compara- complex partnerships.”
tive advantages. Such markets encourage efficiency 7. Informing and providing consumer choice: “If
and innovation, both necessities for sustainable hu- business believes in a free market where people have
man progress.” choices, business should accept responsibility for in-
2. The right frame: “full-cost pricing of goods and serv- forming consumers about the social and environmen-
ices; the dismantling of perverse subsidies; greater tal effects of those choices.”
use of market instruments and less of command-and- 8. Innovation: “Recent history suggests that those living
control regulations; more tax on things to be discour- in wealthier countries do not intend to consume and
aged, like waste and pollution and less on things to waste less. Given that the other 80% of the planet’s
be encouraged, like jobs (in a fiscally neutral setting); people seek to emulate those consumption habits, the
and more reflection of environmental resource use in only hope for sustainability is to change forms of con-
Standard National Accounts.” sumption. To do so, we must innovate.”
3. Eco-Efficiency: “The WBCSD defines eco-efficiency 9. Reflecting the worth of the earth: “We do not pro-
as being achieved by the delivery of competitively tect what we do not value. Many of nature’s resources
priced goods and services that satisfy human needs and services are currently not monetized. Establishing
and bring quality of life, while progressively reducing such prices in ways that do not cut the poor off from
ecological impacts and resource intensity throughout crucial resources could reduce resource waste and pol-
the life cycle, to a level at least in line with the Earth’s lution.”
estimated carrying capacity. 10. Making markets work for all: “The business case for
4. Corporate Social Responsibility: “… the commit- poverty reduction is straightforward. Business cannot
ment of business to contribute to sustainable eco- succeed in societies that fail. Poverty wastes human
nomic development, working with employees, their resources – the ability of the poor to contribute to
families, the local community and society at large to societal development, theirs and others – and under-
improve their quality of life.” mines market potential – the potential for the poor to
5. Learning to change: “Movement toward corporate purchase goods and services.”
concern for the triple bottom line – financial, social,
and environmental performance – requires radical Source: WBCSD 2002

5 shared responsibilities 81
quality objectives, covering the main environmental issues or The regional and local authorities are also partners to the
“themes”. They are then turned into more than 200 quanti- EA negotiations. Regional and local authorities in most EU
fied targets. The responsibility for achieving these targets is countries, e.g. in Holland, like in Denmark, have the main re-
then devolved to the key economic actors in terms of their sponsibility for the implementation of the environmental regu-
contribution to the environmental impact related to these tar- lations. This includes the issuing of the environmental permits,
gets. These actors (industry, agriculture, transport etc.) then that many of the companies involved here will end up having
become “target groups”, to whom government will then al- in order to operate their business.
locate the responsibility for implementing the targets set in
the NEPP. The planned EAs with industry would cover about
90% of the targeted pollutants from Dutch industry. The EA Box 5.4 PPP Public Private Partnership
is therefore the legal instrument by which the sector respon-
sibility is formally taken on by the target group. In the Dutch
case the EA is a legally binding contract according to Dutch
civil law.
This stringency is unusual in the EAs, used in all other
countries, and so are the ambitions invested in them. EAs in
other countries are often concerned with waste management,
in particular in areas with a need for collection of used con-
sumer packaging (bottles, cans) or widely used products, con-
taining noxious substances (batteries with cadmium and lead,
used tyres). Only few, if any, of these EA’s are legally binding
– or rather, not legally enforceable by court ruling.
The point of departure in the Dutch system is therefore Figure 5.2 Partnership for Science. Uppsala Science
set targets for a range of pollutants, relevant to a particular Park is a Public-Private Partnership currently supported
target group like e.g. the chemical industry. Those set targets and established by Uppsala County, Uppsala munici-
are not negotiable at the negotiation table for the agreement. pality and Uppsala University, currently housing 150
They represent the policy, which has to be implemented. The enterprises in the field of biomedicine and information
technology. (Photo @ Uppsala University)
negotiations will instead have to establish what has been called
a “knowledge base’ for the agreement on the implementation. Government-industry agreements appear in other
This is concerned with an inventory of current emissions in the situations besides environmental protection. The
number of projects which are common undertakings
sector, and sub-sector distribution of these emissions. The data
between business and government or local authorities
achieved is used to get the burdens distributed according to the is increasing. Under the name of public-private part-
pollution contributed. Finally a database is set up to store and nerships, infrastructure developments, remediation of
to update all these data for subsequent use. brown fields, sports areas and many other projects are
financed both by tax money and private investments.
5.3.3 Implementing Environmental Agreements In this way railroads, roads etc either become possible
or are constructed earlier than if only public funding
The database describing the present state of pollution in a were available.
specified sector provides the knowledge base for signing a There are several ways for the private actors to
specific Environmental Agreement. The first document to be get money back on their investments. These include
made is called a Declaration of Intent between the two parties, time-limited monopolies, agreed charges, etc. Such
government and industrial sector, represented normally by the schemes need to be part of the contract between the
public and private when a project starts.
business sector association. The Declaration constitutes an In-
It is clear that public-private partnership has in the
tegrated Environmental Target Plan (IETP) for the industry in first place been necessitated by limited access to pub-
question, which is the legal background for the actual imple- lic funding. But at the same time it is an expression
mentation initiatives to be taken. On the industry side the IETP of an administrative culture needed by the authori-
is then signed by all individual companies, active within that ties to achieve sustainability. Sustainability can not be
sector and thereby making it legally binding for them to act in reached by authorities or the private sector in isola-
tion. Cooperation is needed.
accordance with the plan and to contribute their share of the
reductions in impact, contained in the plan.

82 shared responsibilities 5
 With the IETP established the subsequent planning and ne- financial priorities are weak and so is – important for the
gotiation for the implementation of the plan will differ as to second round of CEPs – its strategic content.
the nature of the industry in question. • The competent authorities have resource problems (lack
For sectors with homogeneous types of production, the par- of time and in some cases also skill) to deal adequately
ties will establish a “Sector level Implementation Plan”, stipu- with the CEPs and include the content fast enough into
lating directly what each individual company in that sector will the licences.
have to do to comply and contribute their share of the targeted • There are problems with the accuracy of the quantitative
results. That will then become a part of the environmental li- emission data in the CEPs and in the annual reporting
cence, which these companies have. It will also be introduced – essential for monitoring the progress towards targets.
into the licence next time it has to be reviewed, separately and • The national direction for the development of the CEPs
at once, if needed for the company to comply with important is important and has been working in the chemical sector
requests in the Sector Level Implementation Plan. with a strong association and a surveyable number of
For sectors with heterogeneous, that is complex/mixed- companies.
type, production processes with a wider range of environmen-
tal impacts, the implementation has to be individualised for Box 5.5 The Dutch Covenant Concept
each single company. For these companies a Company Envi-
ronmental Plan (CEP) is worked out to be valid for four years Covenant:
and then revised. The CEP is the instrument which combines Voluntary agreement between government and cer-
the IETP and the legally binding obligations taken on by the tain companies, entered into by the government to
company when signing the agreement. In CEP the company secure the implementation of Dutch environmental
regulation.
obligations are detailed and specified for all the relevant pol-
lutants and impacts in the IETP for that particular company. Objective:
The CEP is prepared in close cooperation and dialogue with To implement the Dutch Environmental Policy Plans
the local or regional authorities, responsible for that compa- (NEPPs) in companies, by making voluntary agree-
ny’s environmental licence. When the CEP is approved by the ments to follow the regulation.
authorities it will serve as the essential management tool for
Philosophy:
the company’s environmental licence. Only if the companies share the understanding of the
importance of the regulatory initiatives will they be
prepared to implement them.
5.3.4 Experiences from the Dutch Environmental
Agreements Requirements of the Covenants (for Companies):
The unique and at the same time important feature of the Dutch A Company Environmental Plan (CEP)
system of EAs is the stringent combination of the Government Specific targets for environmental improvement, in-
Environmental Policy, stated as the sector-wise quantified ob- cluding BAT-technologies.
jectives for reduced impact, the EAs, signed as the IETPs, and Advantages of the Concept:
the actual implementation via the combination of the Environ- A effective implementation structure for the original
mental Licences and the IETP-obligations through the CEPs Dutch license.
or the Sector level Implementation Plans. May constitute the basis for implementing the targets
The first Dutch EA was signed in 1990 with the printing of the IPPC-license.
Could be a suitable implementation structure for
industry. In 1992 the EA for the base metal industry and in
EMAS, since the requirements are quite similar to the
1993 the EA for the chemical sector were signed. With those ones in EMAS.
last two EAs the very complex – heterogeneous – sectors were
included, and the CEP instrument therefore was to be put to Limitations of the Concept:
use. The first round of CEPs in the chemical sector were evalu- Does not in itself establish a sufficient implementation
structure to secure the implementation of the demand
ated in 1997 by the Dutch Inspectorate for the Environment – a
in the IPPC directive for an integrated approach to en-
government agency. Some of the main conclusions on these vironmental regulation.
first round of CEPs were:
Source: Gouldson & Murphy 1998
• The CEPs are acceptable overall, but its scope for
improvements on areas of uncertainty, and details on

5 shared responsibilities 83
• Integration of the new CEP instrument internally in com- rating environmental costs into the prices” (op.cit. p 8). This
panies with e.g. an environmental management system reference to the need for giving market instruments in the form
and for the authorities integration into the existing licens- of taxes, levies and tradable permits is accepted as an important
ing and monitoring system were both not paid enough base for future environmental policy and mentioned throughout
attention to before the start and should be given higher the report.
priority. This indicates a more general shift in policy and poli-
cy instruments as the understanding of the environmental
In 2002/2003 a study on the effectiveness of the agree-
threats is shifting from the need for control of emission of
ments or covenants, commissioned by the Dutch ministry
noxious substances to water and air, to the need for profound
of the Environment (VROM), was carried out [Bressers and
societal restructuring in the reach for sustainable economic
De Bruijn, 2005]. The focus of the project was the identifica-
development. It’s a more normative approach to policy, but
tion of success and failure factors. The central conclusion on
implemented to a higher degree by market-oriented, first of
the use and effects of the covenants is quite positive, although
all economic, instruments. This demands re-thinking and
several constraints were also identified. Most importantly, the
re-formulation of the concept of “shared responsibilities”.
implementation context turned out to be highly relevant for
There needs to be a co-operation on limiting the impact
covenant success.
from current practice to a profound restructuring, “working
on sustainability” as the subtitle of the NEPP-4 programme
5.3.5 Upcoming Revised Dutch Environmental Policy reads.
has a Limited Role for Environmental Agreements
The Dutch government presented during 2000 to parliament a
5.4 Environmental Agreements and the EU
proposed new NEPP, – the 4th National Environmental Policy
Plan (Summary report, Where there’s a will there’s a world – 5.4.1 Evaluation of the Environmental Agreements
Working on Sustainability). It has EAs or Covenants included In 1997 the European Environment Agency (EEA) published
as an instrument, having achieved many successes, first of all a review of Environmental Agreements and environmental ef-
in reducing emissions and thereby the presence of priority sub- fectiveness as an evaluation of environmental policy instru-
stances in the environment. But the implementation problems, ments. It was made to contribute to the European Parliament’s
mentioned also in the study by Bressers and De Bruijn, are un- debate on the EU-Commission Communication on Environ-
derlined and a new evaluation study announced to help create mental Agreements from November 1996.
the background for a “decision of the future role of covenants The evaluation was based on the scarce literature and little
in the policy mix” [op.cit. p 30]. This is the one and only men- empirical evidence available due to the quite recent introduc-
tion of covenants in the report. tion of this instrument, supplemented by six case studies made
The proposal takes its point of departure in the presently for the purpose of the study. The main conclusions of the study
changing nature of environmental impact from human, eco- were:
nomic activity, placing the climate issue, the loss of biodiver-
• It is difficult to make a quantitative assessment of the
sity and the need for profound changes of social life firmly on
environmental effectiveness, the reduction in impact
the agenda. That in turn means, that long-term and broad, fu-
achieved, of the case studies due to lack of baseline infor-
ture oriented policy development is needed, compared to the
mation and reliable monitoring data as well as consistent
thinking of the 1980’s and the 1990’s. The proposal refers to
reporting.
a 1997 document on Environment and Economy, outlining the
• Wider benefits were found on improvements on the situa-
perspective for a sustainable economic development. At the
tion and on the encouragement of environmental manage-
core of this perspective lies a complete decoupling of economic
ment in business.
growth and environmental impact. An evaluation of the effec-
• The transparency, credibility and accountability of the
tiveness of a bottom-up approach to achieve this goal is made.
policies pursued with the EAs were doubted due to the
It points out that holding the private sector accountable for their
often limited public access to the process of establishing
own actions within a co-operative approach with agreement
the agreements.
and covenants as the key instruments has scored successes. The
evaluation also shows, however, that the intended decoupling The EEA concluded that the environmental agreements
cannot be achieved by private initiatives alone. “This requires were most useful as complements to other policy instruments
a national government policy which should focus on incorpo- to help raise awareness, create consensus and provide a fo-

84 shared responsibilities 5
Box 5.6 EA Suitability and Implementation

Some concluding remarks from the European Environ- Implementation is more effective when:
mental Agency’s study on the suitability and implementa-
tion of Environmental Agreements (EAs): • clear targets are set prior to the agreement
• the agreement specifies the baseline against which
EAs are most suitable for: improvements will be measured
• the agreements specifies reliable and clear monitoring
• proactive industries or businesses and reporting mechanisms
• small number of partners or high organisation level of • technical solutions are available in order to reach the
signatory partners agreed target
• production of goods (i.e. industry) • the costs of complying with the EA are limited and are
• sectors which have matured and face limited compe- relatively similar for all members of the target group
tition (i.e. where there are few opportunities for ‘free • third parties are involved in the design and applica-
riders’ tion of EAs
• environmental problems of limited scale (national and
regional environmental problems)
• limited number of sources of pollution
• long-term targets (early signal) Source: EEA 1997, p 15

rum for information sharing and testing of new mechanisms to try have an important role to play in the total mix of policy-
increase flexibility. The case studies demonstrated a potential instruments. They can:
for the agreements in raising effectiveness of implementation,
• Promote pro-active attitudes on the part of industry.
where regulatory and fiscal instruments are difficult to enforce
• Provide cost-effective, tailor-made solutions on imple-
or apply.
mentation.
The cases in the study were taken from six different coun-
• Allow for smooth and effective measures in advance of
tries. They included two cases on Target Setting EAs (An EA
legislation.
on End-of-Life Vehicle disposal from France, and a German
EA on CO2-emissions) and four Implementation EAs (Sweden The Commission stated that it is important to ensure trans-
on Packaging Waste handling, The Netherlands on Chemicals, parency and reliability for the EAs. The Commission later de-
Portugal on Pulp & Paper and Denmark on Packaging Waste veloped guidelines for their use and conditions for their use
handling). when implementing EU Directives, and indicated how they
The EEA study seem to come out less favourable than the might be used as policy instruments at the EU level. At this
investigation made about one year later by the Dutch Inspector- level there are problems for the Commission, as Agreements
ate for the Environment referred to above. Some of the reserva- in terms of legally binding contracts are not part of the legal
tions were the same, however, first of all on the quality of the instruments, open for the Commission according to the EU
emission data. The EEA study had the Dutch cases as the most Treaty. In this respect, the Commission can therefore only use
productive, including effectiveness, although still with reserva- “Understandings” or “Commitments” or that kind of “soft”
tions. The study provided a short list on EA suitability and their expressions.
implementation (Box 5.6) The 6th Environmental Action Programme, decided upon
in 2002 and running till 2010, does not have any central place
5.4.2 The Member States Survey in the strategies and the policy instruments highlighted for
A study on the use of EAs within the member states showed EAs at the national level. A Commission Communication
some 300 EAs in force in 1996 and that they were operating in [COM (2002) 412] presents the work on EAs at the Com-
the twelve countries that were then member states. This study munity level, but it remains quite preliminary and inconcrete
together with the above mentioned EEA study were important as to action. The lack of explicit mentioning of the EAs at
drivers for an EU Communication on the role and possible use the national level in the 6th EAP is surprising in as much as
of EA’s. The Communication concluded that EAs with indus- a crosscutting priority for the new programme is improved

5 shared responsibilities 85
implementation of community legislation in the member
states. It remains therefore to be seen whether we here see
a change in policy at the EU-level along the same lines, as
we saw at the Dutch NEPP-4 programme. It still remains
to be seen what the role of EAs will be in the EU policies.
That will most likely affect the policies towards the EA in
the member states. A shift away from EAs as a central policy
instrument is indicated also by the fact that there have been
no further initiatives concerning EAs at the EU level since
the late 1990’s evaluations and the subsequent Commission
Communications.

5.5 Experiences of Shared Responsibilities Figure 5.3. Environmental agreements. After agreement with author-
5.5.1 The Meaning of “Share” ities several major industrial groups have established companies to
manage recycling. In Sweden today the return of aluminium cans, with
The term Shared Responsibilities rests upon the recognition
a deposit, is about 90%. At Aass brewery in Norway cans made from
of a dual power base for the regulation of environmental im- recycled cans are filled. (Photo: http://www.resirk.no/sw1134.asp)
pact. On the one hand there is the public and political author-
ity, divided into different levels and with the legitimacy to solutions available are neither investigated nor discussed,
regulate activities, private and public, at a societal level. On when the UN, the EU, the OECD, nor World Summits meet
the other hand there is the private business, in this matter and receive “white” or “green” papers and issue declarations
representing at the same time the dominating polluting enti- on the way to sustainability and global equity. OECD thus
ties. Despite the exclusive power, in a democratic society, for writes “Increased Trade and Investment Liberalization is vi-
the political authority to legislate and thereby oblige private tal (for poverty eradication) and its importance for sustainable
business to adhere to and comply with the legislation, the no- development cannot be underestimated, …but needs to be ac-
tion of shared responsibility implies that this formal author- companied by appropriate national policies to ensure social
ity does not work. It is not able to make businesses comply and environmental benefits as well as economic growth”.
with the regulation made to protect the environment and nat- [From the OECD-document Working together towards
ural resources. It therefore needs to enter into a power-shar- sustainable development – the OECD Experience]. This is just
ing exercise with the polluter to reach the level of protection a brief example.
asked for. This type of reasoning is commonplace and has become
The material presented in this chapter – and very much common sense or “mainstream”. The contradictory character of,
more could have been added – shows, that this state of af- and within, this type of reasoning is not addressed. The strongly
fairs worries neither national governments nor supranational contested and outright problematic argumentation on free trade
political entities like the EU. Rather, it is seen as “good en- and poverty eradication is presented as an obvious and proven
vironmental governance” to involve subjects of a regulation fact. When one is no longer able to critically address fundamen-
and stakeholders alike not only in shaping and formulating the tal societal issues and assumptions, one is left with curative,
regulation to come, but also in administering and implement- post-active solutions. One is left with an ideology.
ing the regulation already carried and in force.
It is actually quite seldom that these notions and under- 5.5.2 Implementation
standings are questioned, let alone made subject to a more At the level of implementation, which is gaining increasing
thorough critical assessment. We have seen a few remarks attention (EU 6th Environmental Action Programme and the
from the EU Commission on possible problems with transpar- OECD-2002 Work Programme), the notion “Shared Responsi-
ency and accountability for EAs. Most importantly that they bility” is actually misplaced and a misunderstanding. Compli-
are concluded – at least in the final stages – in closed negotia- ance is not a shared responsibility. For a company subject to
tions between government agencies and business representa- a given piece of regulation, compliance is an obligation – or
tives to make it possible to reach an agreement at all. a “responsibility” – and an obligation for the company alone.
But the whole underlying societal structures and relations To make companies be more active, make them show greater
and their possible influence on the problems encountered and readiness, on compliance represents a long since understood

86 shared responsibilities 5
interconnection between increased regulation of the environ- the interest of the company to be sustained for long time. This
mental impact at the source and a need to find ways of reduc- may be for marketing, for cost saving on supplies or produc-
ing public sector costs in implementing such a regulatory strat- tion, or more generally for image promotion. (This in turn has
egy. Company management is closest to the decision-making much in common with the marketing issue.) Still, these initia-
on what to produce, what machinery and what raw materials tives can be important as they might be setting new standards
to use. Thereby they are best to decide on how to best avoid for e.g. salaries and working conditions at their suppliers in
producing the pollutants they should avoid. 3rd-world countries, or sustainable production of raw materi-
We are here at the very centre of our whole presentation and als like cotton and synthetic fibres. They can be true examples
analysis. We want management to make environmental concern of sharing responsibilities while at the same time benefiting
an integrated part of the managerial function and management company interests.
decision-making in the company. Environmental compliance
should be a “routine matter” in line with paying the paychecks
5.6 Shifting Nature of Environmental
to the employees at the end of the month or the week. The com-
Challenges Changes the Notion of “Sharing”.
petent authority can then save on monitoring and control and
have more time to support the company in forward-looking and 5.6.1 New Trends
dynamic technological changes with a positive environmental Recent moves described and trends spotted above indicates that
perspective. There are then also more time for other public au- the concept of “shared responsibilities” is being reviewed and
thority duties on preservation of environment. re-launched lately. In this the industrial actors have the WBCSD
Here Environmental Management Systems can be of help, as a model, while the political actors have the most covenant/
especially if company management happens to operate at a EA-oriented country, the Netherlands, as the model. In addition
“system” level in all important areas. Otherwise the EMS will the EU 6th Environmental Programme follows the same “line”.
be a separate and thereby also easily isolated phenomenon with- Industry talks about moving from “awareness” to “action”.
out significant impact on management actions. In Chapter 3 we Governments talk about moving from implementation by au-
have dealt with EMS in the previous section together with oth- thority control mixed with consent, till implementation by lev-
er, essentially, management voluntary environment related ac- ies and taxes, i.e. economic incentives. The key to understand
tions. And we have presented an additional instrument close to the development is the same on both sides, that is, the allegedly
management experiences and a well-known business tool, the changing nature of the environmental problems. The important
Environmental Agreement. Also this instrument is concerned goal is to get global and systemic. The “savings” and “emission
with compliance, organised in a form and in a way which reduction” agendas are over and to a great extent also covered
opens for management influence on the details on “how” but, and solved. Remaining problems, e.g. with chemicals, as now
again, not on “whether” as the compliance is obligatory for regulated by the EU REACH initiative, are predominantly a
the company. health issue rather than an environmental issue.

5.5.3 Securing Compliance 5.6.2 The New Task Ahead

The present-day environmental implementation instrument no The task ahead is a profound restructuring of the way we pro-
1 is the Environmental Licence or Permit. In its EU variant it duce and live and the way we secure our standard of living. To
is called and IPPC licence, applying to those industries with avoid backward oriented changes, decoupling is the up-com-
the most and potentially most negative impact on the envi- ing agenda for our societies. Or even more stringent: not only
ronment. Here we are within the full-fledged authority-based decoupling but rather a reverse relation between economic
policy instrument – resting on an EU Directive with the subse- progress and environmental impact. Business has accepted
quent obligation for all member states to implement it in their that this agenda is set, fixed and unavoidable with the climate
environmental law. The environmental permit – and the IPPC issue as the “driving force” for the change of public opinion
Directive – is addressed in the subsequent chapter. and hence of politics. Taking action means that the response
A completely different issue is that of “beyond compli- and contribution from business “will come through our core
ance”. This refers to the management of a company taking business, not from philanthropic programmes. If action to ad-
measures to protect the environment and/or natural resources dress global issues is to be substantial and sustainable, it must
or reach out for equity which is not (yet) included in any regu- also be profitable”. [WBCSD, op.cit./Box. 5.3]. The message
lation and therefore not mandatory. There can be many reasons from the industrial sector is clear: we will act and do so as
for initiatives like this, but they will eventually be linked to far as profitability allows. Possible contradictions between the

5 shared responsibilities 87
task ahead and the limits of profitability are – once again – not Study Questions
addressed. 1. Is sustainability the responsibility of a) state; b) business;
For politics and government the Dutch NEPP-4 reflections or c) both?
indicates, that the politicians have given up on the regulatory 2. What are the pros and cons of regulation and self-regula-
side. Instead they point to market-oriented solutions. In the tion from the business and authority side respectively?
Netherlands these are levies, taxes and tradable permits. The 3. How does the European Union view self-regulation, spe-
liberalist government in Denmark, on the contrary, has exclud- cifically what does the 5th and 6th EAP say?
ed itself from using taxes for changing company (and people) 4. What are the main differences between business concepts
behaviour at all. A recent suggestion from government was to like Eco-Efficiency and Cleaner Production, brought
decrease the environmental taxation and leave almost every- forward at the Johannesburg conference and the concept
thing to the market alone. The recent unambitious energy and of sustainability?
climate policies at the national level in many countries as well 5. Explain the Dutch covenants concept, and what makes
as at the EU level (with many of the same nations assembled them unique.
there) tells a story of leaving things to the profitability of the 6. What are the limitations of environmental agreements?
market. Companies are trying to get their “own share of the 7. What requirements are essential for the implementation of
cake” by levies and taxation, which themselves will remain environmental agreements?
“peanuts” in comparison with the profits at hand. Putting the 8. Explain the Branch level Implementation Plan and the
key part of the regulation in an economic form means making notions of IETP and CEP.
it compatible with the profitability claim. Then it leaves the 9. What lessons could be learned from the Dutch covenant
nature/recipient oriented regulation with absolute thresholds concept/process?
aside. The balance in the “shared responsibilities” concept will 10. Is there a possible synergy between CEPs and EMS with
then have tilted. its initial review and environmental statement?
11. Could experiences from the Dutch system of covenants,
with its large proportion of voluntarity, be transferred to
your country?
12. Explain and discuss the contradictions between free
market competition and poverty eradication and between
profitability and sustainability, pointed at in the text.
13. What is meant by being ‘left just with an ideology’ when
omitting the confrontation on fundamentally differing
positions?

88 shared responsibilities 5
Abbreviations International Chamber of Commerce (ICC)
BASD Business Action for Sustainable Development- http://www.iccwbo.org/
Initiative
CEP Company Environmental Plan International Environmental Agreements database
EA Environmental Agreement http://iea.uoregon.edu/
EAP Environmental Action Programme
EEA European Environment Agency EEA study Environmental Agreements – Environmental
EMAS Eco-Management and Audit Scheme Effectiveness
EMS Environmental Management Systems http://reports.eea.europa.eu/92-9167-052-9-sum/en/page007.
ICC International Chamber of Commerce html
IETP Integrated Environmental Target Plan
IPPC Integrated Pollution Prevention and Control 4th National Environmental Policy Plan
NEPP The Dutch National Environmental Policy Plan http://www2.vrom.nl/Docs/internationaal/NMP4wwwengels.
OECD Organisation for Economic Co-operation and pdf
Development
PPP Public Private Partnership The Dutch Ministry of environment
REACH Registration, Evaluation and Authorisation of http://international.vrom.nl/pagina.html?id=5450
CHemicals
SMEs Small and Mediumsized Enterprises European Environment Agency
VROM Dutch ministry of the Environment http://www.eea.europa.eu/
WBCSD World Business Council for Sustainable
Development Activities of the EU – Environmental agreement and
WSSD World Summit on Sustainable Development COM/2002/0412 final
(Johannesburg Conference) http://europa.eu/scadplus/leg/en/lvb/l28126.htm

EU_Sixth Community Environment Action Programme 2002-

Internet Resources 2010
Johannesburg Plan of Implementation http://ec.europa.eu/environment/newprg/index.htm
http://www.un.org/esa/sustdev/documents/WSSD_POI_PD/
Working Together Towards Sustainable Development: The
English/POIToc.htm
OECD Experience
International Institute for Sustainable Development (IISD) on http://www.oecd.org/document/8/0,2340,en_2649_37425_
the WSSD (2002 Johannesburg conference) 2757192_1_1_1_37425,00.html
http://www.iisd.ca/vol22/enb2251e.html
The Swedish can recycling (Swedish EPA)
World Business Council for Sustainable Development http://www.returpack.se
http://www.wbcsd.ch

WBCSD Annual Review 2005

http://www.wbcsd.org/DocRoot/i3aFM6E34L5LskqjG2A6/
ar2005.pdf with the new strategy document ‘From Awareness
to Action’, May 22nd 2006
http://www.wbcsd.org/DocRoot/u9JWotRo7iZka7fEMbV2/
WBCSD-business-card.pdf

WBCSD Annual Review 2006

http://www.wbcsd.org/DocRoot/
BfNGWxUk4gSKBfZfbYV7/annual-review2006.pdf

5 shared responsibilities 89
90 shared responsibilities 5
 Environmental Licensing
and the IPPC Directive 6
6.1 Components of Environmental Law At the end of this chapter we will address the challenge of
6.1.1 Modernising Regulation through Integration securing a dynamic development in reducing the environmen-
tal impact, embedded in the IPPC-approach, but not automati-
In the previous chapters we have focused, firstly, on the com-
cally realized.
panies’ internal possibilities for taking responsibility for their
environmental issues, and secondly on the joint efforts be-
tween industry and authorities to promote shared responsibil-
ity for the environmental impacts of industrial activities. In this Chapter
In the following chapters we will focus on the regulation
by authorities of industrial processes, based on national and 1. Components of Environmental Law
Modernising Regulation through Integration
international law and forming the legislative framework for
The Legal Framework
keeping the environmental impact of industrial activity within National and International Legislation
politically acceptable limits. This regulation consists of norma- 2. Directives Related to IPPC
tive, or command-and-control, instruments as well as economic IPPC, EIA, SEVESO and EMAS
– market driven – instruments. Environmental Impact Assessment
Normative regulation first focused on the consequences of Which Directives Apply?
Public Participation
industrial discharges into the air and waters. The regulation 3. The IPPC Directive
was differentiated according to type and absorbing capacity Regulating Industrial Activities
of ambient nature. Companies were required to decrease or The Base of the Directive
clean the discharges to meet the limits established against this Objectives and Principles of the Directive
background. This approach does not contribute to solving or The Integrated Approach
Emission Limit Values, ELV
minimizing the load of pollution created, merely containing
Best Available Techniques
it. As has been discussed earlier, the answer was to shift the Review , Update, and Public Participation
focus from “end-of-the-pipe” to the source of the pollution, 4. The IPPC Licensing Procedure
i.e. to the production process. This meant a shift from a pre- The Environmental Courts
dominantly static and defensive to a dynamic and proactive The IPPC Permit Application
5. Assessment
approach to regulating industrial environmental activity. In
Key Elements
the EU-member states this led to demands on technology and BAT and BREFs
tighter emission limit values. It was formulated in the 1996 Economic Aspects of BAT
Directive on Integrated Pollution Prevention and Control, the The Relation between Emissions, EQSs and the
so-called IPPC directive. This directive required industrial Local Environment
installations to use the Best Available Techniques (BAT) and Formulating Conditions in the Permit
base its emission limits upon this assumption.

6 environmental licensing and the ippc directive 91

6.1.2 The Legal Framework In addition to national and European regulations there are
The environmental regulatory framework in the EU, and in also regulations based on international law. These are the trea-
most industrialized countries, has five main stages: ties or conventions made regionally (e.g. HELCOM, the Con-
vention on the protection of the Baltic Sea) or globally (e.g. the
• The law.
Climate Convention). These enter into force in the individual
• Standards for the use of technologies and/or standards for
countries only after ratification (confirmation) by the national
the environmental quality.
parliament. Many regulations based on international environ-
• Licences or permits to allow industrial facilities to operate.
mental law are now channeled through EU legislation, and ap-
• Monitoring of compliance with the law and the licence.
pear for the member states as a Directive or a Regulation. This
• Enforcement of the law and the conditions included in the
process is based on the EU Treaty (Art 24 EU and Art 300
licence.
EC), which regulates when the Union takes over the represen-
There is a specific relation between these five stages. Each tation of the member states in several international matters.
and every step has a distinct function in the general aim to pro- Although the implementation will take place via EU legisla-
tect the environment and natural resources within the context tion, the individual countries will still be represented at these
of economic and other human exploitation. The law and the international negotiations. The purpose is that the signing of a
standards are the politically decided level of intervention to possible treaty or a convention should be made by each mem-
be applied. They represent what is politically meant to be suf- ber country jointly with the EU representative to underline the
ficient to reach that goal. The licence (or permit, meaning the wider support and to influence the negotiation process.
same thing) is the formal instrument linking the law with every All nations have authorised some institution to control the
single operational activity, that the law is meant to regulate. activities and thereby implement the regulations. These are re-
The licence is, in other words, implementing the law. Monitor- ferred to in the legal text as the Competent Authority (CA). For
ing is the follow-up check from the environmental authorities small installations it is often a municipality-based authority or
of every single operation to make sure that the licence – and a regional, that is a county-based, authority. For larger instal-
thereby the law – is complied with. When non-compliance is lations it is typically a national authority such as the Environ-
registered, the final step, the enforcement, is activated. That mental Protection Agency of the country, but it may also be
may in the end mean substantial fines for the company and for e.g. an Inspectorate, such as the Chemical Inspectorate. It is
management personally and, possibly, closure of the company only when the Authority responsible for the implementation
and its operations. of the directive finds that an installation is not complying with
the given permit (licence) that the police authority or a court
6.1.3 National and International Legislation is addressed.
For the EU member states the legal framework is made up of
EU legislation, binding for all member states and of, separate or
additional, national legislation. National legislation is decided
6.2. Directives Related to IPPC
on by the national parliament and implemented by the govern- 6.2.1 IPPC, EIA, SEVESO and EMAS
ment according to the national constitution. EU legislation on The IPPC Directive is related to three other legal EU instru-
the environment has increased dramatically from 1987, when ments. These are the Seveso II Directive, the EMAS Directive
the EC Treaty was renewed and received a separate chapter on and the Environmental Impact Assessment, EIA, Directive.
the environment for the first time, and till today. The Seveso II and EMAS have already been dealt with (chap-
EU legislation has the form either of a Directive or of a ters 1 and 2). Below we will introduce the EIA Directive. En-
Regulation. A Regulation has immediate and direct binding vironmental Impact Assessment of the effects of certain public
effect for everybody in all member states. A Directive, on the and private projects was formally requested first in 1985 [Di-
other hand, must be written into national legislation (trans- rective 85/337/EEC] which was later amended in 1997 [Direc-
posed or legally implemented) before taking effect. The trans- tive 97/11/EC].
position must be completed normally within two years and The Seveso II and EIA directives are both based on the
must comply fully with all the main elements of the directive. experiences of the early 1980’s, and several serious accidents
Each member state decides how the implementation should be in industrial plants. But their goals and scopes are different,
organised, e.g. by placing the rules in different parts of current and the definitions used are not identical. As the discussion of
national legislation or making a completely new national law these and the IPPC Directive took place more or less in paral-
to hold the new regulation. lel, they do not contradict each other.

92 environmental licensing and the ippc directive 6

 The EIA Directive covers a broad array of activities rang- plans. There are also requirements regarding trans-border ef-
ing from industrial to infrastructure projects likely to have fects of new installations, such as a hydropower plant, which
significant effects on the environment. The IPPC Directive may influence a river upstream into another country.
focuses on the environmental impact of new and existing
industries and some agricultural activities. It does not cover 6.2.3 Which Directives Apply?
infrastructure projects. The Seveso Directive applies to estab- It may be argued that IPPC projects should require an EIA
lishments where dangerous substances are present, and thresh- procedure because they are considered to be large installations
olds for installations sometimes differ from those used in the in EU legislation. But the question if an application is needed
EIA Directive. in the EIA, IPPC and Seveso Directives needs close scrutiny.
The differences between the different instruments relate to Annex III of the EIA Directive covers aspects to be taken into
their different objectives. In comparison with the EIA Directive, account in the determination of whether an EIA is required.
the IPPC Directive places more emphasis on the Best Available Neither the IPPC nor the Seveso Directive has such an annex.
Techniques and technical processes, whereas Seveso focuses Member States may provide for a single list of projects for
on the risks of major accidents. In this context the scope of the mandatory EIA (Annex I to the EIA Directive) and then in-
information required under the EIA procedure is the widest and clude all or some of the projects in Annex I of the IPPC Direc-
is largely comprehensive of the documentation required under tive. In the case of changes or extensions of existing projects,
the other directives, so the documentation required for the EIA a range of decisions are left to Member States.
Directive could be considered as a basis which will eventually The EIA and IPPC procedures may be coordinated. On the
be supplemented by other information required by the other other hand, it is possible to apply the EIA and IPPC provisions
instruments. [Interrelationship between IPPC, EIA, SEVESO separately and a project may, therefore, be subject to both pro-
and EMAS, Impel final report 1998]. cedures. In these cases, the results of the EIA procedure shall
be taken into account for the purpose of granting the permit
6.2.2 Environmental Impact Assessment under the IPPC Directive. Environmental reports, information
The environmental impacts considered in an EIA assessment or documentation are required by all instruments. Therefore,
differ depending on national legislation, although some com- synergies should be used wherever possible, and links should
mon ground has been created through the EU directive. In- be established to avoid duplication (e.g. article 6.2 of the IPPC
cluded are thus Directive). However, the environmental reports or documenta-
tion of the EIA and IPPC procedures are focused on environ-
• Space intrusion, affecting a neighbourhood.
mental effects and measures for prevention and reduction of
• Pollution, including pollution caused by transport.
these effects, whilst the Seveso reports are focused on the risk
• Effects on ecosystems and nature.
analysis and safety conditions.
• Nuisance for the society such as air pollution, noise, and
odour. 6.2.4 Public Participation
More recently the social effects of a new installation have Public participation is required in all four instruments but with
been stressed as important to consider. E.g. a new hydropower different characteristics. In the EIA Directive, the ‘public’ has
plant for which a large area is flooded to create a reservoir may to be informed and the ‘public concerned’ consulted before
cause villages to be set under water. Equally the opening of a development consent is granted. In contrast, the IPPC Direc-
new mine, especially strip-mining, may lead to displacement tive the obligation is only to consider the ‘public’ comments
of whole populations. This may lead to very difficult decisions before the decision is made. In the Seveso Directive the in-
where two important values, a socio-economic and environ- volvement of the public is related to the different measures to
mental, have to be balanced. be taken, e.g. emergency plans. The EMAS regulation requires
A very central concern in EIA is the effect on biodiversity. that the public must be informed about the EMAS scheme.
This is especially underlined in developing countries and in the In Environmental Impact Assessment public participa-
UN Convention on Biodiversity. If, e.g. a railroad is planned to tion is important. All those that may be influenced by possi-
go through areas with unique biotopes, the company may be ble nuisances from a new installation have the right to express
forced to choose a different route to get a permit. their opinion on the proposal. The result of the EIA should
For plans, programmes and policies an SEA, Strategic be published in a report, and a public consultation should be
Environmental Assessment, is made based on a EU Direc- undertaken. The comments and the report should be taken into
tive adopted in 2000, mostly used for transport infrastructure account when the final decision is made and when the public

6 environmental licensing and the ippc directive 93

Box 6.1 The IPPC Directive

Introducing the IPPC Directive - (a) the technical characteristics of the installation.
Industrial production processes account for a considera- - (b) its geographical location.
ble share of the overall pollution in Europe (for pollutants - (c) the local environmental conditions.
such as greenhouse gases, acidifying substances, waste-
4. The Directive ensures that the public has a right to par-
water emissions and waste). The EU has a set of common
ticipate in the decision making process, and to be in-
rules for permitting and controlling industrial installations
formed of its consequences, by having access to
in the IPPC Directive of 1996.
- (a) permit applications in order to give opinions.
1. In essence, the IPPC Directive is about minimising pol-
- (b) permits.
lution from various industrial sources throughout the
- (c) results of the monitoring of releases.
European Union. Operators of industrial installations
- (d) the European Pollutant Emission Register (EPER).
covered by Annex I of the IPPC Directive are required
In EPER, emission data reported by Member States are
to obtain an authorisation (environmental permit) from
made accessible in a public register, which is intended
the authorities in the EU countries. About 50.000 instal-
to provide environmental information on major industrial
lations are covered by the IPPC Directive in the EU.
activities. EPER will be replaced by the European Pollutant
2. New installations, and existing installations which are
Release and Transfer Register (E-PRTR) from 2007 report-
subject to ”substantial changes”, have been required
ing period onwards.
to meet the requirements of the IPPC Directive since
30 October 1999. Other existing installations must be
Legislation
brought into compliance by 30 October 2007. This
The original IPPC directive has been amended twice since
is the key deadline for the full implementation of the
it entered in force. The first amendment reinforced pub-
Directive.
lic participation in line with the Aarhus Convention. The
second amendment clarified the relationship between
The IPPC Principles
the permit conditions established in accordance with the
The IPPC Directive is based on several principles, namely
IPPC Directive and the EU greenhouse gas emission trad-
(1) an integrated approach, (2) best available techniques,
ing scheme.
(3) flexibility and (4) public participation.
The consolidated legal text in official EU languages
1. The integrated approach means that the permits must and a short summary of the IPPC directive and amend-
take into account the whole environmental perform- ments are available at the Europa-site.
ance of the plant, covering e.g. emissions to air, water
and land, generation of waste, use of raw materials, Key Implementation Measures
energy efficiency, noise, prevention of accidents, and The Member States have chosen various approaches to
restoration of the site upon closure. The purpose of implement the IPPC Directive, such as case-by-case per-
the Directive is to ensure a high level of protection of mitting or use of General Binding Rules for industry sec-
the environment taken as a whole. tors.
More information can be found in the first implemen-
2. The permit conditions including emission limit val-
tation reports by Member States. Reports for the second
ues (ELVs) must be based on Best Available Techniques
reporting period (2003-2005) were sent to the Commis-
(BAT), as defined in the IPPC Directive. To assist the
sion by 30 September 2006. Reports can be found on
licensing authorities and companies to determine BAT,
Reportnet. Update on the reports submitted by Member
the Commission organises an exchange of information
States can be found in this site.
between experts from the EU Member States, industry
The Commission has adopted in November 2005 its
and environmental organisations. This work is coordi-
first IPPC Report. It included an IPPC Implementation
nated by the European IPPC Bureau of the Institute for
Action Plan set up to support the Member States and
Prospective Technology Studies at EU Joint Research
monitor the progress made towards meeting the dead-
Centre in Seville (Spain). This results in the adoption
line of 30 October 2007 for the full implementation of
and publication by the Commission of the BAT Refer-
the Directive.
ence Documents (the so-called BREFs). Executive sum-
maries of the BREFs are also translated into the official
EU languages.
3. The IPPC Directive contains elements of flexibility by
allowing the licensing authorities, in determining per- Source: the DG Environment webpage http://ec.europa.eu/
mit conditions, to take into account: environment/ippc/index.htm

94 environmental licensing and the ippc directive 6

is informed about that decision afterwards. If a Court of Con- which are difficult to have modified or changed dramatically
cession, or corresponding authority, decides on the permits, the for environmental protection reasons when first established.
public – and in general all stakeholders – have the right to have Compliance with the conditions in the licence is monitored
their say on the proposed new installation in the court process. and enforcement action taken where necessary to secure full
The Aarhus Convention ensures that the public has ac- compliance by the companies. These issues are dealt with in
cess to information on the environmental effects of different Chapter 7.
projects. This convention was adopted by the Community in
2003 [Directive 2003/35/EC]. 6.3.2 The Base of the Directive
The IPPC directive has been in force since 1999 for new instal-
6.3 The IPPC Directive lations and for installations planning for substantial changes in
6.3.1 Regulating Industrial Activities their operations. For existing installations step-by-step imple-
mentation was decided. All existing installations must have an
A considerable part of the environmental impact is caused
IPPC-type of license by October 2007. The grace period for
by industrial activities. In the European Union there are mil-
the existing installations is given in order to make it possible
lions of companies of concern for the environment and thus
to absorb implementation costs.
in need of regulation for the protection of the environment.
The Directive is based on the objectives and principles of
The large majority of these are small and medium sized en-
the environmental policy of the Community as set out in Arti-
terprises, SMEs, mostly with a limited impact. These are all
cle 174 (EC) of the EU-Treaty. This includes the
controlled by national legislation. But there are about 50,000
large industrial sites with activities of major concern. These • Principle of prevention.
are all controlled by the IPPC Directive and should have an • Principle of intervention at the source.
Environmental Licence based on this directive to be allowed • The Polluter Pays Principle.
to operate. • The Precautionary Principle.
The IPPC Directive 96/61 EC of 24th Sept. 1996, on In-
The directive represents a new approach in European in-
tegrated Pollution Prevention and Control, was implemented
dustrial regulation. The integrated licence, comprising all me-
in September 1999 in the EU-15. The ten new member states
dia (air, water and soil) and all outputs (polluted air/dust/gases,
that entered the EU on the first of May 2004, have negotiated
wastewater and solid waste) is the instrument developed to put
different terms and conditions for when this directive should
this approach into practice. It addresses all relevant aspects of
be fully implemented. However it cannot be later than 30 Oc-
environmental impact from an installation. Earlier, emissions
tober 2007. The directive is, as mentioned, concerned with
to air and water were considered separately in accordance with
the major industrial installations and installations in sectors
two different Directives. The IPPC directive furthermore em-
of industry with potentially high environmental impact or
phasises that attention must be given first to prevent the gen-
risk. These, listed in Annex 1 to the Directive, include among
eration of the pollution, and only when this is not possible
others: energy industry; production and processing of metals;
action must be taken to reduce emissions by means of cleaning
mineral industry; tanning; chemical industry and waste man-
technologies [IPPC Directive preamble, sections 4, 5, 6].
agement [IPPC Directive annex 1]. It means that most private
industrial output is regulated by the directive. The smaller 6.3.3 Objectives and Principles of the Directive
and/or less dangerous installations are typically regulated
The overall purpose of the directive is to ensure that member
along the same lines, but according to nationally established
states of the Union provide the necessary framework for the
regulation.
Competent Authority to be able to ensure that installations are
The regulatory concept in the IPPC-directive is that the
run in a proper way. The Competent Authority, most often the
industrial activities, included in the Annex 1 to the directive
Environmental Protection Agency, EPA, should thus see that
are prohibited, i.e. cannot be established and commence ac-
tivity, until they have been given an environmental licence. • The necessary measures are taken in order to prevent pol-
The licence includes specification of the regulatory require- lution, particularly trough the application of BAT.
ments they should fulfill to be allowed to operate. This con- • Waste production is avoided or that waste is recovered
cept makes sure, that risks are controlled from the very start. when produced and – if it is technically and economically
And, even more importantly, the environmental authorities are impossible – is disposed of while avoiding or reducing
not met with a de facto situation in terms of big investments, any impact on the environment.

6 environmental licensing and the ippc directive 95

• Energy is used efficiently. lease of substances, vibrations, heat or noise from individual
• Measures are taken to prevent accidents and limit their or diffuse sources in the installation into the air, water or land”
consequences. [IPPC Directive Article 2.5].
• Measures are taken to avoid risk of pollution and return The emission limit values for substances shall normally ap-
the site of operation to a satisfactory state when activities ply at the point where the emissions leave the installation, and
are definitively closed down. [IPPC Directive article 3]. any dilution must be disregarded when determining the val-
ues. However, when it comes to indirect releases into surface
Besides these overall objectives, the Directive formulates
water, i.e. when an installation discharges its wastewater to a
six key principles that shall direct the regulation. These prin-
common, often municipal, wastewater treatment plant, the ef-
ciples are:
fect of a wastewater treatment plant may be taken into account
• The integrated approach (article 7). when determining the emission limit values of the installation
• Conditions formulated as Emission Limit Values (ELV) involved. If the effect of the treatment plant is included in the
(article 9.3). licence for the installation, it necessitates that an equivalent
• The use of Best Available Techniques (BAT) as baseline level is guaranteed for the protection of the environment as a
for setting conditions (article 9.4). whole, i.e. at the point of discharge from the treatment plant,
• Periodical review and update of the permit and/or condi- whereby it is secured, that it does not lead to higher levels of
tions (article 12 and 13). pollution of the environment [IPPC Directive Article 2.6].
• Self-monitoring (article 9.5).
• Public participation (article 15). 6.3.6 Best Available Techniques
We will discuss each of these principles in turn. The emission limit values and the equivalent parameters and
technical measures referred to above shall be based on the Best
6.3.4 The Integrated Approach Available Techniques (BAT). Historically BAT has in some
nations been termed BATNEEC, where the NEEC referred
The objective of an integrated approach is to prevent emis-
to ‘Not Entailing Excessive Costs’. It was thus an emphasis
sions to air, water or soil in order to achieve a high level of
of the proportional principle saying that the requirement im-
protection of the environment as a whole. The integrated ap-
posed must not be too costly compared to the environmental
proach is to secure that the operator of a firm is discouraged
protection gained. The general proportional principle remains
from transferring pollution from one medium to the other.
important and in force, while the specific “NEEC” addendum
Separate approaches to control emissions to air, water or soil
to the BAT-concept seems to have vanished.
separately may, on the contrary, encourage the shifting of pol-
BAT shall not prescribe the use of any technique or specific
lution between the various environmental media and thus not
technology, but take into account the technical characteristics
protect the environment as a whole [IPPC Directive preamble
of the installation concerned [IPPC Directive Article 9,4].
7 and 8].
In the directive BAT shall mean “the most effective and
The principle of integration implies that conditions and the
advanced stage in the development of activities and their
granting procedure shall be fully coordinated, whenever there
methods of operation which indicate the practical suitability
is more than one authority involved in the permitting process
of particular techniques for providing in principle the basis for
[IPPC Directive Article 7].
emission limit values designed to prevent and, where that is
6.3.5 Emission Limit Values, ELV not practicable, generally to reduce emissions and the impact
on the environment as a whole” [IPPC Directive article 2.11],
The conditions set up for the operation of installations shall
where:
normally be formulated as emission limit values (ELV). Where
appropriate, the emission limit values may, however, be sup- • ‘Techniques’ shall include both the technology used and
plemented or replaced by equivalent parameters or technical the way in which the installation is designed, built, main-
measures [IPPC Directive Article 9,3]. tained, operated and decommissioned.
In the directive, emission limit values shall mean “the mass, • ‘Available’ techniques shall mean those developed on a
expressed in terms of certain specific parameters, concentra- scale which allows implementation in the relevant indus-
tion and/or level of an emission, which may not be exceeded trial sector, under economically and technically viable
during one or more periods of time” [IPPC Directive Article conditions, taking into consideration the costs and advan-
2.6]. Whereas emission shall mean: “the direct or indirect re- tages, whether or not the techniques are used or produced

96 environmental licensing and the ippc directive 6

 inside the Member State in question, as long as they are The Commission is currently carrying out a review of the
reasonably accessible to the operator. IPPC Directive, and related legislation on industrial emissions,
• ‘Best’ shall mean “most effective in achieving a high over the period 2006-2007. The review will not affect require-
general level of protection of the environment as a whole” ments of the IPPC Directive that Member States and industry
[IPPC Directive article 2.11]. will need to fulfill before 30 October 2007.
This review is based, inter alia, on the outcome of the con-
What constitutes the best available technique is of course
sultation organised on the basis of the Commission Commu-
extremely central in the directive. It is dealt with in detail by
nication of 19 June 2003 On the Road to Sustainable Produc-
a special institution of the Union and is expressed in the so-
tion – Progress in implementing Council Directive 96/61/EC
called BREF documents. This will be further explained be-
concerning integrated pollution prevention and control and
low.
contributions.

6.3.7 Review, Update, and Public Participation

6.4 The IPPC Licensing Procedure
In the light of technical advances, Best Available Techniques
will change over time. The competent authorities must there- 6.4.1 The Environmental Courts
fore monitor or be informed of such progress in BAT [IPPC To achieve the above-mentioned objectives and principles,
Directive article 11]. The directive further requires that the the IPPC Directive requires that member states set up an inte-
member states of the EU shall take the necessary measures to grated licensing system for industrial installations, agricultural
ensure that competent authorities periodically reconsider and, activities and landfills, all listed in annex I of the directive.
where necessary, update the conditions set for industry [IPPC The member states needs to establish competent authorities
Directive article 13]. The reconsideration shall furthermore be for the licensing procedures. These are environmental courts
undertaken in any event where: or courts of concession, with the authority to grant permits
for installations covered by the directive. A permit or licence
• The pollution caused by the installation is of such signifi-
should be granted if conditions and requests for modifications
cance that the existing emission limit values of the permit
of the installation can guarantee that the installation complies
need to be revised or new such values need to be included
with the requirements of the directive. If this is not possible,
in the permit.
the court shall refuse to grant the permit [IPPC Directive ar-
• Substantial changes in the best available techniques make
ticle 8].
it possible to reduce emissions significantly without im-
It should be noted that the environmental court normally
posing excessive costs.
also handles applications for e.g. large infrastructures such as
• The operational safety of the process or activity requires
roads, railroads and bridges etc. Environmental courts are nor-
other techniques to be used.
mally established on a regional or national level or both. They
• New provisions of the Community or national legislation
are not the same authority as the one which is responsible for
so dictate [IPPC Directive preamble 20 and article 13].
inspection and control. (The inspection authority is however
The directive demands that the operator carry out ‘suitable’ often responsible for issuing permits on a lower level, see be-
self-monitoring of releases including measurement of meth- low.)
odology and frequency, evaluation procedures etc. in order to For installations which are not listed in Annex 1 to the di-
supply the competent authority with data to evaluate the condi- rective, the member states can establish a set of general re-
tions of compliance [IPPC Directive article 9.5]. quirements for a certain type of installations, that they must
The directive demands transparency in the licensing proc- comply with. This standardization of the requirements for
ess and therefore sets up a procedure that necessitates the smaller and/or less polluting installations simplifies the licens-
involvement of the general public and ensures that different ing process both for the companies and for the authorities.
interests are considered in the process. The public shall thus Here the competent authority may be the same as the one re-
have access to and the opportunity to comment on the permit sponsible for inspection and control, that is an inspectorate or
application and a draft permit before it is processed. Further- municipal or regional authority. Still, this procedure requires
more the general public shall have access to the issued permits that an integrated approach and an equivalently high level of
as well as the monitoring data in order to inform the general environmental protection are ensured in the handling of in-
public on the installations’ actual and potential impact on the stallations, subject to such general regulations [IPPC Directive
environment [IPPC Directive Article 15]. article 9 and preamble 16]. A licence must be issued stating the

6 environmental licensing and the ippc directive 97

conditions from the general set of rules, applicable to the par- 6.4.2 The IPPC Permit Application
ticular installation, as well as stating additional requirements, The IPPC-directive demands that installations listed in annex
based on local or other, supplementary regulations, affecting 1 of the directive must apply for a permit before starting opera-
the particular installation. tion [IPPC Directive article 6].
A licensing procedure normally has 3 stages: This application shall include:
1. Application for the licence by the company. • A description of the installation and its activities.
2. Assessment by the CA of the application checking lay- • The conditions of the site of the installation.
out, technology, production process and material use • The use of raw- and auxiliary materials, other substances,
against the relevant range of regulations. and energy.
3. Formulating performance conditions and monitoring and • The sources of emissions.
reporting requirements in the permit. • The nature and quantities of foreseeable emissions from
the installation into each medium.
• The identification of significant effects of the emissions
on the environment [IPPC Directive article 6].

Figure 6.1 The policy framework

of environmental permits. Factors
General
taken into consideration when issuing
Environmental Law
an environmental permit or licence
are all indicated in the diagram. The
legal framework at the top, the ways International treaties
to do it (technology or environmen- and conventions
tal quality based approaches) in the e.g.
middle, and the implementation part OSPARCOM, HELCOM,
(sectoral or case-by-case) at the bot- Environmental regulations, BASEL, LRTAP
standards and target-setting
tom. [from OECD 1999, p 32]

Technology-based Environmental quality Economic factors

approach (BAT) approach (competitiveness,
investment cycles
Binding Environ- etc.)
Gudance, Binding
technology ELVs EQSs mental
assessment, (general or (general or quality
Technology R&D,
etc. sectoral) sectoral) guidelines
environmental
science
PERMITTING
(media-specific or integrated permits)
Socio-political factors
(public participation,
Case-by-case Sectoral availability of
approach approach information etc.)

Industrial facilities subject

to environmental permits

Environmental performance
monitoring and inspection

Definition of compliace
penalites, emission fees, etc.

98 environmental licensing and the ippc directive 6

 The company in question thus needs to map its production Let’s take a closer look at these key elements of the as-
processes and its technologies, showing inputs and outputs of sessment.
materials and waste. A flow chart of the different processes is
a useful approach linking the input, the use of resources, and 6.5.2 BAT and BREFs
the output, the products and different emissions to the different When defining what is to be considered BAT, whether it is for
processes and techniques in the form of a mass balance, cover- the specific installation or sector in general, the likely costs
ing the full throughput of the installation and thereby provid- and benefits of a measure as well as the principles of precau-
ing a complete overview of its environmental impact. tion and prevention shall – as mentioned earlier – be taken into
Furthermore the application shall include a description consideration.
of proposed technologies and other techniques to prevent or Besides this overall direction, annex IV of the directive
reduce emissions as well as measures for prevention and re- lists different further considerations that shall be taken into
covery of waste from the installation, whereby a clear link is account when setting the conditions (Box 6.2) [IPPC Directive
established between the technologies used and the level of Annex IV]. These considerations provide some guidance on
emissions made. Finally the application shall include meas- what needs to be assessed before licensing the operation of the
ures planned to monitor emissions into the environment [IPPC firm. However these considerations are obviously very general
Directive article 6]. in respect to defining BAT.
To fulfill the requirements for public participation in the The directive therefore requires that the Commission or-
licensing process, which must take place prior to CA decision- ganises an exchange of information across Member States and
making, the application must include a non-technical sum-
mary of all relevant information to make sure that the general Box 6.2 Considerations in the Process of
public has a real chance to understand the potential environ-
Determining Conditions
mental impact of the installation planned, and come up with
comments where people find that modifications are needed.
[IPPC Directive article 6]. • The use of low-waste technology
• The use of less hazardous substances
• The furthering of recovery and recycling of sub-
stances generated and used in the process and of
6.5 Assessment
waste, where appropriate
6.5.1 Key Elements • Comparable processes, facilities or methods of op-
The process starts when the company applying for an IPPC eration which have been tried with success on an
industrial scale
permit hands in its documents (an Environmental Impact As-
• Technological advances and changes in scientific
sessment or an IPPC application or both) to the proper author- knowledge and understanding
ity, that is the environmental court, or court of concession. • The nature, effects and volume of the emissions
The court considers whether to grant or refuse the appli- concerned
cation or what conditions to require for a permit, based on • The commissioning dates for new or existing in-
stallations
the existing environmental law and after careful assessment,
• The amount of time needed to introduce the best
as well as giving concerned parties, stake-holders, the oppor- available technique
tunity to intervene. If the assessment is divided among more • The consumption and nature of raw materials (in-
administrative units, the member states are obliged to establish cluding water) used in the process and their en-
a co-ordination between them to make sure that an integrated ergy efficiency
approach to the licensing can be achieved, and that the shifting • The need to prevent or reduce to a minimum the
overall impact of the emissions on the environ-
of emissions from one medium to another is taken into account
ment and the risks to it
and prohibited [IPPC Directive Art. 7]. • The need to prevent accidents and to minimize
A key element in this assessment is the decision on what the consequences for the environment
can be considered as Best Available Techniques, BAT, in the • The information published by the Commission
context of the particular installation. If Environmental Qual- pursuant to Article 16 (2) or by institutional or-
ganizations.
ity Standards or local environmental conditions require tighter
conditions than those, which can be obtained by BAT, the CA Source: IPPC Directive: Annex IV
must apply these stricter conditions to the licence. [IPPC Di-
rective Art. 10]

6 environmental licensing and the ippc directive 99

Industry concerning what is to be considered as Best Available As mentioned, the BREF’s are non-legally binding guide-
Techniques, about monitoring related to BAT and developments lines that each member state should take into consideration
within the BAT concept [IPPC Directive article 16]. Therefore when defining BAT and setting Emission Limit Values. How-
the commission has established the European IPPC Bureau at ever, the Directive gives the Council powers to set commu-
DG Joint Research Centre in Seville to develop this. nity emission limit values for IPPC installations, if evaluations
The outcome of this exchange of information is put togeth- show that the nationally and locally established limits and con-
er in the European BAT Reference Documents (BREFs). The ditions do not lead to a satisfactory level of protection [IPPC
BREFs are guiding documents to be used by the authorities Directive article 18]. This possibility has not yet been utilized
when formulating conditions. The BREFs are rather technical by the Commission.
documents of several hundred pages, giving overviews of exist-
ing technologies in each sector. By comparing the performance 6.5.3 Economic Aspects of BAT
of various installations across the European Union the authors The starting point when defining BAT is always the technical
conclude what should be considered best available technique characteristics of the installation applying for the licence. The
and the acceptable level of pollution within a sector at the EU BREFs (or other nationally determined BAT guiding system)
level. The aim is to provide “horizontal” (branch-specific) present which techniques to be considered the most environ-
BREFs for all industrial sectors listed in Annex I of the Direc- mentally favourable and at the same time generally accepted
tive. In December 2006 the 31 documents originally planned as economically and technically viable within the sector. But it
had been prepared. Three of them still awaited formal adoption. is only guiding material for the decision on whether the apply-
Furthermore there are some “vertical” BREFs that provide gen- ing installation fulfils the BAT requirement [IPPC Directive
eral guidance on methods to be used when establishing con- article 9.4].
ditions in a licence, i.e. on how to define BAT economically The definition of what constitutes “economically and tech-
and technically, and on how to set up self-monitoring require- nically viable” techniques is somewhat unclear in the direc-
ments. These vertical BREFs are not sector-specific. tive. The question is whether it should be understood as eco-

Box 6.3 Annex III of the IPPC Directive

Indicative list of the main polluting substances to be taken Water

into account if they are relevant for fixing emission limit 1. Organohalogen compounds and substances which
values may form such compounds in the aquatic environ-
ment.
Air 2. Organophosphorus compounds.
1. Sulphur dioxide and other sulphur compounds. 3. Organotin compounds.
2. Oxides of nitrogen and other nitrogen compounds. 4. Substances and preparations which have been proved
3. Carbon monoxide. to possess carcinogenic or mutagenic properties or
4. Volatile organic compounds. properties which may affect reproduction in or via the
5. Metals and their compounds. aquatic environment.
6. Dust. 5. Persistent hydrocarbons and persistent and bioaccu-
7. Asbestos (suspended particulates, fibres). mulable organic toxic substances.
8. Chlorine and its compounds. 6. Cyanides.
9. Fluorine and its compounds. 7. Metals and their compounds.
10. Arsenic and its compounds. 8. Arsenic and its compounds.
11. Cyanides. 9. Biocides and plant health products.
12. Substances and preparations which have been proved 10. Materials in suspension.
to possess carcinogenic or mutagenic properties or 11. Substances which contribute to eutrophication (in
properties which may affect reproduction via the air. particular, nitrates and phosphates).
13. Polychlorinated dibenzodioxins and polychlorinated 12. Substances which have an unfavourable influence on
dibenzofurans. the oxygen balance (and can be measured using pa-
rameters such as BOD, COD, etc.).

Source: IPPC-directive Annex III

100 environmental licensing and the ippc directive 6

nomically and technically viable at a sector level or for the additional Emission Limit Values (ELV) must be included in
specific installation. the conditions of the licence. [IPPC Directive article 9.4, pre-
However, the commission has expressed its opinion on amble 18]. On special occasions local environmental condi-
this matter in a Handbook on the implementation of the EU tions might lead to denial of the application altogether when
environmental legislation directed especially to new Member located at this particular place or area.
States. In this, the commission suggests the following:
‘Economically viable’ is usually taken to apply to the cat- 6.5.5 Formulating Conditions in the Permit
egory of installations as a whole, rather than to individual As stated above the condition should primarily be formed
operators. However, what is economically viable may be dif- as a maximum level of emissions – Emission Limit Values
ferent between different sectors of industry, and may be differ- (ELVs).
ent in the case of existing plants as opposed to new ones. In ELV’s express the amount, defined in terms of concentra-
practice the CA should, in consultation with representatives of tion and/or level of emission, which may not be exceeded over
the industrial sector concerned, examine the viability of pro- a certain period of time.
posed processes to arrive at an acceptable definition of a BAT, Based on the assessments of the application, the CA shall
which is achievable by the installations. Reference to world- thus decide on an appropriate maximum level of the different
wide examples of techniques and assessment of availability pollutants that the firm is allowed to emit during operation.
in the country concerned should feature in the examination Principally, this may involve all the substances used in pro-
[EU-Handbook on the Implementation of EC Environmental duction. The directive does recommend, however, that ELV’s
Legislations, Section 7, p. 51f]. are primarily laid down for the particular groups, families or
Thus, the CA both needs to consider the technological categories of substances that are listed in annex III of the di-
performance of the individual plant and the average level of rective.
achievable technological performance of the sector in general, The ELV’s are used also because they set a certain level
and to decide the appropriate level of protection to be met without prescribing the techniques or the methods
If the companies cannot meet these levels at once, the Di- used to achieve this level. Those decisions should be left to the
rective contains an option to set temporary derogations from company management to avoid limiting or hampering innova-
the requirements. This implies that a rehabilitation plan is ap- tion and thereby technological development [IPPC Directive
proved by the CA, ensuring that these requirements are met preamble 17]. And thereby the responsibility for fulfilling the
within six months and that the project will lead to a reduction requirements is also placed solely where it belongs – with the
of pollution [IPPC Directive article 9.6]. company management. Finally, the CA will typically not have
the information or the qualifications to enter into that type of
6.5.4 The Relation between Emissions, EQSs and the decision-making. But the CA might, based on horizontal expe-
Local Environment riences from numerous applications and inspections at produc-
The directive states that where an Environmental Quality tions sites, have advices to offer the company in the process of
Standard, EQS, requires stricter conditions than those achiev- dialogue between the CA and the company, which is a typical
able by the use of BAT, additional measures shall be required part of a licensing procedure.
in the permit [IPPC Directive article 10]. The directive gives, however, the options to supplement or
In the directive, an Environmental Quality Standard shall even replace the emission limit values by equivalent param-
mean “the set of requirements which must be fulfilled at a given eters or technical measures, where this is appropriate [IPPC
time by a given environment or particular part thereof, as set Directive 9.3].
out in Community legislation” [IPPC Directive article 2.7]. Besides these performance conditions to ensure that the
As the EQS typically refers to local or regional environ- company is operating within a predefined acceptable level of
mental conditions, generally binding EQS at the EU level and pollution, the competent authority shall also formulate self-
even the national level are not set. These standards are to be monitoring requirements. The objective of the self-monitoring
found in different parts of EU and national legislation, which is three-fold: to simplify the follow-up for the CA regarding
must then be taken into account when issuing environmental compliance and enforcement; to push the firm to keep track of
licences. When assessing the environmental benefits from the their environmental performance; and to use the self-monitor-
BAT requirements, the geographical location and the local ing data in an emission register available to the general public.
environmental conditions should always be considered. If the
BAT-approach cannot secure compliance with these standards,

6 environmental licensing and the ippc directive 101

Study Questions OSPARCOM OSPAR Commission
1. What are the main components of a legal framework for R&D Research and Development
an environmentally hazardous activity in a EU member SEA Strategic Environmental Assessment
state? SMEs Small and Medium-sized Enterprises
2. Describe the basics of the IPPC, EIA, EMAS II and
Seveso II directives and how they are related.
Internet Resources
3. In what way does public participation come in when these
four directives are implemented? DG Environment webpage on the IPPC Directive
4. List what activities in the EU member states need an http://ec.europa.eu/environment/ippc/index.htm
IPPC license (numbers and character); comment on how
those not needing an IPPC license are regulated. The consolidated IPPC Directive full text (pdf document)
5. What is the philosophy behind, and main components of, http://eur-lex.europa.eu/LexUriServ/site/en/consleg/1996/
the IPPC Directive? L/01996L0061-20031120-en.pdf
6. What are the main advantages and limitations of the IPPC
Directive? DG Environment webpage on the EMAS II Directive
7. Explain how the concept of BAT should be understood http://ec.europa.eu/environment/emas/index_en.htm
and used.
8. What are the advantages and drawbacks of defining BAT DG Environment webpage on the Environmental Impact
on the sector level in comparison to defining BAT on the Assessment Directive
company level? http://ec.europa.eu/environment/eia/eia-legalcontext.htm
9. What should be included in an IPPC permit application?
10. Discuss the use of EQSs and ELVs in relation to the local DG Environment webpage on the Strategic Impact
environment and the IPPC license. Assessment Directive
http://ec.europa.eu/environment/eia/sea-legalcontext.htm

Abbreviations DG Environment webpage on the Seveso II Directive

BAT Best Available Techniques http://ec.europa.eu/environment/seveso/index.htm
BOD Biological Oxygen Demand
BREF BAT Reference Document Interrelationship between IPPC, EIA, SEVESO Directives and
CA Competent Authority EMAS Regulation (Impel report 1998)
COD Chemical Oxygen Demand http://ec.europa.eu/environment/eia/eia-studies-and-reports/
EIA Environmental Impact Assessment impel-full-text.pdf
ELVs Emission Limit Values
EMAS Eco-Management and Audit Scheme IPPC 2003 Communication – On the Road to Sustainable
EPA Environmental Protection Agency Production
EPER European Pollutant Emission Register http://ec.europa.eu/environment/ippc/com_communication.
E-PRTR European Pollutant Release and Transfer htm
Register
EQS Environmental Quality Standard Documentation of BREFs by the European IPPC Bureau
HELCOM Helsinki Commission of the Convention on the http://eippcb.jrc.es/pages/FActivities.htm
Protection of the Baltic Sea
IMPEL European Union Network for the Implementation
and Enforcement of Environmental Law
IPPC Integrated Pollution Prevention and Control
LRTAP Long Range Transboundary Air Pollutants
NEEC Not Entailing Excessive Costs
OECD Organisation for Economic Co-operation and
Development

102 environmental licensing and the ippc directive 6

 Implementing
Environmental Licensing 7
7.1 Balancing Rules for Environmental Licensing 7.1.2 Technology or Limit Values
7.1.1 Balancing Different Interests The IPPC Directive requires that the conditions formulated for
When implementing environmental law in practice one will an industry applying for a licence or permit shall weigh to-
always be forced to strike a balance between different inter- gether several concerns. These are:
ests. These are often economy versus environment. To avoid • The technical ones formulated in the Best Available Tech-
pollution may be costly and difficult to finance for a company. nique, BAT.
Excessive costs may in some cases even lead to a threat to • The environmental concerns formulated in environmental
make a company less competitive, create unemployment or quality requirements as the Environmental Quality Stand-
even close an activity. Often compromises are made to avoid ards, EQSs.
such costs, or changes requested distributed over a number of
years to reach an acceptable level of annual environmental in-
vestments. In this Chapter
Balancing may also involve the development of such con-
1. Balancing Rules for Environmental Licensing
ditions as development of infrastructures, protection of natural Balancing Different Interests
reserves, or the living conditions in residential areas. People Technology or Limit Values
living close to an industrial production have often, and for Emission Limit Values
good reasons, complained about e.g. air pollution, intense 2. Best Available Technique
and disturbing traffic, or risks. Such concerns need also to be Sector or Company Standards
BREFs or Continuous Improvement
weighed into a decision on licensing.
3. The Integrated Approach
The environmental conditions for allowing an industrial The OECD Approach
activity are defined in environmental law. In practice, however, Extending the Material Flows Perspective
the conditions are not exactly defined. Thus it is a concern for 4. Promotion of CP via the IPPC Licensing Framework
the authority to arrive at a conclusion on the exact require- Promoting Environmental Development
ments for such a licence or permit. This chapter will discuss The Licensing Process as a Dynamic Cycle
Negotiation During the Licensing Process
how a balance between different approaches is decided when Developing Conditions
an authority is developing a permit for a production facility. Information
The parameters involved are technical, economic, environ- The Weak Point – Lack of Systems View
mental, managerial etc. They are all made in the context of 5. Licensing and Other Regulatory Instruments
the Integrated Pollution Prevention and Control, the IPPC, Goals and Policies in the Licence
Licensing Supporting EMS
Directive, as the basis for environmental licensing within the
Differences Between Licensing and EMS
European Union. Development and Environmental Plans

7 implementing environmental licensing 103

• The particular local conditions, the geographical location panies’ internal accounting system could be to formulate limits
and the situation at the particular site or industry. according to the produced units instead of absolute emission
limits. Requiring production-related indicators can help pro-
These conditions require the integration of two different
vide an overall frame for the company to act within, whereas
approaches (Figure 6.1):
the conditions based on emission limit values make it difficult
Firstly a technology-driven approach, where the focus is
for the companies to maneuver [Kjær, 1996:20ff]. The dilem-
on the optimising of the technology choices in order to lower
ma is of course that the environment is sensitive to the abso-
the pollution as much as possible. It corresponds to a licence
lute amounts, regardless of how many units are produced. An
to use the proposed techniques.
absolute upper limit on how much emission is allowed is also
Secondly an environmental approach, whereas the focus
what an installation normally has in its licence, even if there
is on the carrying capacity of the environment as direction for
also may be a value for the performance indicator.
allowed pollution. This corresponds to a licence to pollute a
Since the conditions and self-monitoring data would then
specific amount.
be expressed in the same terms, the companies would have a
The inclusion of both approaches gives wide freedom to
clear indication of their environmental performance to incor-
formulate the national regulation. Here there are two different
porate into their management. A periodical evaluation of the
traditions. The directive focuses on the use of BAT as a basis
company’s development between the reviews of the permit can
for formulating the conditions whereas the EQSs and the lo-
facilitate the implementation of the conditions.
cal surroundings are more peripheral. The national regulation
has traditionally focused on allowed pollution in respect to the
local surroundings. When implementing the IPPC Directive 7.2 Best Available Technique
we see a move from the environmentally driven licensing to 7.2.1 Sector or Company Standards
a more technology-driven one. This is a move from regulat-
As mentioned there are some uncertainties regarding the inter-
ing and controlling the emissions from the plant separately
pretation of the principle of Best Available Technique (BAT).
according to the media they are released to, to a more inte-
It many be either the best techniques achievable on a sector
grated, holistic, regulation focusing on the possibilities for
level, or that achievable for each specific company.
process optimization through the use of BAT. It represents an
If BAT is interpreted as the level achievable for an aver-
understanding of the permit as an environmental approval of
age of the firm in the sector, it is evident that the BAT sets a
the technology and processes used in the production instead
minimum-standard that cuts off the industries with the worst
of, as earlier, a licence to pollute a certain amount.
performance.
However, it is questionable if it is possible to specify BAT
7.1.3 Emission Limit Values, ELVs so that one specific technical solution can be defined as BAT
Traditionally emission limit values have been the basis for en- [Kjær, 1996: 15]. The technology and techniques used in dif-
vironmental legislation. Emission limit values have still a very ferent productions can differ substantially even though they
central place in the directive when formulating the conditions. belong to the same sector and make the same. The different
This naturally means that focus will be at emissions rather than techniques used, the choice of resources, auxiliaries, interme-
on inputs and processes. This is a problem for two reasons. diate feedstock, and the organization of the production will all
Firstly it is opposed to the directive’s emphasis, that pre- influence the performance of the specific production. The dif-
ventative actions should be the first option. If the formulated ferent techniques will be very difficult to compare, especially
requirements do not correspond to this, it will be more difficult because of the fact that one technique might perform better in
to keep the focus on the preventative actions in production. some aspects but worse in others. To formulate uniform and
Secondly emission limit values do not provide adequate coherent conditions may therefore prove to be difficult. If the
flexibility for the installation and do commonly not correspond idea is to provide different options for improvement, however,
to how the companies themselves prefer to report their envi- the work will be eased substantially.
ronmental aspects. Normally, in their internal accounting sys- The interpretation of BAT on the sector level has an addi-
tems, companies present their result in respect to the number tional disadvantage. It can make it more difficult to foster the
of produced units, so-called performance indicators. Thus we firms to go further than what the sectorial standards prescribe
have e.g. number of tonnes of SOX per produced units, rather and therefore halt innovation. When general or sectorial stand-
than the total amount of SOX from the factory. A way to make ards exists the competent authority needs quite strong argu-
the condition more flexible and corresponding with the com- ments to make the firms see that they need to go further. When

104 implementing environmental licensing 7

Box 7.1 BAT in the Chlor-Alkali Industries

The electrolytic production of chlorine from sodium

chloride solution (brine), the chlor-alkali process, was in-
troduced on an industrial scale around 1890. Since the
1940’s world chlorine production has risen enormously
on the back of the burgeoning demand for plastics, no-
tably PVC (polyvinylchloride) and polyurethanes, the
production of chloro-aromatics such as chloro-benzene,
solvents containing chlorinated hydrocarbons, and inor-
ganic chlorine compounds.
The main technologies applied for chlor-alkali produc-
tion are mercury, diaphragm and membrane cell elec-
trolysis.

Technology choice
The mercury cell process involves two “cells” in an elec-
trolyser through which saturated brine, 25% sodium chlo-
ride, flows. In the bottom a film of mercury (Hg) flows,
serving as one of the electrodes, the cathode, adsorbing
the sodium ions to produce sodium amalgam, thereby
liberating chlorine gas at the anode. A typical plant using
this technology needs about 200 tonnes of mercury; the
Figure 7.1 Chlor alkali industry. View of a membrane cell
contamination of land and waterways by mercury was,
room equipped with bipolar electrolysers [source: the BREF
and is, a big environmental problem.
document].
In the diaphragm process a diaphragm is employed to
separate the chlorine liberated at the anode, and the hy-
Regulations
drogen and caustic soda is produced directly at the cath-
Mercury emissions from the industry is the base for re-
ode. A disadvantage with this method is that the chlorine
peated request for out-phasing the mercury method in
gas produced is less pure than in the mercury process.
the chlor-alkali industry. According to Euro Chlor, the total
Also the diaphragms are made of asbestos, which is an
mercury emission to air, water and products from chlor-
environmental concern, and need regular replacements.
alkali plants in Western Europe was 9.5 tonnes in 1998.
In the membrane cell process the anode and cathode
Because of its historical experiences of mercury pollution,
are separated by a water-impermeable ion-conducting
the Minimata disaster, Japanese regulation does not allow
membrane. Brine solution flows through the anode com-
mercury technology to be used, and all installations in
partment where chloride ions are oxidised to chlorine gas,
Japan are mercury free since mid 1980’s. (The membrane
while the sodium ions migrate through the membrane to
technology was developed in Japan in the mid 1970s).
the cathode compartment which contains flowing caustic
Decision 90/3 of 14 June 1990 of the Commission for the
soda solution. The caustic soda produced with this tech-
Protection of the Marine Environment of the North-East
nology is less concentrated. On the other hand the proc-
Atlantic (OSPARCOM) recommends that existing mercury
ess is more energy efficient.
cell chlor-alkali plants should be phased out as soon as
practicable, and no later than 2010.
BAT considerations
In Europe there were in 2002 some 60 plants using
The BREF document of the chlor-alkali process describes all
the mercury methods, 40 of them in Germany, many in
three methods in some detail and the pros and cons for
Russia, 2 in Poland, and 2 in Sweden. Present EU regula-
each of them. It is clear that the membrane process is the
tion foresees that the plants in the EU have changed tech-
preferred one, both environmentally and economically; all
nology or have closed by 2010. How to collect and store
plants built the last 20 years – since 1987 – use that technol-
the mercury from these plants is still debated. Previously
ogy. It is clearly said the membrane process is the best avail-
mercury was sold on the world market. This will not be
able technique, BAT. The BREF also describes the process for
allowed, as all trade with and use of mercury as such will
converting a plant from mercury to membrane technology
be out-lawed. The mercury will have to be stored in old
as well as from diaphragm to membrane technology, and
mines or equivalent places.
the environmental requirements made in connection with
such conversions. The investments needed are estimated,
Source: The BREF document.
citing some recent experiences in Western Europe

7 implementing environmental licensing 105

Box 7.2 BAT in the Cement Industry

Cement and concrete (a mixture of cement, aggregates,

sand and water) is a basic material for building and civil
engineering construction. Output from the cement indus-
try is directly related to the state of the construction busi-
ness in general and follows the overall economic situation
closely. The production of cement in the EU-12 in 1995
was 172 million tonnes. In 1995 there were 252 installa-
tions producing cement clinker and finished cement in the
EU-15 and a total of 437 kilns. In recent years typical kiln
size has come to be around 3,000 tonnes clinker/day.

Technology choice
Cement manufacturing begins with the decomposition of
calcium carbonate (CaCO3) at about 900°C to leave calci-
um oxide (CaO, lime) and carbon dioxide (CO2), known as
calcination. The calcium oxide then reacts at high tempera- Figure 7.2 Kunda Nordic Cement Factory, Estonia. The
ture (1,400-1,500°C) with silica, alumina, and ferrous oxide factory is one of the largest in the Baltic Sea region. It was
to form the clinker, which is then ground or milled together transformed from an environmental disaster to a ISO 14001
with gypsum and other additives to produce cement. certified plant in the ten years after the systems change. See
There are four main process routes for the manufac- further Book 4 in this series. (Photo: Kunda Cement)
ture of cement. In the dry process, the raw materials are special combustion chamber between the rotary kiln and
ground and dried to raw meal in the form of a flowable the preheater.
powder. The dry raw meal is then fed to a precalciner kiln The four-stage cyclone preheater kiln system became
or, more rarely, to a long dry kiln. In the semi-dry proc- standard technology in the 1970’s when many plants
ess dry raw meal is pelletised with water and fed into a were built in the 1,000 to 3,000 tonnes/day range. The
preheater before the kiln or to a long kiln. In the semi-wet exhaust gas is normally used for raw material drying.
process the slurry is first dewatered and then fed either
to a preheater or directly to a filter cake drier. In the wet BAT considerations
process, the raw materials (often with high moisture con- A large part of world clinker production is still based on
tent) are ground in water to form a slurry, which is either wet processes. However, in Europe, more than 75% of
fed directly into the kiln or first to a slurry drier. production is based on dry processes thanks to the avail-
ability of dry raw materials.
Historical development Total burning energy requirement is – in MJ/tonne
The first rotary kilns were long wet kilns, up to 200 meter clinker – about 3,000 for dry process, multi-stage cyclone
length, where the whole heat-consuming thermal proc- preheater and precalciner kilns, 3,100-4,200 for dry proc-
ess takes place in the kiln itself. The introduction of the ess rotary kilns equipped with cyclone preheaters, 3,300-
dry process allowed drying, preheating and calcination 4,500 for semi-dry/semi-wet processes (Lepol-kiln), up to
to take place in a stationary installation rather than in the 5,000 for dry process long kilns, and 5,000-6,000 for wet
rotary kiln. process long kilns.
Grate preheater technology, better known as the Lep- The selected process will thus have a significant effect
ol kiln, was invented in 1928. It was the first approach on the energy use. For new plants and major upgrades a
to letting part of the clinkering process take place in a dry process kiln with multi-stage preheating and precal-
stationary installation outside the kiln. This allowed the cination is today’s state of the art. The wet process kilns
rotary kiln to become shorter and reduced the heat losses operating in Europe are generally expected to convert
and increased energy efficiency to the dry process when renewed, and so are semi-dry
The invention of the suspension preheater in the early and semi-wet processes. Thus kiln systems with 5 cyclone
1930’s was a significant development. Preheating and preheater stages and precalciner are considered standard
even partial calcination of the dry raw meal takes place technology for new plants. Such a configuration will use
by maintaining the meal in suspension with hot gas from 2,900-3,200 MJ/tonne clinker.
the rotary kiln. The precalcination technique has been The selected process will also affect the releases of all
available to the cement industry since about 1970. In this pollutants, and be favoured by the new technology.
procedure a primary fuel combustion occurs in the kiln
burning zone, while a secondary burning takes place in a Source: BREF document

106 implementing environmental licensing 7

a sector specific BAT is defined, it is difficult to define the achievable in the sector into consideration. It involves assess-
BAT for the specific firm as stricter than the sectorial require- ing the performance of the installation and its improvement
ments. When BAT is defined according to the specific facility possibilities in order to determine BAT according to the instal-
the authority needs to set the requirements according to the lation. It also needs to compare this performance with the sec-
techniques achievable for the company in question. In that way tor level, including the different guiding material as BREFs,
the authority can ignore the sector specific definitions of BAT other BATs or sector notes etc.
and define BAT for the facility higher than the average per- Besides this discussion on whether to interpret BAT as
formance of the sector in general. It is a way to foster the firms improvement possibilities for the specific firm or as an av-
to innovate further and beyond the BAT defined in the sector. erage level for the sector, a relevant discussion concerns the
On the other hand, if BAT is solely determined with re- term BAT itself. The term BAT originates from Best Available
spect to the specific firm, it is also evident that the perform- Cleaning Technology (BACT). The BAT thus was a principle
ance achievable for that specific firm might be lower than the means to ensure that the best and cheapest end-of-pipe tech-
average performance of the sector. According to a strict inter- nologies were chosen. The directive does not adopt this in-
pretation of the BAT related to the specific firm there won’t be terpretation. But with the directive’s focus on emission limit
any minimum restrictions. The facilities should then innovate values (and thereby on emissions rather than input) it can be
on their own possibilities for improvements with no regard to difficult to keep the process technologies in mind.
the average sector level of technology performance. A strict Furthermore, the use of “Available” as the central ele-
interpretation will thus not be able to secure a minimum per- ment of BAT makes the term retrospective in its approach. It
formance. is mainly the technologies already existing on the market that
are assessed in order to determine which are preferable and
7.2.2 BREFs or Continuous Improvement achievable. The BAT approach does, in this regard, not con-
The directive’s promotion on the individual licensing system tribute to foster the companies to innovate new technologies in
for each specific installation emphasise the local authorities order to comply with BAT.
and their definition of conditions to promote improvement A more innovative and forceful approach, would be to
possibilities for the specific facility. To secure a minimum of firstly set requirements of continuous improvement of the in-
acceptable BAT levels, the EU has prepared the European BAT stallation’s environmental performance, operating with short-
Reference Documents, BREFs. The decision that the BREFs term conditions, to be complied with by the facility right away
should be guiding documents shows that the EU sees them as (BAT); and secondly to set long-term objectives and require-
minimum standards, and prefers that the relevant authorities ments to guide and foster further innovation.
and member states promote possibili-
ties for improvements going beyond
the BREFs.
Athmospheric
In line with the above discussion
emissions
about the directive, it is clear that the
air and noise permit
directive promotes an approval system
where the competent authority should
primarily assess the facility’s possibil- OUTPUTS
INPUTS
INDUSTRIAL SITE Products
ities for improvements. This should be Materials
and
and AND PROCESSES
done taking the overall performance manufactured
energy
goods

Water permit Water permit

N33
3

Figure 7.3 The base of an integrated

Waste Water discharges
permit. In the single media approach air,
noise, waste and water permits are treated
and granted separately. In an integrated
permit (grey frame) these are all interre- single-media permit integrated permit
lated [OECD, 1999 vol. 1 p. 33].

7 implementing environmental licensing 107

 Addressing issues upstream and downstream of industrial operations

Air pollution

Noise
Input
- Raw materials
- Intermediate foodstocks
- Suppliers
- Upstream LCA Output
Product
Internal Considerations Downstream LCA
External Considerations - Management Monitoring
- Multisource management - Eco-efficiency / recycling Public information
- Reduction plans/targets EPR decommissioning
- EIA
- Liability insurance – risk

N33
- Public information

3 Toxic waste Wastewater

Figure 7.4 The OECD approach to integrated licensing. Here the production process itself is in focus to allow the development of pollution
prevention techniques, and efficient resource use. In addition life cycle assessment, LCA, is used to the extent possible to regard upstream and
downstream improvements. [Figure from OECD 1999 vol. 1, p 57]

levels positively and thereby reduce the overall contamination.

7.3 The Integrated Approach
A natural first option to prevent pollution is thus to conduct an
7.3.1 The OECD Approach integrated assessment of the plant.
The primary focus in the integrated approach in the directive
is that the plant shall receive one integrated permit instead of 7.3.2 Extending the Material Flows Perspective
several media-specific permits. The OECD further argues that the integrated terminology
The integrated approach thus mostly concerns the inte- should be extended on the input- and the output side. On the
grated assessment of emissions to all media. In the view of the input side OECD propose to go beyond the facility – the site
OECD, the term is however broader and does not solely con- – now asking for a licence, and include the relation of the fa-
cern the integral assessments to the different media. It rather cility to suppliers and the raw materials and other products,
emphasises the assessment of the processes of the industrial they deliver to the facility. The licence cannot make request to
site [OECD 1999 vol.1: 33]. these “upstream” suppliers themselves, but the licence might
The integrated assessment of the whole plant is thus the include requests to the applying facility to have in place sys-
primary step in identifying the possibilities for pollution pre- tems, whereby the demands on quality and environmental
vention. An integrated assessment of the whole installation impact from products and processes, which the facility has
should, according to the OECD, cover input, output and inter- for itself, should also be complied with by the suppliers. It
nal processes [OECD 1999 vol.1: 57]. Inputs are then defined comprises Life Cycle Assessment on products, Environmental
as the use of resources, semi-manufactured articles and energy Impact Assessment on products and of supplying installations
as well as intermediate feedstock. Output includes product, and presence of Liability Insurance for products delivered.
waste and emissions. Internal processes include the manage- Much of the same goes for the output side as well, and
ment of the production, eco-efficiency and direct recycling as here it concerns requests directly for the facility itself. Still,
well as the techniques used. there is at present no legal background for such a demand,
Such an assessment clearly links the levels of emissions but it’s getting more and more commonplace among the most
to the use of resources and techniques in the production. The environmentally conscious companies on a voluntary basis,
improvement of techniques in the production and a more ef- pushed by image-nursing and customer requests [OECD 1999
ficient use of input must be expected to affect the emission Vol. 1: 57].

108 implementing environmental licensing 7

 ENVIRONMENTAL ASSESSMENT

Response to compliance
Facility
failures
- Investigation of problems and
Assessment of discussion with permitting
Environmental Impacts authority
- Adoption of new measures to Discussion and
ensure compliance negotiation of permit
33
3

N application or renewal
- Disclosure of plant information
on operations and production
Monitoring and future projecttions
- Identification of environmental
and enforcement issues of concern
- Presentation of monitoring or
- Monitoring of operations,
end-of-pipe control and The investigation results
environmental impacts
- Investigations on releases and Permitting
plant operations Application procedure
- Inspections Cycle Facility application
- Charges and penalties related
to pollutant releases - Identification of type and
amount of pollutant releases
and other environmental
impacts
Implementation - Description of proposed and
of permit alternative measures to reduce
conditions environmental impacts

- New and ongoing investments Permit award Public hearing and

for environmental improvements expert assessment
- Accumulation of experience Stipulation of permit conditions
- Environmental management - Emission limit values - Technology assessment
procedures - Monitoring programmes and - Assessment of environmental
- Internal environmental studies reporting requirements needs
- Compliance timetable - Assessment of land-use
- Other conditions impacts

Figure 7.5 The environmental permitting cycle. Permits of industrial productions are time-limited and the licensing is therefore cyclic. The
permits and conditions in them, in addition, have to be adapted to the industrial investment cycles. This will allow for the development of new
measures to achieve compliance and improve environmental performance in the next cycle. [OECD 1999 vol. 1, p 82].

7.4 Promotion of CP
tion. We argue, however, that environmental regulation can go
via the IPPC Licensing Framework
further. It can and should be used more progressively to set
7.4.1 Promoting Environmental Development out directions and perspectives for the forthcoming develop-
The EU IPPC framework may be used not only for normative ments. It can and should motivate companies to incorporate
environmental regulation of industry. Local authorities can act environmental considerations into all of their activities.
within this framework in order to foster industry to take action The OECD is one context in which one operates with the
to minimize the environmental aspects of their production. It is idea that regulation shall set out directions for innovations. Be-
a step beyond just setting minimum standards for industry. low follows a discussion how to develop the licensing proce-
The typical philosophy of the environmental regulation of dure using this approach. It is mainly based on the recommen-
industry and the issue of permits is to ensure that a minimum dations from OECDs work on Environmental Requirements
of binding standards are enforced. In this way authorities se- for Industrial Licensing [OECD vol 2: 99 ff and vol 1].
cure that facilities lagging behind in the environmental per- According to the OECD, the licensing should achieve a
formance reach a minimum level of the environmental protec- triple goal:

7 implementing environmental licensing 109

• Ensuring a minimum of binding standards. In line with the above, the conditions should be formulated
• Providing clear indications on both short- and long-term in a way that makes companies work to ensure continuous im-
objectives. provements of their environmental performance.
• Providing adequate flexibility for innovation. According to the OECD, the dynamic and improvement-
oriented approach necessitates some kind of dialogue or ne-
When aiming at long-term goals, which require innova-
gotiation between the authorities and the operator of the fa-
tions, licensing must be construed less as a set of requirements
cility in question. The negotiation may continue throughout
that have to be met to ensure compliance. It should be more of
the whole process of formulating the requirements starting
an instrument to facilitate for companies to pursue a sustained,
with a pre-application to determine the scope of the permit all
dynamic work of innovation and improvement of environ-
the way to the final licence. Thus, the licensing process is the
mental performance. As stated above, the formulation of gen-
primary interface between regulations and the actual environ-
eral and sector-specific standards might be favourable when
mental performance of industrial operations.
it comes to securing the minimum level that every company
The OECD states that the purpose of these negotiations
needs to comply with. In contrary, the formulation of the con-
is to exchange information to find the best measures and op-
ditions in the permit by the local administration makes it more
timal solutions with a long-term perspective, and not to set-
flexible and possible to set up a system that fosters, motivates
tle on compromises. That is, the information should concern
and facilitates for companies to take further action.
the conduction of permit conditions (ELVs, BATs etc.) that
The IPPC Directive in all cases contains the need to issue
stimulate technological and process-innovation to achieve
the permit, with a focus on continuous improvements. We will
improvements in the overall environmental performance. In
now focus on how the licensing authority can use the procedure
those negotiations, the OECD points out the importance of a
to foster, motivate and facilitate for a company to take action on
mutual understanding of each other’s role, which should not
their environmental impacts. As mentioned above, the OECD
be doubted or taken over by the counterpart.
has some ideas and recommendations regarding these matters.
7.4.4 Developing Conditions
7.4.2 The Licensing Process as a Dynamic Cycle
The objective of the licensing scheme is to facilitate for each
As mentioned, the IPPC Directive contains a requirement to
company to innovate for improvements. The licensing require-
periodically review the permits in respect to innovation in
ment should therefore contain an obligation for the company
BAT, advances in science etc. This means that the licensing
to continuously improve its environmental performance. The
procedure should strive to secure sustained improvements of
competent authorities should use the permit to launch reduction
the facilities. In spite of the fact that this sets the stage for pow-
goals formulated as performance-based requirements, which
erful dynamism, it is not incorporated as a basic principle un-
leave room for the firms to choose the technology path. The
derlying the entire framework. The OECD has picked up this
stipulation of goals and requirements needs to take into consid-
thread and formulated the dynamic approach much stronger.
eration the existing technological state and environmental per-
The OECD’s set-up follows a cyclic process containing seven
formance of the company in question and the possibilities for
steps that are continuously repeated. In contrast to the IPPC
improvements. If the requirements are set too strict, beyond the
Directive, the OECD interpretation of the dynamic of the per-
reasonable reach of the company, it is likely that the require-
mit system is not limited to the periodical review, however.
ments won’t be met or the company will even try to bypass it
The OECD emphasises that the dynamic approach must be a
in different ways e.g. by diluting effluents. On the other hand,
central aspect at all stages throughout the cycle.
if the requirements are too low, they won’t help to foster any
7.4.3 Negotiation During the Licensing Process substantial changes and improvements in production.
Effective strategies are based on pragmatic assessments
The formulation of the conditions in a permit develops through
from case to case when it comes to identifying the environ-
the entire licensing scheme:
mental performance of industrial activities and possibilities for
1. The operator’s application including an environmental improvements. This means that the authorities must both fos-
review of the facility; ter the companies performing better than what is considered
2. Assessments of the facility and its environmental impacts; BAT at the sector level. BAT should thus be interpreted as a
3. Developing the guiding material; minimum criterion for setting the requirements in the permit.
4. Final formulation of the conditions and requirements in The requirements in the permit should also incorporate
the permit. long-term goals and timetables for implementing improve-

110 implementing environmental licensing 7

ments, as well as monitoring programs and reporting re- tees all citizens access to relevant environmental information,
quirements that clearly show the environmental results and came into force in 2001. It has since been expanded and de-
economic aspects of the implementation of the different im- tailed as a directive, which came into force in 2006. This is in
provement options. To ensure that the requirements conducted the spirit of the IPPC. The need to incorporate parties and make
in the permit are attainable for the firms, the authorities should the application and permit public, will help to get firms involved
set a timetable for compliance that corresponds to the firm’s in taking responsibility for their environmental impacts.
internal economic investment cycle.
Having knowledge about these investment cycles is thus of 7.4.6 The Weak Point – Lack of Systems View
great importance to setting the requirement for investments at An IPPC licence only considers one specific installation.
the right time. If the requirements are formulated in regard to However, an installation is never isolated in real life. It is part
the normal change and investment in production technology and of an industrial system. It is connected to an upstream supply
design, the firms will more easily be able to incorporate these side and a downstream demand side, and how these two work
requirements in their investments planning, to identify more op- has a major impact on the real environmental performance of
timal solutions. In this way the firms can avoid putting up some the installation. There are many forceful cases of this. These
end-of-pipe cleaning provisions which could be the outcome if circumstances may, or may not, be included in the licence.
requirements that are stipulated without any regard and under- The cement industry offers an illustratation. A cement kiln
standing of a company’s behaviour in a capitalist society. may use all kinds of organic material as fuel since the tempera-
In this process it is important to remember that technology ture in the kiln is up to 1,250°C. Some kilns are therefore used
is defined more broadly than production techniques; it may to incinerate hazardous waste. The capacity of a large industry
also include management, procedures etc. It is evident that may well be enough to take care of all hazardous waste of
the facilitating of innovation and performance improvements a country. On the other hand, the ash remaining after clinker
should also contain these aspects. formation may be used for soil improvement. This is done e.g.
in Estonia, where the soils in general are too acid, and are thus
7.4.5 Information improved by this measure. The cement kiln in this way has
To perform all these different assessments, it is of great impor- considerable environmental advantages which are not in the
tance that the competent authority collect sufficient informa- installation itself, but rather in the system.
tion – especially concerning the information included in the Another case is that of industrial symbiosis, that is, several
application from the companies. The competent authority thus industries working together as the output from one of them
needs to consider if the company has been asked the most rel- is used as a resource in another. Even if these circumstances
evant questions. are not always mentioned in a licence, the conditions of the
What is sufficient information obviously differs in the dif- “downstream” waste side are normally included.
ferent steps in question, and also when it comes to the procedure A further weakness of the IPPC licensing system is that al-
of formulating the conditions in the permit. As the application ternative installations are seldom considered. The application
should contain an environmental review of the company, the for a permit is considered from the point of view of the instal-
operator has access to most of the information, since it con- lation in question. The possible existence of completely differ-
cerns the company’s internal processes. However, the operator ent and environmentally better ways to e.g. provide a product
could need further information on which substances might be is normally not considered. The application is judged on its
included in the processes of the company. For this purpose, own merits. Optimisation is thus local and not systemic.
substance flow analysis (SFA), emission registers etc. could
be useful. For the competent authority, additional knowledge
7.5 Licensing and Other Regulatory Instruments
needed is information about possible alternative technological
choices in order to assess if the technology of the firm is BAT, 7.5.1 Goals and Policies in the Licence
and possibilities for improvements. Finally legal knowledge is One way to foster and facilitate for companies to undertake
necessary for the final formulation of the conditions. environmental innovations and improvements could be to
Not only the authority but also the public in general have conduct the licensing procedure in a way that motivates and
the right to information on the environmental performance of facilitates them to discover the potentials in eco-efficiency. In
larger industries, as the legal support for a proper access to in- this way Cleaner Production and Pollution Prevention strate-
formation on environmental impacts and hazards are getting gies, may be introduced, and environmental impact becomes a
stronger with the EU. The Aarhus Convention, which guaran- parameter that needs to be optimized.

7 implementing environmental licensing 111

 As outlined in Chapter 3, industries have different tools area, as well as goals and objectives agreed on at the sector
to use in optimizing their production in an eco-efficient man- level. The licensing procedure in this way interlinks the politi-
ner, which incorporates their environmental impacts into their cal goals for the specific sector formulated at political levels,
business and management strategies. These different tools and the internal organization of the production of a facility.
may be organised in some kind of Environmental Manage-
ment System (EMS) in which companies can keep track of 7.5.2 Licensing Supporting EMS
their environmental performance and set up goals about con- As described in earlier, an EMS is a tool for companies to
tinuous improvements. Setting up the licensing procedure and manage their environmental performance. The system can be
requirements properly may spur the companies to implement either a self-created or a certified system, accredited by an ac-
some kind of Environmental Management System to continu- creditation company.
ously overlook their performance in order to identify achiev- One of the essential parts in the EMS is the environmental
able improvements. mapping of the company’s production. Environmental map-
The licensing of the specific firms should also be seen in ping is an assessment of the production and the potential envi-
connection with the different political planning documents and ronmental impacts of the operations. Based on this, the com-
the goals and objectives for the area or sector in question. These pany can assess the most vital environmental issues, thereby
should be considered when formulating the long-term direc- focusing their actions towards issues that are the most environ-
tions and obligations in the permit. The licence in this way be- mentally damaging. However, as it is an internal tool, it would
comes a legal document that obligates a company to the goals be reasonable to expect that only actions that are economically
and objectives formulated in overall development plans for an viable are taken into account.
In order to evaluate the progress
towards the goals, companies need to
ACTIVITY AUTHORITY decide on some indicators and need to
Voluntary Environmental Management Licensing keep track of their performance accord-
(Certified/Own System) (Green accounting) ing to these indicators. Typically, the
Start Application indicators are “performance-based”, i.e.
Applica- performance indicators, based on rela-
tion and
tive measures expressed in relation to
=
collection
Preliminary
of data Environmental
Environmental
Description
the number of units produced.
Review
As an EMS basically is a system
for a company to keep track of their
environmental impacts, the EMS thus
Environ-
Flow Mass mental Target CT
have some overlaps with the licensing
Analysis Diagram Balance Effect Areas Projects scheme. This especially concerns the
environmental review; the formulation
of goals and objectives/requirements
Decision on Environmental and obligations on behalf of the review;
Actions Assessment
the formulation of indicators; and the
follow-up on the goals and conditions.
Implemen-
tation Environmental Management Licence If the two systems are interlinked so
that the data collected in the one sys-
Environmental
Action Plan Periodical Frames: tem is feasible for the other, an EMS
/Yearly • Flexibility
Environmental Conditions:
New Action Plan • limit values/requests
Revision/ Management
• time horizon
Control • control/revision
Environmental Figure 7.6 Integration of environmental
Audit management and licensing. The EMS
of the company (to the left) is coordinated
Report – Control/ Audit – New with the licensing cycle (to the right) to fa-
Programme and so on ... cilitate both processes. [Figure from Kjaer
1996, p 32]

112 implementing environmental licensing 7

can ease the work needed to follow up the licensing procedure tions rather than emission limit values, defining pollution lev-
both for the authority and the company. The information col- els (inputs or emissions) per produced unit.
lected for the EMS can be used in the permitting procedure as The performance-based indicators can be used to monitor
well. Furthermore, the introduction of an EMS can increase the production and performance as a part of the self-monitor-
the credibility of the data provided in the application by the ing. The application for an integrated permit should contain
company. Lastly, an EMS can help to make companies aware an assessment of the environmental effects of the installation,
of economic potentials and thus – themselves – take action to which is basically what the environmental mapping of the
go beyond the requirements in the permit. installation is. Furthermore, the conditions for performance-
We therefore argue that the licensing procedure should be based self-monitoring can help promote environmental issues
performed so that it spurs companies to implement an EMS within the company. This might make companies realise the
or similar procedures to keep track of their environmental potential for cost savings [Kjær 1996: 31ff].
aspects. It especially seems obvious to coordinate the IPPC
framework and the EMAS scheme, as they both are EU regula- 7.5.4 Development and Environmental Plans
tions, even though the latter is voluntary. The EU’s network for A central element in the recommendations of the OECD is that
the Implementation and Enforcement of Environmental Law the requirements in the permit should also have a long-term
(IMPEL) has actually prepared a report showing the similari- perspective and point out some areas of concern that should
ties and overlaps of the IPPC and the EMAS requirements. be improved in the long run. We furthermore argue that it is
important to see the licensing in connection with other regula-
7.5.3 Differences Between Licensing and EMS tions and objectives laid down.
It is, however, important to keep in mind that the permitting We therefore suggest that the long-term requirements in
and environmental management systems represent two differ- the permit be interlinked with the political goals and objec-
ent approaches. The permitting system is based on formulating tives laid down in different political documents. These could
requirements that ensure the best possible protection of the be local development plans or environmental plans for the area
environment, whereas the EMS is a voluntary system for the in question, formulated by local councils etc. It could further
companies whose main purpose is to provide possibilities for evolve objectives at sector level laid down in agreements be-
the company to gain profit [Kjær 1996: 25ff.] for example by tween national or regional (EU) government and the sector/in-
more efficient use of resources. The main reason for getting a dustry organization in question.
certified management system, such as ISO 14001 and EMAS, The interlinking of the requirements to the goals and ob-
may also be to improve the reputation of the company. jectives laid down in these development and environmental
The environmental permit, on the other hand, is part of the plans, whether it concerns the local community or the sector
legal system and has to consider different issues when stipulat- in general, mean that the permit shall be the legal document
ing the requirements of the permit such as the protection of the that obligates the companies to contribute to reach these goals
local environment, the interests of the local population etc. and objectives.
An EMS is furthermore an internal system that needs to be
very flexible as it must correspond to the actual procedures at
all time and thus may be reviewed at all times, whereas that
would be overkill in a licensing procedure. The argumentation
is thus not that the two systems should be coordinated so that
the permit corresponds to specific procedures in the EMS. Our
argumentation is that the licensing should be performed so that
it fosters and supports the company to keep track of its envi-
ronmental performance in a similar way as an EMS.
In order to interlink the two systems, the permitting system
must be designed in a way that leaves the possibility open for
the EMS to support the permitting process. The link between
the two systems can be established by setting goals based on
the environmental mapping. Furthermore the conditions can
be formulated in correspondence with the indicators normally
used by the industry. This implies performance-based condi-

7 implementing environmental licensing 113

Study Questions Abbreviations
1. Compare the approaches of issuing a permit using media BACT Best Available Cleaning Technology
specific ELVs or EQSs and the IPPC Directive. BAT Best Available Techniques
2. Discuss in what way BAT can limit the development of BREF BAT Reference Document
some industries and encourage others. How may these CT Cleaner Technology
difficulties be circumvented? EIA Environmental Impact Assessment
3. Look up the BREF document for the chlor-alkali or ce- ELVs Emission Limit Values
ment industry and discuss what level of technical com- EMAS Eco-Management and Audit Scheme
petence is needed to discuss these documents with an EMS Environmental Management System
industry representative. EPR Extended Producer Responsibility
4. In what way is an environmental authority able to include EQS Environmental Quality Standard
questions of upstream and downstream impacts of a pro- IMPEL European Union Network for the Implementation
duction in a licensing process? and Enforcement of Environmental Law
5. Describe the permitting cycle according to OECD and IPPC Integrated Pollution Prevention and Control
explain why it is cyclic. LCA Life Cycle Assessment
6. Describe how the formulation of the conditions in a per- OECD Organisation for Economic Co-operation and
mit is dealt with in several stages and at which stage there Development
is an opportunity for the company to negotiate conditions. OSPARCOM OSPAR Commission
7. How does the request for information to the public have R&D Research and Development
to be met? SFA Substance Flow Analysis
8. Explain in what ways the lack of a systems approach to
environmental permitting (that is a permit is valid only
for a specific plant) is a weak point in combating environ- Internet Resources
mental impacts from industry. DG Environment webpage on the IPPC Directive
9. In what ways does an Environmental Management Sys- http://ec.europa.eu/environment/ippc/index.htm
tem and an environmental licensing process interact with
and support each other? The consolidated IPPC Directive full text (pdf document)
10. Why is the performance-based approach (based on http://eur-lex.europa.eu/LexUriServ/site/en/consleg/1996/
performance indicators) to environmental protection not L/01996L0061-20031120-en.pdf
acceptable as a base for environmental licensing?
Documentation of BREFs by the European IPPC Bureau
http://eippcb.jrc.es/pages/FActivities.htm

OECD on Environmental permitting in Eastern European countries

http://www.oecd.org/document/49/0,2340,en_2649_34173_
26397169_1_1_1_1,00.html

Environmental quality standards in Swedish environmental

legislation
http://www.internat.naturvardsverket.se/index.php3?main=/
documents/legal/standard/quality.htm

Material Flow Accounting/Substance Flow Analysis (MFA/SFA)

at Leiden University
http://www.leidenuniv.nl/interfac/cml/ssp/projects/chainet/
tools-mfa.html

114 implementing environmental licensing 7

 8
Compliance
Monitoring and Continuous
Improvement

8.1 Factors which Promote Compliance ways. It depends on what is defined as the overall objective, on
8.1.1 From Implementation to Control the content, that is, the number and types of facilities subject to
the regulation, on the regulative framework provided by higher
The previous chapters described the environmental licence as
authority levels, and on internally available competences and
the key regulatory instrument in relation to all sectors of in-
resources, etc. It is therefore of crucial importance that clear
dustry. This chapter is concerned with the follow-up activities,
strategies be developed in order to tailor the activities to be
that the authorities can make use of in order to ensure a thor-
carried out in the compliance programme.
ough implementation of the licence. Thereby the environmen-
tal regulation as such is implemented in practice within each
licensed company. A structured overview of these follow-up
In this Chapter
activities is presented in Box 8.1.
The IPPC Directive offers an additional perspective on 1. Factors which Promote Compliance
the implementation control measures. It asks from the com- From Implementation to Control
pany’s continuous environmental improvement, starting from Compliance Programme
The Competent Authorities
or based upon the requirements and conditions in the licence
Role of ‘Policing’ and ‘Deterrence’
issued to the company by the environmental authorities. The Role of the Market and the Public
This request means that the follow-up measures have a Green Networking Provides Support
double function: firstly, and in the first instance, to help make 2. The Competent Authorities
sure that the current regulation is thoroughly implemented, From the European Union to Member States
State Level Environmental Authorities
and secondly to look ahead towards the next licence by point-
The Regional and Municipal Level
ing out the scope for improvements and more sustainable com- Power in Public Administration
pany practices. The Pros and Cons of Decentralization
3. Compliance and Management Systems
8.1.2 Compliance Programme The Scope of the IPPC Directive
The implementation measures are normally organised by the Compliance Typology and EMS
Differentiated Inspections
relevant authorities as a compliance programme. Using a pro-
The Compliance Cycle
gramme structure allows the authority to have an organised 4. Monitoring
and more comprehensive approach to setting priorities when The Role of Monitoring
following up on compliance. It defines which sectors and com- Self-monitoring
panies to target first and the most, as well as how to allocate 5. Evaluation of Compliance Programmes
Evaluation as Feedback
personnel and other internal resources.
Compliance as Continuous Improvement
The activities carried out in a compliance programme are
manifold and can be organised and structured in many different

8 compliance – monitoring and continuous improvement 115

 A strategy and a plan must determine the objective of therefore an integral part of developing a strategy. It should
the compliance programme. It should clarify the content of be clear how one may reach the goals by effectively balancing
the programme, that is, what kind of industrial facilities are preventive actions and legal, punitive, measures. At the same
present in the jurisdiction, and how to approach the different time one should make efficient use of scarce resources.
types of facilities. As the world is a dynamic place, the strategy should be
Add to this the fact that most compliance programmes are evaluated and reviewed periodically and systematically. In this
bound to an administrative system with limited access to re- way one may improve the strategy by learning from past expe-
sources. The strategy therefore needs to balance the overall rience, as well as readjust to changes in conditions.
objectives with the available resources. Setting priorities is
8.1.3 The Competent Authorities
Box 8.1 Elements of a Compliance Programme The authority in charge of the local administration and the im-
plementation of the compliance programme has the responsi-
Compliance means the full implementation of envi- bility for providing the compliance programme strategy. The
ronmental requirements by the companies. Compli- authority may be local, regional or national. The local author-
ance occurs when requirements are met and desired ity has the insight and knowledge about the local environment,
changes are achieved. the local economic actors and about the resources available to
• Compliance Programme is the structured and com- it. This is all needed background for setting necessary priori-
prehensive organisation of the available set of ap- ties. The level of the authority in charge of the implementation
proaches and activities, that the responsible au-
varies considerably across countries. We shall return to this in
thority has decided to use to achieve compliance
within its jurisdiction. section 8.2.
• Compliance Promotion means activities to facilitate Regardless of which level of authority, it is best if the au-
or encourage voluntary compliance with environ- thority with the power of making strategies and priorities for
mental requirements. compliance also possesses the power and obligation to imple-
• Compliance Monitoring means the collection, meas- ment this legislation. It should also have the power to decide
urement and analysis of information regarding en-
vironmental performance and compliance status.
on the allocation of the resources needed to fulfil this task. It
should be mentioned, however, that placing these powers with
The actions taken in relation to monitoring normally
the local authority may generate a conflict of interest between
involves:
creating a favourable climate for business and thereby securing
• Self-monitoring where the companies themselves jobs for the local citizens, and a rigorous implementation of
keep track of their environmental performance.
the environmental regulation. If the local authority is identical
• Inspection where the competent authority checks
up on the compliance situation, either as a desk- with the local government, and thus an elected political body,
check or a field-check, the latter by paying a visit it will belong to an established democratic tradition and have
to the company. The field check means a dialogue proven integrity. These will be important prerequisites to secur-
and opens for pointing at ways of improving the ing proper handling of this – latent – conflict of interests.
environmental performance. If there are doubts at this point, the local authority might be
• Negotiations with individuals or site managers,
who are out of compliance on mutually accept- better placed within a more hierarchical, state authority struc-
able schedules and approaches for achieving com- ture, which will tend to make the local authority operate more
pliance. rule-oriented and according to instructions from ‘above’ on
• Compliance Enforcement normally is taken to mean how to handle different types of cases. This will, in short, mean
the set of actions that governments (or others) less flexibility in the application of, but better compliance with,
take to correct or halt behaviour that fails to com-
the environmental regulation. It is at the same time in line with
ply with environmental requirements or that en-
danger environment or public health. the intended outcome of the regulation in the first place.
• Legal action, where necessary, to enforce compli- The general legal regulatory framework is nowadays to a
ance and to inflict consequence in terms of fines, great extent provided by the EU, taking effect in the now 27
criminal action against management and/or clo- member states and 3 EEA states. The structure and distribution
sure of the parts or all of the facility.
of power within the national public administration is decided
Source: IMPEL 1999, p 34 ff and p 70 ff by the national political authorities, parliaments and govern-
ments, according to the constitution of the individual states.
Historical as well as structural matters thus decide the distri-

116 compliance – monitoring and continuous improvement 8

 that group of companies all together and thereby reduce the
Box 8.2 Minimum Criteria for a Compliance
number of inspections and related administrative work by the
Program Strategy
authorities spent on enforcement.
This approach, having much in common with the general
• Industries to be inspected
role of the police in most of the regulated areas in society,
• Data management
• Resources available has to be carefully balanced to avoid becoming outright coun-
• Time available for inspections terproductive. It might create an atmosphere of hostility and
• Guidelines distrust, which in the end will lead to more, not less, use of
• Frequency of inspections resources and possibly to less compliance.
• Estimating resources to complete inspections
This ‘balance’ will be different in different societies, de-
• Prioritisation
• Revision of the plan pending on the general relationship between citizens and au-
thorities, including the effectiveness of the ‘rule of law’ versus
Source: IMPEL 1999b, p. 6
presence of corruption. This in turn has to do with the position
of and the salary level for civil servants and thereby influences
the moral standard of the civil servants. In some countries a
bution of administrative roles and power in any nation state. tougher, ‘policing’ type of approach might therefore be neces-
They thereby also decide which authority at which level will sary, at least for some time and to some considerable extent. In
be in charge of promoting and securing compliance with envi- other countries with a longer tradition for an impeccable civil
ronmental regulations. service and a well-established legal system, a more flexible
When the competent authority for the compliance, moni- and consensus-oriented and dialogue-based approach might
toring and enforcement establishes its compliance programme come out favourably for the compliance – even at lower cost.
and the strategy for putting it into practice, a checklist, making There are certain preconditions to be met in order to estab-
up the minimum criteria for such a programme, has been pro- lish a credible feeling of ‘deterrence’ on the side of the compa-
vided by the IMPEL group (Box 8.2). nies. Box 8.3 sums up the ways to achieve deterrence.
The purpose of a compliance program is to make the target
group comply with the regulation, and do so at the lowest level 8.1.5 The Role of the Market and the Public
of costs possible. A first approach to achieving this is that of In recent years market forces have provided an essential sup-
promoting compliance with the licences and other regulation, port for the promotion of compliance. Non-compliance may
made for a given target group, first of all within private indus- have serious repercussions for first of all consumer-oriented
try. A number of ways and tools are available for authorities companies (retailers), which make them comply from the out-
to promote compliance in a given sector or type of industry. set. This effect is, however, quite unpredictable and the ‘trig-
These include gers’ work somewhat haphazardly. It is therefore something,
which the authorities may stimulate and try to help organise
• Supply of relevant information.
somehow.
• Creation of a standing positive personal relation between
company and authority personnel.
• A consensus-oriented and dialogue-based approach.
Box 8.3 Ways to Achieve Deterrence

8.1.4 Role of ‘Policing’ and ‘Deterrence’ • Providing strict and timely response to non-com-
Despite all efforts to promote compliance, it is – like in other pliance;
areas of regulation – closely linked to the effectiveness of the • Establishing social disapproval of violators, result-
ing from public awareness of regulation of envi-
control. It is necessary to be ready to act on non-compliance
ronmental performance;
when discovered. Control is therefore the second approach to • Publicising successful enforcement actions;
making sure the regulations are complied with. Control can be • Addressing with perseverance minor but wide-
taken so far as to establishing a sense of ‘deterrence’. It should spread violations and by creating incentives to im-
be made clear that violations will not be tolerated. An ‘atmos- prove compliance and reward good behaviour.
phere of deterrence’ is aimed at, and will only be felt by, those
Source: OECD 1999, p. 10
companies, which are in general reacting slowly and minimal-
ly to the requirements. The ‘deterrence’ may therefore reduce

8 compliance – monitoring and continuous improvement 117

 ‘Green Networking’ at all levels from local and national
Box 8.4 Green Networking
levels to regional and global levels is one case of successful
cooperation between authority and industry. Essentially green
networking brings industry and authorities at the relevant level
together to promote good environmental practices. NGOs and
the Academic side quite often have a role to play here. The
preparation for the ‘Earth Summit’ in Rio in 1992 is one case.
With a base in the Brundtland Report on ‘Environment and
Development’, industry also became active (see Chapter 5 on
“Shared Responsibilities”), and formed the ‘Greening of Indus-
try Network’ in 1990. Here Industry, Authorities, NGO’s and
Academia came together to discuss, develop and share ideas
and experiences on how to make production and the economy
as a whole more ‘green’ and ultimately more sustainable. This
network is still active and has in recent years managed to get a
strong presence from the South East Asian countries and other
Our Mission rapidly growing newly industrialised countries.
The Greening of Industry Network develops knowl-
edge and transforms practice to accelerate progress 8.1.6 Green Networking Provides Support
toward a sustainable society.
At the national and local level ‘green networking’ of a differ-
Our Vision ent kind has been established in many countries. It brings in-
The Network seeks to create new concepts and a new dustry and authorities together to promote and encourage not
language that will make it possible to extend our ho- only compliance with current legislation, including environ-
rizons and communicate across disciplines, nations,
mental licences like the EU-IPPC-licences. That is a precondi-
and sectors.
tion for becoming a member at all. The wider ambitions are
The Network: about creating the background for ‘going beyond compliance’.
• Mobilizes a community of researchers to stimulate This means knowledge sharing and promoting new technol-
the emergence of a new strategic research area on ogy projects and best practices. Thus there is the Danish lo-
the greening of industry.
cal ‘Green Networks’, which have been around for now 12-15
• Creates a dialogue between this new research
community and leaders in business, labour, civil years. In Sweden there is the organisation Swedish Environ-
society organizations, government. mental Directors including many of the big companies, and
• Provides an opportunity for all stakeholders, with there is a corresponding organisation in Finland.
equal voice, to develop research and action agendas There are also quite a few examples of companies entering
on issues of industry, environment, and society. into formal co-operation with one or more, typically nationally
based, green NGOs. The subject of the cooperation is to develop
Source: http://www.greeningofindustry.org/
an ‘Environmental Code of Conduct’ or ‘Environmentally best
Foundation for Sustainable Agriculture and Forestry practices’ in company matters like packaging, transport, waste
Foundation for Sustainable Agriculture and Forestry in handling, energy and water conservation etc. In this co-opera-
Developing Countries (FSAF), was created in 2005 by tion the company gets the ‘blue stamp’ from the NGO on its
the Von Der Otto group in Germany.
operations, when the agreed conduct or practices are complied
The Project Cotton made in Africa is one out of
several projects run by FSAF. It is supported by an al- with. It is the ethics of co-responsibility on the side of the NGOs
liance of industrialists. The group include the follow- which quite often makes NGOs hesitate to engage in such ar-
ing partners: Otto Group, Deutsche Entwicklungsges- rangements. But there are several examples from Germany.
ellschaft (DEG), Deutsche Welthungerhilfe (DWHH), Still, the awareness of the general public of the environ-
Gesellschaft für technische Zusammenarbeit (GTZ), mental behaviour and performance of major industrial com-
NABU, Tom Tailor GmbH and WWF Deutschland:
panies is as important as ever. A strong and rigorous pro-en-
Source: http://www.fsaf.de vironment attitude of the general public is important to make
industry comply with legislation. It is equally important for the
political will to actually act and insist on compliance with cur-

118 compliance – monitoring and continuous improvement 8

rent regulation in the countries where the companies operate. law-making, a series of public authorities implement the ac-
The NGOs have an important part to play in keeping people tual environmental regulation. The main authority on the state
aware and on the alert on issues of environmental protection level is the Environmental Protection Agency, EPA. An EPA
and sustainability and their violation. The NGOs are accepted was the first authority on the state level formed to deal with
as an influential and therefore important ‘player’ and partner environmental issues often back in the 1970’s. Today typically
at national, regional and international levels. NGOs are being there are several authorities on the state level with responsibil-
asked for opinions on proposals, to sit on committees and help ities in the environmental sector. For example in Sweden the
promote programmes and regulations. They also organise pro- offices dealing with chemicals control left the EPA many years
tests of different kinds as an instrument to influence especially ago to form its own agency, the Chemicals Inspectorate. This
regional and global, political decision-making on environmen- is on the same level as EPA and the division of tasks between
tal protection issues. them is important. Thus for example the implementation of
the Waste Directive is the responsibility of the EPA while the
implementation of the REACH Regulation is the responsibil-
8.2 The Competent Authorities
ity of the Chemicals Inspectorate.
8.2.1 From the European Union to Member States Other state authorities in Sweden with responsibilities in
In all European Union member states the EU-Treaty means the environmental sector include the Health Authority, the
that a considerable part of the legal regulations for activities Food Authority, the National Energy Authority, the state au-
impacting the environment are decided upon at the EU-level thority in the transport sector, in the building sector etc. The
in cooperation between the Council, the Parliament and the Energy Authority e.g. implements the Kyoto Protocol and car-
Commission. The EU-level law takes the form of either a “Di- bon dioxide emission trading.
rective” or a “Regulation”. In both cases the EU-level legisla- The authorities on the national level typically have the task
tion has precedence over the (existing) national legislation. of developing detailed national rules, to give input to the Min-
A Regulation takes effect and must be implemented di- istry and the Ministers involvement in EU-level law-making
rectly and without any additional ‘transposing’ of its content or new national legislation, to survey the state of the environ-
into national legislation. And if national legislation contradicts ment in the nation, to carry out commissioned reports to the
the EU Regulation, national legislation must be changed. ministry, and to develop knowledge needed for environmental
A Directive must be transposed – or transferred – into na- protection. National authorities in some countries carry out
tional regulation before it takes effect. Member States have inspections at individual plants or organisations or grant per-
normally two years to get that in place, and if this is not done, mits and licences. They may also, for example, negotiate with
the Member State faces a court case at the European Court, industrial sectors to agree on covenants in the environmental
opened by the EU Commission, which checks that all Member sector.
States get the EU-directives transferred. The content and spirit
of the Directive must be adhered to, but the exact transfer or 8.2.3 The Regional and Municipal Level
location of the rules in national legislation is up to the Member All states have a three-level division of public administration:
State itself, either by changing one or more laws, which will the state (country), regional (county) and local (municipal)
require a decision by the national Parliament, or by changing levels. In the Baltic Sea region Germany and Russia also have
lower level, national “regulations”, which will then be made above these three a federal level. Some states, such as Poland
by the government and the minister in charge. and Finland, have different kinds of local authorities, where
The implementation of these legal regulations, originating typically large cities are on one level and smaller rural com-
from the EU, is the responsibility of the government, as is the munities on another. Associations of municipalities or coun-
case for legal regulations, originating in the Member State it- ties with certain tasks have been formed in some countries,
self. Previously environmental issues were quite often the re- e.g. in Finland, when local authorities are small.
sponsibility of the ministry of agriculture, industry, or energy. On the County level there is typically an office for nature
Since the 1980’s governments typically have ministries of the protection which has responsibly for inspection and control. It
environment. includes for example the Natura 2000 areas and protected spe-
cies. There may also be an office for inspection and control of
8.2.2 State Level Environmental Authorities industrial activities dealing with environmental issues.
While the ministry is preoccupied with forming environmental On the local level the municipal authorities have since
policies at the national level as well as giving input to EU-level long been responsible for simple environmental inspections,

8 compliance – monitoring and continuous improvement 119

regarding e.g with water and waste. This responsibility has de- local level. Responsibilities are quite often divided between
veloped in some countries today into inspection and control these two levels so that facilities with a wider, regional impact
of a large number of activities, from car shops to large indus- and with an environmentally potentially more dangerous ac-
tries. This is most typical in the Nordic countries in which the tivity will be handled at the regional level, and the rest at the
importance of the local level has been strong for more than a local level.
hundred years, and is still increasing. Municipal offices with Still, there is an important distinction to be made between
responsibilities for environmental inspection and with author- authorities at a given level that are parts of the state admin-
ity to issue permits and licences are found in all Nordic coun- istration and authorities that constitute parts of the regional
tries. or local (self)government administration. The way to execute
In Eastern Europe, on the other hand we find a tradition environmental inspections and to issue permits may be quite
of strong centralisation, and the city or village was always different. But it depends on the competence to implement the
weak in this respect, as was local taxation, local regulation environmental legislation when it is decentralized. Does the
and local competence. Since the systems change in the early decentralized administration have the power to issue the envi-
1990s the importance of the local level is rapidly increasing ronmental permits? Does it also have the duty to monitor and
in Central and Eastern Europe. Through fusions and adminis- – in the end – enforce the regulation in case of non-compli-
trative reforms the units have grown to become fewer, larger ance? If punishment of any importance is possible, how does it
and stronger. Today in all the new EU countries the tasks of relate to the systems of prosecutors and the court system?
common services such as wastewater treatment, landfills and Any administration of the local authority will be in the
district heating is increasing for the municipalities, and so is hands of the local politicians, albeit subject to state level in-
the local taxation. Thus although increasing, their role in envi- structions and guidelines on how to apply the rules. Local poli-
ronmental inspection and control is still limited. The exception ticians will typically be very concerned about for e.g. econom-
is the Russian Federation, where a strong central level is the ic development. If a regional/local office is part of the state
rule. administration the loyalty will be with the state administration
For inspection and control of environmental legislation in where it belongs and from where it gets its instructions and
Eastern Europe the state has typically local offices to execute its competence. In this case we should expect less concern for
that responsibility. For example in Poland all inspection and other local considerations. The distinction between centralized
control is carried out by one authority, the Polish State Envi- or decentralized responsibility for the implementation should
ronmental Protection Inspectorate. This authority has 33 of- therefore always be qualified with a closer look at which kind
fices in all 16 voivodeships (counties) in the country and a total of decentralized authority, we have before us.
of 49 laboratories to support monitoring schemes. The author-
ity had in year 2000 a total of 41,000 entities in its register and 8.2.5 The Pros and Cons of Decentralization
carried out about 16,000 inspections that year. Local/regional Immediately after the sweeping changes in CEE in 1990-91
offices of state authorities are present in several other CEE some countries like e.g. Poland decided to establish a state
countries. administrative monitoring, control and enforcement system.
Previously this was the responsibility of the regional govern-
8.2.4 Power in Public Administration ment. The primary implementation of the regulation, such as
Power in public administration is an issue that need a book of permits, use of natural resources, waste-handling systems etc.
its own to be dealt with at any depth. There are many differ- remained with the regional administrative system. In the west,
ences across the different countries in the Baltic Sea region e.g. in Sweden and Denmark, the implementation powers lie
as to the exact organisation and allocation of power and re- at the decentralized level with the self-government administra-
sponsibilities. However, implementation of complex, norma- tion, which has both the competence to implement the regu-
tive regulation, aiming at protecting the physical environment, lation and the competence to monitor the observance of the
will need an administrative structure, covering a not too big regulation, i.e. the compliance.
geographical area. Regardless of administrative organisation it This difference reflects the difference in political and ad-
is only on the local level that it is possible to establish concrete ministrative history. Strong decentralization and wide compe-
knowledge about an area and its economic activities for which tence with considerable discretionary elements included re-
the regulation is meant to be applied. quires a well-established administrative system, well founded
In most countries primary responsibility for the implemen- on the principles of the ‘rule of law’ and a well-trained and
tation will be allocated to the regional and/or at the municipal/ well-paid set of civil servants [Guy Peters, 1999]. This was

120 compliance – monitoring and continuous improvement 8

not at hand in Poland in 1990, which motivated the division bigger tax-potential for the local authority, may play a role in
of powers and establishment of a new, state environmental the consideration of a permit.
‘police’ for the monitoring and control functions [Polish EPA, On the other hand a state administrative unit would not so
1991]. easily become involved in these local interests. A state admin-
The advantages of a local administration in the environmen- istrative unit would most likely lead to less difference in condi-
tal field are many. It is able to keep the activities together and tions for companies located just on different sides of a munici-
the handling of the cases is very integrated. Another advantage pal border. Such differences may be considerable if different
is that the civil servants develop a considerable knowledge and local authorities are responsible for surveillance of legislation,
a good understanding of ‘his/her’ company. Furthermore the and they may be very difficult to equalize, as they are a conse-
integration of the tasks creates an interaction between com- quence of that very decentralization.
pany and authority and automatic feedback on progress and
problems. This will increase the authority’s insight and under-
8.3 Compliance and Management Systems
standing of a company and its activities and ways to reduce
impacts on the environment. 8.3.1 The Scope of the IPPC Directive
A drawback of local administration also exists. At least in The EU-directive on Integrated Pollution Prevention and Con-
smaller local administrative units, there may be a ‘rule of law’ trol (the IPPC directive) now provides the general environ-
issue. The company which applies for, or is running under, a mental norms as well as the framework for implementation
locally issued environmental permit will become dependent on of environmental regulation for all countries around the Bal-
a very small group of civil servants dealing with all issues and tic Sea, except Russia, Belarus and Ukraine. But also in these
all aspects of the company’s environmental impact. For the countries the development of EU Directives has a strong influ-
society at large there is in this practice a possible temptation ence. Their exports to the European Union are important and
of corruption. The small group of civil servants – which may dependent on their environmental performance. For example
in reality consist of only one person – might be offered a tip the REACH Regulation will require that also imported chemi-
for ‘closing his, her, or their eyes’ about things, that would not cals are tested according to this directive.
pass the normal test. Even if there is not any direct corruption The IPPC directive targets the bigger and environmentally
involved, there might still be a problem of this nature. Local more risky part of industry, which is positively listed in the
interests in a wider sense, such as a new factory under consid- annex to the directive. Industrial production which is not listed
eration with great benefits for the town in terms of jobs and in the directive is not affected by the directive. This production
is regulated by domestic law in each individual EU Member
State. These production facilities will be dealt with in more
standardised way due to their size and – presumed – low po-
tential environmental impact. But they will normally be in-
cluded in the compliance programme and handled by the same
authorities in countries with extensive decentralization, espe-
cially the local authorities. In the end it is expected that the
IPPC directive will have a wider impact, as it asks for its basic
principles to be used for environmental regulations in general,
not only for the larger installations and the listed sectors.
The key instrument in this regulation is the environmen-
tal permit (licence) as we have seen in Chapter 7 above. The
directive requires in article 14 that the Member States take
the necessary measures to ensure compliance with the condi-
Figure 8.1 Environmental campaign inspection. The inspectors tions set out in the permit. The national compliance program is
have the task of monitoring activities that constitute a potential therefore an important component of the IPPC directive, help-
threat to the environment and human health. This monitoring, con-
ing out on the implementation and ultimately the enforcement
ducted by the Swedish Labour Inspectorate at a car repair workshop
in late 1999, was part of a program where 800 companies in Stock- of this regulation.
holm area and Gotland were checked for management of chemicals In line with the principles in the directive, carried on into
containing isocyante, a carcinogen common in many work places. the company’s internal operations by the IPPC-permit, a com-
(Photo: Jack Mikrut/ Pressens bild.) pliance program needs to have a comprehensive approach

8 compliance – monitoring and continuous improvement 121

paralleling the demands for the permit. The programme must tored. It has in recent years become quite common to distin-
include an evaluation of the overall performance of the com- guish between three types of companies, depending on their
pany technology used in production and the appropriateness attitude towards the environment and their subsequent com-
of measures to prevent and control pollution emissions of dif- pany environmental policy.
ferent kinds from the facility, including measuring and taking The best group includes companies with a documented en-
samples to be analyzed in the laboratory. vironmental record, often by having an EMS in place (EMAS
The comprehensiveness, combined with the dynamic un- or ISO 14000) and a pro-active approach to the problems aris-
derstanding of the licensing itself with the permit to be re- ing. The middle group is made up of companies, which want
viewed minimum every ten years and at any time, where more to comply with the regulation and do what is needed, including
than marginal changes in throughput and/or technology take reacting to requests from the authorities in relation to compli-
place, spills over to the compliance programme. It must be ance control inspections. The third group is made up of the
seen as part of, and must support the dynamic approach to, laggards, which include companies wanting to do the least
regulation. It should focus on constant improvements in com- possible, just paying ‘lip-service’ to the authorities and all the
pany environmental impact, while at the same time securing way to companies, actively looking for ‘loop-holes’ and/or are
compliance with current regulation. actively resisting compliance with the regulation. This compli-
This twofold dimension of the compliance programme has ance spectrum is illustrated in Figure 8.2.
to be taken into account when prioritisation of resources is According to this typology, most efforts in terms of inspec-
done within Authorities in charge of the programme. tion and monitoring should be allocated to the laggards, while
the middle group should be encouraged to improve their posi-
8.3.2 Compliance Typology and EMS tion, first of all by putting an EMS in place, though not necessar-
Even if compliance must be achieved to the greatest extent ily having it certified, with all the costs related to that. And time
possible, there is some scope for differentiation while imple- and resources can be saved in the best group as their systems,
menting the law. usually an EMS, will supply the necessary data on the environ-
Compliance is an obligation for the relevant authorities mental performance of the company and in itself mean transpar-
from a purely formal point of view. Applying the law is not a ency in relation to company activities, technology, etc.
power handed to the authorities by the Parliament at National
and at EU-level as well as by the EU-Council for discretion- 8.3.3 Differentiated Inspections
ary use. It must be enforced. Besides that, law implementation While this way of thinking is commonplace, and to a great
hampers the credibility of environmental regulation alltogeth- extend both relevant and needed, a different approach to the
er, as well as the credibility of the authorities themselves. issue of differentiation could be envisaged. The key to this un-
Still, it is possible – and relevant – to differentiate the way derstanding lies with the principle, that each and every com-
and the extent to which different types of companies are moni- pany is unique. It has a unique combination of technology,

Good compliance

Best Group

Re-active Middle Group

Proactive

The laggards

Weak compliance
Figure 8.2 The compliance spectrum

122 compliance – monitoring and continuous improvement 8

materials put through, workforce and organisation. Therefore tional regulation, the complete implementation and compli-
each company should be dealt with individually to best catch ance sequence can be understood as a – never ending – cycle
their situation and their motivation. Then it is easier to under- of programming, practising and feed back. This in turn means
stand the background for their position towards requirements revising of programme and initiating a new cycle.
in protection of the environment and also to advice and guide The quality achieved at each stage affects what can be
them towards better solutions and a better approach towards achieved at all later stages. Attention to quality is needed
the environment. throughout the sequence to avoid “soft spots”, which will in-
This kind of approach combines the compliance inspection fluence not only that sequence itself but potentially the next
with the continuous improvement inspection. It applies tough sequences as well.
control measures and severe fines to those of the laggards be-
yond ‘therapeutical’ reach. For the remaining as well as to the
middle group, it gives dialogue-based counselling on every- 8.4 Monitoring
thing from emission details to EMS-implementation. Finally 8.4.1 The Role of Monitoring
it leaves the best group for desk inspection and check up on Monitoring of compliance with the licence is a matter of con-
in-coming environmental (performance) data. tinuous checking of the processes as well as the input to the
This approach does not pose severe problems for making processes and the output from the processes of a given pro-
priorities for the resources available to any one authority. The duction. As licensing requires a great deal of often very de-
problem lies rather in the demands on qualifications on the tailed information on all operational aspects, it often leads to
side of the authority and its employees, the inspectors. In addi- a number of equally detailed requirements for data, e.g. on
tion, this approach implies intimate insight into the activity of emission and generation of waste to be monitored to prove,
each company in question. This points to a strong decentrali- that the company stays within the license.
zation of the implementation and control functions of the en- Much of this monitoring is very close to the daily oper-
vironmental authority. However, this in turn often means, that ational routine. The IPPC Directive obliges (Article 14) the
the competence is not available in these as decentralized units. company, operating the plant, to constantly monitor and in-
Manning is normally very limited in numbers and therefore form the authorities about the releases from the site. The re-
also in areas of knowledge covered. Further, time and there- quirement for self-monitoring by the company, as one of the
fore total resources are not available to actually perform this requirements in the licence itself, has therefore grown dramat-
type of strongly differentiated inspections. ically in recent years. This is one reason why putting an EMS
Still, the strategy is very tempting and for the future. As in place is favoured by the authorities. A proper EMS will
more and more companies are getting a better grip on their en- more or less automatically provide not only most of data on
vironmental impact and are getting systems in place, less time company performance but often much more than formally re-
will be needed for inspections. However, as these prospects quired or needed in all environmentally related aspects. Given
are long-term benefits, while the costs in terms of resources the right format for transferring the data from the EMS, they
and qualifications are needed now, the outlook for this kind of will ‘pour’ into the authority database easily.
strategy is quite bleak. Still, monitoring by the authorities themselves of a pro-
duction site on a site visit, referred to normally as doing an
8.3.4 The Compliance Cycle Environmental Inspection, gives the necessary first-hand im-
Monitoring and enforcement are the two key instruments in pression of the level and quality of the environmental manage-
securing compliance. They represent the work directed at and ment, practised at the company. Further, the site visit opens the
focused upon one particular company, its licence, its sites and dialogue (where possible at all) with the management e.g. on
the production activities going on there. They include field- possibilities for solutions to problems they face and/or for sug-
work as well as desk activities. And enforcement comes, of gesting improvements, based on experiences from other com-
course, after the monitoring, as monitoring is the check on the panies, which the inspector will know much about. Going on
company activities in terms of the environmental licence, the inspection at the site is therefore an important prerequisite for
company was allocated and whereby the environmental legis- securing compliance with current regulation and for support
lation was applied on this potentially environmentally damag- of continuous improvements of the company’s environmental
ing economic activity. performance. This is also support of the dynamic perspective
Given the environmental licence, where that is necessary on regulation, imbedded in the IPPC Directive and related
according to the IPPC Directive and possible additional na- regulations. And yet again, this does not exclude the differen-

8 compliance – monitoring and continuous improvement 123

tiation among the companies according to e.g. a typology as operator complies with the environmental regulation and the
the one shown in section 8.3.2 above. On the contrary. We will permit conditions, including those specifying the requirements
address the two types of monitoring in this order. for self-monitoring.
Requiring self-monitoring can offer benefits to the compe-
8.4.2 Self-monitoring tent authorities through:
As already mentioned the IPPC directive requires that the per-
• Utilising the operator’s knowledge and experience when
mit include conditions regarding self-monitoring and report-
planning and carrying out a monitoring programme that
ing. The key purpose of self-monitoring and reporting is to
can lead to improved control over releases to the environ-
make the operators track their own environmental perform-
ment.
ance and present the results for governmental review.
• Providing a mechanism for educating the operator about
At the same time effective self-monitoring can help prompt
the requirements for complying with relevant laws,
internal response to irregular situations and can inspire the
regulations and permits, and for increasing management
management of enterprises to improve environmental efficien-
responsibility for compliance and the impact of process
cy and prevent pollution.
releases to the environment.
Self-monitoring primarily relates to measurements of proc-
ess conditions and releases and other output from the process.
However, self-monitoring of an operator’s performance with
8.5 Evaluation of Compliance Programmes
regard to environmental targets, process/plant improvements
and overall compliance is also considered to some extent. 8.5.1 Evaluation as Feedback
Self-monitoring does not constitute self-regulation. The In order to keep a compliance program effective, regular pro-
competent authorities are still responsible for ensuring that the cedures for evaluation of the effectiveness of the applied strat-
egy should be implemented. A compliance program is only as
Box 8.5 Self-monitoring Regimes good as the strategy applied, and the strategy is only as good
as the achievement it generates.
Self-monitoring regimes may cover: The authority in charge should make sure that an evalua-
tion is taking place periodically with the aim to evaluate the
• emissions of waste gases and airborne particulate
to air via chimney stacks; appropriation of the strategy, especially how it relates to:
• discharges of waste water via sewers to and from
• The established policy and objectives.
effluent treatment plants, directly to receiving wa-
ters such as the sea, lakes, rivers and streams, and • The strategy and the approaches laid out.
to land via septic tanks and soakaways; • The financial and human resources used.
• disposals of solid waste to landfill sites;
• disposals of solid and liquid wastes, including or- This evaluation plays an important role in the process of
ganics, to incinerators; developing future goals and planning the use of resources.
• industrial process raw material inputs (such as trace An important part of the evaluation is providing the minis-
contaminants) and operating conditions (such as terial level, which has the overall responsibility for design and
process temperature, pressure and flowrate); implementation of the environmental legislation, with feed-
• fugitive releases to air, water and land;
• receiving environments such as ambient air, grass,
back on compliance-oriented activities performed as well as
soil surface and ground waters; with problems encountered by the implementation related to
• use of raw materials and energy (IPPC); the regulation itself. And where issuance of the environmental
• noise and vibration; licences is handled by another section or unit of the system of
• odour; public authorities than the authority in charge of the compli-
• process/plant conditions that are relevant to the
ance programme, the feed-back at a quite detailed level to the
time when measurements are taken or that may
affect releases, such as down-time of plant or per- licensing department is absolutely vital for effectiveness of the
centage of full utilisation of plant; licensing instrument as such. When we come into the more
• operation and maintenance of monitoring and severe enforcement instruments like closure of a site – or part
other relevant equipment. of a site – the license department will be involved in the case.
This is also the case in any kind of criminal charge against the
Source: IMPEL 1999b, p. 5ff
company and/or the site management. Criminal charges will
normally be handled by the prosecutor’s office, but drawing

124 compliance – monitoring and continuous improvement 8

heavily on the environmental authorities in the preparation of
the case. Compliance
The ordinary reporting provides at the same time the gen- strategy
eral public with easy access to information about the environ-
mental problems and how they are handled by the authorities
in relation to industry, agriculture, the service sector and all
other regulated economic activities, including the widespread Evaluation & Monitoring
public services, which are also affected and covered by the reporting
environmental regulation. The reporting and the open evalua-
tion underline the accountability of the authorities towards the
general public.
To help in the direction of ‘good reporting’ and thereby the
Enforcement
best possible base for the evaluation of the compliance pro-
grammes IMPEL has developed a guide for the structure of
and the topics to be covered by the report. They can be sum- Figure 8. 3 The compliance cycle. [Based on IMPEL 1999, p 2]
marised [IMPEL 1999b, p. 13] in the following main points:
a comprehensive and holistic approach and as being an on-
• Evaluation of the success/failure to meet the goals and
going process, continuously looking for improvements. This
priorities of the plan.
understanding adds or inserts the perspective of ‘continuous
• Conclusions on the adequacy, quantitative as well as qual-
improvements’ into the authorities’ striving for compliance.
itative, of resources to carry out the planned inspection
While monitoring for compliance with current regulation,
policy to ensure compliance by industrial installations.
inspectors in the best-planned compliance systems will seek to
• Conclusions on the level of compliance by installations
deal with problems and outright violations in the perspective
with the regulations and a comparison with previous re-
of improvements. That is, they will enter into a dialogue on
porting periods in addition to the effects of actions taken
how remedying the violation can turn into or include prospects
to enforce compliance.
for an even better, and often cheaper, solution than the one
• Identification of specific legal requirements not complied
they had before.
with, and evaluation of possible methods to ensure greater
In this way, pushing for compliance becomes a platform
compliance e.g. promotion, special campaigns, change of
for the next improvements and, eventually, becomes an on-
rules, practising other enforcement measures.
going process – a cycle, where you go through the different
• Recommendations for future planning.
steps of the cycle one by one, arranging the feed-back where
relevant, and ending up with the base for a new start, the next
8.5.2 Compliance as Continuous Improvement cycle. This understanding of the compliance is summarised in
Parliamentary democracy, legislative decision-making and Figure 8.3.
principles of ‘rule of law’ make sense only when the targeted
citizens and companies are in compliance with the legislation
in question. In addition, compliance is vital for the legitimacy
of political institutions and political decision making as such.
Securing compliance is therefore at the core of environmen-
tal regulation as well. This does not affect the need to respect
the individual rights guaranteed for citizens, physical or legal
alike, in all democratic societies. On the contrary, these are
equally important for the legitimacy as is compliance.
We have presented key instruments in the drive for secur-
ing compliance. It is a complex task the authorities are facing
here. In line with the understanding behind the EU-based envi-
ronmental regulation, compliance has to be seen not only as a
fundamental principle for the proper functioning of democratic
societies. Environmental regulation is understood as needing

8 compliance – monitoring and continuous improvement 125

Study Questions Abbreviations
1. Describe the different components of a compliance CEE Central and Eastern Europe
programme. Why is the evaluation of a compliance pro- EEA European Economic Area
gramme so important? EMS Environmental Management System
2. Give some examples of support a company may have to EMAS Eco-Management and Audit Scheme
achieve compliance with environmental legislation and EPA Environmental Protection Agency
licensing. Discuss the roles of Authorities, Media, Public, IMPEL European Union Network for the Implementation
Market and Green networking. and Enforcement of Environmental Law
3. How could authorities in charge of inspections encourage IPPC Integrated Pollution Prevention and Control
companies to be more proactive towards environmental REACH Registration, Evaluation and Authorisation of
issues? CHemicals
4. Describe what competent authorities exist in your country
on the local, regional and national level. Especially ex-
plain if a regional authority is a regional office of a state Internet Resources
authority or part of the regional administration such as the Introduction to IMPEL
county. http://ec.europa.eu/environment/impel/introduction.htm
5. Explain the dilemmas a local/regional authority may
face in pursuing compliance in a company, located in the IMPEL Reports related to Minimum Criteria for Environmental
region. Inspections
6. Is it appropriate to reduce inspection frequency and in- http://ec.europa.eu/environment/impel/reports_minimum.htm
tensity with companies with an EMS in place – why/why
not? IMPEL Reports related to permitting, monitoring and the 6th
7. Describe how a company may conduct self-monitoring EAP
– required by the IPPC directive – in the simplest way. http://ec.europa.eu/environment/impel/reports_maximum.htm
8. Describe the compliance typology of companies.
9. What are the components of the compliance cycle? The International Network for Environmental Compliance and
10. How should one conduct an evaluation of the success/ Enforcement (INECE)
failure to meet the goals and priorities of the compliance http://www.inece.org/
plan?
Making Law Work: Environmental Compliance & Sustainable
Development. (INECE)
http://www.inece.org/makinglawwork.html

The Greening of Industry Network (GIN)

http://www.greeningofindustry.org/

Foundation for Sustainable Agriculture and Forestry (FSAF)

http://www.fsaf.de/index.php?en-home

Environmental Self-Monitoring in EECCA

http://www.oecd.org/document/45/0,2340,en_2649_34339_
26408557_1_1_1_1,00.html

DG Environment webpage on the IPPC Directive

http://ec.europa.eu/environment/ippc/index.htm

126 compliance – monitoring and continuous improvement 8

 Inspection, Enforcement
and Court Processes 9
9.1 Inspection 9.1.2 Four Types of Inspections
9.1.1 The Role of Inspections Historically inspections were made as a response to complaints
The prime objective of inspection is to monitor compliance received typically from neighbours and/or downstream eco-
among the regulated production sites and to identify possible nomic activities dependent on the same watercourse or odour
violations of the regulation. free air. Quite a few of the typical neighbour problems have,
The site visit will also have to look into the ways the data however, been overcome or significantly reduced. For example
from self-monitoring is provided and thereby assess the ap- sewage systems have been built and linked to effective waste-
propriateness, quality and reliability of these data. water treatment plants, and noise and other direct impacts have
If violations are identified, inspections also serve to docu- been taken care of by the licensing system. The nature of the
ment the non-compliance situation and thus provide the legal
documentation to support any follow-up enforcement actions
or any other appropriate consequences drawn.
An additional purpose of inspection may be to establish In this Chapter
an atmosphere of ‘deterrence’, whereby a particular company
– and in wider context all companies – is made aware of, that 1. Inspection
The Role of Inspections
compliance with environmental regulation is taken very seri-
Four Types of Inspections
ously by the authorities. Finally the very presence of inspec- The Functions of Inspections
tors in the field increases compliance rates by both the facili- Form and Intensity of Inspections
ties that are repeatedly inspected and by others who may fear 2. Enforcement
inspection – exactly as is the case with the traffic police. Enforcement Actions
As mentioned above a new role for inspections has emerged The Range of Response Mechanisms
The Enforcement Process – Selection of the
in recent years. Inspections are used as an opportunity and a
Appropriate Enforcement Response
means to encourage production management to improve the 3. The Court Process
environmental performance of the company, also beyond a Appeals within the Administrative System
narrow compliance with current licence. It is important how- Protection of Citizens Rights – rule of Law
ever to stress that inspectors should not give specific advice The Role of the Courts
Courts to be Involved in Case of Criminal
about how to come into or maintain compliance. Such actions
Charges
could shift responsibility for compliance from the regulated 4. Agreements, Compensation and Damage
source to the government inspector. For example, if the source Agreements
relies on the advice of an inspector and this does not result Proportionality and the Consequences of
in compliance, the responsibility for ensuring its own compli- Violations
ance is lessened because they “did what they were told to do” Compensation for Damages
by a government agent.

9 inspection, enforcement and court processes 127

main environmental issues has at the same time changed, and A third type of inspections are the so-called campaign in-
has become increasingly systemic and global. spections. They are performed as a concerted action at many
This development requires a more planned and strategic or all regions or municipalities to highlight and target a certain
answer also at the level of inspections to support solutions and type of installations, or made to control a specific, normally
improvements for the new kind of problems. Planned interven- quite serious, environmental problem.
tions are today mainly made on demand from government and Finally, one talks about the follow-up inspection, to check
the political system at large. Their purpose is to document ef- that violations identified at a routine inspection, have been
forts and to keep costs under control. Inspections are therefore corrected in a way that was ordered and within the time limit
increasingly an integrated part of a Compliance programme given by the authority.
along the lines discussed in the previous chapter.
A typology for inspections has been developed, based 9.1.3 The Functions of Inspections
upon the reason and/or the aim of the inspection. The reactive These different types of inspections have been defined and de-
inspection takes place after a complaint to the authorities. The scribed in some more detail by IMPEL. Routine inspections
routine inspection takes place in accordance with the compli- are carried out periodically to:
ance programme, set up by the particular authority.
• Ascertain compliance with valid regulations.
• Check proper operation.
Box 9.1 Inspection Goals • Control self and independent monitoring systems and
their results.
Environmental inspections may have one or several of • Establish further inspection activities.
the following goals:
In addition to the routine periodic inspections, there are
• Identifying specific environmental problems.
other circumstances in which inspections should be carried
• Making the source aware of any problems.
• Gathering information to determine a facility’s out. These [IMPEL, 1999c, p. 6f] are reactive and immediate
compliance status. inspections such as:
• Collecting evidence for enforcement.
• Ensuring the quality of self-reported data. • Inspection concerning failures in operation of the instal-
• Demonstrating the government’s commitment to lation such as after an incident; where permit conditions
compliance by creating a credible presence. have been infringed; or where an infringement is antici-
• Checking whether facilities that have been ordered pated without additional controls being implemented.
to comply have done so. • Inspection after complaints – where the responsible
• Promote sustained improvement beyond compli-
authority gets complaints from local people, competitors,
ance.
non-governmental organisations or other authorities to
Inspections may focus on one or more of the following: ascertain the source and cause of the complaints.
• Does the facility have an up-to-date permit or li-
• Inspection after an accidental release, an explosion or a
cence? fire to assess the causes, effects and the measures taken to
• Has required pollution monitoring or control mitigate environmental effects.
equipment been installed?
• Is the equipment being correctly operated? Additionally, specific inspection campaigns may be held in
• Are records of self-reported data properly prepared the following circumstances:
and maintained?
• Is the facility properly conducting any required • To investigate or follow up a certain environmental issue.
sampling and analysis? • To prepare for the introduction of new regulations.
• Do the facility’s management plans and practices • After a number of permit infringements, operational
support the required compliance activities? failures or incidents of a similar nature at installations of a
• Are there any signs of willful violation of regula-
particular type.
tions and/or falsification of data?
• Is there some opportunities for process and tech- • On grounds of public outcry.
nological improvement of the facility? • To establish mass-balances, reports, plans or registers.

Source: IMPEL 1999 p. 62-64

128 inspection, enforcement and court processes 9

 Office Site On-site
Intensity

”Walk-through” Compliance control

”Drive-by” Inspection
Desk Study Inspection Inspection Figure 9.1 Form and intensity
of inspections. The inspections
change character, and require
Time spent in the field more time and resources, de-
pending on the task.

9.1.4 Form and Intensity of Inspections A compliance control inspection is a full-fledged check on,
The different types of inspections can be carried out at differ- in principle, the whole operation and on all points included
ent levels of intensity, that is, with varying use of time in total in the environmental licence. It is therefore very structured,
and on the site. The differentiated use of inspections depends and generally involves multiple steps and elements from in-
on the categorization of companies as to their general environ- terviews, observations of installations and processes till docu-
mental performance and transparency (see previous chapter). ment review and emission samplings. Time is spend on check-
We distinguish between five types of inspections as to form and ing and verifying self-monitoring data and the relevance and
intensity. Apart from the distinction between going on site visit appropriateness of critical elements of present requirements
or not, the difference across the four types of inspections at or to the operation as well as on options for improvements of the
on the site is clearly related to the intensity of the inspection. environmental performance.
A desk study is a paper- or data-check exercise taking place A beyond compliance inspection is normally linked to – or
at the authority premises. If this is all done it is a pure desk is an aspect of – the compliance control inspection. It repre-
study. All site visits however – and more so the more intense sents a perspective of prevention and (continuous) improve-
– need preparation at the desk before going out. In this prepa- ment of the company’s environmental performance, very much
ration the data provided by self-monitoring as well as previous in line with the EMAS and EMS certification, which includes
inspection reports are important. this pledge. An inspection can be a good opportunity to present
The drive-by inspection is something between the desk more wide-ranging perspectives for changes in technology or
study and the site-visit. This inspection may take the form of installations, which has to be modified to stay in compliance
a visual examination of a site without entering the site, e.g. of present licence. For example instead of installing a new and
performed from an anonymous car. It may include observing more effective filter at the outlet of wastewater from a proc-
working hours, waste management practices, the presence or ess, it might be worthwhile to think about getting a water recy-
absence of visible air emissions or odours or noise, or other cling system established. While recycling means saving water
visual aspects of a facility operation. A drive-by inspection is it might at the same time recover other raw materials, till now
useful in revealing information helping to decide whether to going into the sewage system together with the wastewater. Fi-
follow-up with a proper on site compliance control inspection. nally, the recycling will make the company able to comply with
Drive-by in an area can also be used as a way of identifying fa- any foreseeable upcoming regulation on wastewater quality and
cilities or operations potentially subject to regulatory require- limit values for e.g. heavy metal content and at the same time
ments for which they have not (been) registered. use the ‘green’ process in its marketing for new customers.
A walk-through inspection involves entry into the facility, These inspections and related evaluations require a wide
possibly review of a few relevant documents with emission range of knowledge, skills, and abilities on the side of the in-
data, a quick ‘glance’ at regulated operations or practices, and spectors. Time range for this type of inspection go from a few
then exit. Walk-trough inspections are useful in establishing hours up to two weeks or more for very large and complex
presence (“showing the flag”) and as a follow-up on earlier production facilities.
requirements and agreements. They also serve to ensure, that All the above inspection can be conducted with or with-
there have been no unauthorized expansions or changes in op- out prior notice to the facility manager. Inspection with prior
erations or processes, and verify that there are no ‘hidden’ op- notice is termed ‘announced’, and without prior notice ‘un-
erations. Inspectors can often conduct multiple walk-throughs announced’. The advantage with announced inspection is that
in a day, particularly of smaller companies. besides the management representative, employees in charge

9 inspection, enforcement and court processes 129

of the targeted processes and operations can be present and The practice of environmental inspections is discussed in de-
the processes actually running. Further, the company repre- tail in the special section on Inspections.
sentative has had time to prepare all data and documentation
needed and required. The major drawback is the possibility of
removing installations or hiding processes or emissions that 9.2 Enforcement
represent violations of current licenses and other relevant envi- 9.2.1 Enforcement Actions
ronmental regulation. Here again the differentiation according
Enforcement are actions that government officials take in or-
to the company record on compliance and transparency will
der to correct violations. The means of enforcement is to com-
influence the tactic used by the inspection.
mand the facilities to get into compliance by imposing differ-
The criteria, relevant to consider prior to any site visit, and,
ent sanctions. It usually begins with a request of correction
indeed, during site visits, have been summarized by IMPEL.
within a given time limit. If this is not achieved then economic
penalties may result. In the extreme cases non-compliance
may lead to forced closing of an activity. If it is considered a
Box 9.2 Minimum Criteria for Site Visits criminal offence the case is handed over to the police.
The threat of sanctions can create an atmosphere in which
1. As a minimum criterion, on-site visits should be the regulated community is stimulated to comply as govern-
carried out through an integrated approach, which
ment has shown willingness to act when non-compliance is
examines the full range of environmental impacts,
as far as organisational arrangements allow. If site detected.
visits are carried out by more than one inspectorate,
co-ordination between the authorities should be 9.2.2 The Range of Response Mechanisms
assured by mutual knowledge of each other’s plans Enforcement can be controversial because so much is at stake
for site inspections. The findings of site visits should environmentally and economically. The legal basis for en-
be exchanged between the relevant authorities.
forcement is thus essential to the power and credibility of an
2. A minimum criterion for site visits is that every enforcement programme. The given environmental or related
site visit should be recorded, and the record filed. laws need to provide the regulators with the needed warrants/
3. Programmed, systematic site visits should cover:
authorities to act on non-compliance and enforce the imple-
- Checking compliance with laws, regulations mentation of given requirements.
and/or permits etc. In a country, based upon ‘rule of law’, the range and type
- Promote and improve the understanding by of response mechanisms to non-compliance situations depends
operators (of industrial installations) of the rel- ultimately on the authorities/warrants provided by laws. These
evant environmental requirements and of the
vary from country to country, but need to provide the enforce-
environmental impacts of their activities in or-
der to secure compliance with the underlying ment authorities with access to the full range of informal, ad-
objectives of environmental legislation. ministrative, civil and criminal remedies. These [OECD p. 21]
- Consider the impact on the environment may include, but are not limited to, the following:
of the installation in order to evaluate im-
pacts, current control requirements and the • Informal responses, such as recommendations, mutual
need for improvement in either or both. agreements and warning phone calls and letters.
• Formal warning letters, including recommendations, and
4. Ad-hoc site visits in response to complaints, inci- notices of violation.
dents and non-compliances should occur for:
- The investigation of the serious complaints,
• Mandatory corrective actions required by administrative
where appropriate. orders to correct violations and bring non-compliance
- The issue or renewal or modification etc of situations back in compliance.
permits, which is particularly important at the • Changes in permit(s) conditions and suspension or can-
start of the permitting process. cellation (withdrawal) of the permit(s).
- The investigation of significant accidents and
• Financial penalties (fines), administrative or judicial, ac-
incidents and non-compliances.
cumulating as long as the illegal situation persists.
• Negative publicity.
Source: IMPEL 1997, p. 4f
• Attachment of property, facility shut down, which may
be required by administrative or judicial order (and may

130 inspection, enforcement and court processes 9

 be effected by executive coercion, when authorities take rule of law. And it is wise from the perspective of protection
remedial action at the expense of the offender). of the environment, as the aim of enforcement is not to punish
• Criminal punishment, including imprisonment and confis- anybody and use a lot of authority resources to that end. The
cation of gains from being out of compliance. aim of enforcement is to get the facility to comply with the
environmental regulation. It should therefore be given the op-
9.2.3 The Enforcement Process – Selection of the portunity at each stage to choose the compliance itself instead
Appropriate Enforcement Response of (more) punishment.
The above described response mechanisms can broadly be pic- The seriousness of offence determines the escalation of the
tured as shown in Figure 9.2. The scheme cannot, however, process as can be seen from the figure. The ‘appropriate’ re-
include all possible national variations. The key lesson from sponse should be in proportion to the violation and take into
the figure is the very strong position, the government and/or a consideration aggravating or mitigating factors. (See on pro-
more decentralized level of public authority possess, although portionality 9.4.2. below).
it will vary across the EU Member States.
The informal reaction is also an enforcement response. The
9.3 The Court Process
enforcement therefore starts already during the compliance
check site visit – and in the immediate follow-up on that by 9.3.1 Appeals within the Administrative System
the written report made. This is informal, but may well have an The right to appeal means that there are one or several points
influence, not least when the immediate outlook otherwise is in an enforcement process where a violator can appeal, that
a charge in the criminal court for violations of environmental is protest against, the findings of an authority regarding the
regulation. violation. It may concern in the first place the remedial ac-
Having these different response mechanisms available, tion required by the enforcement program, and secondly the
it raises the question of how to select an
appropriate enforcement response to pro-
mote the facility to get into compliance. In Legal Status Type of Authority Sanctions
general, enforcement usually follows the
following sequence: warnings and rec- Recommendations
ommendations (informal and/or formal),
orders to take corrective actions, change INFORMAL Admin Warnings
or withdrawal of permit, monetary sanc-
tions (fines, compensation), attachment of Agreements
property, and, where appropriate and pos-
sible, criminal prosecution (confiscation Orders about
of gains and imprisonment). There are Corrective
actions
certain conditions and time allowances for
the company to react before the next step
Withdrawal of
can be taken. That again has to do with Civil Admin Permit
the ‘legal rights’ in a society based on the

Negative publicity
Figure 9.2 Actions taken by the authority in
FORMAL
case of non-compliance. The first response Shutdown
by the inspectors is normally an informal,
such as a warning (above). If the company
Fine
does not comply formal actions continue in
the administrative system (middle), which
still may be very serious. In a few cases the Criminal Judicial Imprisonment
inspection authority regards the non-com-
pliance to be an environmental crime, and
address the case to the police. Here the case Confiscation of gains
will continue to the prosecutor and become a
court case (below).

9 inspection, enforcement and court processes 131

Box 9.3 Agreements or Settlements with Violators of Environmental Law in the United States

In the United States agreements between the company and Environmental audits have been required in several
authority are often used to address non-compliance. Agree- enforcement actions in the United States for one of two
ments can include any provisions that the compliance pro- purposes. First, they have been used where a source shows
gram officials is authorized to impose on a violator. Depend- a clear pattern of violations that suggests a management
ing on their legal authority, environmental officials may have problem. In such cases, a settlement may include an agree-
some latitude to develop creative approaches to solving envi- ment that the source pay for an environmental audit to
ronmental problems. identify and correct the internal management problems
Creative settlements can also be used to leverage a single that led to the repeated violations.
case to gain either greater environmental benefit or greater Second, if a violation is likely to be repeated at other
deterrence than would have occurred with a conventional operations owned by the same company, a settlement may
settlement. Examples of creative settlements are described include an agreement (1) that the company or a third-par-
below. ty auditor will audit for that violation at the other facilities
owned by the company, and (2) that any violations will be
Monetary penalty reported and corrected.
Creative settlements are often linked to some limited reduc-
tion in monetary penalty or an agreement to extend compli- Restoration of damage
ance schedules. Creative settlements may also be sought for Environmental Restoration settlements not only repair the
violators with limited ability to pay or violators that demon- damage done to the environment because of the violation,
strate a strong level of cooperation with the government. but also further enhance the environment around the fa-
U.S. policy limits the amount of penalty reduction allowed in cility. If the environmental damage caused cannot be re-
creative settlements because of need to maintain some level stored, the settlement may require the facility to restore a
of penalty to preserve deterrence and recover the economic comparable environment in another location.
benefit of noncompliance.
Public settlement
Pollution prevention In the United States, violators who sponsor public aware-
Pollution Prevention settlements involve an agreement by ness projects must also agree to clearly state to the public
the facility to convert to practices or processes that reduce that the project was undertaken as part of the settlement
or eliminate the generation of pollutants and wastes at the of a lawsuit brought by the government.
source. Pollution is prevented when the volume and/or the Publicity settlements (public awareness settlement) in-
toxicity of pollutants is reduced. In manufacturing, for exam- volve that the violator agrees to undertake some activity to
ple, pollution prevention includes activities such as substitut- increase the awareness by the regulated community of the
ing chemicals, reformulating products, modifying processes, need for compliance and/or ways to achieve compliance.
improving housekeeping, and recycling on site. For example, the violator could sponsor a series of seminars
Pollution prevention projects may directly correct the vio- to provide information to a specific industry group about
lation or may reduce pollution not connected with the original how to correct violations common to that industry. The
violation. Pollution prevention settlements help ensures that violator could also sponsor public announcements on tel-
violations will not recur and/or they reduce the total risk that a evision and radio to discourage violations or to describe
facility’s operation poses to public health or the environment. how new technologies can be used to correct violations.
Pollution Reductions beyond Compliance settlements can Training settlements can be used to correct internal
be negotiated in which the violator agrees to reduce pollution compliance problems within a company or organization.
further than the level required complying with the require- Violators that are industry leaders may be required to de-
ments. For example, a violator may agree to install more ef- sign and conduct compliance training for others within the
fective control technologies that reduce the overall discharge same industry group.
of pollutants. Escrow or Bond for Sources Unable to Pay Penalties set-
tlement is useful for facilities that cannot afford to pay the
Environmental auditing monetary penalty normally imposed for the particular type
Environmental Auditing is a periodic, systematic, documented of violation. In such cases, the facility agrees to put some
and objective review at a regulated facility of its compliance money into an escrow or bond account which will be used
status, management systems and/or overall environmental to fund remediation or other activities to improve environ-
risk. Auditing has been encouraged by many nations and by mental quality
the International Chamber of Commerce as an essential tool
for regulated facilities to ensure compliance and to effectively
manage their environmental risks. Source: US EPA 1992

132 inspection, enforcement and court processes 9

sanctions imposed. Appeal systems vary across countries, but lies behind – by taking the authority to court and have the de-
two appeals within the administrative system are quite usual. cision tried in court trial. This option of appeal and in the end
The first appeal is often heard and decided on by a ‘court-like’ of taking the authority to court and have a court ruling, which
panel, manned by a mix of judges and technical experts. After must be respected also by any government authority, is a fun-
the administrative appeal is exhausted the violator may turn to damental element of the ‘rule of law’ concept.
the court system, where he/she will normally have one appeal
to bring the case before the next level of court. 9.3.3 The Role of the Courts
As seen above enforcement responses are bound to create The courts are normally organised according to principles,
disputes between program officials and company representa- written in a country’s constitution. They are state institutions,
tives throughout the enforcement process. This might even partly financed by the state budget and partly by the fee, paid
start by the officials trying to gain access to the facility and by the parties for opening the case. The courts should in a dem-
might be disputed all the way through three appeals up to the ocratic state be independent from government decision-mak-
supreme count. Enforcement officials [US EPA, 1992] should ing, not only on how to decide in particular cases, of course,
therefore always be prepared to: but also in how to organise their activities and, most impor-
tantly, on ‘hiring and firing’. A judge can be fired only by the
• Prove that a violation has occurred.
court itself. That principle is there to protect the judges, and
• Establish that the procedures and policies were fairly
thereby the court system, against government pressure. When
and equitably followed and that the violator is not being
politically important cases are brought to court by people or
wrongly accused.
organisations, disagreeing with the interpretation of the law
• Demonstrate the underlying environmental or public
and the administration of a political majority, the court should
health need for the requirement being respected.
be independent from other power-holders in the society.
• Demonstrate that a remedy for the violation is avail-
The court system can be organised differently, but has nor-
able (e.g. affordable pollution control equipment). (Even
mally three stages with the right to have one’s case tried at
though this is not usually the responsibility of the govern-
least twice, i.e. having at least one court of appeal. One might
ment, this information can be important to negotiations.)
also have a second appeal, and thereby a third court hearing for
• Demonstrate the ability of the violator to pay, e.g. showing
the case. This will normally be decided on by an independent
that a “poor” facility is owned by a wealthy parent company.
body, set up to evaluate the nature of the case. A second ap-
peal is normally only granted if some principle questions are
9.3.2 Protection of Citizens Rights – Rule of Law involved for which a final ruling by the highest court would be
Democratic societies, subscribing to the ‘rule of law’ must bal- important, as that will work as precedence. Precedence cases
ance the need for, often, swift action by the authorities in the set the norm for future decision making within the government
best public interest with the fundamental rights of the indi- administration in the area. But also first and second level court
vidual citizen. rulings will have important an impact as precedence, if they
The decisions made by governmental officials, affect- are not questioned by any of the two parties’ decision-making
ing private interests, are therefore subject to appeal and can in that area for the future.
eventually be taken to court for a final verdict on the matter.
The court system will not be used very often as it takes time 9.3.4 Courts to be Involved in Cases of Criminal
and can be quite expensive in case you lose. But court rulings Charges
will, on the other hand, have effect as precedence in a much As soon as criminal charges, whether fines, based on the envi-
stronger and wider sense, than will rulings from administrative ronmental act itself or criminal charges with the possibility of
appeal panels. imprisonment become relevant, the case has to be handed over
The rule of law and legal rights issue sets a general limit on from the environmental authorities to the police and – later on
what the environmental authority, is allowed to do as a govern- – to the prosecutor, who will then, when decided to proceed,
ment authority. As an authority it acts unilaterally within its take the case to court. For fines, the police can decide a level
competence – and its obligation – to implement current law and ask the offender to accept to pay that fine. If accepted,
and derived regulation. A citizen or a company will have to there will be no court case. If refused, the case will have to be
comply with the final decision of the government authority, taken to court, regardless of the size of the fine proposed.
i.e. when administrative appeal is exempted. Or challenge the So, when a case is considered by the environmental au-
decision – that is challenge the interpretation of the law, that thorities to be serious enough and/or compliance has not been

9 inspection, enforcement and court processes 133

possible to establish by the means available to the authority, between the underlying violation and the health or environ-
it will report the case to the police and hand over all informa- mental benefits, that will result from the SEP [EPA/1998 and
tion and evidence available. The police will start an investiga- Case in Box 9.4].
tion and probably during the investigation ask for additional
information. At the end of the investigation the police will 9.4.2 Proportionality and the Consequences of
discuss its opinion with the environmental authorities wheth- Violations
er to push the case or not, which pretty much is a matter of It should be underlined, that the appropriate reaction within
assessing the scope for winning the case. If it is decided to go the range of sanctions available is guided first of all by propor-
on, the prosecutor will take court action and charge the per- tionality, i.e. the sanction must correspond in seriousness with
son and/or the company with fines – and for a person possibly the seriousness of the violation assessed by the environmental
also with imprisonment, where indicated and made possible objectives of the regulation violated.
by the law. The steps taken may have very much more serious conse-
quences for a company than those stated in an authority deci-
sion. In general one looks upon the sanctions applied by the
9.4 Agreements, Compensation and Damage
environmental authorities (civil sanctions) as less severe than
9.4.1 Agreements the sanctions, applied in the criminal justice system (criminal
The instrument of an agreement is on the borderline between sanctions). That view is most likely related to the moral stand-
sanctions and compliance. It may be seen as in ‘both worlds’, ing in the court system. Becoming a defendant in a criminal
depending on the way it is made and thereby the legal sta- case is generally very damaging for the reputation of a com-
tus it acquires. It is important in which general legal regime pany and for its business image. Reduced goodwill will reduce
it is made. Within the EU an agreement or ‘deal’ between the business opportunities.
owner of a non-compliant facility and the authority does not
mean anything legally. Here the authority will have the power
to push things on an authoritative basis anyway. On the other Box 9.4 A Settlement of Environmental
hand they cannot extend performance beyond the legal base by Violation at the University of Virgin Islands
making an agreement and getting acceptance for more. That
agreement would be void. Still, in practice, making an agree- In a creative settlement of violations under EPA’s col-
ment can be important. The owner of the facility may think, a leges and universities compliance program, the Uni-
fair(er) deal was made. Because of the signature or just clear versity of the Virgin Islands (UVI) agreed to help im-
prove environmental performance at all schools on
acceptance of the deal he/she may feel a sincere obligation to
the Virgin Islands.
actually act accordingly. The inspectors had at UVI uncovered violations of
In the USA the situation for the agreement can be com- federal hazardous waste requirements, including fail-
pletely different. Here there is much greater scope for civil ure to store incompatible waste chemicals separately.
law and thereby leeway for an authority to stage unilateral ac- They also missed out on minimising risks of fire, explo-
sions and the release of hazardous wastes. EPA also
tions and negotiate enforcement. Still, also in the USA, the
noticed that UVI had not properly labeled containers
agree­ment cannot go beyond the competence of the authority of hazardous waste, and had not provided proper
to push requirements through. The role of the agreement – or training to employees.
creative settlements – in US enforcement practice is shown The settlement included that UVI must spend at
in Box 9.3. As shown it may have quite a wide range of is- least $99,000 to help all U.S. Virgin Islands schools
sues and obligations, including some ‘rebate’ on penalties for comply with environmental rules. UVI has agreed to do
this partly by training their staff and faculty from both
quick compliance by complementary action or investment by
campuses and conduct a series of assessments, reports,
the company in violence. mentoring activities, and seminars to help other schools
The April 1998 update lists eight categories or subject ar- better handle their own environmental obligations.
eas for action by a non-complying company, able to replace Additionally, the UVI had to pay a penalty of
(substantial) part of a fine that is otherwise looming. The term $20,000.
for these agreements is Supplemental Environmental Projects
Source: http://enviro.blr.com/display.cfm/id/76437 -
(SEPs). As they are made as part of an enforcement settlement, 04/26/2007
an SEP must advance at least one of the objectives of the envi-
ronmental statute violated. Thereby they include a relationship

134 inspection, enforcement and court processes 9

 Secondly, sanctions like withdrawal of the permit or, ul- Study Questions
timately, shutting down the whole operation till the violation 1. Describe the different types of environmental inspection
has been removed, can be very serious economically. The and list their major advantages and drawbacks, as well as
break in production may lead to violated business contracts. resources needed for each of them. What are the advan-
In addition to the economic consequences, these inabilities to tages and drawbacks of site visits compared to desk study
deliver may have an equally damaging impact on reputation as inspections?
a criminal case. 2. Which are the purposes of inspections? Make a list of 5-
10 important goals, and questions which may be asked the
9.4.3 Compensation for Damages company representatives.
A serious breakage of environmental law normally occurs in a 3. Describe how a site visit may be prepared and legally
situation where emissions into water, air or soil takes place and conducted. Which are the main differences between
considerable damage has occurred. This may be a violation “drive-by”, “ad hoc” and “compliance control” types of
of environmental law but also causes damage to a third party. site visits?
This party, be it a company or private individuals or even more 4. Should inspections always be announced, like a newly
often a large group of individuals, normally claim compensa- passed regulation in Denmark requires – why/why not?
tion for the damages caused. Fairly large sums of money may 5. How could authorities in charge of inspections encourage
be involved in the claim and also here there is the possibility of companies to be more proactive towards environmental
taking the violator to court or reaching an agreement outside issues?
the court. 6. What are the advantages and disadvantages of an enforce-
The most spectacular cases of claims on companies have ment approach that takes into account the principle of
occurred in the USA, where there is a tradition of suing com- proportionality and citizens rights and make use of the
panies for large sums of money, even if the damage from a whole range of enforcement mechanisms, as opposed to a
European perspective not is large. But also in Europe it is clear strategy that goes straight to the more severe enforcement
that damage compensation is very important in environmental mechanisms when a violation is identified?
legal offences. They may be much higher sums of money than 7. When does an authority, in face of non-compliance, move
the fines imposed for breaking environmental law or failing to from informal actions to formal actions and finally leav-
comply with the licence. ing the case to the police?
8. Which formal statements and documents does an authori-
ty need be able to provide when a case of non-compliance
is handed over to the police?
9. Which are the roles of the courts in a lawsuit on environ-
mental non-compliance and which rights do the party,
charged for non-compliance, have?
10. What role is appropriate for “deals” – agreements and
settlements between the authority and the non-compliant
company – in relation to enforcement of compliance?

9 inspection, enforcement and court processes 135

Abbreviations Environmental settlement between US EPA and University of
EMAS Eco-Management and Audit Scheme the Virgin Islands
EMS Environmental Management System http://enviro.blr.com/display.cfm/id/76437
IMPEL European Union Network for the Implementation
and Enforcement of Environmental Law US EPA Environmental law Enforcement Business and Legal
INECE International Network for Environmental Reports
Compliance and Enforcement http://enviro.blr.com/topic.cfm/topic/204/WT.cg_n/article_
OECD Organisation for Economic Co-operation and topic_link/WT.cg_s/enviro
Development
SEP Supplemental Environmental Projects US EPA Supplemental Environmental Projects
US EPA United States Environmental Protection Agency http://cfpub.epa.gov/compliance/resources/policies/civil/seps/

Internet Resources
IMPEL Reference Book for Environmental Inspection
http://ec.europa.eu/comm/environment/impel/pdf/refbook.pdf

IMPEL Reports related to Minimum Criteria for Environmental

Inspections
http://ec.europa.eu/environment/impel/reports_minimum.htm

IMPEL Operator self-monitoring

http://ec.europa.eu/comm/environment/impel/pdf/selfmon.pdf

IMPEL Planning and Reporting of Inspections

http://ec.europa.eu/comm/environment/impel/pdf/plan_and_
report.pdf

IMPEL Frequency of Inspections

http://ec.europa.eu/environment/impel/pdf/freq.pdf

IMPEL General Principles for Inspection

http://ec.europa.eu/environment/impel/pdf/mincrit.pdf

The International Network for Environmental Compliance and

Enforcement (INECE)
http://www.inece.org/

The INECE International Environmental Compliance and

Enforcement Library
http://www.inece.org/library/proceedings.html

INECE’s 7th International Conference on Environmental

Compliance and Enforcement, 2005
http://www.inece.org/conference/7/index.html

Licence Enforcement of EPA Ireland

http://www.epa.ie/whatwedo/enforce/lic/

136 inspection, enforcement and court processes 9

 10
Economic Policy
Instruments
Taxes and Fees

10.1 The Economy of Environmental Protection centives. This is a particularly strong incentive in any business
10.1.1 To Pay the Costs of Environmental Services context. By changing behaviour, that is, by replacing one kind
of material or process with environmentally less harmful ma-
Environmental policy is about protecting the environment by
terials or processes, the company can reduce the fee or avoid
reducing or removing environmentally adverse behaviour on
paying all together. Economic instruments therefore influence
the side of business, people at large and public activities alike.
the behaviour of the business, that is, change the way the busi-
The need for environmental policy means, that this aim is not
coming about all by itself. Environmental policy is, therefore,
essentially about finding ways and means to influence be-
haviour of all kind of human actors in more environmentally In this Chapter
friendly direction.
1. The Economy of Environmental Protection
This book focuses on industry and thereby business. We To Pay the Costs of Environmental Services
have in the previous chapters seen key elements of regulatory Why Economic Instruments?
policy instruments applied by policy makers to make industry Setting the Right Price for External Effects
minimize, or at least reduce, adverse environmental impact The Polluter Pays Principle
from their activities. Many of these instruments have a strong 2. Charges or User Fees
Charges
element of self-control and self-management. Where they are
Setting a Price for Water Services
authoritative, i.e. determined by the environmental authorities, 3. Environmental Taxes
like an environmental licence according to the IPPC directive, Introducing Environmental Taxes
there is a considerable element of consensus-making involved Pollution Fees and Product Taxes
in establishing these licences. Taxes on Waste
Energy Taxation
When we now turn to the economic policy instruments,
Taxes on Fuels
which make up an important – and increasing – part of the arse- Car-related Taxes make up the Most
nal of environmental policy instruments, the basic assumption Making Passenger Car Taxation Environmen-
is that there are no “free luncheons”. Resource use and waste tally Based
emissions are services which cost something and those costs 4. Subsidies
need to be paid. If the prices are right they would – according to Subsidies as State Support
The European Union Subsidies Programmes
the views of market economy – take care of all environmental 5. Role of Environmental Economic Policy
protection needed. But it is not that simple, as we will see. Tax Revenue or Environmental Protection.
Economic instruments are general in their nature. For any Do the Polluters Pay?
unit performing the targeted activity or using the targeted com- Taxation does Reduce Pollution of the
modity and once decided upon, there are no negotiations on Environment.
their application. Economic instruments work by economic in-

10 economic policy instruments 137

ness is run to avoid the fee. Ideally, the policy intentions have licences for an activity and by specific product standards, set
been achieved, when no fee is paid. Then the policy has been upper limits on the hazardous content. In other cases an origi-
successful. nal economic approach is replaced by a regulatory one. Regu-
For economic instruments the key property and peculiarity lation of cars is illustrative in this respect. Authorities started
is, that complying fully with the policy brings the “free lunch- to phase out leaded petrol by introducing a differentiated petrol
eons” about at last. It might even be topped up by outright tax. Later they demanded catalytic converters on all new cars
economics gains, at least in the long term. Reality is, however, from a certain time. This ended the use of leaded petrol, since
also in this area, often quite a bit away from the ideal. Before converters did not function with lead in the petrol. Another ex-
expanding on that, we will take a somewhat closer look at the ample is provided by agriculture. Here the use of fertilizer and
economic instruments and their application. pesticides were regulated via a quota-system and by quality
requirements or outright ban on certain products.
10.1.2 Why Economic Instruments? Still, regulatory policy instruments are not sufficient. There
Economic instruments are applied to change behaviour by is a limit to in how much detail you can regulate an activity.
economic incentives. But why do these incentives need to be The resources needed for detailed control would be impossi-
imposed? Why do not companies and individuals see and go ble. This is especially true for diffuse sources and/or diffuse
for these benefits on their own? and long-term effects. Further, the direct regulation approach
There are several reasons. does not promote changes and innovation very well. It holds
First a good deal of the natural environment, such as the no or limited incentives. In these cases economic instruments
air, is “common good”, i.e. it has no owner. There is then a are more efficient.
risk of exploitation. The state comes in to play the role of the
owner to protect this common good. It may do this by charging 10.1.3 Setting the Right Price for External Effects
a fee for its use. The damaging effects of emissions exemplified above, remain
In other cases there is no possibility of charging for the use external to the cost-calculations in companies and hence are
of a service, for example street lighting. But it costs something not included in the prices of the products. This is where the
to provide it. In order to cover the costs again the public has economic instruments may play an important role. Such instru-
to collect a tax. ments can “internalize” the costs of this type of environmental
Thirdly, and more importantly, environmental consequenc- impact by assigning a tax to each unit of exhaust, to each kg of
es of human activities are diffuse, wide-ranging, piece-meal fertilizer and to each ton of CO2. Such taxes will make the pric-
and often dangerous only in the long term. A few examples es go up. Thereby they will create a dynamic (or continuous)
may illustrate this: incentive to innovate, to substitute or – at least – to try to reduce
the use of the environ­mentally damaging products or methods
• Particles from car exhaust in the city affect health seri-
to avoid paying or reduce the amount of the tax to be paid.
ously; people exposed to particles on the street will bear
There are, in other words, some “social costs” of human
the consequences, far away from the car owners.
activities, which are not automatically brought “into the equa-
• Nutrients and pesticides leaking from agricultural land
tion”. The economic instruments, i.e. taxation, provide a way
cause pollution of rivers and coastal waters; reduced wa-
to internalize these costs into the private calculations. In this
ter quality, reduced biodiversity etc will be felt far away
way private and social costs are added together to make up the
from the polluter.
full costs for the environment of human activity and thereby
• Pollution of air by SOX and NOX cause degradation of
make the prices “tell the truth” [Weizäcker, 1997] about the
buildings, monuments and corrosion of various installa-
environmental costs of a given commodity or service.
tions due to acidification; owners of these monuments or
For micro-economic theory the internalization of social
equipments are far away from those emitting the acidify-
costs represents a problem of principle. It has correct (fair
ing gases.
and firm) marginal pricing as a precondition for efficiency in
• Release of CO2 from power generation etc., create the
cost distribution and resource re-allocation via the market. But
enhanced green house effect; those suffering from the
the estimation and quantification of the social costs of differ-
consequential climate change are often far away from the
ent kinds of environmental damage are very difficult to es-
polluters.
tablish, and any calculation will be full of uncertainties and
Some of these impacts are regulated by regulatory policy reservations. Fixing the tax-level will therefore not come up
instruments. Emission values, imposed by the environmental to these micro-economic requirements, which are, by the way,

138 economic policy instruments 10

also hampered by many other uncertainties and reservations when the Brundtland Commission Report Our common Fu-
in their practical application. Rather, deciding the level of the ture was published. For the economic instruments, the polluter
taxation will be much more of a “trial and error” exercise, de- pays principle is the oldest, the most widely recognized, taken
pending on political support and drawing on experiences from up in legislation across the globe. It was adopted in the 1st EU
other areas and from other countries and then correcting the Environmental Action Programme back in 1973 and included
tax-level as experiences are gained. in the EU Treaty of 1992/93, Art. 174/EC. It was also included
in the UNCED-Rio-Declaration from 1992. The key issue is,
10.1.4 The Polluter Pays Principle what should be included to fulfil this principle, i.e. when can
Quite a few environmental policy principles have been devel- the polluter be said to have paid (all the costs of his activ-
oped over the recent 30 years and most notably since 1987, ity)? Like most other areas we have here witnessed a historical
development, changing the notion and the understanding of
Table 10.1 User fees/charges in Denmark for discharging/deliver- the polluter pays principle as to what should be included for
ing wastewater and solid waste to treatment and handling facili-
full cost coverage. The main distinction goes between envi-
ties for years 1998 and 2004, compared with the environmental
taxes for the same years. Figures in Million DKK. The OECD ronmental fees/charges and environmental taxes. Suggestions
defines charges and fees as “compulsory requited payments to for moving into taxation were heard all the way from Pigou
either general government or to bodies outside general government, in the 1920’s till Baumol and Oates in the late 1970’s into the
such as for instance an environmental fund or a water management 1980’s. It was not until the latter half of the 1980’s that the first
board” (OECD, 1999), and environmentally related tax as a “com- environmental taxes were actually introduced.
pulsory, unrequited payment to general government levied on tax-
bases deemed to be of particular relevance. Taxes are unrequited in
the sense that benefits provided by government to taxpayers are not
10.2 Charges or User Fees
normally in proportion to their payments” (OECD, 2001). [Sources:
Danish Ministry of Finance and Danish Statistics Service]. 10.2.1 Charges
Tax 1998 2004 Charges are defined as the payment which should cover the
proven expenses for handling waste or providing a resource
Energy- tax 22,964 31,768
such as water. The charges include costs for collecting sew-
CO2/SO2-tax 4,515 4,954 age and treatment of wastewater in treatment plants collecting
Packaging tax 864 921 and incineration of solid waste collecting and depositing solid
waste on landfill collecting and managing hazardous waste,
CFC/Chlorinated compounds etc. 2 53
either by incineration, or storage cleaning or depositing pol-
Pesticides 298 379 luted soil from so-called brown fields
Raw-materials 157 161 The companies responsible for these services are in many
EU-countries run by, or owned by, the municipality or by the
Solid Waste-tax 889 1,005
regional government, but private companies are also involved,
Wastewater tax 273 197 especially in the solid waste-handling sector.
Drinking-/Tap water tax 1,544 1,430 As the handling cost for the clean-up operations are not
taking into account the wider implications and wider social
Miscellaneous 53 92
costs of the economic activity, they will never be able to
In Total 31,559 40,960 achieve the full “internalization” of these social costs. Still,
in EURO, million 4,236 5,498 within their scope, the charges will have some internalization
effect as these costs will influence the behaviour of companies
and consumers in the direction of avoiding or minimizing the
User fees, same years: amount to be paid. If charges were not required there would
Waste water treatment 6,400 7,900 be a social redistribution via the state for the benefit of those,
creating the pollution. The costs would then have to be paid by
Solid waste handling 6,200 13,300
the ordinary taxpayer.
in Total 12,888 21,200 Data on charges are not available in Eurostat, (the EUs Stat-
In EURO, million 1,730 2,845 ics Bureau), or EEA, the European Environmental Agency, on
the charges collected in the EU-countries on only the taxes. But
User Fee, percentage of Taxes 40.8 51.7
they are available nationally. As an example the fees and charg-

10 economic policy instruments 139

es paid by Danish users in 1998 and 2004 are shown in Table the country or the region has put a tax on water use, this tax
10.1 together with the environmental taxes paid these same will have to be paid also by companies with their own water
years. It is clear from the table, that the relative increase in the supply, as the objective of the tax is reduced use of the water
charges is higher than the relative increase in the taxes. The resource as such. This is yet another demonstration of the dif-
main increase comes from charges for solid waste handling, ference between the fee and the tax.
which has actually doubled within these 6 years with the big-
gest “jump” from 1998-2000. The reasons seems to be cost
increase at the handling utilities, including expansion of the 10.3 Environmental Taxes
handling capacity, a rise in the amount received and a slight 10.3.1 Introducing Environmental Taxes
increase in the proportion of private companies, active in the
Environmental taxes have become increasingly popular with
solid waste sector.
most governments in recent years. It all started in the late
10.2.2 Setting a Price for Water Services 1980’s with an OECD declaration by the member countries’
Environmental Ministers in June 1985. This was a pledge for
For the publicly owned utilities the charges may cover the ac-
the use of the polluter pays principle and initiated an extensive
tual costs of running the operations, but may not exceed that
survey of the use of economic instruments among the member
level. Then they would turn into profit making, i.e. act as a hid-
states. The study [Opschoor & Vos, 1989] found a number of
den and non-decided taxation. The charges must, put different-
charges but in reality no environmental taxes. The Japanese
ly, not move beyond making the services “expense-neutral”.
SO2 tax was the only exception. In addition taxes on petrol in
The responsibility for defining the charges is normally
the Netherlands and Scandinavia were identified.
that of the municipality or region. The city council or regional
In Denmark, the petrol tax was introduced as far back as
council in these cases appoints and constitutes the board of
in 1927, but at a low level. Petrol taxes were, however, sub-
such companies, which decides the charges.
sequently raised considerably. In conjunction with the first
The charges may be fairly easy to calculate from the cost of
and the second “oil crises” in 1974 and 1979 respectively an
operations. But it is less clear how to divide charges between
increase of petrol tax was introduced to halt a rise in, or to
a basic and a volume-dependent part of the charge. The cost
reduce, the petrol consumption. At the same time a shift from
for wastewater treatment is by far dominated by the basic cost
oil-based to coal-based power generation was initiated. Both
for running the treatment plant, which is volume independent.
measures were made to reduce the Danish dependency on oil
Still, if the charge is volume-dependent, that is, dominated by
and the damaging influence on the balance of payment. These
costs per cubic meter, it will work as an incentive to decrease
taxes were, therefore, not originally founded on environmental
water use. This was dramatically illustrated when charges for
concerns, but were increasingly seen that way, as the concern
water were introduced in Central and Eastern Europe. Water
for the environment came firmly on the agenda with the 1987
use decreased from more than 400 l/capita and day to less than
Brundtland Report and the Rio summit in 1992.
100 l/capita and day in a few years. A further complication
OECD has compiled information on the level and impor-
is that normally the costs for water and wastewater manage-
tance of the “environmentally related taxes” for its 30 member
ment are combined into a single charge. The user pays for the
states. Table 10.2 A-C provides an overview of the taxes for
volume of water used, regardless of how it is used and pol-
selected countries, related to GDP, to total tax revenue and per
luted. In addition many water companies do more than simply
capita.
take care of water. They e.g. ferment their sludge to produce
biogas, which is sold, and they may use residual heat in waste- 10.3.2 Pollution Fees and Product Taxes
water e.g. by a heat pump to feed into the district heating. It is
Environmentally related taxes or fees are of several kinds.
not clear in which way the costs and gains from these activities
They include:
enter into the definition of the charges.
In general only small industries use municipal water and • Emission charges or fees, e.g. on emitted SOX.
municipal treatment plants. The larger industries most often • Non-compliance fees when exceeding permitted emis-
have their own water supply and thus are independent of the sions.
municipal policy for setting charges. The cost for their water • Product taxes on products causing an environmental
use is instead decided by the costs connected with fulfilling impact, such as fertilizers.
the conditions for water withdrawal and concentrations of pol- • Product charges on petrol.
lutant in the effluents as decided in their licences. But in case • Taxes for land-filling of waste.

140 economic policy instruments 10

A. Env. tax revenue per 1995 1999 2003 2004 The most direct form of environmental taxes is when a cost
GDP (%) is charged on emissions. The fee for emission of sulphur di-
Czech Republic 3.36 3.03 2.83 2.62 oxide provides an example. The taxation is done to stimulate
the reduction of emissions. Charges for SOX emissions should
Denmark 4.36 5.19 4.96 5.10
be compared to the cost of abatement. In this case it is rather
Finland 2.93 3.49 3.29 3.12
cheap to remove the SOX from the flue gases and, at least in
Germany 2.41 2.29 2.64 2.53 several countries, the taxes are more expensive. This means
Norway 3.54 3.26 2.98 3.03 that the taxation have been a rather efficient economic instru-
Poland 1.52 1.94 1.94 na ment to improve environmental protection. It is much less easy
Slovak Republic 2.41 1.99 0.14 na to abate NOX and the reduction of NOX in flue gases from in-
Sweden 2.92 2.88 2.95 2.88 dustry or car exhausts decreases more slowly.
An IPPC licence usually gives the right to a company to
United Kindom 2.93 3.21 2.68 2.65
emit a defined amount of each substance from its activity. If
United States 1.12 1.03 0.88 na
these amounts are exceeded the consequences is in the first
OECD average 1.94 1.89 1.73 na place a non-compliance fee. It is an economic instrument with
the purpose of reducing the likelihood of exceeding the al-
lowed amount. The non-compliance fee is often progressive,
B. Env. tax revenue per 1995 1999 2003 2004 that is, the first few kg or m3 are less costly and the additional
total tax (%) kg or m3 cost more.
Czech Republic 8.38 7.79 7.52 na Taxes may also be put on products, which will cause en-
vironmental impact. Most typical is the charge on petrol, but
Denmark 8.83 10.08 10.27 na
there are several other taxes. Artificial fertilisers have a tax
Finland 6.52 7.42 7.37 na
in Sweden, related to their nitrogen content. In this case it
Germany 6.30 6.07 7.44 na has been clearly shown that the use of fertilisers is depend-
Norway 8.52 8.07 6.86 na ent on the level of this tax. When it increases the amount of
Poland 3.83 5.54 5.67 na fertilisers decreases, which is exactly what the tax is meant
Slovak Republic na 5.79 na na to achieve.
Sweden 6.14 5.50 5.84 na
10.3.3 Taxes on Waste
United Kingdom 8.33 8.88 7.57 na
One of the environmental taxes, which have increased very
United States 4.07 3.56 3.46 na
considerably the last few years is a tax for landfilling. The base
OECD average 7.07 7.42 7.07 na is the year 1999 EU Landfill Directive, which aims at reducing
the waste ending up in landfill sites. For this reason a landfill
tax has been introduced. The present tax on landfilling waste
C. Env. tax revenue per 1995 1999 2003 2004 in Sweden is 435 SEK (50 Euro) and in England it is 24 GBP
capita (USD/cap) (36 Euro) per tonne. The level of the tax after its introduction
Czech Republic 169 162 251 274 in 2000 has increased yearly.
Denmark 1501 1687 1945 2288
Table 10.2 Revenues from environmentally related taxes. The
Finland 741 862 1024 1114 table gives data from countries in the Baltic Sea region and, for
Germany 724 588 781 845 comparison, data for the USA, UK, and average for the 30 OECD
countries. The tax-bases covered include energy products, transport
Norway 1189 1155 1440 1660 equipment and transport services, as well as measured or estimated
Poland 49 77 106 na emissions to air and water, ozone depleting substances, certain non-
Slovak Republic 82 74 na na point sources of water pollution, waste management and noise, in
addition to the management of water, land, soil, forests, biodiversity,
Sweden 794 817 993 1112 wildlife and fish stocks. A: Revenues in % of GDP. B: Revenues in
United Kingdom 568 800 814 950 % of total tax revenue. C: Revenues per capita in US Dollars. The
averages for 2003 and 2004 are calculated only across the countries
United States 310 342 332 na
for which 2003 and 2004 figures are available. [Source: EURO-
OECD average 597 619 725 505 STAT. http://www2.oecd.org/ecoinst/queries/]

10 economic policy instruments 141

 Specifically the Commission’s policy is that the amount of
biodegradable municipal waste (including household rubbish)
in landfill should be reduced by 35% by 2020 compared to that
of 1995. A main reason is to remove methane (a greenhouse
gas) emissions from landfills. Composting and subsequent use
for soil improvement is the preferred way. Composting is used
all through Europe especially in the old EU-15 countries. The
tax on landfill has again proved to be a very efficient instrument
to promote a long series of projects to reduce landfilling. Most
of these projects have been initiated and run by local authori-
ties. An important option is solid waste incineration, which is
increasing in Europe.
The taxes on landfilling have also stimulated the establish- Figure 10.1 The car and the environment. Car traffic is a burden
ment of a market for recycled materials, such as paper, glass on the environment in several ways. Climate change due to the use
and scrap metal. This has, in a very considerable way, changed of fossil fuels, air pollution, and the extensive infrastructure are
waste management in the European Union and in other parts of the dominating categories. Car traffic also is heavily taxed and in
fact contribute with about 85 % of all environmental taxes. (Photo:
the world. Other kinds of waste may also be reused. For exam- Credit © European Community, 2007)
ple volumes from building sites may be sent to road construc-
tions. Waste taxation is thus one of a number of regulatory and pean Union. Below we will see that there are rules for mini-
economic instruments, which have been introduced to stop the mum taxation of fossil fuels in Europe.
galloping amounts of waste in Europe, and change our “wastei- Energy taxes are fairly high. As an example the Swedish
sation” society into a society of good resource management. price on 1 litre of petrol in March 2007 had a total cost of 1.3
euros per litre, of which about 2/3 is tax. This level is normal
10.3.4 Energy Taxation for western European countries. In 2006 the Swedish petrol
Energy taxes are by far the oldest types of environmental tax- taxation totalled 41 billion SEK (4.4 billion Euro). Petrol taxa-
es. Energy taxation has been a main instrument for a number tion has since increased.
of purposes, the most important being:
10.3.5 Taxes on Fuels
• To reduce oil dependency.
A most important tax revenue provider is the fuel used for
• To reduce emission caused by power production.
transportation, personal as well as commercial. We will see
• To reduce car traffic.
below that about 2/3 of all environmental tax revenue is com-
• To increase fiscal revenues.
. ing from fuel taxation.
We will comment on each of these issues below to see to The EU-directive 2003/96/EC of 27 October 2003 sets
what extent they influence energy taxation. minimum rates of taxation for motor fuel, motor fuel for in-
Energy taxation is implemented for petrol and in general dustrial or commercial use, heating fuel and electricity (Table
for fossil fuels for cars, for oil used for heating purposes, for 10.3). The levels of taxation applied by the Member States
gas and coal used for the same purposes, as well as for elec- must not be lower than the minimum rates set in the Directive.
tricity. Energy taxation has not been introduced for interna- Under certain conditions, i.e. linked to product quality, quanti-
tional traffic, neither by boat nor by air. This is becoming an ty of energy used for heating purposes and e.g. for local public
increasingly serious drawback in efforts to reduce carbon di- transport, waste collection and ambulances, the member states
oxide emissions. An added problem is that international ferry may have differentiated rates. Further, certain exemptions and
traffic does not have to pay fees for using high sulphur oil and reductions are allowed in limited and very special cases. Oth-
is thus becoming a main contributor to aid rain. Some Baltic erwise the member states should comply with the minimum
Sea ferry companies use low-sulphur oil anyhow to improve price system, which has two stages, one to be implemented by
their goodwill, and due to customers requests. 1st of January 2004, while the second stage (applicable to mo-
Taxes are decided on nationally. They thus vary consider- tor fuels only) takes effect from 2010.
ably, but all member states in the European Union have energy These taxes will apply to and affect private households and
taxes. There have been efforts to harmonise energy taxes, and private transportation, including the costs for commuting. The
even more so, that there are carbon dioxide taxes, in the Euro- same is true about waste and water taxes, which are applied in

142 economic policy instruments 10

a number of member states, but with widely different amounts The registration tax on new cars is also counted as an envi-
among its members. ronmental tax. This tax varies very much across the countries
Fuel for commercial use, i.e. non-car-related use, is mak- with Denmark having by far the highest level of that tax in all
ing up about 6-8% of the household taxation. That is true also EU, making up 40% of all environmental taxes in Denmark.
for the fuel used for producing heat and electricity. This is the only reason why Denmark has the highest share of
environmental taxes to the GDP. Denmark would otherwise be
10.3.6 Car-related Taxes make up the Most close to the average level of environmental taxes.
A number of economic instruments have been introduced for More importantly, the registration tax should not be in-
car traffic. These have been motivated in at least three differ- cluded in the environmental taxes at all, as it has very little to
ent ways: do with protecting the environment and even in some respect
• Cars should pay their costs for investments in infrastructure. serves the opposite – it increases the pollution from cars. A
• Cars traffic should be moved over to public transport. high registration tax makes cars more expensive and hence
• Cars traffic should pay for their environmental impacts. makes people keep them longer, which make technological
innovations, i.e. more energy-efficient motors and lighter
The economic instruments include energy tax on petrol, materials, spread less quickly. Registration tax has no effect
registration tax (accis), and road tax. on how much you use your car. It is a “one-off” payment,
Petrol taxes started already in the 1970’s in many west- made when you buy the car. It may, on the contrary, again,
ern European countries, motivated by the search for means to prompt you to use your expensive investment even more to
ease the energy-dependency after the so-called oil price crisis. justify it.
When this after a few years had lost much of its impetus, the Till now, the dependence of the environmental taxation on
petrol taxes had at the same time become an important income car-related taxes becomes clear in Figure 10.2. It shows that
for the state. It was then convenient to be able to “rename” it 90% of the tax is related to cars. It is based on material from
“environmental”. Still, the effect in terms of reducing or keep- 1995, but the OECD underlines, that the overall picture is still
ing the use of petrol stable was there and a directional effect valid. Petrol and registration taxes make up about 70% of all
along the ideas behind the environmental taxation therefore environmental taxes collected within the OECD countries,
realized. while another 20% relates to cars as “recurrent taxes”. Some

Table 10.3 Minimum taxes for fuels/electricity in the EU. The table gives minimum levels for motor fuel, motor fuel for industrial or com-
mercial use, heating fuel and electricity according to EU Directive 2003/96/EC.
Minimum levels Kind of fuel Current minimum excise Minimum excise rates Minimum excise rates
of taxation for rates from 1.1.2004 from 1.1.2010
Motor fuels Petrol (/1,000 l) 337 421 421
Unleaded petrol (/1,000 l) 287 359 359
Diesel (/1,000 l) 245 302 330
Kerosene (/1,000 l) 245 302 330
LPG (/1,000 l) 100 125 125
Natural gas 100 (/1,000 kg) 2.6 (/gigajoule) 2.6 (/gigajoule)
Fuels for Diesel (/1,000 l) 18 21
industrial or Kerosene (/1,000 l) 18 21
commercial use
LPG (/1,000 kg) 36 41
Natural gas 36 (/1,000 kg) 0.3 (/gigajoule)
Heating fuels Diesel (/1,000 l) 18 21 21
and electricity Heavy fuel oil (/1,000 kg) 13 15 15
Kerosene (/1,000 l) 0 0 0
LPG (/1,000 kg) 0 0 0
Natural gas /gigajoule) - 0,15 0,3

10 economic policy instruments 143

Box 10.1 Environmental Taxes and Charges in Europe

Environmental taxes and charges are the most widely disposable cameras in Belgium; lubricant oil in Den-
used market-based instrument for environmental policy in mark (now abolished), Finland, Italy, Latvia, Norway,
Europe, despite current interest in trading schemes. They Slovenia, Spain and Sweden; and oil products (to
are generally seen as the most cost-effective instruments combat and compensate oil pollution damage) in Fin-
for environmental improvements. Below is a overview ex- land and France.
tracted from a 2005 EEA report on the application of en-
vironmental taxes, charges and deposit-refund schemes Waste
across Europe. It is not complete, e.g. some car-related User charges are in place in most EU Member States
taxes are not included. and Balkan as well as eastern European countries
and in the EFTA countries (Norway and Switzerland).
CO2 taxes There are waste taxes (landfill tax) in many EU Mem-
While attempts to introduce a CO2/energy tax at ber States; hazardous waste taxes or charges in a
the EU level have failed, CO2 taxes have been widely number of countries, notably Belgium, Denmark, Fin-
adopted in the Member States. The first CO2 tax was land, France, Germany and Poland; and differentiated
levied in Finland in 1990, and there are now CO2 taxes user charges in many municipalities in a wide range of
in Denmark, Finland, Germany, the Netherlands, Nor- Member States, with the aim of making this compul-
way, Poland, Slovenia, Sweden and the UK. Estonia sory across all municipalities in Ireland and Italy.
introduced a charge on CO2 emissions in 2000. These
taxes are often an additional tax levied on some en- Water
ergy carriers, not always differentiated according to User charges for water are in place for all EU Mem-
their carbon content, and with many exemptions. ber States and Balkan and eastern European countries,
though with different levels of cost recovery implicit in
Air pollution the price. There are water abstraction tax/charges in
A levy on NOX is in place in France, Italy and Sweden, Denmark, the Netherlands and the majority of the new
and SO2 levies are in place in Denmark, France, Nor- EU Member States and applicant countries; wastewater
way, Sweden and Switzerland. More comprehensive, tax/charge – effluent charges in several EU-15 Member
multi-pollutant systems of air pollution charging are States including Denmark, France, Germany and the
in place in some of the new EU Member States (such Netherlands, and in several new EU Member States
as the Czech Republic, Estonia, Latvia, Lithuania and and Balkan as well as eastern European countries.
Poland) and candidate countries (Bulgaria and Roma-
nia) as well as in the eastern European countries (such Fisheries
as Russia where more than 200 different air pollutants While not strictly speaking an environmental charge,
and around 200 water pollutants are subject to a pol- there are economic instruments that apply to fisheries.
lution charge). Switzerland has introduced a tax on The EU pays access charges on behalf of its long-dis-
volatile organic compounds (VOCs). tance fleet for access to the fisheries resources of some
third countries. In some cases, these countries also
Agricultural inputs levy additional charges directly on the boat owners.
There are taxes or charges on pesticides in Denmark, These may be flat rates or linked to catch levels. The
Norway and Sweden, and in Belgium, although not levying of charges on recreational fishing is common
on products used in agriculture; and on fertilisers in throughout the EU.
Denmark (tax on phosphorus in animal food), the
Netherlands (to be abandoned) and Sweden, and ear- Others
lier (now abolished) in Austria, Norway and Finland. Aggregates taxes, covering sand, gravel and/or
crushed rock, are in place in Belgium (Flanders), Bul-
Products garia, Denmark, Russia, Sweden, Ukraine and the UK.
There are taxes or charges on a wide range of pollut- In addition, there already are, or are seriously pro-
ing products, including: batteries in Belgium, Bulgar- posed, taxes/charges on: air transport (noise charge),
ia, Denmark, Italy, Latvia, Lithuania and Sweden, with chlorinated solvents, disposable tableware, light bulbs,
a takeback scheme in place in Austria, Germany and PVC, phthalates, junk mail; vehicle scrapping charges
Switzerland; plastic carrier bags in Denmark, Italy and (already in place in Norway, Slovenia and Sweden),
Ireland; disposable beverage containers in Belgium, electronic and electric waste (already in place in sev-
Denmark, Estonia, Finland, Latvia, Lithuania, Poland eral EU countries), nuclear waste management, and
and Sweden and deposit-refund schemes in Austria, air polluting emissions from incinerators.
Germany and the Netherlands; tyres in Bulgaria, Den-
mark, Finland, Latvia and Sweden; chlorofluorocar- Source: http://reports.eea.europa.eu/technical_report_
bons (CFCs) and/or halons in Latvia and Denmark; 2005_8/en/EEA_technical_report_8_2005.pdf

144 economic policy instruments 10

of this last 20% will be environmentally oriented, but the ma- Unlike the registration tax, a full replacement of annual
jor part will be related to road maintenance and construction circulation taxes by CO2-related taxes is not foreseen. As
etc. The same figures are not available for the EU-15. It would transportation is increasing and in all countries responsible for
probably show less dependency on the car for taxation, but the a substantial increase in energy consumption and hence in CO2
difference would be marginal. emission, and as car-related taxation makes up the most of all
environmentally related costs this proposed EU-regulation is
10.3.7 Making Passenger Car Taxation turning an important part of the car-related taxes into real en-
Environmentally Based vironmentally related taxation. The proposal relates to the two
The EU-commission has in the summer of 2005 presented dark columns in Figure 10.2 and affects thereby the base for
a draft directive on a gradual shift of registration tax for a about 1/3 of the total environmentally related tax revenue.
CO2-based taxation system for passenger cars, with the least Removing the registration tax will make it easier for more
CO2-emitting car models receiving the biggest tax rebate. The people to acquire a new and more energy efficient-car in those
reason behind the proposed directive is a mix of harmoniza- of the EU countries, which presently have a high registration
tion of the EU-internal market, needed because substantial tax. It might at the same time lead to more cars being sold
differences in registration tax across the member states hin- and thereby more kilometres driven and hence higher energy
ders cross border trade, and environmental concerns, referring consumption at the end. This is probably part of the reason for
not least to the compliance with the EU obligations under the the car industry being enthusiastic about the proposal. Still,
Kyoto Protocol. The proposed CO2-based taxation should be focusing on the CO2 emission will affect all cars and if made
tax revenue neutral. The registration tax should be abolished high enough, the tax could mean a change in both models
all together by 2016 and 50% of the revenue accounted for chosen by the consumers and gradually more focus at the
by CO2-taxation as early as 2010. The proposal also includes car industry on developing more energy-efficient cars. The
taxation for use of passenger cars, termed “annual circulation reason for “labelling” the proposal an internal market and an
taxes”. These taxes should be related to the CO2-emission of environmentally related piece of legislation has to do with the
the cars and reach the level of minimum 50% of all annual EU Treaty, demanding all taxation legislation to be decided
circulation taxes by 2010. upon unanimously. That has in taxation issues till now proven

Figure 10.2. Revenues raised

on different environmentally
related tax bases. The graph
shows estimates for the 30 OECD
member countries based on 1995
data. The data are in general
still valid with the exception that
taxes on the final handling of
waste have increased from 0.8%
in 1995 to 2.5% in 2001, and are
still increasing. Data shown in
million 1995 US dollars [Source:
http://www2.oecd.org/ecoinst/
queries/TaxInfo.htm]

10 economic policy instruments 145

impossible. Further, the proposal does not decide the level The largest-scale subsidy program is in the area of agricul-
of the taxes – only what kind of taxes are allowed and how ture. Thus subsidies constitute an important part of the income
they should be calculated or on what they should be based. for any European farmer, and decide much over what he/she
The proposed directive may therefore be decided upon by the does. If a farmer has animals or not, or grows certain crops
qualified majority decision-making procedure. rather than others, is decided by the European Union Com-
mon Agricultural Policy, CAP. Only recently, with the more
fundamental reshuffling of the CAP, the support for producing
10.4 Subsidies certain (amount of) agricultural products (e.g. meat, milk and
eggs) was changed to support for being a good farmer, keep-
10.4.1 Subsidies as State Support
ing your land in good agricultural and environmental condi-
Subsidies are the opposite of charges. While charges corre-
tions, so-called “cross compliance”. Like any other significant
spond to the ‘stick’, subsidies constitute the ‘carrot’ in the car-
change, this will take effect over 10 years. The EU legislation
rot and stick metaphor. Subsidies by the state are widely used
was decided upon in 2003 and till 2013 the amount of money
for a number of purposes, one of them being environmental
available for the CAP as a whole will be largely maintained.
protection.
The interesting issues are in the actual priorities and how they
Subsidies could be either direct or indirect. A direct sub-
will change during that period towards more environmental
sidy is for example when a state partially finances an invest-
protection and with a perspective of achieving sustainable ag-
ment, which the state considers important. An example from
ricultural production in the EU. But the instruments are here:
the environmental field is a wastewater treatment plant. For the
changing subsidies and not restructured taxation.
individual household state subsidies have been used for stimu-
The European Union structural funds have been an impor-
lating the change of heating equipment for individual houses.
tant part of financing investments in several areas, and have
Thus in Sweden the state pays a constant subsidy (3,000 Euro)
contributed to industrial development in these areas. The struc-
to those who change from direct electric heating or an oil-
tural funds have also been very important for infrastructure
fuelled boiler to an environmentally better heating mode, such
development, the building of roads, railroads and bridges. Of
as district heating, pellet-fuelled boiler or heat pump. Most
course such investments need to abide by the environmental
recently in spring 2007, the Swedish government introduced
legislation of the Union, but otherwise they are not particularly
a subsidy of 1,000 Euro for buying a so-called “green car”. A
geared towards environmental objectives.
green car is a car which has been labelled environmentally bet-
The European Union fund for improvements of environ-
ter by the road authority, for having low fuel consumption or
mental protection in its new member states is called Life. The
being a hybrid car or a car using ethanol or biogas as fuel.
Life programme supports investments for e.g. wastewater
An indirect subsidy is a reduction of costs for a certain ac-
treatment plants, solid waste management and the building of
tivity. For example tax reduction may be offered to a company
landfills. The Life programme is an important policy element
which invests in a region of the country, which is in need of
of the EU.
working places.
Subsidies are sometimes of key importance for a company
which needs to invest to change technology, which may be 10.5 Role of Environmental Economic Policy
required to obtain a permit or licence for an activity. It appears 10.5.1 Tax Revenue or Environmental Protection
that the Danish government used subsidies more than any oth-
While energy taxation till now has had little to do with pro-
er European government to improve environmental manage-
tection of the environment and has done little to implement
ment. In late 1998 there were a total of 36 subsidies schemes
the polluter pays principle as far as the wider social costs are
in effect in Denmark.
concerned, fuel-taxation has, of course, had some effect as to
In Central and Eastern Europe it appears that indirect sub-
putting some constraint on the consumption of fuel. But the
sidies, such as tax reduction, are more commonly used, for
fuel taxation has not been increased in accordance with the
stimulating investments asked for by the authorities.
rise in the GDP. The overall trend for the OECD-countries as
well as for the EU-15 is a relative decrease in the rate from
10.4.2 The European Union Subsidies Programmes 1998 and onwards, while the trend for the USA has been a
The European Union has established several huge funds for decrease all the way from 1994. The USA fuel taxation rate, at
promoting development in the so-called less developed areas of some 40% of the average for all OECD-countries, is in addi-
the Union, or stimulating certain activities rather than others. tion by far at the lowest level of all nations.

146 economic policy instruments 10

 While fossil energy is increasingly making up the main tection work, as these sums normally are far larger than the
problem for the environment, the presently dominating type fines charged for non-compliance.
of environmental taxation has little or no effect on redirecting
this adverse trend. Two recent EU-legislative initiatives may 10.5.3 Taxation does Reduce Pollution of the
signal that changes are gradually underway. One is the new Environment.
proposal for a directive on a passenger car taxation system The main effect of environmental taxes has thus been to reduce
with a clear CO2 and environmentally oriented aim, which we emissions, rather than to compensate the victim for his/her
dealt with just above. The other initiative is from 2003, where costs for the damages the emissions may cause. Good envi-
the directive, which will harmonize the minimum level for fuel ronmental taxes are set in such a way that it is more profitable
prices in the member countries, was decided. That may have to avoid emissions than to pay the fees. In these cases the in-
elements of equalization of the competitive framework with come from taxation decreases. This is caused by price elastic-
the EU, but it also has a distinct CO2-taxation orientation and ity. Price elasticity is how much consumption changes with
thereby an environmental perspective. This initiative on fuel the price. It is for prices with a high degree of elasticity that
prices we will include in the next chapter, where we will be the tax really contributes to changed behaviour. For commodi-
taking a closer look at the UN Climate Convention and the ties with less price elasticity, such as energy, the tax provides
subsequent Kyoto Protocol, based on the Convention in order more of an income for the state than an incentive for changed
to see, whether the protocol influences the CO2 or green house behaviour in the society.
gas policies in the EU and elsewhere. Taxation and fees have reduced pollution and the material
flows in our societies. The countries in Europe are slowly mov-
10.5.2 Do the Polluters pay? ing from waste to recycling societies. Important incentives in
What effects do the environmental taxes have? Have they this process are taxation of resources, fees on landfill, markets
moved the burden of paying costs for environmental impact to on recycled material, regulation on end-of-life of products in-
the polluter? Do they reduce environmental impact? cluding producers’ responsibility. These economic policy in-
It seems clear that environmental taxation never or very struments have had an influence on the price of the products
seldom makes the polluter pay for an environmental cost. The and stimulated environmentally better behaviour.
victim still has to take care of the cost of pollution. When acid
rain decreases the productivity of a forest, it is the owner of
the forest, who assumes the burden of decreased income. This
cost can be calculated with some degree of precision, and the
sums are very large. For example, the costs of all damage
caused by acid rain in all of European Union were estimated
in 1997 to be about 90 billion Euros. For sure those being
victim of these losses had to carry these costs, from owners
of forests to owners of individual cars destroyed by corrosion,
to authorities responsible for maintenance of damaged public
monuments etc.
There are a few cases, however, when the victim of an en-
vironmental impact does receive compensation. These are the
court cases where damage compensation is part of the case.
They all deal with very direct damages, e.g. an oil spill or a
large sudden emission of a toxic substance, not at all with dif-
fuse or long-term effects. Examples are the Seveso disaster or
oil spills in the Baltic Sea. It should be added that only few of
these kinds of events lead to compensation of costs. In general
it is too difficult or costly to charge the polluter. To see charges
filed against emitters of diffuse pollution is even further away.
Damage compensation is decided on by a criminal court, and
thus not part of the environmental legislation as such. Never-
theless it has an important role to play in environmental pro-

10 economic policy instruments 147

Study Questions Abbreviations
1. What is an external cost, and in what way is it external to CAP Common Agricultural Policy
the declared cost of a product or service? CFC Chlorofluorocarbons
2. The polluter pays principle is a main principle for de- EEA European Environmental Agency
veloping environmental taxes and charges. Describe its EFTA European Free trade Association
history and how it has been received in policy-making. Eurostat EU Statistics Bureau
3. Make a small list of the most common environmental GBP British Pound
charges for water, waste, etc. How are the charges set? GDP Gross Domestic Product
What are the problems connected to setting charges? IPPC Integrated Pollution Prevention Control
4. What are the reasons for introducing environmental taxes? LPG Liquid Propylene Gas
5. List the most used environmental taxes and explain which OECD Organisation for Economic Co-operation and
are most important for the state (for state income), for Development
companies (for company costs), and the environment (for PPP Polluter Pays Principle
reducing environmental load). What is the general level of SEK Swedish Crowns
environmental taxes compared to taxes as a whole? VOC Volatile Organic Compounds
6. Would people act rationally and purchase the least envi-
ronmentally damaging products, if such products were
least expensive, or would some products still signal great Internet Resources
prestige and thereby still be selling greatly, in spite of a Polluter pays principle (Encyclopedia Britannica)
high price – or perhaps because of their high price? http://www.britannica.com/eb/article-224615/environmental-law
7. Consider the alternatives to a registration tax on cars.
Would it benefit the environment if user fees were set in OECD/EEA database on environmental policy and natural
relation to the use of cars instead of a tax on the purchase resources management instruments
of cars? http://www2.oecd.org/ecoinst/queries/
8. Explain in what way energy is taxed and what importance
it has had for energy management in society for industry, OECD/EEA information on environmentally related taxes, fees
transport, and in households. and charges
9. Give some examples on the use of subsidies in environ- http://www2.oecd.org/ecoinst/queries/TaxInfo.htm
mental policies.
EEA report on environmental taxes, and charges, deposit-
10. Give a general summary on the role of economic policy
refund schemes
instruments for environmental improvements. Mention
http://reports.eea.europa.eu/technical_report_2005_8/en/EEA_tech-
specifically the Polluters Pays Principle, environmental nical_report_8_2005.pdf
pollution, and resource management.
Ecological Economics A Cross-Disciplinary Conversation
http://forestpolicy.typepad.com/ecoecon/2006/03/economism_or_
pl.html

European Commission’s Taxation and Customs Union

Directorate-General
http://ec.europa.eu/taxation_customs/taxation/excise_duties/en-
ergy_products/index_en.htm

EU Summaries of Legislation Framework for the taxation of

energy products and electricity
http://europa.eu/scadplus/leg/en/lvb/l27019.htm

DG Agriculture EU’s common agricultural policy (CAP)

http://ec.europa.eu/agriculture/publi/capleaflet/cap_en.htm

148 economic policy instruments 10

 Market-based Economic
Instruments
Emission Trading
11
11.1 Making Business of the Environment 11.1.2 Economic Tools Using Market Mechanisms
11.1.1 The Role of Markets in Environmental The most obvious tool for markets is when a resource has a
Protection price and there is a buyer and a seller. The best examples are
The most natural economic instruments for business, including when a company may improve the environment by turning
industrial companies, are market-based ones. If resources and waste into a resource via regenerating and recycling schemes
environmental services are bought and sold just as other items for (previous) waste material. The simplest examples are the
a company manages, it is easy to include them in normal op- recycled materials, such as paper, glass or scrap metal. The
erations. As mentioned in Chapter 10 it is not possible to give market for waste will be described below. Another, less com-
all environmental services and resources a correct price and mon, case appears in what is called industrial symbiosis. In
thereby introduce them to a functional market. They remain
external to the operations. In these cases economic instrument
such as taxes, fees or subsidies are used, or regulations are In this Chapter
introduced to correct behaviour, which does not relate to the
economy naturally. However in other cases markets, where 1. Making Business of the Environment
services or resources are bought and sold, do work. This is the The Role of Markets in Environmental Protection
Economic Tools Using Market Mechanisms
topic of this last chapter. A Market for Waste
It should be mentioned from the beginning that the use 2. Emission Trading
of a market as a frame for economic transactions and deci- The First Experiences
sion-making is limited, not only in environmental matters but Trading Emissions Under the Climate Convention
in general. Market values are not used in for example a fam- The EU Obligations in the Kyoto Protocol
EU Emission Trading Scheme (EU-ETS)
ily economy or for that matter in a national economy. Values
3. Implementing the Emission Trading
other than money are much more important and the price is Assessment of Allowances
not so relevant or simply does not exist. For example health, The Results of Trading in the First Period
the desire for a good life or where to live are values which Following Periods – Beyond the Industrial
steer the decisions individuals and families take, and e.g. se- Installations
Policy Measures – the EU Linking Directive.
curity may be the more important for a nation than economic
4. Climate policy and Sustainable Development
development. Growth Versus Emissions
Nevertheless, when market mechanisms can be used, they IPCC 4th Assessment Report – Taxing Carbon
are simple and, if the prices are right, they should at least Sustainable Development and the Concept of
theoretically lead to the right decision, optimising all aspects an Ecological Tax Reform
which need to be considered in a process, including the protec- Towards a Sustainability Regime
tion of the environment.

11 market-based economic instruments 149

this case one industrial plant sells an output which normally is of copper from scrap metal compared to virgin copper is about
not seen as a product, such as energy in the form of hot water 30 times, for iron it is about six times. In a time when much
or steam, to a neighbouring activity, most often another indus- effort is made to increase energy efficiency to reduce carbon
trial plant. Some industries sell excess heat to the municipality dioxide emissions, this is obviously very important.
where they are located, for use in district heating (See further The introduction of collection and recycling of used paper,
book 2 in this series). glass, metal etc was mentioned in chapter 4. Packaging waste
Another case is when a service is charged on more or less makes up an important part of the glass and metal waste, not
commercial conditions. The services from municipalities for least in the form of beverage containers. Packaging waste is
management of water, waste or energy belong to this category. regulated by the European Parliament and Council Directive
The deviation from market conditions is of course the fact that 94/62/EC of 20 December 1994 on packaging and packaging
the provider, the municipality, in reality often has a monopoly, waste. It distinguishes between ‘reuse’, ‘recovery’ and ‘recy-
so that there is no well functioning market. It is, however, not cling’ in this order of priority and includes minimum targets of
always so. A company may find another solution if the serv- 50-65% of all packaging waste to be dealt with in either way
ice offered by the local or regional authority is considered too by the member states. The directive authorizes use of Agree-
costly or not good enough for the needs at hand. For example ments with the relevant companies and/or business sectors as a
most industrial plants provide their own source of water, rather possible instrument for reaching the targets set.
than buying it from the municipal water company. The charges The Directive opens (article 7) for use of deposit and re-
for such services were discussed in the previous chapter. funds systems to be used primarily with the general public as
To sell or buy the right to emit a certain amount of pollutant an incentive to return e.g. beverage containers but also used
has been implemented for carbon dioxide as will be described cars and other waste. Sweden has a well-elaborated deposit
below. Again a market is established. The interesting aspect of and refund system and manages to get more than 90% of alu-
this way to deal with environmental impacts is that it is pos- minium containers returned, while the return level in countries
sible to find out how much the environment can handle of each without the deposit-refund component is much lower.
specific pollutant. The total amount, the ceiling, of each spe- Environmental Agreements are used with companies and
cific pollutant should in principle be established. Then it is up industrial sectors also on other types of waste than packaging
to those who pay most to use this capacity of the environment. waste.
However, on the existing emission markets the ceiling is not The simple establishment of business operations for pro-
established on the basis of the capacity of the environment, but viding basic services in the sector of waste and solid waste
rather the capacity of industry to reduce its emissions. management and the use of recycled material has been very
important for a good environmental policy.
11.1.3 A Market for Waste
Some categories of waste can be sold; they have a market val-
11.2 Emission Trading
ue. This includes used paper, glass, and scrap metals but also
some plastics. The establishment of a market for recycled ma- 11.2.1 The First Experiences
terials and goods has been very important for the improvement Tradable pollution permits are an alternative to setting emis-
of the environment, and the market for recycled materials is sions standards or using pollution fees. The tradable pollution
a key economic instrument. Today close to half of the paper permits involves the establishment of a trading system for the
produced in the European Union comes from recycled paper. “right to pollute”. It may be used among those living along
A cellulose fibre can be used about six times before being too a coast or a river, which has the capacity to adsorb a certain
short to be suitable for making paper. It is obvious that very amount of exhausts, or more commonly among those emitting
many trees have been saved by this recycling of paper. Very pollutants to the air in a region.
important, too, is that a huge reduction of energy use and pol- The use of pollution rights to be sold and bought on a mar-
lution is the result of recycling. ket was first proposed in 1968 by the American economist
A similar comment can be made both regarding glass and Herman Daly. This arrangement became quite popular in the
metal. Close to 50% of glass production in the European Un- USA, in which several such markets have been established. It
ion is based on recycled glass and a sizeable amount of the is mostly used for air pollutants. A condition is that it is not so
iron, copper and aluminium production. In both cases the big important exactly where the pollutant is emitted.
gain is connected to reduction of the energy required. For the The first European case seems to be that of the Polish city
case of copper the reduction of resource use for the production of Chorzow in Upper Silesia, where a trading scheme was

150 market-based economic instruments 11

established between just two industries. One steel mill was piece by piece, have formed one of the most efficient conven-
in bad economic conditions with many emissions, but where tions ever created. The 3rd COP in Kyoto, Japan, in 1997 was
these could be reduced by rather inexpensive actions. The other especially fruitful since the levels for decreased emission of
factory was in good economic conditions, but the reductions CO2 for the so-called Annex 1 states, basically the industrial-
of emission would be comparatively expensive. The common ised countries, were detailed in its protocol.
trading scheme was successful and dramatic reductions in emis- The Kyoto protocol states that by 2010 (as the average of
sions of particles, CO, SO2, NOX and VOC were achieved. the 2008-2012 window), the parties should have decreased
The Polish scheme constituted a quite local so-called bubble. their CO2 emission by an average of 5.2% as compared to the
The maximum concentrations or amounts allowed according to chosen base year of 1990. The commitments were unevenly
the scheme set up by the authorities is called the ceiling. distributed and for the European Union members it was -8%,
The largest scale emission trading ever established is the for the USA -7% and Japan -6%.
EU carbon dioxide emission trading which we will now de- The Kyoto protocol entered into force on the 16th of Feb-
scribe in some detail. ruary 2005 after the Russian Federation had ratified the proto-
col as one of more than 150 States. Thereby countries, repre-
11.2.2 Trading Emissions Under the Climate Convention senting the requested 55% of the 1990-emission of CO2, had
The Framework Convention on Climate Change, FCCC, was ratified the protocol, which was made a precondition for its
signed during the UNCED Rio Conference in 1992 by 153 par- entering into force. The USA, responsible for about 35% of
ticipating states. It entered into force in March 1994. Its inten- the global CO2-emission, is now the only major state, which
tion was, and is, to stop climate change by reducing combus- has not ratified the protocol.
tion of fossil fuels and the resulting green house gas emissions, Later key COPs were the one in Marrakesh in which the
but exactly how to do it was then left to further developments. so-called Clean Development Mechanisms measures were
A series of COPs (Conference of Parties) were staged, which, agreed on, and the one in Montreal, Canada, in which a sanc-

Figure 11.1 The distance-to-target indicator (DTI) measures for the Kyoto obligations. The table shows the deviation of actual emissions
in 2003 from a (hypothetical) linear path between base-year emissions and the burden-sharing target for 2010. A positive value suggests an
under-achievement and a negative value an over-achievement by 2003. The DTI is used as an early indication of progress towards the Kyoto
and Member States’ burden-sharing targets (Source: EEA, 2005).

11 market-based economic instruments 151

tion system was outlined making the Climate Convention close multi-national emission-trading scheme worldwide. It can be
to becoming a real global legal regime. considered as a forerunner for the global emission trading
scheme, foreseen in the Kyoto Protocol, but not realized till
11.2.3 The EU Obligations in the Kyoto Protocol. now, as the protocol has just entered into force. The EU-ETS
The EU member states (then the EU-15) have, as mentioned, is prepared to become an integrated part of a future global sys-
made a joint plea for a reduction in CO2 discharge of 8% by tem under the protocol.
2008-2012. The obligations were subsequently distributed The principle of the ETS is to help make sure, that CO2
among the member states with variations from reductions emission reductions take place at installations or companies,
of 21% (Germany and Denmark) to an increase of 15-27% where these savings can be made at the lowest costs. The ETS
(Spain, Greece and Portugal). The 10 new member states had does that by providing a framework or a marketplace for buy-
individual CO2 targets, set under the Kyoto Protocol. They have ing and selling allowances for emissions. In this way those
between 6% and 8% reduction targets relative to the 1990-base able to make savings for low costs can go further than they
line. As these countries have seen a profound economic re- need to meet their own target and sell the allowances via the
structuring over the 1990s with closure of a number of energy ETS to those which need high investments to meet their target.
consuming industries, this reduction has been met – and more These last types of installations will then buy allowances to
so – by this very economic restructuring. But the countries cover what would otherwise bring them into exceeding their
need to regain lost levels of economic performance and, in ad- number of allowances, and face penalties.
dition, continue to develop their economies to improve living The EU-ETS is based upon allocation of emission allow-
conditions for their citizens, which may lead to some addition- ances to 11,500 energy intensive industrial companies and in-
al CO2-emitting activities. This was an important part of the stallations across EU like electrical power plants, oil refineries,
reason to become members of the EU anyway. A joint EU-25 iron and steel plants as well as factories e.g. making cement,
plea on CO2 emissions is therefore not foreseen. glass, bricks and pulp and paper. Together they account for
Concerning the implementation of the Kyoto targets the about half of the total CO2 emissions within the EU.
EU-15 are behind schedule. Some of the countries are at this Each of these 11,500 energy intensive installations re-
stage already unable to reach their targets, regardless of the ceives an emission allowance when the trading begins. The
(realistic) measures they might introduce for the remaining allowances were first negotiated between the EU member
period up to 2012. states. Then the national allowances were distributed between
An EEA-report (Figure 11.1) shows substantial difference the listed installations. This way to distribute allowances is
among the EU-15 countries as to attaining their target levels. commonly called grandfathering, since it is decided on from
The distance-to-target indicator (DTI) measures the deviation “above”, rather then bought, for example in an auction of
of actual emissions in 2003 from a (hypothetical) linear path emission rights.
between base-year emissions and the burden-sharing target for The allocation of allowances is based on a National Alloca-
2010. A positive value suggests an under-achievement and a tion Plan (NAP), made by each member state and specifying
negative value an over-achievement by 2003. The DTI is used for each installation the number of tons of CO2 emissions allo-
as an early indication of progress towards the Kyoto and Mem- cated. The national plans are then checked and approved by the
ber States’ burden-sharing targets. For the following Member EU-Commission. There are three trading phases foreseen – the
States the additional effects of the use of Kyoto mechanisms first in 2005-2007, due May 2004, the second in 2008-2012,
are included: Austria, Belgium, Denmark, Finland, Ireland, due June 2007, and the third, starting 2013. Each of these will
Italy, Luxembourg, the Netherlands and Spain. Additional start with a total amount of CO2 allocated. For each new phase
measures are planned or already implemented to help those the total amount will be reduced substantially.
countries lagging behind – and thereby the EU as a whole – The ET scheme has disadvantages in as much as it does
fulfilling or at least come closer to their target levels. The most not lead to any CO2-emission reduction, neither short term nor
significant initiative, already implemented, is the EU Emission long term. On the contrary, it leads to the use of a quota in the
Trading Scheme. short term which should only have been used later in accord-
ance with the actual economic development within the coun-
11.2.4 EU Emission Trading Scheme (EU-ETS) try, possessing it or – may be – never been used at all. This is
The EU Emission Trading Scheme (EU-ETS) is an internal why this Kyoto Protocol ET-scheme has been named “trading
EU-emission trading system among the 25 EU member states. warm air”, i.e. trading emission reductions which are not real
It was established by Directive 2003/87/EC and it is the first or nothing at all. There are different demands for a maximum

152 market-based economic instruments 11

Box 11.1 Exemplifying the ETS Working Principles

Let’s say that companies A and B both emit 100,000 costs are 5 (i.e. lower than the market price). Company A
tonnes of CO2 per year. The government gives each of will reduce its emissions, because it is cheaper than buying
them 95,000 emission allowances. One allowance rep- allowances. Company A may even reduce its emissions by
resents the right to emit 1 tonne of CO2. So, neither more than 5,000 tonnes, say 10,000 tonnes. For Company
company is fully covered for its emissions. At the end of B, the situation may be the opposite: its reduction costs are
each year, the companies have to surrender a number of 15 (i.e. higher than the market price) so it will prefer to buy
allowances corresponding to their emissions during the allowances instead of reducing emissions.
year, whatever the emissions of the individual company Company A spends 50,000 on reducing 10,000
are. If they fail to do so, they face a fine of 40 per miss- tonnes at a cost of 5 per tonne and receives 50,000 from
ing allowance during the 2005-2007 trading period, and selling 5,000 tonnes at a price of 10. So Company A fully
100 during the second 2008-2012 trading period. Com- offsets its emission reduction costs by selling allowances,
panies A and B do not want to pay the fine and both whereas without the Emissions Trading Scheme it would
have to cover 5,000 tonnes of CO2. They have two ways have had a net cost of 25,000 to bear. Company B spends
of doing this. 50,000 on buying 5,000 tonnes at a price of 10. In the ab-
They can either reduce their emissions by 5,000 sence of the flexibility provided by the Emissions Trading
tonnes, or purchase 5,000 allowances in the market. In Scheme, company B would have had to spend 75,000.
order to decide which option to pursue, they will com- Since only a company that has low reduction costs
pare the costs of reducing their emissions by 5,000 tonnes and therefore has chosen to reduce its emissions, like
with the market price for allowances. Company A, is able to sell, the allowances that Company
For the sake of the example, let’s say that the allowance B buys represent a reduction of emissions, even if Com-
market price is 10 per tonne of CO2. Company A’s reduction pany B did not itself reduce emissions.

amount of a total quota to be sold to make sure that a country is When the ETS is running, the member states will oper-
not, in the short term, selling so much that it will get in trouble ate an electronic registry of allowances to be able to follow
fulfilling its own obligation towards the Protocol later, when it the transfers of allowances, which takes place via the ETS in
has eventually had got the economy better under way. order to be able to keep track of where all national allowances
belong at any possible time. The EU Commission is running a
registry hub to be able to monitor, that the trading and transfer
11.3 Implementing Emission Trading
of allowances are in line with the directive.
11.3.1 Assessment of Allowances The member states will collect allowances, which have to
There are 12 criteria, listed in Annex 3 to the Directive, for the be given up by the installations in accordance with the alloca-
assessment and approval of the national plans by the EU Com- tion plan, and distribute allowances to new installations, being
mission. The first and most important criterion is, that the al- set up. It’s also the member state responsibility to collect the
lowances allocated in the NAP makes it possible for that state data that each installations is obliged to produce currently on
to fulfil its obligation towards the Kyoto Protocol. This will its CO2 emission to prove that it stays within the allowances
for most member states eventually mean, that the allowances received. Finally, the member states will make a report annu-
in total will have to be smaller than the total present emission, ally to the EU Commission on the operation of the system,
as most member states have obliged themselves to bigger or including the emission data collected.
smaller reductions. Under the Kyoto Protocol, the EU-15 has to reduce its col-
The Commission demanded changes in 8 of the 25 mem- lective greenhouse gas emissions by 8% below 1990 levels
ber state NAP’s for 2005-2007 with the following three types during 2008-2012. This target is shared among the 15 Mem-
of problems as the main issues: ber States under a legally binding burden-sharing agreement
[Council Decision 2002/358/EC of 25 April 2002]. The major-
1. Allocations made it impossible to meet the Kyoto targets.
ity of the Member States that joined the EU on 1 May 2004
2. Allocations exceeded current emissions.
have individual targets under the Kyoto Protocol with the ex-
3. Reservations for redistribution of allowances after start of
ception of Cyprus and Malta, which have no targets.
the EU-ETS, so called “ex-post adjustments”, which are
not acceptable.

11 market-based economic instruments 153

11.3.2 The Results of Trading in the First Period total CO2-emission in EU. Other important factors are trans-
The first phase began on 1 January 2005. In its first year, 362 portation, household and agriculture. Directive 2003/96/EC
million tonnes of CO2 were traded on the market for a sum of establishes a common minimum taxation level on all kinds
7.2 billion euros. The price of allowances increased more or less of fuels for private and commercial use (transport, industrial
steadily to its peak level in April 2006 of ca. 30 euros per tonne applications, machinery used in forestry and agriculture). It
CO2, but came crashing down in May 2006 to under 10 euros/ raises the minimum taxation level by some 25% from 2004
ton when it became clear that many countries had given their – for petrol from 359 to 421 euros/1,000 l, while a second
industries such generous emission caps (limits) that there was stage, decided for 2010 only means a rise for few fuels.
no need for them to reduce emissions. The prices then continued The second phase (2008-12) is expected to expand the
to drop through 2006 resulting in a trading price of 1.2 euros scope significantly:
per tonne in March 2007 (Figure 11.2). NGOs have accused • All greenhouse gases, and not only CO2 will be included.
governments of abusing the system under industry pressure, and • CDM and JI credits are expected to be introduced in sec-
have urged far stricter caps in the second phase (2008-2012). ond phase through the Linking Directive.
Still during 2006 the total turnover of emission rights was 22.5 • Aviation emissions will likely be included.
billion euros and 1.6 billion tonnes of CO2. The Norwegian • Four non-EU members – Norway, Iceland, Liechtenstein,
Consultancy Point Carbon reports that projected carbon trad- and Switzerland – are expected to join the scheme.
ing for 2007 is 2.4 billion tonnes, and that the projected price
for 2008 is 13.8 euros/tonne CO2, a figure used when planning The inclusion of aviation is a move considered important
investments in European industry. due to the large and rapidly growing emissions of that sector.
Presently an estimated 4,000 projects to reduce emissions are The inclusion of aviation is estimated to lead to an increase in
under way in Europe corresponding to total annual reductions demand of allowances of about 10-12 million tonnes of CO2
of 2 billion tonnes of CO2. The reported carbon trading is to a per year in phase two. This in turn is expected to lead to an in-
large extent financially motivated and corresponds only partly creased use of JI credits from projects in Russia and Ukraine,
to actual reductions. Equally the planned projects are partly which would offset the increase in prices and eventually result
CDM projects, which neither corresponds to emission reduc- in no discernible impact on average annual CO2 prices.
tions within the European Union, although they are included in Ultimately, the Commission wishes the post-2012 ETS to
the Kyoto obligations. include all greenhouse gases and all sectors, including aviation,
maritime transport and forestry. For the transport sector, the
11.3.3 Following Periods – beyond the Industrial large number of individual users adds complexities, but could
Installations be implemented either as a cap-and-trade system for fuel sup-
Establishing the EU-EST is an important step forward in the pliers or a baseline-and-credit system for car manufacturers.
efforts to attain the reductions which the EU-15 (and the 10 The National Allocation Plans for Phase II, the first of
new members individually) undertook. But the installations, which were announced on November 29, 2006, will result in
which the scheme deals with makes up less than 50% of the an average cut of nearly 7% below the 2005 emission levels.
Development of EUA Prices

35
30

25
20
15
Figure 11.2 Prices of carbon emissions in Euros/
10 tonne at the European carbon pool of the EU-
5 ETS. Carbon Pool Europe provides access to the
carbon market that companies need to be able to
0
actively take part in the EU-ETS. The Carbon Pool
31.08.2005
26.11.2004

28.07.2005

04.10.2005
07.11.2005

07.06.2006
26.10.2004

03.01.2005
04.02.2005

13.01.2006

27.04.2006

11.07.2006
17.08.2006

24.10.2006
15.04.2005

09.12.2005

16.02.2006
22.03.2006

20.09.2006

28.11.2006
04.01.2007
10.03.2005

23.05.2005
24.06.2005

13.03.2007
07.02.2007

in an international trading platform for EU allow-

ances valid under the EU-ETS. The Carbon Pool
website will report daily spot prices for carbon
emissions (http://www.carbonpool.eu).

154 market-based economic instruments 11

11.3.4 Policy Measures – the EU Linking Directive to take place in the Central and Eastern European transition
Directive 2004/101/EC is called the linking directive because economies, where the scope for reduction is high and at lower
it was made to create connection between the EU-ETS and the costs than in the western economies.
“project-based mechanisms” in the Kyoto Protocol. The next mechanism is the Clean Development Mecha-
One of these mechanisms is Joint Implementation Projects nism (CDM), regulated in article 12 of the protocol. It is de-
(JI), regulated in article 6 of the protocol. It allows industri- signed to make industrialized countries invest in CO2 reduc-
alized countries to do joint projects with other industrialized tion projects in developing countries, and grants the investing
countries on at source reduction of CO2 emissions and on cre- country the right to include documented reductions in its own
ating sinks for the deposit of CO2 and let the investing country CO2-reduction budget. This mechanism was established, ex-
count the reduction achieved as its own reduction and thereby plicitly recalling the need to promote equitable geographic
serve as part of the investing country’s compliance with the distribution of CDM’s at regional and sub-regional level. It is
Kyoto Protocol. This kind of projects are first of all expected underlined that CDM-projects cannot be funded by develop-

Table 11.1 Overview of total Allowances for the three years 2005-2007 and Kyoto targets across member states. Divide by 3 to receive
annual average. Opt-ins and opt-outs of installations in accordance with Article 24 and 27 of Directive 2003/87/EC (later used by Sweden,
Finland and Estonia) are not included. Under the Kyoto Protocol, the EU15 has to reduce its collective greenhouse gas emissions by 8% below
1990 levels during 2008-2012.
Member State CO2 allowances in Share in EU Installations Registry functional Kyoto target
mio. tonnes allowances covered
Austria 99.0 1.5% 205 Yes -13%*
Belgium 188.8 2.9% 363 No -7.5%*
Czech Republic 292.8 4.4% 435 No -8%
Cyprus 16.98 0.3% 13 No -
Denmark 100.5 1.5% 378 Yes -21%*
Estonia 56.85 0.9% 43 No -8%
Finland 136.5 2.1% 535 Yes 0%*
France 469.5 7.1% 1,172 Yes 0%*
Germany 1,497.0 22.8% 1,849 Yes -21%*
Greece 223.2 3.4% 141 No +25%
Hungary 93.8 1.4% 261 No -6%
Ireland 67.0 1.0% 143 No +13%*
Italy 697.5 10.6% 1,240 No -6.5%
Latvia 13.7 0.2% 95 No -8%
Lithuania 36.8 0.6% 93 No -8%
Luxembourg 10.07 0.2% 19 No -28%*
Malta 8.83 0.1% 2 No -
Netherlands 285.9 4.3% 333 Yes -6%*
Poland 717.3 10.9% 1,166 No -6%
Portugal 114.5 1.7% 239 No +27%*
Slovak Republic 91.5 1.4% 209 No -8%
Slovenia 26.3 0.4% 98 No -8%
Spain 523.3 8.0% 819 Yes +15%
Sweden 68.7 1.1% 499 Yes +4%*
United Kingdom 736.0 11.2% 1,078 Yes -12.5%*
Total 6,572 100.0% 11,428

11 market-based economic instruments 155

 Index (base year = 100)
Figure 11.3 EU-15 Green- 120
house gas emissions 1990–2004
compared with target for
2008–2012. The linear target 110
path provides a simple measure
of how close the EU-15 emissions
in any year are to the linear path
from emissions in 1990 to the EU 100
Kyoto target, represented by 92 98.0
percent of base-year emissions
in 2010. The presentation does
not take into account the use of 90 92.0
flexible mechanisms or activities
under Article 3, land-use change,
on the Kyoto Protocol. The unit is
80
index points with base-year emis- 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
sions being 100. [Source: EEA,
Greenhouse gas emissions GHG target 2010 Target path 2010
Technical report 10/2006]

ment aid budgets in the industrialized country, but should be

11.4 Climate Policy and Sustainable
funded, provided extra and for the benefit of the particular
Development
CDM project. 11.4.1 Growth Versus Emissions
Finally, Emission Trading (ET) is opened in the protocol The data provided show, that there is a long way to go on the
by article 17. The trade is limited to take place between coun- climate policy issues to reach the goals set – for EU-15 a joint
tries, which have got an emission limitation that is a CO2 quota reduction on 8% by 2012 of the 1990-CO2 emission level. The
in Annex B to the Kyoto Protocol. In practice this means that IPCC 4th Assessment Report, released 4th of May 2007 un-
countries, which had a quite high CO2 emission in the base line derlines the problems, the current situation and recent trends.
year of 1990 and since then have undergone serious economic CO2 emissions have grown between 1970 and 2004 by about
restructuring and transformation and therefore presently and 80%, and 28% between 1990 and 2004. The growth is dif-
within the 2012 target year will have an emission allowance ferent across sectors. The energy supply sector has increased
surplus, can sell (part of) this surplus to industrially developed by 145% and transport by 120%. (IPCC, Working Group III,
countries needing to reduce their emission. Most former So- 2007). The problems within the EU-15 is illustrated in Fig-
viet Republics and some non-EU member states in Central and ure 11.3, showing the considerable deviation from the path
Eastern Europe have such a quota-surplus. The country buying towards the intended reduction.
emission quota or emission units from a country with a quota The 2nd phase of the EU-ETR will mean some reductions
surplus can use the units bought in its own reduction budget. in the caps for the NAP’s and thereby for the total of EU-25.
The Linking directive is only regulating the relation to and Till now about 20 of the 25 NAP’s for the 2nd phase are ac-
use of the JI and CDM, because EU itself has set up the in- cepted by the EU-commission. It will lead to a reduction in
ternal Emission Trading Scheme (see section 11.3.4 above), the overall level of CO2 emissions from the EU-25. It is there-
which has a clear CO2 emission reduction perspective, under- fore responding to widespread criticism that the 1st phase caps
lined by the joint EU-15 plea towards the Kyoto Protocol for were far too lax, voiced by NGO’s and others. But it will not
a joint total emission reduction of 8%. That is not possible bring about the reduction needed for the EU-15 to reach their
to achieve by trading – short-term – surpluses among these committed goal of the 8% reduction by 2012, while the situ-
same 15 countries. That can only be achieved by own reduc- ation is more mixed for the EU-10 (and now EU-12) having
tions, and the EU-ETS is designed to support these efforts. The joined the EU within the last 3 years.
EU-Directive on ETS declares itself open to negotiations and The EEA Report 1/2005 (EEA, 2005) ‘Climate change and
possible joining of the EU-ETS and the Kyoto Protocol ET at a European low-carbon energy system’ is a very comprehen-
a later stage, when the Kyoto-ET is up and running, i.e. estab- sive and interesting analysis of the options available to the EU
lished, based upon the same concept of contribution towards (EU-15 and EU-25/27) in order to fulfil the Kyoto-protocol
emission reduction as is the EU-ETS. obligations as well as the 2030 and 2050 requirements to stabi-

156 market-based economic instruments 11

 GtCO2-eq Figure A GtCO2-eq Figure B
35 35 Figure 11.4. Global economic mitiga-
30 30 tion potential in 2030. The potential
reduction of carbon dioxide emissions
25 25
at three different levels of carbon pric-
20 20 es: 20 USD, 50 USD and 100 USD/t
15 15 CO2-eq. The bottom-up study (left)
represents sector-based estimations.
10 10
The top-down study (right) assesses
5 5 the potential through economy-wide
0 0 mitigations options. The top-down
low end of range high end of range low end of range high end of range model has been the base for the studies
<0 < 20 < 50 < 100 US$/CO2-eq < 20 < 50 < 100 US$/CO2-eq on mitigation options and macro-eco-
nomic assessments.

lize the CO2 concentrations in the atmosphere below 550 ppm. options. The top-down model has been the base for the studies
The analyses and the results in the report are very much in line on mitigation options and macro-economic assessments.
with the recent IPCC 4th Assessment Report, including the The estimation in the report of the macro-economic conse-
calculation of the growth and general costs, this will mean for quences of stabilizing the level of atmospheric CO2 between 445
the EU member countries. and 710 ppm CO2-eq in 2030 is a reduction in the average annu-
Extensive use of the connected policies in Directive al GDP-Growth between 0.06-0.12 percentage points. It is con-
2004/101/EC (the linking directive) on Joint Implementa- sidered a ‘worst case’ scenario and some models actually show
tion Projects and Clean Development Mechanisms, combined over all gains for the GDP as they consider the baseline situation
with direct purchase of surplus CO2-emission quotas from less than optimal and that mitigation policies like the increase
the Central and Eastern European Countries having surpluses of carbon prices will improve market efficiency and/or lead to
within the Kyoto-allocated quotas due to the profound eco- increased technological change (p. 16). The modelling does not
nomic restructuring after the collapse of the Soviet Union, consider the consequences of change of attitudes and life-style
might bring them close. But this does not bring about changes in continuation of the proposed mitigation measures and possi-
in the EU-15 countries themselves, meaning that the under- ble positive effect this might have. These are therefore not repre-
lying trend here will remain unchanged, or, at least, insuf- sented in the models. These models are, of course, very complex
ficiently modified. and a number of reservations are necessary. But the conclusion
on the 0.06-0.12 percentage range of the negative impact on the
11.4.2 IPCC 4th Assessment Report – Taxing Carbon average GDP growth rate is labelled with the comment ‘high
The 4th IPCC-report on ‘Mitigation of Climate Change’ [page agreement and medium evidence’ in terms of backing across the
4 and figure 4 / page 8] states, that: scientific panel (see also the EEA Report 1/2005).
“with the current climate change mitigation policies and These figures should be compared to the main conclusions
related sustainable development practices global GHG emis- by a team of economists in the so-called Stern Report, pub-
sions will continue to grow over the next few decades – the lished in late 2006 by the World Bank economist Sir Nicholas
IPCC-scenarios showing an increase in 2030 relative to 2000 Stern. They concluded that about 1% of global GDP needs to
of between 25% and 90 %, be invested to mitigate climate change to avoid major prob-
In the report, the IPCC panel presents the concept of ‘miti- lems. If this is not invested the possibility remains that a major
gation potential’, which has been developed to assess the scale economic depression will eventually result.
of GHG reductions, relative to emission baselines, possible to When summarising the policies and instruments avail-
achieve at a given level of carbon price, expressed in costs per able to governments, the IPCC report points out that there is a
unit of CO2 equivalent emissions avoided or reduced. The po- wide variety of options at hand from ‘policy integration’ and
tentials of this concept are described at three different levels ‘standards and regulations’ till ‘taxes’, ‘tradeable permits’ and
of increased carbon price – 20 USD, 50 USD and 100 USD/t ‘voluntary agreements’ as well as ‘R&D in support of tech-
CO2-eq (ton CO2-equivalent) – summarized in Figure 11.4. nological advance, cost reduction and progress towards sta-
The bottom-up approach is sector oriented while the top- bilization’. In consistence with the models and the mitigation
down model assesses economy-wide potential of mitigations concept, presented above, the report then points out that

11 market-based economic instruments 157

 “Policies that provide a real or implicit price of carbon
could create incentives for producers and consumers to signifi- JAP
NL
cantly invest in low-GHG products, technologies and processes. I
Such policies could include economic instruments, government
funding and regulation (high agreement, much evidence).”
DK
Further, it is stated in this context that an effective carbon-
price signal could realize significant mitigation potential in GB
F
all sectors. References are again made to the models, show- B/LUX
SUI

Fuel efficiency
ing that carbon prices of 20-50 USD/t CO2-eq, sustained long D
FIN
term, could lead to a power generation sector with low GHG-
S
emissions by 2050 and make many mitigations options in the
end-use sectors economically attractive.
The conclusion is, that the IPCC-panel considers an in- AUS
crease in the carbon price by taxation as a precondition for
CAN
reaching the set goals. Taxation is therefore the most important
USA
policy instrument to achieve the CO2-emission reduction (and
reduction also of other GHG-gases) necessary to reach and to
sustain the level of 550 ppm CO2-eq by 2100. Other policy op-
tions and instruments, however useful and important, are sup-
plementary or auxiliary to the carbon price increase by taxa- Fuel prices (index USA 1988 = 100)
tion in some form, if the key policy goal is to be achieved.
In this context it should be added that the rather “optimis- Figure 11.5. Relationship between macro-economic fuel effi-
ciency and price. Data from 1988 are provided for OECD countries
tic” view of fossil fuel availability that this model requires has
related to 1988 US dollars. Macro fuel efficiency is calculated as
been questioned. The Association for the Study of Peak Oil the reciprocal value of per capita fuel consumption, and understood
(ASPO) has predicted that the global peak of fossil fuel pro- as a measure of how efficient the inhabitants of countries of similar
duction – all categories – is imminent, and most likely will economic performance are in their use of fuel. The macro-economic
occur in 2008-2010. One should then expect an increase in the fuel efficiency (specific fuel consumption) relates positively to the
price with a correlation coefficient in of r = 0.85. [source http://esl.
real price of fuels. This should make the carbon-free alterna-
jrc.it/dc/etr/ecological_tax_reform.htm]
tives more attractive and thus lead to reduced emissions.
through innovation and savings, which is the expected out-
11.4.3 Sustainable Development and the Concept of come of the taxation itself. The revenue should be used to re-
an Ecological Tax Reform place – wholly or to a great extent – the taxation of human
The ecological tax reform (ETR) is a different concept com- activity, of labour. The concept is summarized in the following
pared to environmental taxation. The latter is about using the phrase: The Ecological Tax Reform (ETR) is about achieving
taxation to make people act environmentally sensibly, i.e. “a wider use of labour and a wiser use of nature”. The source
use economic incentives to achieve the goals for the envi- for the total state tax revenue should, in other words, to a much
ronment which the legislation has set up. The ETR is about greater extent be natural resources instead of labour and other
a completely new and comprehensive taxation strategy, shift- human activity.
ing taxation away from labour to natural resources. The aim is There will be a need for compensation to a part of industry
still environmental, i.e. a sustainable production and a sustain- to allow for time to adapt. And there will be a need for social
able society. The higher taxation of natural resources, first of balancing towards people with low income and/or shortage
all energy resources, will put enormous pressure on industry, of investment or mobility options [Weizsäcker & Jesinghaus,
transportation and private households alike. The only solution 1992; Axelsson, 1996]. But the overall credibility of the ETR
will be higher energy and general resource efficiency, i.e. the approach is further shown by the same team by the following
introduction innovation and savings. The relation between fuel compilation:
prices and fuel efficiency was shown by Weizäcker and Jering- The relations documented in this short representation of
haus in their 1992-study on ETR (Figure 11.5). a very extensive and still ongoing discussion on ETR and the
The revenue should not be used for environmental protec- most realistic approach are important and promising. But they
tion. That is in principle delivered by the efficiency increase are the result of a quite long and, above all, piecemeal or incre-

158 market-based economic instruments 11

mental transformation process. If ETR is to be realistic accord- society and the taxes designed so that they could convince citi-
ing to its principles, it will mean substantial efficiency increas- zens of their appropriateness, an ecological tax reform could
es, which in turn will be accompanied by drastic restructuring create widespread support, even if it meant that the burden of
of all sectors of industry, transportation and the public sector tax would have to rise to meet the targets. No government has
as well as people private lives in terms of housing, heating, yet dared to do that, but we might see it in the near future.
shopping and personal transportation etc.. It will mean more,
not less employment, but within a framework of change. This
will mean a higher degree of uncertainty and anxiety among Study Questions
the employee population. 1. List a few cases where market mechanisms can be used as
This restructuring will be equally drastic and difficult to policy instrument for environmental protection.
plan, forecast for and hence to control for capital. Capital is 2. Find out the market prices for some common waste mate-
focused upon being able to calculate potential profits as well as rials, such as paper, glass, and scrap metal.
– and not least – risks and uncertainties. The ETR project will 3. For emission trading, explain the concepts of grandfather-
entail all the features of unpredictability which capital doesn’t ing, ceiling, bubble, and cap.
want, and hence be opposed by large segments of industry. 4. Describe the components of EU-ETS, how it is imple-
The only way to bring about real progress for the ETR-ap- mented, and check on the Internet the current spot price
proach will be market-driven, real and not managed, energy for carbon emissions (euros/tonne of carbon).
price hikes, documenting the approaching end to the “oil- 5. Would you say that the EU Emission Trading Scheme is a
based” industrial era. success of failure? Justify your position.
6. What are the major advantages and drawbacks of a trad-
11.4.4 Towards a Sustainability Regime able permit system?
Economic instruments are so far more taxes to boost the state 7. Describe the intentions of the EU Linking Directive and
budget than environmental protection, although things like the discuss in which ways it might weaken the EU-ETS as an
CO2 tax, waste tax, adopted in some countries, and the internal instrument for fulfilling the Kyoto obligations.
EU-emission trading system are pointing in the direction of 8. Give/find examples of successful and unsuccessful appli-
environmental protection. The charges/fees are also making cations of economic instruments in environmental politics
alternatives to ‘business as usual’ attractive in some areas. and discuss the reason for success and failure.
What seems to be missing is a fuller exploitation of the 9. Explain the concept of an ecological tax reform. What
potentials in a combination of normative regulation and eco- would be the social consequences of introducing an eco-
nomic incentives. We need to set a final deadline for phasing logical tax reform? Would the richer or the poorer benefit
out of certain fuels, compounds and electrical appliances. We the most from such a reform?
need to set demand for a certain performance level for a vehi-
cle or for the volume of CO2 per unit produced. This will allow
us to push the development towards compliance even before
the deadline by setting up economic incentives, that is, care-
fully designed taxes.
Taxes are, however, never popular. In a liberalist political
climate, these years predominant all over the western hemi-
sphere, taxes are considered the “root of all evil”. Raising
environmental taxes to the level needed to offset the social
costs – or to internalize fully the externalities – is therefore not
likely in this political context. But a shift from tax on income
to tax on use of energy and other resources could be tempting
in a liberalist perspective, but only to the point where the tax
burden in total would be as before, or less. In that case a re-
form might miss the point, as the view will be limited taxation
instead of resource efficiency and a sustainable society.
If, in a less tax hostile political environment, clear goals and
targets were set politically for an environmentally sustainable

11 market-based economic instruments 159

Abbreviations The Kyoto Protocol
CDM Clean Development Mechanism http://unfccc.int/kyoto_protocol/items/2830.php
COP Conference of Parties
DTI Distance-to-target Indicator Intergovernmental Panel for Climate Change (IPCC)
EEA European Environmental Agency http://www.ipcc.ch/
ET Emission Trading
ETR Ecological Tax Reform IPCCs Fourth Assessment Report ”Climate Change 2007”
EUA EU Allowances http://www.ipcc.ch/
EU-ETS EU Emission Trading Scheme
FCCC Framework Convention on Climate Change Stern Review final report
GHG GreenHouse Gases http://www.hm-treasury.gov.uk/independent_reviews/stern_
GDP Gross Domestic Product review_economics_climate_change/stern_review_report.cfm
IPPC Integrated Pollution Prevention Control
IPCC Intergovernmental Panel on Climate Change Association for the Study of Peak Oil (ASPO)
JI Joint Implementation http://www.peakoil.net/
NAP National Allocation Plan
OECD Organisation for Economic Co-operation and The Ecological Tax Reform by Ernst Ulrich von Weizsäcker and
Development Jochen Jesinghaus
R&D Research and Development http://esl.jrc.it/dc/etr/ecological_tax_reform.htm

Swedish Society for Nature Conservation’s report of green tax

Internet Resources shift (ETR)
Resource Recovery Forum http://www.snf.se/pdf/rap-eng-ecotax.pdf
http://www.resourcesnotwaste.org/

European Union Greenhouse Gas Emission Trading Scheme

(EU ETS)
http://ec.europa.eu/environment/climat/emission.htm

EU Emissions trading – National allocation plans

http://ec.europa.eu/environment/climat/emission_plans.htm

Point Carbon (company working with carbon trading)

http://www.pointcarbon.com/

Directive 2003/96/EC on the taxation of energy products and

electricity
http://www.managenergy.net/products/R538.htm

Directive 2003/87/EC on a scheme for greenhouse gas

emission allowance trading
http://ec.europa.eu/environment/climat/emission/
implementation_en.htm

United Nations Framework Convention on Climate Change

http://unfccc.int/2860.php

160 market-based economic instruments 11

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 Inspection
Environmental Inspection and Enforcement in
Theory and Practice

A
 CONTENTS

Part 1 Theory and Framework Part 2 Environmental Inspection in Practice

1. Introduction 1. Introduction
2. Objects of Inspection 2. EU Parliament Recommendations for Minimum Criteria for
A- and B-levels Environmental Inspection
C-level 3. Inspection Planning – Preparation of On-site Visits
U-level 4. Inspection Reports
3. Licences – IPPC and BREFs 5. National Legislation
The Licences Study Questions
Environmental Inspections
Part 3 Students Workshop
4. Authorities – Organization and Framework
1. Student Exercise – Preparation of an Inspection
5. Environmental Legislation
Study Questions
6. Law Enforcement
2. Study Visit to a Local Inspection Authority
7. Quality of the Inspection
Study Questions
The Working Methods
3. Study Visit to an Inspection Object
Management of the Quality of Inspections
Study Questions
8. Communication and Conflict Management
4. Concluding Discussion
9. Social Skills
Study Questions for a Concluding Discussion
Study Questions
Internet Resources

IMPEL, the European Union Network for the Implementa-

tion and Enforcement of Environmental Law, is an informal
network of the environmental authorities of EU Member
States, acceding and candidate countries, and Norway.
The core of IMPEL’s activities concerns the training of
It is recommended that part 1 – Theory and Framework inspectors, minimum criteria for environmental inspec-
and part 2 – Environmental Inspection in Practice be tions, exchange of information and experience on im-
studied as group work where the questions after each plementation and enforcement of existing EU environ-
part are discussed, first in student groups and then mental legislation, development of common views on
with the teacher. The questions should be a starting the coherence and practicality of current EU legislation,
point and preparation for the on-site inspection to and on commenting issues of practicality and enforce-
come. Due to the different conditions between coun- ability at an early stage in the development of new EU
tries some of the questions may be irrelevant or dif- legislation, before a proposal is formally tabled.
ficult to answer. IMPEL projects look at how legislation is currently im-
plemented and enforced, and then at good practice for the
If possible, the student group should visit one work- inspection and/or permitting process is defined. IMPEL is
place of inspectors, an authority, and secondly an introduced at http://ec.europa.eu/environment/impel/ and
inspection object, such as a company. The aim of a brochure is available at http://ec.europa.eu/environment/
visiting the workplaces of inspectors and inspection impel/pdf/brochure_en.pdf [Source IMPEL website].
objects is to get an understanding of the conditions The core of recommendations in this section is
under which inspectors work. Inspectors are civil serv- based on the IMPEL work, and IMPEL documents are
ants that often work with limited resources. important reading.
 Part 1
Theory and Framework

1. Introduction have to have a permit, and which ones have to make a notifica-
This part focuses on the role of authorities in environmental tion. The example below is only valid for Sweden.
protection and serves as a short summary of recommendations
for planning an inspection, preparing for on-site visits, and A- and B-levels
making an inspection report. The overall objective is to briefly Larger organisations and companies usually employ an en-
explain authorities’: vironmental coordinator. The coordinator usually has a good
knowledge on how the company affects the environment and
• Legal basis for action.
publishes an environmental report each year, which is required
• Organizational framework.
by law. He or she also is familiar with all systematic work
• Ways of working.
with environmental issues in the organisation, especially the
• Kinds of problems faced.
supervision of self-monitoring schemes of operators of differ-
The laws and regulations, as well as the organization of ent activities. Some of these organizations are certified accord-
authorities, differ across countries, as do the general working ing to IPPC regulations. In the municipality of Umeå there are
conditions and the problems faced by inspectors in their daily about ten of them. These have to apply for and get a license
work. Thus, the role of authorities in environmental protec- before the activity starts. This usually takes between a half and
tion is based on national prerequisites and experiences. There one year.
is of course a common international objective of protecting
the environment, though the framework varies. There are also C-level
guidelines issued by the European Union, which are or will be The C-level is a heterogeneous one, containing large com-
valid for most countries in Europe. panies with up to 200 employees to smaller companies with
Laws and regulations determine the nature of an inspec- only 1-2 employees. The larger ones are similar to A/B-level
tor’s job. An inspection has a clear mission with the purpose to in knowledge, self-monitoring and so on, while the smaller
compile facts and figures and to make observations. Inspection ones usually are less well informed about e.g. self-monitor-
is a practical activity that requires several competencies, in- ing. Self-monitoring of operators is a useful tool when applied
cluding technical, scientific, administrative, and social skills. to larger companies with larger resources. Smaller companies
need to be authority-controlled in the “old” way. That means
more inspections and actual monitoring of hazardous points,
2. Objects of Inspection like chemical storage, waste management etc. There is no gen-
In order to harmonise the environmental requirements im- eral demand for an environmental report, but the supervising
posed on industry within the EU, environmental policies and authority can issue an injunction with a requirement for an
legislation have recently been developed. The member states annual report on certain issues, for instance regarding use of
have largely brought their national environmental legislation chemicals, waste handling etc. This is common for petrol sta-
and policies in line with EU requirements. However, because tions and vehicle scrapping. The C-level companies have to
of the harmonisation of national legislation with EU require- make a notification six weeks prior to the activity starts, ac-
ments and of the development of self-regulatory instruments cording to Swedish law.
like Environmental Management Systems, the tasks and re-
sponsibilities of environmental enforcement inspectorates U-level
have become more complicated. U-level companies are small companies with a low level of
The environmental code contains classification of different knowledge and resources. Some of these can have a consider-
environmental hazardous activities, and points out which ones able impact on the environment. For instance car repair shops

inspection – part 1 171

which usually handle oils and chemicals in relatively large is currently built up in the EU. Technical Working Groups,
amounts may pollute soil and water. Since the knowledge is coordinated by the European IPPC Bureau based in Seville,
on a low level, the storage and actual handling of chemicals have so far produced BAT Reference Documents (BREFs) for
can lead to discharges to the environment. The number of U a large number (33) of sectors.
companies is very large which means that the total impact of The European Union Network for the Implementation and
these companies can be quite high. U-level companies need to Enforcement of Environmental Law (IMPEL) is an informal
be monitored by inspections, and actual checking of hazard- network of the environmental authorities of the European Un-
ous points, like chemical storage, waste management etc are ion member states. The network, formed in 1992, is commonly
important. The authority also needs to inform and educate the known as the IMPEL network. The European Commission
companies on how they can improve on their risk of impact is also a member of IMPEL and shares the chairmanship at
on the environment. These companies do not have to apply meetings. The objective of IMPEL is to create the necessary
for a permit or make a notification before the activity starts. impetus in the European Community (including the potential
Therefore the authorities’ knowledge of these companies is future memberships) to make progress in ensuring a more ef-
not complete. Some of them have never been inspected or vis- fective application of environmental legislation. The network
ited by the environmental health officers. The authority gains promotes the exchange of information and experience and the
knowledge of these companies through complaints from the development of a greater consistency of approach in the imple-
public and by making inventories of certain sectors of industry mentation, application and enforcement of environmental leg-
(car shops, dentists etc etc). islation, with a special emphasis on environmental legislation.
There is a parallel network, AC-IMPEL, for the benefit of
the EU candidate countries. Its main role is to support these
3. Licences – IPPC and BREFs
countries in meeting their obligations in the field of environ-
mental legislation, specifically in terms of implementation and
IPPC = Integrated Pollution Prevention and Control
enforcement. AC-IMPEL operates in close cooperation with
BREFs = Best Available Technique Reference documents
the IMPEL network.

The Licences Environmental Inspections

The purpose of the EU IPPC (Integrated Pollution Prevention The IMPEL Reference Book for Environmental Inspection is
and Control) Directive (96/61/EC) is to prevent and limit pol- a central document for environmental inspectors in the Euro-
lution, mainly from large industry and other potential polluters. pean Union with the purposes to provide the inspectors with
The directive regulates environmental demands on pollution tools to develop a consistent approach to site visits (prepa-
from individual objects, but does not consider transports, pos- ration, execution and follow-up) as well as reviewing of the
sibilities for recycling, etc., that is, outside-the-plant activities. impact of Environmental Management Systems (EMS). It is
According to IPPC, Best Available Technique (BAT) must mainly meant for field inspectors, but is also useful to top and
be used, and an information system to ensure the use of BAT middle management of inspectorates.

Table 1.1 Chart of environmental activities and permits in Umeå, a medium-sized city in North Sweden. Four different levels of inspec-
tion exist. The largest require an A-permit, which is an IPPC license, the second largest a B-permit under national legislation, the next category
a notification, and the smallest no special permit, although they still need to abide by environmental legislation. The permits are issued by the
national Environmental Court, a regional authority or the municipal authority, Office of Environment and Health. The Office of Environment &
Health can make a request to the County administration to take over the responsibility of supervision of A and B activities.
Level Permits issued by Supervision No Example
A-permit National Environmental court County administration/Office of 2 Waste treatment facility, power
Environment & Health plant, paper mill
B-permit County administration County administration/Office of 50 Larger mechanical industries, oil
Environment & Health depots
C-notification Municipal Office of Office of Environment & Health 150 Petrol station, chemical lab, dry
Environment & Health cleaning
U Municipal Office of Office of Environment & Health 1,000 Car repair shop, dentist, building
Environment & Health contractors

172 inspection – part 1

 The tasks and responsibilities of environmental inspector- ever, in some Member States considerable legislative power
ates are primarily the implementation and enforcement of en- is delegated to regions. Common for all EU Member States is
vironmental legislation. An inspector in Europe has also an that licences are required in order to set up and operate major
important role in the regulatory cycle. This involves the de- industrial installations. In the licences there are specified de-
velopment of legislation, licences permitting, implementation, tailed requirements for the individual installations, and it may
compliance control, compliance promotion, and enforcement be necessary to obtain several sectored licences or a single
(Figure 1.1). In most member states the regulatory cycle is integrated licence.
well developed. Nevertheless, it has been observed that en- In the Member States, there may be separate pieces of legis-
forcement may be neglected to some extent. lation for the various environmental media, or, integrated legis-
lation that covers all environmental media. However, the body
of EU legislation is quite large and covers the main areas:
4. Authorities – Organization and Framework
• Water
The administrative and legal systems for environmental protec-
• Control of air pollution
tion differ widely between countries and even among Member
• Solid waste
States of the EU. There are significant differences between the
• Harmful substances: chemicals
systems, in spite of efforts to harmonize environmental laws.
• Noise
Chapters 2-4 in the IMPEL Reference Book for Environmen-
tal Inspection are recommended reading for an overview of An overview of the most relevant EU-Directives, including
organizations, legislative frameworks and administrative rou- the Seveso-Directive and the IPPC-Directive, is presented in
tines within EU member states. Annex 6 of Part IV in the IMPEL Reference Book for Envi-
Figure 1.2 presents the institutional arrangement for Sweden. ronmental Inspection. Up to this date, there has not been any
Directive developed that specifically deals with inspection.

5. Environmental Legislation
Usually, legislation related to permitting or licensing is de- 6. Law Enforcement
veloped by the central government (e.g. by the Ministry of Public law enforcement can be divided into three categories,
Environment) decided on by the parliament and applied na- which are common among the EU Member States: administra-
tionally. The legislation commonly takes the form of frame- tive law, criminal law and private law enforcement. In cases
work legislation, which establishes the general requirements, of non-compliance at companies, an environmental inspector
and implementing legislation, which provides details. How- primarily uses administrative law enforcement. With the sup-

Policy
Objectives Legislation
planning

Permitting

}
Compliance
control Implementation
Authorities create the necessary
conditions and companies implement
Compliance activities to comply with legislation.
promotion
The application of statutory means of

}
coercion and sanctions in a situation
Enforcement where it has been established that
there is non-compliance with an act
Figure 1.1 The regulatory proc- or regulations.
Assessment and
ess by which the different com-
feedback
petent authorities take action to
implement acts and regulations.

inspection – part 1 173

port of administrative law, officials at the competent authori- 7. Quality of the Inspection
ties may: The Working Methods
• Demand to inspect and take copies of business records Every inspectorate should maintain high quality, and it should
• Halt transports and search cargoes also be in the interest of each inspector to strive for a continuous
• Enter all places with equipment (except private houses) improvement of his/hers inspection performance. In the IMPEL
• Arrange to be accompanied by other persons when enter- reference book, quality is defined as: “A body of well-defined in-
ing the premises structions, working methods, control mechanisms and perform-
• List, examine and take samples of goods ance indicators, that result in pre-defined outputs and quality
• Inspect processes and emissions levels”. The quality management applied could, for example, be
based on the methodology of ISO, or the inspectorate may even
Enforcement, which can be either preventive or reactive, is be certified by ISO. One way to reach and maintain a success-
the final active process that authorities undertake to ensure that fully inspectorate is to regularly perform assessment of:
licence requirements are met. Depending of the seriousness of
a non-compliance of a company, various administrative sanc- • The quality of the inspection
tions and measures may be applicable. For example, warnings • The consistency and quality of the inspection report
in the form of a formal letter to require the offender to take • The performance of the inspection body
remedial action, penalty payment, change or withdrawal of li- By using a quality management system with well-defined
cence, etc. It is also stated that compliance with the regulations instructions, working methods, control mechanisms, perform-
must be achievable and not require the impossible. ance indicators and, of course, proper feedback, indicators for

Government Parliament
– Decision making body – Execution of laws
– Ratification of regulations

Ministry of the Environment (ME)

– draft environmental policies and laws

Swedish Environmental National Chemical Environmental Court

Protection Agency (SEPA) Inspectorate of Sweden – Grant environmental permits to
– Develop guidelines – Supervision of compliance large industries, airports,
– Monitor and advise Counties with the rules about chemical construction of major roads, rail
and Municipalities products and biotechnical ways etc.
– Feedback to ME organisms

County Administrative Board Public Prosecutor

(CAB) – Evaluates criminal offences
– Grant environmental permits – Formulates penalties
– Supervise activities requiring
licenses under the Environmental
Protection Act
– Administrative enforcement
actions

Environmental- and Public Police

Health Committees – Investigate criminal offences
– As for counties but for smaller
sites with exceptions for inspection
objects delegated by CAB
– Strive for a sustainable Figure 1.2 The institu-
development tional arrangement for
– Information and preventive
permitting, inspection
actions
and enforcement in
Sweden.

174 inspection – part 1

quality as well as quantity can be identified. Such an assessment • Changing character of infringements.
may be performed either within the inspectorate, or by others. • Changing number of required enforcement actions.
The quality of inspections may be improved by regular • Punctuality of enforcement responses.
evaluations of the:
Indicators for quantity include:
• Performance of inspectors.
• Number of inspections.
• Role of the inspector in the inspection process (monitor-
• Number of fines issued.
ing, enforcing or advising role).
• Quantity of self-reported data.
• Inspection procedures that are followed.
• Changing number of required enforcement actions.
• Efficiency of the on-site visit.
• Time needed to carry out an inspection. An annual report in which the performance is reviewed, as
• Correctness and accuracy of the inspection. well as deficiencies and required modifications are identified and
• Frequency and timing of the inspection. listed, can be used as a tool in the assessment of the performance
• Competence of and justification of the persons involved. of the inspectorate and to identify further improvements.
• Data storage.
• Arrangements on follow-up visits.
8. Communication and Conflict Management
Management of the Quality of Inspections
It is important for a successful visit that respect and credibility
The quality and consistency of the inspection report may be
are created by the inspector showing appropriate knowledge
improved by evaluation of the:
and skills. At on-site visits, communication is a very important
• Completeness of the report. Does it contain all relevant tool, and to cover the various items related to on-site visits an
general and specific information? inspector should be trained in:
• Consistency and correctness of the report and the conclu-
• Communication aspects.
sions drawn. Reports should be structured in the same
• Inquiry and negotiation techniques.
way so that relevant information can be extracted quickly.
• Conflict management and resolution
Regarding the inspection body, two ways of improving the
In order to:
performance of the inspection body are presented.
Firstly the inspectorate may track the results back while • Establish a good contact with the contact persons at the
looking for trends and changes in activities or results over time. inspected facilities.
This may be done by using local/regional reports in order to • Improve public relations.
publish a yearly report on the authority’s inspection perform- • Ensure compliance promotion.
ance. This report should also include inspecting resources (per-
In some EU Member States inspectors may need skills in
son-year and amount of money) used in previous years for in-
negotiation and conflict management and resolution. For ex-
spection and permitting, number of inspection objects, number
ample, an industry has the main aim to operate its activities as
of inspections, enforcement actions. This provides a possibility
efficiently and economically as possibly. If they are dependent
for the government and the public to get an insight to the inspec-
on environmental authorities for licences, they may consider
tion body. It is also an opportunity for inspectors to learn from
enforcement bodies to be “on the opposing side”. Environ-
each other. It is important that authorities communicate and co-
mental authorities have an interest in improving the environ-
operate with each other in order to perform inspections equally.
ment and implementing laws and regulations, thus, they may
Secondly the inspectorate may set targets and afterwards
have a similar view of industry. Negotiation techniques may
compare the results with the targets. This is a way to monitor
come in handy in situations where there is a need to reach a
the performance of the authority. Depending on the indicators
position which is acceptable for both parties. In such situations
chosen for monitoring, the quality and/or quantity of the per-
the inspector may be required to negotiate with company rep-
formance is measured.
resentatives in order to achieve the conclusion required by the
Indicators for quality include:
regulatory authority. The inspector must also be prepared that
• Quality of self-reported data. the representatives of the company may question the details of
• Environmental improvements within companies. environmental regulations and compare them with those ap-
• Changing non-compliance rates. plied to the company’s competitors.

inspection – part 1 175

 In case of negotiation the inspector must have a clear un- Study Questions
derstanding of what areas are flexible and what areas are fixed. 1. What do IMPEL, IPPC, and BAT stand for?
It is of great importance that the inspector ensures that the po- 2. What are the roles of an environmental inspector within
sition of the regulatory body is not compromised. By means the regulatory cycle?
of arguments, facts, views and conditions, an inspector can try 3. Discuss problems and difficulties that can occur in con-
to influence or persuade the company representatives. Further, nection with implementation and enforcement of environ-
other important aspects of communication are that the inspec- mental laws and recommendations. What can be done to
tor is credible and reliable in order to make a good impression; improve the situation?
he/she should also be polite and avoid verbally attacking the 4. What courses of action can be taken in response to non-
company representatives. compliance connected to environmental inspections?
Conflicts should not always be seen as unwanted; they may 5. Define quality management connected to environmental
lead to an opportunity for renewal and change. The inspector inspections. Can quality be quantified?
should try to be a part of the solution rather than part of the 6. Financial and human resources are usually limited. How
problem and strive for a win-win situation. Examples of ways can priorities be made when resources are limited?
to handle conflicts are: 7. Good communication is essential in all public inspections.
• Co-operation which takes both interests into account. How can a good climate for communication be created?
• Searching for compromises to find suitable, mutual and Can enforcement be prevented in other ways than by
acceptable solutions. communication only?
8. How can conflicts be handled? Conflicts are not necessar-
ily destructive. Can conflicts be positive, and if so, how
and why?
9. Social Skills
9. Briefly describe the organization and responsibilities of
In spite of the differences in organization, legal framework, environmental authorities at different levels involved in
chain and delegation of responsibilities, etc, the basic con- inspection and enforcement (governmental bodies, region-
ditions are similar for environmental inspectors in different al/local administrations).
countries. The competence of the individual inspector, or team 10. Describe the cooperation between authorities at different
of inspectors, must cover all aspects of the work, such as the levels. Are there any delegations from higher authorities
administrative framework, the legal system, inspection meth- to lower levels?
odology, issuing permits, technical skills, as well as a good
ability to communicate with counterparts. In 2003, IMPEL
published Best Practices Concerning Training and Qualifica-
tion for Environmental Inspectors, which is an important doc-
In order to inspire further discussions about methods
ument for the training of inspectors (see Internet Resources).
of inspection, communication, social issues and how
Apart from strictly theoretical knowledge, good social to plan and perform an environmental inspection,
skills are always vital in order to perform a good inspection. two films have been produced. The film Environmental
Communication, i.e. a good ability to communicate a message Inspection describes the roles and activities of a Mu-
and to understand the problems of the counterpart, is therefore nicipality Inspectorate in a Swedish municipality, and
the film from Lithuania shows a similar case.
an important part of the practical work. At best, an inspection
not only checks for compliance and enforcement of laws, but The purpose of the films is not to learn details about
also inspires confidence and encourages improvements. An- Swedish or Lithuanian legal systems, etc., but merely
other very important part of the social skill of an inspector to provide an impression of how the workplaces look.
is to listen and show interest. In an open-minded discussion
between authorities and companies, it is often easier to find The cases are typical and the purpose of the films is to
illustrate the practical work of a civil servant, i.e. a day
solutions that meet the demands of both parts. Also essential
at work. The working conditions vary, of course, be-
for improving the environmental performance of a company tween different countries depending on the organiza-
is a functional self-monitoring programme and good commu- tion of the society in general. So, for obvious reasons,
nication with authorities. This of course does not exclude the the Swedish case is only valid for Sweden as is the
importance of traditional inspections made by authorities, in- Lithuanian only for Lithuania.
cluding checking compliance with laws and permits.

176 inspection – part 1

 Part 2
Environmental Inspection in Practice

1. Introduction Even if the conditions under which the inspectors work dif-
Although an inspection must be based on laws and permits, fer widely between countries, these are fundamental prerequi-
the inspector cannot merely use a simple checklist with clear sites for everyone involved as a civil servant in public monitor-
regulations. Conditions vary widely between regions and com- ing activities. In order to decide what information is necessary,
panies, and the structure of a small company is not the same a definition of the concept of environmental inspection is need-
as that of a global industry. Permits and conditions shall, of ed. The IMPEL publication Minimum Criteria for Inspections
course, be checked and documented, but to be successful the (see Internet Resources) gives the following definition:
inspector/authority must also be able to communicate with the
“An inspection is an activity which, in the broadest sense,
counterparts, to inspire and encourage. The greatest challenge
entails:
in environmental inspection is to prevent pollution and encour-
age improvements, not just to enforce compliance. • Checking and promoting the compliance of installations
The objective with this part is to give a framework for car- within requirements stated in laws, regulations, ordinanc-
rying out an environmental inspection of an industrial plant or es, directives, prohibitions and/or permits etc.
other kind of activity subjected to public control under nation- • Monitoring the general impacts of specific installations
al, regional or local environmental laws. This part includes: on environment that might lead to enforcement action or
further inspection.”
• A summary of preparation for on-site inspection visits,
including planning and reports.
• A summary of the EU Parliament recommendations for 2. EU Parliament Recommendations for
Minimum Criteria for Environmental Inspection. Minimum Criteria for Environmental Inspection
• Preparation and planning of study visits by answering and
The reason for describing minimum criteria for environmental
discussing the questions below.
inspection is to set a base line for the quality of inspection
• A study visit to a local inspection authority and discuss-
activities, i.e. describe the basic requirements for a proper in-
ing the questions.
spection of, in this case, industrial plants, including power sta-
• A study visit to an inspection object together with an
tions and waste treatment/disposal facilities. The background
inspector.
for setting up a basic level is mainly that different countries
Students will be familiarized with the theoretical frame- have different systems for inspection and control, legal sys-
work for inspection activities, experience practical inspec- tems and furthermore not the same capacity and economical
tions, and see the conditions under which inspections are per- support. Hence, there is a need for a minimum level that all
formed. The purpose of the questions below is to address the countries should reach. It is the responsibility of each member
following issues: state to report that the minimum criteria have been implement-
ed and to make these reports available to the public.
• The prerogatives, restrictions and obligations of an inspector.
The responsible authority must have a plan for their in-
• The kind of information needed before an inspection.
spection covering a certain time and area, what sites to visit,
• The way of carrying out an inspection.
how often and what to achieve during the inspections. A plan
• The kind of measures that can/should be taken after an
for inspection should be based on the following:
inspection.
• The kind of competence (e.g. technical, social, etc.) nec- • A database of industrial installations.
essary to be successful. • A survey of regulations and conditions to be complied with.

inspection – part 2 177

• A general survey of major environmental problems and visit must be recorded and the findings should be evaluated and
a general survey of the state of compliance by industrial conclusions drawn regarding further action. The reports must
facilities with regulatory and other requirements. be properly filed in a database for easy retrieval and the infor-
• Performance indicators and data on previous inspections, mation should be exchanged between the relevant authorities.
e.g. frequency, resources used, non-compliances etc. In short, minimum criteria are described for the important
parts of what should be done before, during and after an in-
Further, plans for inspections should include the procedure
spection, including:
for inspection in reaction to accidents, complaints, non-com-
pliance situations and permitting processes. • Plans for inspection.
The minimum criteria applied to site visits states that on- • Site visits, analysis.
site visits should be carried out through an integrated approach • Follow-up and reporting at the site/company level.
to examine the full range of environmental impacts. Every site • Evaluation and reporting of inspection activities.

1. General approach 4. Frequency of inspections

• Set clear objectives with the inspection. Most inspectorates in EU have guidelines on a
• Prepare yourself; make sure you are familiar basic frequency of inspections depending on
with: the type of industry. The guidelines are based
- the technical aspects. on a number of assumptions. For example,
- compliance history. companies with greater environmental impact
- relevant regulations and the physical site should be inspected more often than those
lay-out. with smaller impact, and sectors of industry in
• Practical preparation, equipment; photo which infringements of environmental
camera, safety clothing, ear protection, etc. legislation occurred in the past should be
visited more often.
2. Updating information
It is essential for the inspectorate and the Criteria that may influence the frequency are:
inspector that the information of the • Relevant polluters similar to IPPC-installations.
companies to be inspected is updated and • The age of the installation.
relevant. • Number of complaints on the installation.
• The local situation, is the facility located in a
residential area, a protection area, a polluted
area or in a high density of installations.

3. Categories of inspection 5. Inspection plan

Integrated inspection; all environmental laws A properly prepared inspection plan should
and rules including the environmental licence save time and resources during the actual
are checked and self monitoring systems are inspection. Apart from the reasons of the
investigated and evaluated. inspection it is a step by step guide of tasks,
procedures and how to compile relevant
Specific inspections may concern only a specific evidence in case of non-compliance.
topic,for exampel, the extent of soil pollution.
(The IMPEL reference book focuses mainly on Branch specific checklists are considered to be
integrated inspections.) more useful than site-specific checklists. They
can help an inspector to keep track of all
Should the visit be announced or different relevant environmental aspects of a
unannounced? certain sector of industry.

Figure 2.1 Relevant actions of inspection planning for on-site visits.

178 inspection – part 2

 In addition to the IMPEL publication Reference Book for • Procedures
Environmental Inspection the IMPEL publication Minimum - Announced or unannounced inspection?
Criteria for Inspections is available (see Internet Resources). - What specific facility processes will be inspected?
- What procedure will be used?
- Will the inspection require special procedures?
3. Inspection Planning - Has a quality assurance plan been developed and
– Preparation of On-site Visits understood?
- What are the responsibilities of each team member?
Good planning of the inspection is essential and concerns all
- How will the reporting be organised?
activities related to the scheduling, organisation, timing, ex-
• Resources
ecution and follow-up of inspection work. Figure 2.1 shows
- What personnel will be required?
some relevant aspects of inspection planning. The degree of
- What equipment will be needed?
preparation for an inspection depends on the type of inspec-
- Has a safety plan been developed and understood?
tion (integrated or specific), and the size and the complexity
• Schedule
of the installation. The purpose must be clear and the infor-
- How much time will be needed for the inspection?
mation needed must be collected. Studying the dossier, i.e.
- What is essential/what is optional?
the collected information at the inspectorate regarding the
- Will there be a follow-up inspection?
inspection object, can give much useful information prior to
the inspection. More specific details concerning planning and reporting of
Preparation of a sound inspection plan prior to the inspec- inspections are presented in the IMPEL publication Planning
tion serves several purposes and is as important to the total and Reporting of Inspections (see Internet Resources).
compliance monitoring and enforcement process as the gener- Generally during on-site visits, the inspector verifies
ation of a high quality, well-documented inspection report. A whether the observations in field are consistent with the mate-
proper inspection plan should save time and resources during rial collected during the planning in order to determine com-
the actual inspection: which questions are appropriate to ad- pliance with licence conditions. The inspector should be alert,
dress, guidance for what kinds of evidence should be collected curious and prepared to “get hands dirty”. Self-monitoring and
and documented, etc. reporting must be scrutinised and evaluated. Finally, impres-
The inspection plan should at least include the following sions like smell, sounds may provide useful information and
parts: should also be recorded. At the end of the inspection visit, the
inspector should inform the company representatives on the
• Objectives/background history of the inspection.
preliminary conclusions of the inspection, and announce if a
• Scope and assessment topics.
follow-up of the inspection is relevant.
• Inspection activities and field techniques.
• Sampling planning.
• Safety plan. 4. Inspection Reports
• Administrative requirements.
The purpose of the inspection report is to give a factual record
The following list may serve as a guide for the inspector to of an inspection, and to organise and co-ordinate all evidence
develop an inspection plan: gathered in a comprehensive and useable manner. It is there-
fore important that the report be:
• Objectives
- What is the purpose of the inspection? • Accurate: all information must be factual and based on
- What is to be accomplished? sound inspection practices.
• Tasks • Relevant.
- What records, files, licences and regulations will be • Comprehensive.
checked? • Co-ordinated, documentary support (photos etc.) should
- What co-ordination with laboratories, other state or be clearly referenced.
local authorities is required? • Objective, no conclusions should be drawn. However, the
- What information must be collected? inspector’s conclusion about the compliance of the facil-
- What samples will be taken and/or tests will be ity are the critical factors in the decision as to whether a
conducted? violation did or did not exist.

inspection – part 2 179

 1. Identification of the industrial activities that may have caused the problem
• What industries/ activities handle oil products and may be the source?
- dossiers at the inspectorate
- yellow pages / business phone book
- register of local government, local business organizations and local environmental organizations
• Which of those companies are connected to the STP?

When the possible sources have been identified the inspector may choose between:

2. Information meeting 2. Preparation of on-site visit

If the problem is considered as less acute, representatives from the If the problem is considered to be acute the inspector studies the
identified sectors are summoned to an information meeting held dossiers and permits / licences of the identified companies that
by the inspector in which they are informed about: may be responsible for the emission. Technical drawings and
• The problem and its consequences. process diagrams may be very useful for the inspection. A photo
• Relevant regulation and acts. camera and the logbook should also accompany the inspector.
• An upcoming inspection campaign.

3. Inspection
• Announced inspection.
- If it is important to meet the responsible persons at the company for interviews regarding routines and to check relevant documentation at
the company, the inspection should be announced.
• Unannounced inspection.
- If the main purpose with the inspection is to check how chemicals and processes are handled, the inspection should be unannounced.

4. On-site visit
The problem is presented to the company representatives by the inspector which then lets them describe their routines. Do they know what to
do? Do they know why they should do it? Do they know the relevant legislation? Do they have self monitoring systems? Etc.

Then, the inspector describes how the routines regarding hazardous waste should be performed and monitored. The inspector should also
stress the importance of relevant education for the personnel. Increased knowledge and understandment among the employees reduces the
risks for wrong handling. In addition, the relevant documentation, licences and permits are also inspected.

The inspection of the premises should, for example, include:

• How are oil and waste oil stored and labeled?
• Are there any safety equipment in case of spillage?
• If it is possible, talk to the personnel and let them describe procedures.
• How is other chemicals and hazardous waste handled?
• Are the amounts reported at the company the same as those noted by the receiver of the hazardous waste?

5. After the inspection

• At the end of the inspection the inspector informs the contact persons on the preliminary conclusions.
• The inspector writes an inspection report and updates the dossier.
• The company will receive a summary of the inspection report with information regarding the actions the company is expected to take. In
cases where non-compliance has occurred, a list of potential or anticipated punishment is included. In case of infringement a warning letter
may be issued. The inspection report may be an attachment to the letter.
• Appropriate authorities are informed.
• If necessary a follow-up inspection is planned.

6. Inspection follow-up
• An unannounced inspection to check how processes and chemicals are handled.
• Evaluation
- Why was the oil emitted? (accident, negligence, lack of knowledge etc.)
- How can this be prevented? (information, education, new routines, safety equipment etc.)
The conclusions should be presented in a public report that is available to the Commission.

Figure 2.2 Schematic description of how an environmental inspector may work.

180 inspection – part 2

• Clear and well organised. trial installation or other kind of inspection object. It should
• Neat and legible. also be noted that environmental inspectors at local levels, i.e.
at municipalities, in many European countries focuses mainly
The report should start with an introduction containing gen-
on inspection on small facilities since they usually are much
eral information (purpose, participants, date etc.), a summary
more common than large industries. In Sweden for example,
of findings and a short history of the facility. Following the
inspectorates at the regional level have a main part of the large
introduction is a summary describing the inspection activities
industries as inspection objects whilst only a few are delegated
such as opening meeting, records, evidence collection, collected
to the municipal inspectorates.
samples and closing of the meeting. Analytical results, photo-
Regarding the general questions below, all relevant infor-
graphs, copies of documents etc. may be attached to the report.
mation should be collected, briefly described and discussed.
The length and extent of the report is highly dependent on the
Focus should be on how the information should be used in
purpose of the inspection. For example, at an integrated inspec-
practical inspection work. To answer the questions, it is useful
tion with the purposes to check compliance with all environ-
to have defined a plan for further inspection.
mental laws and rules, including the environmental licence and
to investigate and evaluate the self-monitoring systems of the
facility, the inspection report will, of course, be more extensive.
An inspection concerning only a specific topic, e.g. emission of
a substance to the municipal sewage system, will be short. Lay-
outs examples of inspection reports are included in Chapter 11.3
and in Annex 8 in the IMPEL publication Reference Book for
Environmental Inspection (see Internet Resources).

5. National Legislation
The objective here is to describe the national legal, administra-
tive and practical prerequisites for an inspection of an indus-

Study Questions
Example – Inspection of a Small Object 1. What are the necessary elements of an inspection plan?
Explain the meaning of these elements for a common
The manager at the local sewage treatment plant industrial plant.
(STP) informs an inspector at the municipality envi- 2. Briefly describe how to perform an on-site inspection.
ronmental inspectorate that, during the last three
3. What is meant by a licence check connected to an inspec-
days, there have been elevated levels of petroleum oil
in the influent. tion?
4. Discuss the advantages and disadvantages of announced
The inspector and the manager agree on the impor- and unannounced inspections.
tance of quickly finding the source of the incoming oil 5. Describe the main contents of an inspection report.
to minimize the damage in the biological treatment at 6. Define the word “inspection.” What activities are in-
the STP and to protect the recipients. The first step for
the inspector is to identify what industries or activities cluded?
may be responsible for the elevated levels of oil. 7. List the minimum criteria for an on-site inspection.
8. Reporting and feedback are important steps in an inspec-
After the source/sources have been identified the in- tion. What are the purposes of reporting and feedback?
spector may, depending on how acute the problem Who is it necessary to report and give feedback to?
is, prepare for an information meeting or for on-site
visits.

The procedure of how an environmental inspector

may handle a case like this is schematically described
in Figure 2.2.

inspection – part 2 181

Seminar Topics
1. Reasons for inspection
a. Who decides to do an inspection?
b. Discuss possible reasons for initiating an inspection in
general. Why inspect now?
2. Access to plants and properties
a. Are there any restrictions for access to the inspection
object?
b. What are the possibilities for the inspector to enforce
access to the inspection object? Is police enforcement
possible/necessary?
3. Access to information
a. What kind of information is needed in advance?
b. Are there any restrictions concerning receiving and
retrieving the information needed for the inspection?
c. Is it possible/allowed to take samples from waste wa-
ter, etc., from the site? Who can take these samples for
analysis (e.g. the company, authority, or consultants)?
4. Requirements and enforcement
a. How can the inspector enforce improvements at a
company?
b. Can hazardous activities be stopped temporarily by
the inspector?
5. Sanctions for breaches
a. Who collects and secures evidence in case of violation
against laws and permits?
b. Describe the procedure for appealing decisions. Who
makes the decisions for sanctions in case of an envi-
ronmental crime?

182 inspection – part 2

 Part 3
Students Workshops

1. Student Exercise inspector have access to the programs? May these be

– Preparation of an Inspection of use for the inspection process?
Select a type of inspection object, e.g. an industrial plant pro- c. Is technical equipment needed for taking samples?
ducing herbicides, a mine or a mechanical workshop etc. that 4. Evaluation and Reporting
is possible for the study visit. Discuss the questions below be- a. Who makes the evaluation of the collected information
fore making the study visits to a local authority and an inspec- from the inspection, including chemical analysis, etc.?
tion object. Then make a short inspection plan and collect the b. What kind of information will be included in the
information needed. report from the inspection?
c. What happens with the report? Who will be informed
and who will have access to it? How will the imple-
Seminar Topics mentation process proceed after the inspection?
1. Purpose
a. What is the purpose of the inspection (periodic
compliance visit, complaints or accidents, specific 2. Study Visit to a Local Inspection Authority
campaigns, etc.)? The purpose of the study visits is to be familiar with proce-
b. What frequency of inspections is necessary? How often dures and working conditions at the authority. The teacher
should the installation be checked in order to have suf- organizes a study visit to a local or regional environmental
ficient information about environmental performance? authority. During the visit some of the unresolved questions
c. Will the inspections be scheduled or not? Is it neces- above should be discussed with inspectors or the manager of
sary to inform the manager or others at the plant in the authority. Apart from the very specific questions listed
advance of the visit? above, a number of other issues can be discussed (listed be-
d. What aspects will be checked? Single aspects such as low). The answers are probably not documented but are very
waste treatment, chemicals, pollutions to air, etc.? All important for the everyday work at the office.
permits? Is this an IPPC installation? What about the
routines for environmental management and internal
monitoring? Note: it is very important to check the Study Questions
function of routines and responsibilities. 1. How does the cooperation with other authorities work (at
2. Environmental Demands different levels, in other communities, etc.)? Are there
a. What are the demands in the national legislation con- problems?
nected to “your” inspection object? 2. Discuss the organization of the authority. Who makes the
b. What are the demands on the inspection object in decisions? What are the financial and personal resources?
licences and permits? Is education/further training needed?
3. Planning 3. Describe the working climate at the authority. Is there any
a. What kind of information is needed for the inspection political or financial pressure on the authority?
plan? Examples are licences and permits to be com- 4. Is the environmental legislation clear? Are interpretations
plied with, reports from previous inspections, knowl- by the local authority or the inspectors possible and/or
edge of industrial processes, etc. Collect some of the desirable?
information in order to plan your inspection. 5. What environmental issues are the most important? Why?
b. Are there any self-monitoring programs or Environ- Which are the most common?
mental Management Systems available? Does the 6. How does the authority plan the work?

inspection – part 3 183

7. Does the authority try to prevent environmental problems 4. Concluding Workshop
in any way, by information, campaigns, etc.? Study Questions for a Concluding Discussion
8. What are the most common problems connected with the
1. Is there any conflict between economic interests/job op-
inspection procedure?
portunities and environmental efforts? Are there political
9. How does communication and cooperation with industrial
pressures and priorities?
plants work? Does the authority have any guidelines for
2. Compare the theoretical purposes with environmental
good communication and social behaviour?
inspections, expressed in IMPEL, with practical inspec-
10. Are there any legal or social differences between inspec-
tions. Are there any problems? If so what kind of prob-
tions at small and large companies?
lems? What are the most important parts of IMPEL?
11. How can the authority ensure quality and an equal stand-
3. Can authorities contribute to the improvement of envi-
ard of their inspections?
ronmental efforts in other ways than merely by permits
and enforcement? Is it possible to encourage voluntary
3. Study Visit to an Inspection Object improvement?
4. Does planning and performing of inspections differ be-
The purpose is to get practical experience from an environ-
tween objects, for instance small and large companies?
mental inspection. The participants will visit an inspection
5. How does communication work between authorities and
object together with the responsible inspector. The object may
inspection objects? Make a short guideline on how to
be chosen according to interest by the participants. The object
ensure and improve good communication.
should not be too large (making it difficult to get the informa-
6. What are the most common and/or important problems
tion and knowledge needed), but not too small either (discus-
connected to the possibilities to carry out environmental
sions about licences and permits are necessary).
inspections?
The questions connected to the visit should be defined dur-
7. Define the meaning of “inspection quality.” How does one
ing the planning process and the visit at the authority. The par-
ensure good quality in environmental inspections?
ticipants should list issues in advance to discuss and examine
during the visit. Examples of important questions are collected
below.

Study Questions
1. How does the visit start? Who do you meet, e.g. the
manager and employees? Describe the organization of the
inspection object. Who makes the environmental deci-
sions – the board, the manager or maybe sometimes even
the employees?
2. How to behave during the visit? Who decides what to
discuss? Do the authority and the company agree on the
environmental conditions?
3. What questions should be discussed, e.g. only legal issues
and compliance with laws and permits or other possibili-
ties of environmental improvement as well?
4. How does the company ensure compliance to permits and
their environmental quality, e.g. self-monitoring or other
internal control measures?
5. How does the inspection end? What will the form of
examination be? What will be the main content of the
report? How will the process proceed?

184 inspection – part 3

Internet Resources
IMPEL (Implementation and Enforcement
of Environmental Law)
http://ec.europa.eu/environment/impel/

IMPEL Best Practices Concerning Training and Qualification

for Environmental Inspectors
http://ec.europa.eu/environment/impel/pdf/env_inspectors_
finreport.pdf

IMPEL Minimum Criteria for Inspections

http://ec.europa.eu/environment/impel/pdf/mincrit.pdf

IMPEL Frequency of Inspections

http://ec.europa.eu/environment/impel/pdf/freq.pdf

IMPEL Operator Self-Monitoring

http://ec.europa.eu/environment/impel/pdf/selfmon.pdf

IMPEL Planning and Reporting of Inspections

http://ec.europa.eu/environment/impel/pdf/plan_and_report.pdf

IMPEL Reference Book for Environmental Inspection

http://ec.europa.eu/environment/impel/pdf/refbook.pdf

IMPEL Best Practice in Compliance Monitoring

http://ec.europa.eu/environment/impel/pdf/compliance.pdf

The IPPC Directive

http://ec.europa.eu/environment/ippc/

The IPPC Directive – Links

http://ec.europa.eu/environment/ippc/ippc_links.htm

European IPPC Bureau

http://eippcb.jrc.es/pages/FAbout.htm

inspection – resources 185

 European Union
Environmental Legislation

B
 CONTENTS

1. INTRODUCTION 6. INDUSTRY AND TECHNOLOGY

1.1 Basis of European Union Legislation 6.1 The EU Industrial Environmental Regulations and Policies
1.2 Development of the Directives 6.2 The IPPC Directive
1.3 Framework Directives 6.3 Development of the IPPC Directive
1.4 Strategies and Policies 6.4 Eco-Management and Audit Scheme (EMAS)
1.5 Incorporation into National Legislation 6.5 Integrated Product Policy (IPP)
1.6 Legal Follow-up 6.6 Implementing the Integrated Product Policy
1.7 Policy Areas 6.7 The European Union Eco-label scheme
1.8 Economic Instruments 6.8 Greening Standardisation
1.9 The European Economic Area 6.9 Green Public Procurement
1.10 European Neighbourhood Policy 6.10 Environmental Technologies Action Plan, ETAP
1.11 Global cooperation
7. LAND USE, NATURE PROTECTION, AND SOIL
2. AIR 7.1 Land Use and Spatial Planning
2.1 Clean Air for Europe 7.2 Environmental Impact Assessment
2.2 The Convention on Long range Transboundary Air Pollution 7.3 Strategic Environmental Assessment
2.3 The Air Quality Framework Directive and its Daughter 7.4 Nature Protection and Biodiversity
Directives 7.5 Proposal for a Framework Directive on Soil
2.4 Air Quality Standards
8. NOISE
2.5 Emissions from Traffic on Road, Sea and Air
8.1 The Directive on Environmental Noise
2.6 Emissions from Industrial Sources – Large Combustion Power
8.2 Existing Directives Relating to Noise Sources
Plants
9. WASTE
3. CHEMICALS
9.1 Strategies and Framework Directives on Waste
3.1 The Dilemma of Chemicals Control
9.2 The Landfill Directive
3.2 The REACH Regulation
9.3 Biodegradable Waste
3.3 Scope of REACH
9.4 Mining Waste
3.4 The Implementation of REACH
9.5 Waste Incineration Directive
3.5 The Directives on Existing Substances, EINECS and ELINCS
9.6 Disposal of Waste Oils
3.6 Plant Protection Products and Biocides
9.7 The Disposal of PCBs and PCTs
3.7 POPs – Persistent Organic Pollutants
9.8 Disposal of End-of-Life Vehicles
3.8 Directives on Chemical Accidents (Seveso II)
9.9 Packaging and Packaging Waste
3.9 Large Oil Spills at Sea
9.10 Waste Electrical and Electronic Equipment, WEEE Directive
4. ENERGY 9.11 Disposal of Batteries and Accumulators
4.1 Energy and Environment 9.12 Waste Management Planning
4.2 Energy Efficiency 9.13 Waste Shipments
4.3 Energy Performance of Buildings
10. WATER
4.4 Cogeneration
10.1 The Water Framework Directive
5. CLIMATE CHANGE 10.2 River Basin Management
5.1 EC and the United Nations Framework Convention on Climate 10.3 Drinking Water Directive
Change 10.4 Urban Waste Water Treatment, UWWT Directive
5.2 European Climate Change Programme (ECCP) 10.5 Sewage Sludge
5.3 EU Emissions Trading Scheme (ETS) 10.6 The Nitrates Directive
5.4 The Community Strategy to Reduce CO2 from Light Vehicles 10.7 Priority Substances Under the Water Framework Directive
(Cars and Vans) 10.8 Groundwater Directive
5.5 European Community Action to reduce Ozone Depleting
Substances
 European Union Environmental Legislation

1. INTRODUCTION
number is a serial number. The addition EEC indicates that the
1.1 Basis of European Union Legislation directive was legally based on the EEC treaty.
The legislation of the European Union consists of documents The number of directives related to environmental issues
on basically four levels. The Treaty of the Union functions as is large and increasing. The European Commission develops
a constitution of a state. It is an over-all legal base for all other directives with considerable input from member states and the
documents. The Declarations are policy documents with in- European parliament. Once adopted by the Council of Minis-
dicate a direction but does not have binding status. The Pro- ters, the member states are solely responsible for the imple-
grammes, such as the EAPs, are policy documents and not bind- mentation of the requirements of the directive. However, there
ing. They have, however, considerable influence on the process is some time before the implementation is to be complete.
of legislation since they provide principles and directions. Directives develop over time. New regulations are added
Finally there are the Directives and Regulations. A regu- or amended to them. The amendments may be published as
lation becomes immediately enforceable as law in all mem- Decisions or Communications of the Commission. If many
ber states simultaneously. The directives, the most common changes were made the Directive may be codified by the Com-
type of EU legislation in the field of environment, on the other mission into a new text, without any policy or legal changes.
hand, are implemented nationally. The general clause Art 189 They then get a new designation – year and number. As new
EEC says that Directives are developed to substitute older legislation, the
“A directive shall be binding as to the results to be achieved former texts are appealed by the new ones, and thus not any
upon each member state to which it is addressed, but shall leave more valid.
to the national authorities to choice of form and methods.“
Directives are referred to by their official numbers, for 1.2 Development of the Directives
instance 70/229/EEC. The first number refers to the year in The first legislation dealing with an environmental issue was
which the directive was adopted (1970 in this case); the second a Euroatom directive from 1959 and the two directives on ve-
hicle emissions and noise from 1970 and 1972. But it was not
Sources for this section until after the second Environmental Action Programme in
The text in this section is a based on the European Union Commis- 1977 that a number of directives with more far-going ambi-
sion Directorate General for Environment website http://ec.europa.eu/
environment/index_sv.htm. A review of the EU activities in the field tions were adopted. These included legislation on water qual-
of environment, including legislation, is found on http://europa.eu/pol/ ity, air quality (directive on limits to SO2 and particulates, as
env/index_en.htm. All legally valid document (directives, regulations, well as a directive on lead concentration in the air), waste
etc., and their amendments) are found as pdf documents on
http://eur-lex.europa.eu/en/repert/1510.htm. The same texts in other handling, labelling and packaging of dangerous substances,
EU languages than English are also available on these sites. as well as regulating discharge of dangerous substances into
surface waters.

european union environmental legislation 189

 These directives were largely a static set of regulations, fo- Water, after all, flows freely from one country to the next and
cusing on setting discharge and concentration limits and the downstreamers may suffer very badly from sins committed by
absolute reduction of ambient environmental impact and level the upstreamers. International regulation is well justified. To
of pollution. All these concerns and areas have since been pur- framework directives are added daughter directives or other
sued in much more forceful regulations. pieces of legislation, regulating specific issues.
The first steps to create more dynamic and pro-active
instruments of regulation came with the introduction of the 1.4 Strategies and Policies
BAT notion in relation to the cleaning of wastewater. BAT The Sixth Environment Action Programme represented a step
is Best Available Technology, later changed to Best Avail- in the direction of integrated environmental policies. One of
able Techniques. It was at that stage referring to dangerous the initiatives in the EAP was the development of thematic
or hazardous substances in wastewater before being dis- strategies covering seven areas, all of them prepared in 2005
charged into surface waters and in a separate directive, the and 2006. The areas are
same regulation in relation to discharge to ground water. The
• Air Pollution (adopted 21/09/2005)
Best Available (Cleaning) Technology is still used as a refer-
• Prevention and Recycling of Waste (adopted 21/12/2005)
ence for the end-of-pipe emission limit values, as a BAT type
• Protection and Conservation of the Marine Environment
production equipment and management is required to get an
(adopted 24/10/2005)
IPPC-licence.
• Sustainable Use of Pesticides (adopted 12/07/2006)
1.3 Framework Directives • Soil (adopted 22/09/2006)
• Sustainable Use of Resources (adopted 21/12/2005)
Still later even more comprehensive and far-going pieces of
• Urban Environment (adopted 11/01/2006)
legislation took the form of Framework directives (Box 1). A
framework directive constitutes a general frame for legislation The Thematic Strategies represent the next generation of
in an area and requires a set of national decisions to define environment policy. As their name suggests, they work with
limits, and rules of adoption etc. The first framework directive themes rather than with specific pollutants or economic activi-
was the one on water. This directive is based on a considerable ties, as has been the case in the past. They take a longer-term
amount of research and was put forward as a set of principles perspective in setting clear environmental objectives to around
to protect water in the Union. It is not surprising that water 2020 and will thus provide a stable policy framework.
protection was the first area to be developed in some detail. Finally, they focus on identifying the most appropriate in-
struments to deliver European policy goals in the least burden-
some and most cost-effective way possible. Legislation is one
Box 1 Framework Directives such instrument; others are economic support, research, and
stakeholder agreements etc.
Framework directives or corresponding integrating
regulations of whole areas exist in the following areas: 1.5 Incorporation into National Legislation
The directives need to be incorporated into national legisla-
• Integrated Pollution Prevention and Control in In-
tion to enter into force. This may in some cases be trivial in
dustries, IPPC (Directive 96/61/EC).
• Air Quality Framework Directive (Directive 96/62/ the sense that a country already practises laws, which conform
EC) on ambient air quality assessment and man- to the directive or are more advanced than the directive. Then
agement. no action is needed. But as EU legislation develops, more and
• Water Framework Directive on integrated river ba- more of the directives need to be translated into national law.
sin management (Directive 2000/60/EC). This should be done within a given time limit, which is part of
• Waste Framework Directive (Directive 2006/12/
EC).
the decision of the directive.
• A Regulatory framework (Regulation) for the Reg- From this point of view the European Legislation is not rel-
istration, Evaluation and Authorisation of Chemi- evant, only the national one. But the European environmental
cals (REACH) from December 2006. legislation gives a hint on what exists in the national legisla-
• A Soil Framework Directive for the protection of tion; it is a common minimum requirement. The national envi-
soil was proposed (COM(2006) 232) by the Com-
ronmental legislation, the Environmental Code of the country,
mission in 2006.
is what counts, but the European legislation gives a picture of
what it includes.

190 european union environmental legislation

 It should be added that the development of EU legislation tional legislation implementing a directive, after the deadline
includes a considerable amount of stakeholder consultation, for implementation has passed. Secondly, there are “non-con-
of questionnaires in which every EU citizen can take part, and formity” cases, where a Member State has failed to implement
of specialists reports from the countries. Legislation should a directive correctly. The final category is “bad application”,
thus be well prepared in Member States and is expected to be where a Member State is failing correctly to apply Community
acceptable both in content and the conditions for implementa- environment law in practice in a particular case.
tion. In most cases they also have been accepted by consensus The infringement procedure consists of several stages de-
in the Council of Ministers. fined in Article 226 of the EC Treaty. If the Commission finds
In most cases the environmental directives defines mini- that a Member State fails to comply with EU environment
mum conditions for environmental management in an area. law, it will issue a letter of ‘formal notice’ to the responsible
The Member States may use more stringent conditions. government. The government then has two months to respond
with its comments. If this response is considered inadequate
1.6 Legal Follow-up the Commission will issue a so-called ‘reasoned opinion’. If
It is the Commission’s responsibility to ensure that Com- the Member State then fails to comply within two months, the
munity law is implemented and applied correctly by the 27 Commission can refer the case to the European Court of Jus-
Member States of the Union. There are a number of ways in tice. If the Court finds the Member State guilty of breaching
which the Commission monitors this. First of all it undertakes Community law it may impose a fine in the form of a lump
its own studies and assessments. Secondly the Commission sum or penalty payment.
investigates complaints from EU citizens, petitions from the The Commission publishes each year a report on the Im-
European Parliament, and questions from Members of the Eu- plementation and Enforcement of Community Environmental
ropean Parliament (MEPs). The Commission also scrutinize Law, and the European Court of Justice publishes information
reports submitted by Member States themselves (there is an on the leading cases and judgements of the environmental law.
obligation to report under the environmental directives), to see
if there is a violation of Community environment law. 1.7 Policy Areas
There are three categories of breaches of Community law. The EU environmental legislation includes in 2007 several
Firstly, “non-communication” cases, where a Member State hundred legal acts. Most are directed towards a special medi-
has failed to adopt and communicate to the Commission na- um or sector, such as water, air, nature, waste, and chemicals.
Others deal with cross-cutting issues, e.g. access to environ-
mental information, and public participation in environmental
Box 2 Areas of Policy and Legislation decision-making (Box 2.)
All relevant areas will be briefly described below and the
The acts of policy and legislation are grouped in the most important legal texts listed and links given. Texts are
following 17 areas listed in alphabetical order: based on the EU Commission and DG Environment website.
1. Air In several areas the legalisation is fairly complex and in these
2. Biotechnology cases a selection has been made. The complete texts can be
3. Chemicals found in the links provided. In addition information from some
4. Civil Protection and Environmental Accidents
integrated areas (e.g. energy) is included.
5. Climate Change
6. Environmental Economics The original legally valid document (directives and their
7. Enlargement and Neighbouring Countries amendments) are found as pdf documents indicated with links
8. Health on the website. The review of environmental legislation here
9. Industry and Technology is mostly based on the introductory texts available for each of
10. International Issues the policy areas.
11. Land Use
12. Nature and Biodiversity
Link http://ec.europa.eu/environment/index_sv.htm.
13. Noise
14. Soil 1.8 Economic Instruments
15. Sustainable Development As a sharp contrast to the extensive body of European Union
16. Waste common environmental regulations, the EU does not have a
17. Water
common tax policy, with the exception of EU regulations on
minimum taxes for fuels. The use of economic instruments

european union environmental legislation 191

to support the implementation of EU environmental policy is 1.10 European Neighbourhood Policy
thus left to each Member State individually. The European Neighbourhood Policy (ENP) goes beyond ex-
The European Environmental Agency has, in coopera- isting relationships with the neighbouring countries to offer
tion with the Organisation for Economic Co-operation and substantial technical, political and financial support in sev-
Development, OECD, established a considerable database on eral areas including issues such as energy, transport and the
environmental economic policies and the use of environmen- environment. It is based on the Commission Communication
tal economic instruments within the EU and OECD Member “Wider Europe” from 2003, a Strategy Paper from 2004, and a
States. The database allows the user to select either one or more report on implementation from 2006. ENP applies to the EU’s
sectors of the economy or one or more household expenditure immediate neighbours by land or sea.
categories. The query will then list all the instruments to which In the Baltic Sea region ENP includes Belarus and Ukraine.
these sectors/categories have been linked. The ENP process is based on country reports and an action
The information is available in the following areas: Wa- plan for each country. The ENP Action Plan for Ukraine was
ter Pollution, Air Pollution, Climate Change, Land Contami- agreed on in early 2005. For Belarus ENP is not yet ‘activated’
nation, Waste Management, Natural Resource Management, since no Cooperation Agreement, which forms the base of the
Noise, Ozone Layer Protection, Energy Efficiency, Transport, ENP agreement, is in force.
Land Management. The relations with Russia are not part of ENP but devel-
Environmentally Related Taxes, Fees and Charges can be oped through a Strategic Partnership covering four so-called
studied e.g. revenues generated, tax rates, tax ceilings and ex- ‘common spaces’. (Common economy; freedom, security and
emptions in environmentally related taxes. There are also data justice; external security; research, education, culture.) Envi-
on Tradable Permit Systems, Deposit-Refund Systems and En- ronmental concerns are not included.
vironmentally Motivated Subsidies. Up to 2006, ENP assistance was provided under geograph-
Link http://www2.oecd.org/ecoinst/queries/index.htm ical (TACIS for Central Europe and Russia and MEDA for
the Mediterranean area), and thematic programmes such as
1.9 The European Economic Area EIDHR (European Initiative for Democracy and Human
EFTA, the European Free Trade Association, was created by Rights). From 2007 these have been replaced by the European
seven, later expanded to nine, European states in 1960. Since Neighbourhood and Partnership Instrument (ENPI), designed
then several of these joined the European Union. In 1992 the to target sustainable development and approximation to EU
remaining countries – Iceland, Liechtenstein and Norway – policies and standards. For 2007-2013 the ENPI budget is ap-
entered into the European Economic Area (EEA) Agreement proximately 12 billion euros. The ENPI cross-border coopera-
with EU, which entered into force in 1994. tion (CBC) programme, which supports activities across the
The EEA was maintained because of the wish of the three EU’s external borders in the East and the South, is funded with
countries to participate in the Internal Market, while not as- 1.18 billion euros for the period 2007-2013.
suming the full responsibilities of EU membership. The coop- Link http://ec.europa.eu/world/enp/index_en.htm
eration is very close as all new Community legislation in areas
covered by the EEA, which include environmental legislation, 1.11 Global Cooperation
is integrated into the Agreement through an EEA Joint Com- Most environmental problems are transboundary, often global,
mittee decision, and subsequently becomes part of the national and can only be addressed effectively through international
legislation of the EEA EFTA States. In addition, the three EEA cooperation. For this reason, the EC Treaty establishes that
EFTA States fully participate in the European Environment one of the key objectives of Community policy on the environ-
Agency. The EEA EFTA States are, of all the countries associ- ment is to promote measures at international level to deal with
ated with the Union, technically the most closely linked to the regional or worldwide environmental problems. The Union is
EU. Thus, in effect, the EU environmental legislation applies also part of a number of international bodies in which it plays
in 30 of the European countries. an import role, as it represents a considerable group of coun-
Politically, however, the fact that EU membership is not tries. It is in these many of the international conventions and
on the current agenda for any of the EEA EFTA countries dis- other agreements are worked out. The most important include
tinguishes them from other close neighbours, who have EU the United Nations with its institutions such as the Commis-
membership as a declared objective. These include Turkey and sion on Sustainable Development, and United Nations Envi-
the Balkan countries. Switzerland is unique as it stands outside ronment Programme (UNEP), the Organisation for Economic
almost all international cooperation. Cooperation and Development (OECD) and the G8 group.

192 european union environmental legislation

 The European Community participate in international en-
Box 3 International Environmental Agreements
vironmental agreements, together with its Member States. The
6th EAP of the EU is asking for “swift ratification, effective
International environmental agreements to which
the EU is a Party or a Signatory listed according to
compliance and enforcement of all international conventions
theme and agreements relating to the environment where the Com-
munity is a Party”. The Union has also already ratified many
Geneva Convention on Long-range Transboundary Air International Environmental Agreements both on a global lev-
Pollution, CLRTAP (1979) el (multilateral conventions negotiated under the auspices of
Convention on Biological Diversity, CBD (1992) and the UN), regional level (e.g. in the context of UN/ECE or the
the Cartagena Biosafety Protocol (2000) Council of Europe), and sub-regional level (for instance for
Rotterdam Convention on Prior Informed Consent on the management of seas or transboundary rivers).
hazardous chemicals, PIC (1998)
The matters addressed by these agreements are very wide,
Stockholm Convention on Persistent Organic Pollut- and include among other the following areas: biodiversity and
ants, POP (2001) nature protection, climate change, protection of the ozone
Helsinki Convention on Industrial Accidents (1992)
layer, desertification, management of chemicals and waste,
Barcelona Convention to reduce pollution in the Med- transboundary water and air pollution, environmental govern-
iterranean Sea (1976) ance (including impact assessments, access to information and
Helsinki Convention on the protection of the marine public participation), industrial accidents, maritime and river
environment of the Baltic Sea (1992)
OSPAR Convention for the Protection of the Marine
protection, and environmental liability (Box 3).
Environment of the North-East Atlantic (1992) The Union has an important role in the follow-up of sev-
Bonn Agreement on cooperation for combating pollu- eral international conference in the field of environment and
tion in the North Sea Area (1983) sustainable development, including the Rio (UNCED) and
Lisbon Agreement on the Protection of the Coasts and Johannesburg (WSSD) conferences. The Johannesburg Plan
the North-East Atlantic against Pollution (1990)
of Implementation (JPol) and the Political Declaration adopt-
United Nations framework Convention on Climate ed in Johannesburg, together with the Doha Development
Change, UNFCCC (1992) and the Kyoto protocol Agenda (Trade) and the Monterrey consensus (Financing for
(1997)
Development), have shaped a global partnership for sustain-
Vienna Convention for the Protection of the Ozone
Layer (1985) and the Montreal protocol (1987) able development. This partnership includes commitments to
increased development assistance and market access for de-
Aarhus Convention (1998) on access to environmen-
veloping countries, good governance and a better protection
tal information
Espoo Convention on Environmental Impact Assess- of the environment.
ment (1991)
Alpine Convention (1991) 2. AIR
Bonn Convention on the Conservation of Migratory
Species, CMS (1979) 2.1 Clean Air for Europe
Bern Convention on European Wildlife and Habitats Air pollution has been one of Europe’s main political con-
(1979) cerns since the late 1970’s. European Union policy included
Convention on the Conservation of the marine fauna the control of emissions from stationary sources, in particu-
and flora of the Antartic (1980) lar large power plants and other installations in the energy
sector, but also mobile sources, e.g. through requests on fuel
United Nations Convention to Combat Desertifica-
tion, UNCCD (1994) quality.
Air quality trends in the Community are overall encourag-
Basel Convention on hazardous wastes (1989)
ing. Since the 1970’s the air pollution in Europe has decreased
Helsinki Convention on Watercourses and Internation- by some 80%. Still the Sixth Environmental Action Programme
al Lakes (1992) includes air pollution as one of the issues under Environment
River basin conventions (Danube (1987), Elbe (1990),
and Health, where new efforts are considered necessary. The
Oder (1996), Rhine (1999))
objective is to “achieve levels of air quality that do not give
rise to unacceptable impacts on, and risks to, human health
and the environment”.

european union environmental legislation 193

 EU work to reduce air pollution includes EC legislation, 2.3 The Air Quality Framework Directive and its
international agreements to reduce cross-border pollution, sec- Daughter Directives
tors responsible for air pollution, national, regional authorities The Council Directive 96/62/EC on ambient air quality assess-
and NGOs, and research. The focus is implementation of air ment and management is commonly referred to as the Air Quality
quality standards and coherency of all air legislation and re- Framework Directive. It describes the basic principles as to how
lated policy initiatives. Data on pollutants and their effects on air quality should be assessed and managed in the Member States.
health are provided by the Air Quality Guidelines of the World It lists the pollutants for which air quality standards and objectives
Health Organisation (WHO) and from the European Environ- have been and will be developed and specified in legislation.
mental Agency. Council Directive 1999/30/EC specifies limit values for
In order to integrate the work of the Union on combating air sulphur dioxide, nitrogen dioxide and oxides of nitrogen, par-
pollutions the Commission launched in March 2001 the CAFE ticulate matter and lead in ambient air. The directive is the so-
Programme (Communication COM(2001)245). CAFE which called First Daughter Directive. The directive describes the
is short for “Clean Air for Europe” is a programme of techni- numerical limits and thresholds required to assess and man-
cal analysis and policy development underpinning the Thematic age air quality for the pollutants mentioned. It addresses both
Strategy on Air Pollution. CAFE aims to develop long-term, stra- PM10 and PM2.5 but only establishes monitoring requirements,
tegic and integrated policy advice to protect against significant no limit values, for fine particles.
negative effects of air pollution on human health and the envi- Directive 2000/69/EC, the Second Daughter Directive,
ronment. The implementation of the Thematic Strategy started in specifies limit values and numerical criteria relating to the as-
September 2005. The Council adopted unanimously the Council sessment and management of benzene and carbon monoxide in
Conclusions on the Thematic Strategy in March 2006. ambient air.
The member states are requested to report on air quality Directive 2002/3/EC, the Third Daughter Directive, estab-
data, as regulated in Council Decision 97/101/EC. It estab- lished target values and long term objectives for the concentra-
lishes a reciprocal exchange of information and data from tion of ozone in air. Ozone is a secondary pollutant formed in
networks and individual stations measuring ambient air pol- the atmosphere by the chemical reaction of hydrocarbons and
lution within the Member States. This EoI Decision describes nitrogen oxides ion in the presence of sunlight. The directive
the procedures for the dissemination of air quality monitoring therefore also describes certain monitoring requirements relat-
information to the Commission and to the public. ing to volatile organic compounds and nitrogen oxides in air.
Link http://ec.europa.eu/environment/air/ Directive 2004/107/EC, the Fourth Daughter Directive,
Link http://ec.europa.eu/environment/air/cafe/index.htm completes the list of pollutants initially described in the Frame-
work Directive, with arsenic, cadmium, mercury, nickel and
2.2 The Convention on Long Range Transboundary
polycyclic aromatic hydrocarbons in ambient air. Target values
Air Pollution
for all pollutants except mercury are defined for the listed sub-
The United Nations Economic Commission for Europe, UN- stances. For PAHs, the target is defined in terms of concentra-
ECE, introduced in 1979 the Convention on Long Range tion of benzo(a)pyrene, which is used as a marker substance.
Transboundary Air Pollution, to which EU is a partner. To the Monitoring requirements are specified only for mercury.
Convention has been added a total of 8 protocols, in particu- The Commission adopted a proposal for a directive on am-
lar a protocol on sulphur in 1985, on nitrogen oxides in 1988, bient air quality at the same time as it adopted the thematic
on VOC, Volatile Organic Compounds in 1991, a second sul- strategy on air pollution. This new proposal includes the fol-
phur protocol in 1994, and a protocol on heavy metals and lowing key elements:
one on POPs in 1998. The development of the Convention
continues with protocols on integration and multiple effects • that most of existing legislation, except for the fourth
of pollutants. daughter directive, be merged into a single directive with
The Convention has been successful as far as air pollution no change to existing air quality objectives
in Europe has decreased considerably over the period of its • new air quality objectives and monitoring requirements
existence. The Convention management includes the EMEP for PM2.5 (fine particles)
programme for monitoring and evaluation with a Data Centre • the possibility to discount natural sources of pollution
for systematic reports and studies of the effects. There is also a when assessing compliance against limit values
considerable cooperation with IIASA in these matters. • absolute time extensions of up to five years for compliance
Link http://www.unece.org/env/lrtap/ with the dates of entry into force of existing limit values.

194 european union environmental legislation

The directive proposal is subject to the co-decision procedure port and use of their fuels by 10% between 2011 and 2020.
and will only enter into force once adopted by both the Coun- This will cut emissions by a cumulative total of 500 million
cil of Ministers and the European Parliament. tonnes of carbon dioxide by 2020.
Link http://ec.europa.eu/environment/air/existing_leg.htm Directive 98/70, as amended by Directive 2003/17/EC,
contains the environmental fuel quality specifications for pet-
2.4 Air Quality Standards rol and diesel fuels in the Community with the main focus on
The European Union has developed an extensive body of leg- sulphur and, for petrol, on lead and aromatics. Since 1 January
islation which establishes health based standards and objec- 2005 the limit on the sulphur content of petrol and diesel is
tives for a number of pollutants in air. These standards and ob- 50 ppm and Member States are required to start phasing in ul-
jectives are summarised in a table (see link). They apply over tra-low sulphur fuel with a maximum10 ppm sulphur content.
differing periods of time because the observed health impacts Since 1 January 2002 all petrol sold in the EU is unleaded. A
associated with the various pollutants occur over different ex- new petrol blend will be established allowing higher content of
posure times. A limit value is legally binding. A target value the biofuel ethanol; sulphur levels in diesel and gasoil will be
is to be attained as far as possible by the given attainment date cut to reduce emissions of dangerous dust particles.
and is less strict than a limit value. Ships are fast becoming the biggest source of air pollution
The legislation requires that the Member States divide their in the EU. In 2000 EU-flagged ships emitted almost 200 mil-
territory into a number of zones and agglomerations in which lion tonnes of carbon dioxide. This is significantly more than
they should undertake assessments of air pollution levels using emissions from EU aviation. In November 2002, the European
measurements and modelling and other empirical techniques. Commission adopted a European Union strategy to reduce at-
Where levels are elevated, an air quality plan or programme mospheric emissions from seagoing ships. The strategy sets
should be prepared to ensure compliance with the limit value out a number of actions to reduce the contribution of shipping
before the date when the limit value formally enters into force. to acidification, ground-level ozone, eutrophication, health,
Information on air quality should be disseminated to the public. climate change and ozone depletion. Air pollutant emissions
Link http://ec.europa.eu/environment/air/quality.htm from ships are also covered by Annex VI of the Marine Pollu-
tion Convention, MARPOL 73/78, of the International Mari-
2.5 Emissions from Traffic on Road, Sea and Air time Organization with provisions on sulphur and nitrogen
The EU transport system is currently not sustainable, and in oxide emissions standards for ships’ engines.
many respects moving away from sustainability rather than to- Engines in non-road mobile machinery, such as engines in
wards it. The European Environment Agency has highlighted excavators, bulldozers, front loaders, etc. are regulated by Di-
the sector’s growing CO2 emissions that threaten the EU meet- rective 97/68/EC.
ing its target under the Kyoto protocol. It also pointed to the Link http://ec.europa.eu/environment/air/transport.htm
large proportion of the population that is exposed to air pollu-
tion and other environmental impacts from transport, even if 2.6 Emissions from Industrial Sources – Large
emissions are measurably falling (even though traffic volumes Combustion Power Plants
continue to rise). A number of pieces of legislation have been Control of emissions from large combustion plants – those
developed to control air pollution from vehicles. with a rated thermal input equal to or greater than 50 MW
Motor vehicle emissions are regulated by Directive 70/220/ – plays an important role in the Community’s efforts to com-
EEC (light vehicles) and 88/77/EC (heavy vehicles) with bat acidification, eutrophication and ground-level ozone. Di-
amendments. By the Auto-Oil Programme stricter limit val- rective 2001/80/EC on the limitation of emissions of certain
ues for carbon monoxide (CO), Volatile Organic Compounds pollutants into the air from large combustion plants, the LCP
(VOC), nitrogen oxides (NOX) and particles will be imple- Directive, entered into force in November 2001. It repealed the
mented for light (Directive 98/69/EC) and heavy duty (Direc- old Directive on large combustion plants (Directive 88/609/
tive 1999/96/EC) vehicles. By the Auto-Oil Programme the EEC) and tightened the Community requirements for air pol-
manufacturers are responsible for the emissions from light ve- lution control from new combustion plants in line with the
hicles during five years or 80,000 km, whichever occurs first. substantial technical progress in the area.
A similar legislation is on its way for heavy-duty vehicles. The LCP Directive encourages the combined generation of
In January 2007 the European Commission proposed new heat and power and sets specific emission limit values for the
standards for transport fuels that will ask suppliers to reduce use of biomass as fuel. It also includes gas turbines in its scope
the greenhouse gas emissions caused by the production, trans- in order to regulate NOX emissions. In particular, the LCP Di-

european union environmental legislation 195

rective requests that plants licensed after November 2002 will REACH will create a single system for both what are cur-
have to comply with the emission limit values for SO2, NOX rently described as “existing” and “new” substances, and for
and dust, and that plants licensed after July 1987 and before all of them ensure registration, evaluation and authorisation.
November 2002, will have to comply with certain of these Registration requires manufacturers and importers to obtain
emission limit values. The LCP Directive also requires sig- relevant information on their substances and to use that data to
nificant emission reductions from ”existing plants” (licensed manage them safely. To reduce testing on vertebrate animals,
before 1 July 1987) to be achieved by January 2008. data sharing is required for studies on such animals. For other
A national emission reduction plan, whether used alone tests, data sharing is required on request. Better information
or as part of a combined approach, must address all the three on hazards and risks and how to manage them will be passed
pollutants covered by the Directive for all the plants covered down and up the supply chain. Downstream users are brought
by the plan. The plants covered by the LCP Directive are also into the system.
covered by the Integrated Pollution Prevention and Control Evaluation is undertaken by the forthcoming European
(IPPC) Directive. In this respect, the LCP Directive only sets Chemicals Agency to evaluate testing proposals made by in-
minimum obligations, which are not necessarily sufficient to dustry or to check compliance with the registration require-
comply with the IPPC Directive. ments. The Agency will also co-ordinate substance evaluation
Link http://eur-lex.europa.eu/LexUriServ/site/en/con- by the authorities to investigate chemicals with perceived risks.
sleg/2001/L/02001L0080-20011127-en.pdf Substances will be made subject to authorisation. Applicants
will have to demonstrate that risks associated with uses of sub-
stances are adequately controlled or that the socio-economic
3. CHEMICALS
benefits of their use outweigh the risks. Applicants must also
3.1 The Dilemma of Chemicals Control analyse whether there are safer suitable alternative substances
The need to protect the environment by creating common or technologies, and if there are, they must prepare substitution
standards for products, amongst them dangerous chemicals, plans, or provide information on research and development ac-
was recognized early. But the systems introduced have not tivities. The restrictions provide a procedure to regulate that the
been sufficient to deal with the problems. There is still no le- manufacture, placing on the market or use of certain dangerous
gal instrument to ensure the safe use of the most substances. substances shall be either subject to conditions or prohibited.
Today there are more than 100,000 substances used in the Un- Thus, restrictions act as a safety net to manage Community
ion; most of them have not been tested for toxicity. If there is a wide risks that are otherwise not adequately controlled.
suspected damage caused by a chemical the burden of proof is The European Chemicals Agency (ECHA), which will
not on the industry, which have used or produced the chemical, manage the technical, scientific and administrative aspects of
but the victim or on the public authorities. the REACH system at the Community level, will create a clas-
Many pieces of Community legislation have been adopted sification and labelling inventory of substances will help pro-
to handle chemicals. These include Regulations on Pesticides; mote agreement within industry on their classification.
Worker Protection; Prevention of Chemical Accidents and Link http://ec.europa.eu/environment/chemicals/index.htm
Reduction of Industrial Emissions e.g. Volatile Organic Com-
pounds and Mercury. In addition, work is progressing in par- 3.3 Scope of REACH
ticular on Endocrine Disrupting Chemicals and on Dioxins. The REACH Regulation, was formally adopted on 18 Decem-
ber 2006. It will eventually replace a number of legal docu-
3.2 The REACH Regulation ments, such as the Directive on the Classification, Packaging
The Commission proposed a new EU regulatory framework and Labelling of Dangerous Substances, and on the Evaluation
for the Registration, Evaluation and Authorisation of Chemi- and Control of the Risks of Existing Substances; and the Di-
cals (REACH) in October 2003. REACH is based on the idea rective on Restrictions, Marketing and Use of certain Danger-
that industry itself is best placed to ensure, that the chemicals ous Substances.
it manufactures and puts on the market do not adversely affect REACH covers all substances whether manufactured, im-
human health or the environment. This requires that industry ported, used as intermediates or placed on the market, either
has knowledge of the properties of its substances and man- on their own, in preparations or in articles, unless they are ra-
ages potential risks. Authorities should focus their resources dioactive, subject to customs supervision, or are non-isolated
on ensuring that industry is meeting its obligations and taking intermediates. Waste is specifically exempted. Food is not sub-
action when needed. ject to REACH as it is not a substance, preparation or article.

196 european union environmental legislation

Other substances are exempted where other equivalent legisla- registration of substances in articles (e.g. manufactured goods
tion applies. such as cars, textiles, electronic chips), a special regime ap-
There is a general obligation for manufacturers and import- plies. REACH requires all substances that are intended to be re-
ers of substances to submit a registration to the Agency for each leased from articles during normal and reasonably foreseeable
substance manufactured or imported in quantities of 1 tonne or conditions of use to be registered according to the normal rules,
above per year. Manufacturers and importers of substances will including tonnage, deadlines and information requirements, if
need to obtain information on the substances they manufacture those substances are present in the articles above 1 tonne per
or import, and use this information to assess the risks arising year. As a safety net, the Agency can require a registration of
from the uses, and to ensure that the risks which the substances a substance in an article at any time when it considers that its
may present are properly managed. Registration requires man- release poses a risk to human health or the environment.
ufacturers and importers to submit a technical dossier, for sub- To enable a smooth transition from the existing chemicals
stances in quantities of 1 tonne or more, and a chemical safety legislation to REACH, the Commission has developed an in-
report for substances in quantities of 10 tonnes or more. terim strategy. The main purpose of this interim strategy is to
To find out the properties of the substances new tests are ensure that all stakeholders, especially industry and public au-
only required when it is not possible to provide the informa- thorities, are adequately prepared for the practical application
tion in any other permitted way. Where new tests are carried of the new system by the time REACH enters into force.
out there are general provisions on the generation of informa- Link http://ec.europa.eu/environment/chemicals/reach/reach_
tion to ensure the quality of toxicological and eco-toxicologi- in_brief04_09_15.pdf
cal tests and analyses. A defined set of information is asked for
persistent, bioaccumulative and toxic (PBT) or very persistent 3.5 The Directives on Existing Substances, EINECS
and very bioaccumulative (vPvB) substances or substances and ELINCS
that are potentially dangerous to health or the environment. In the 1960´s the national provisions on chemicals differed
A chemical safety report (CSR) is requested for substances widely and thus hindered the trade of the European Commu-
manufactured or imported in quantities starting at 10 tonnes. nity. In addition, it was recognised that there was a need to
The CSR must include an exposure scenario on the appropri- ensure the protection of public health, in particular the health
ate risk management measures and operational conditions that of workers handling dangerous substances. Directive 67/548/
ensure that the risks from the uses of the substance are ad- EEC in 1967 approximated the national provisions relating
equately controlled. For intermediates, that is substances that to dangerous substances. The Directive introduced common
are used in the manufacturing process, but are consumed or provisions on the classification, packaging and labelling of
transformed into another substance, special rules apply. dangerous substances. Since its adoption in 1967, the Direc-
Link http://ec.europa.eu/environment/chemicals/reach/reach_ tive has constantly been updated in order to take into account
in_brief04_09_15.pdf scientific and technical progress to make sure a high level of
protection of man and the environment, as well as the correct
3.4 The Implementation of REACH functioning of the internal market is guaranteed.
REACH entered into force on 1 June 2007. After that, there The 6th amendment of the Directive in 1979 introduced a
will be an additional year before the main REACH procedures notification system for “new” substances. In consequence it
start to apply in order to allow the new European Chemicals required the establishment of the list of “existing” substances,
Agency to be established in Helsinki, Finland, to become fully called EINECS. EINECS is the European Inventory of Exist-
operational. Then the industry will start to submit pre-registra- ing Commercial Chemical Substances and lists all substances
tion dossiers for existing substances and registration dossiers that were reported to be on the market on or before 18 Sep-
for new substances. tember 1981. EINECS is listing about 100,000 existing sub-
To facilitate the transition to the REACH system, the reg- stances – counting for about 99% of the chemicals’ volume on
istration provisions will be applied in a step-wise fashion. A the market. The substances placed on the market for the first
series of registration deadlines are established for the different time after this target date are considered “new” and are added
tonnage ranges, although certain substances of high environ- to ELINCS. ELINCS is European LIst of Notified Chemical
mental concern will need to be registered early. About 30,000 Substances. New substances are required to be tested and noti-
phase-in substances (excluding intermediates) are expected to fied before marketing in volumes above 10 kg.
be registered over the first 11 years after the entry into force of The core of the EU’s ’Existing Substances Program’ is to
REACH, plus a number of “non-phase-in” substances. For the ensure better management of risks of existing substances to

european union environmental legislation 197

man and the environment. Hence, risk assessment reports and ants consists of pesticides (such as DDT), industrial chemicals
risk reduction strategies create the necessary basis for the im- (such as polychlorinated biphenyls, PCBs) and unintentional
plementation of risk reduction measures. The 7th amendment by-products of industrial processes (such as dioxins and
of the Directive in 1992 required a risk assessment for “new” furans). Persistent Organic Pollutants are transported across
substances. It further introduced the “sole representative” in international boundaries far from their sources, even to regions
the notification system, and added the Safety Data Sheet as a where they have never been used or produced. Consequently,
hazard communication facility for the professional user. persistent organic pollutants pose a threat to the environment
The notification system of ’new substances’ will be sub- and to human health all over the globe.
stituted by REACH. The classification and labelling system Two international legally binding instruments control
of the Directive 67/548/EEC will be substituted by the imple- POPs. The Protocol on POPs to the UNECE Convention on
mentation of the Globally Harmonised System (GHS), the glo- Long-Range Transboundary Air Pollution (CLRTAP), which
bal measure corresponding to REACH. entered into force in 2003, and the global Stockholm Conven-
Links http://ec.europa.eu/environment/dansub/home_en.htm tion on POPs, which entered into force in 2004. These instru-
http://ec.europa.eu/environment/chemicals/exist_subst/index.htm ments establish strict international regimes for 16 POPs in the
UNECE Protocol and 12 POPs in the Stockholm Convention.
3.6 Plant Protection Products and Biocides Both instruments also contain provisions for including addi-
Pesticides are chemical products that are used to destroy or tional chemicals into these lists.
otherwise control pests and other harmful organisms. There The European Community has signed both international in-
are significant economic and other benefits related to the use struments on POPs, together with the then 15 Member States,
of pesticides, but they also cause concern for human health and they are now included in Regulation (EC) No 850/2004
and the environment. on persistent organic pollutants. They lay down the follow-
Pesticides contain one or more biologically active sub- ing control measures: Prohibition or severe restriction of the
stances that have the controlling effect on the unwanted organ- production and use of intentionally produced POPs. Restric-
isms. Unfortunately, these substances are often also harmful to tions on export and import of the intentionally produced POPs
non-target organisms. Therefore, in many countries, pesticides (Stockholm Convention). Provisions on the safe handling of
have been subject to strict control for long time already. Spe- stockpiles (Stockholm Convention). Provisions on the envi-
cific assessment and approval schemes have been established ronmentally sound disposal of wastes containing POPs. Pro-
to prevent unacceptable effects on human health and the envi- visions on the reduction of emissions of unintentionally pro-
ronment and to ensure that products are effective and suitable duced POPs (e.g. dioxins and furans).
for their purpose. The new Regulation complements the earlier Community
In Community legislation, pesticides have been divided into legislation on POPs and aligns it with the provisions of the
two major groups, plant protection products and biocidal prod- international agreements on POPs. The European Community
ucts. Products belonging to these groups need to be assessed and Implementation Plan to the Stockholm Convention, which
authorised before they can be placed on the market. In addition, complements the national plans of the EU Member States, was
certain pesticides are subject to prohibitions or restrictions and adopted on 9 March 2007.
regulations concerning control of international trade. As many Link http://ec.europa.eu/environment/pops/index_en.htm
pesticides are deliberately released to the environment, they are
also a source of surface and ground water pollution. Therefore 3.8 Directives on Chemical Accidents (Seveso II)
they are subjects of water legislation as well. All in all, the sus- The ”Seveso” accident happened in 1976 at a chemical plant
tainable use of pesticides is an issue recognised to be of major in Seveso, Italy, manufacturing pesticides and herbicides. A
importance in the Sixth Environment Action Program. dense vapour cloud containing tetrachlorodibenzoparadioxin
Links http://ecb.jrc.it/biocides/ (TCDD), commonly known as dioxin, was released from a re-
http://ec.europa.eu/environment/chemicals/preparing/interim.htm actor, used for the production of trichlorofenol. Although no
immediate fatalities were reported, kilogramme quantities of
3.7 POPs – Persistent Organic Pollutants the substance lethal to man even in microgramme doses were
Persistent organic pollutants (POPs) are chemical substances widely dispersed which resulted in an immediate contamina-
that persist in the environment, bioaccumulate through the tion of some ten square miles of land and vegetation. More
food web, and pose a risk of causing adverse effects to hu- than 600 people had to be evacuated from their homes and as
man health and the environment. This group of priority pollut- many as 2000 were treated for dioxin poisoning.

198 european union environmental legislation

 In 1982, Council Directive 82/501/EEC on the major-acci- At present, the legal basis of Community action is found
dent hazards of certain industrial activities – so-called Seveso in Decision 2850 of 20/12/2000 on a framework for coopera-
Directive – was adopted. In the light of severe accidents at the tion in the field of accidental or deliberate marine pollution
Union Carbide factory at Bhopal, India in 1984 where a leak with the aim to support and supplement Member States’ ef-
of methyl isocyanate caused more than 2,500 deaths and at the forts. Council Decision of 23 October 2001, which established
Sandoz warehouse in Basel, Switzerland in 1986 where fire- a mechanism for reinforced cooperation in civil protection as-
fighting water contaminated with mercury, organophosphate sistance interventions covering both civil protection and ma-
pesticides and other chemicals caused massive pollution of rine pollution, has had a significant impact. At the same time
the Rhine and the death of half a million fish, the Seveso the European Maritime Safety Agency (EMSA) has increased
Directive was amended twice, in 1987 by Directive 87/216/ its role. In December 2006 the Commission issued a Com-
EEC and in 1988 by Directive 88/610/EE. Both amendments munication (2006/0863) on the current preparedness and re-
aimed at broadening the scope of the Directive, in particular sponse of Community to marine pollution, indicating how to
to include the storage of dangerous substances. continue and promote this field from 2007 and on.
In 1996, Council Directive 96/82/EC on the control of Link http://ec.europa.eu/environment/civil/marin/mp02_en_
major-accident hazards – so-called Seveso II Directive – was legislation.htm
adopted. The Seveso II Directive has fully replaced its predeces-
sor, the original Seveso Directive. Important changes includes a
4. ENERGY
revision and extension of the scope, the introduction of new re-
quirements relating to safety management systems, emergency 4.1 Energy and Environment
planning and land-use planning and a reinforcement of the pro- All energy production and consumption has environmental
visions on inspections to be carried out by Member States. impacts. Energy related emissions contribute to pollution of
In the light of recent industrial accidents (Toulouse, Baia air, water and soil while also posing risks to human health,
Mare and Enschede) and studies on carcinogens and sub- nature and biodiversity. EU sustainable energy policies aim to
stances dangerous for the environment, the Seveso II Direc- reduce these threats, while ensuring the security of supply and
tive 96/82/EC was extended by the Directive 2003/105/EC. the competitiveness of the EU industries.
The most important extensions of the scope of that Directive The EU has made a commitment to integrate environmen-
are to cover risks arising from storage and processing activi- tal concerns into all relevant policy areas, including energy.
ties in mining, from pyrotechnic and explosive substances and This work is an ongoing process requiring efforts in a number
from the storage of ammonium nitrate and ammonium nitrate of areas including setting ambitious targets for increasing
based fertilizers. energy efficiency and share of renewable energies in overall
Link http://ec.europa.eu/environment/seveso/index.htm energy mix and for alternative fuels, as well as ensuring the
internal energy market by separating energy production from
3.9 Large Oil Spills at Sea distribution.
Europe is the world’s largest market in crude oil imports, rep- Comparison of the energy related effects on environment
resenting about one third of the world total. Ninety percent of and human health from different energy sources is often not
oil and refined products are transported to and from Europe by straightforward and energy modelling is thus needed to guide
sea. Accidents resulting in massive spill, such as ”Prestige” or the policy decisions in selection of the relevant policy meas-
”Erika”, provide gripping illustrations of the problem of vessel ures and the choice between different energy sources.
pollution. Large oil spills at sea constitute a threat to the envi- Climate change is currently the most serious threat to the
ronment, placing enormous demands on the national authori- natural environment and human health with potentially devas-
ties responsible for response and clean-up operations. tating economic costs to the societies worldwide. Since 80% of
Besides accidental pollution, caused by ships in distress, the greenhouse gases originate from heat and power production
there are three types of routine ship operations, which pollute as well as from transport, one of the main energy-related policy
the sea: ballast water, tank washings and engine room efflu- drivers in the EU is the reduction of greenhouse gases (GHG) at
ent discharges. Due to these operations large amounts of oil their sources. This is persued in the European Climate Change
are pumped deliberately from ships every day, along almost Programme (ECCP), the greenhouse gas trading Emissions
the entire coastline of Europe. This is the greatest source of Trading Scheme (ETS), limiting air pollution through National
marine pollution by ships, and the one that poses an insidious Emission Ceilings (NEC) directive, and developing common
long-term threat to the marine and coastal environment. rules for Carbon Capture and Storage (CCS).

european union environmental legislation 199

 The 2007 Spring European Council adopted an energy and legal frameworks needed to eliminate barriers and imper-
policy for Europe, aiming at saving energy and promoting cli- fections in markets for energy services and for providing en-
mate-friendly energy sources. EU leaders set a firm target of ergy-saving programmes. The proposed directive includes an
cutting 20% of the EU’s greenhouse gas emissions by 2020 annual target to save 1% of the quantity of energy supplied
– the EU will be willing to put this goal up to 30% if the US, and/or sold to the end customers.
China and India make similar commitments. EU leaders also The proposal is related to Council Directive 93/76/EEC
set a binding overall goal of 20% for renewable energy sources on limiting carbon dioxide emissions by improving energy ef-
by 2020, compared to the present 6,5%. A binding minimum ficiency (SAVE). The Communication from the Commission
target of 10% for the share of biofuels in overall transport pet- – Energy efficiency in the European Community – Towards a
rol and diesel consumption by 2020 was also set. strategy for the rational use of energy is of interest.
With the exception of carbon dioxide trading, legislation Link http://europa.eu/scadplus/leg/en/s14000.htm
in this area is rather weak and development is rather promoted
through policy actions and support programmes. Below exist- 4.3 Energy Performance of Buildings
ing and planned legislation will be described in the context of Energy consumption for buildings-related services accounts
the European energy policy. for approximately one third of total EU energy consumption.
The Directive 2002/91/EC on the energy performance of build-
4.2 Energy Efficiency ings is a follow-up to the measures on boilers (92/42/EEC),
The European Community, together with its Member States, is construction products (89/106/EEC) and SAVE programme
working intensively to improve energy efficiency in all sectors provisions on buildings. The earlier directive on the energy
whilst at the same time increasing the use of renewable ener- certification of buildings (Directive 93/76/EEC repealed by
gies. This can be a key issue to solve environmental, self-suf- Directive 2006/23/32/EC) does not have the same objectives
ficiency and cost problems and adequately provide for increas- as Directive 2002/91/EC, which propose actions to fill any ex-
ing energy demand without major upheavals. Improved energy isting gaps.
efficiency will play a key role in meeting the EU Kyoto target Directive 2002/91/EC concerns the residential sector and
in an economic way. the tertiary sector (offices, public buildings, etc.). It covers all
The Green Paper on Energy Efficiency points to the fact aspects of energy efficiency in buildings in an attempt to estab-
that the EU could save at least 20% of its present energy con- lish a truly integrated approach, while the scope of the provi-
sumption in a cost-effective manner, equivalent to 60 billion sions on certification does not include some buildings, such as
euros per year, or the present combined energy consumption historic buildings, industrial sites, etc.
of Germany and Finland. Energy saving is without doubt the The four main aspects of the proposed general framework
quickest, most effective and most cost-effective manner for are:
reducing greenhouse gas emissions, as well as improving air
1. a common methodology for calculating the integrated
quality, in particular in densely populated areas.
energy performance of buildings;
In order to support better integration of energy efficiency
2. minimum standards on the energy performance of new
measures into national legislation the European Commission
buildings and existing buildings that are subject to major
has proposed several directives, which have been adopted and
renovation;
are now in force. These concern broad areas where there is
3. systems for the energy certification of new and existing
significant potential for energy savings. They are:
buildings and, for public buildings, prominent display of
• End-use Efficiency & Energy Services this certification and other relevant information. Certifi-
• Energy Efficiency in Buildings cates must be less than five years old;
• Eco-design of Energy-Using Products 4. regular inspection of boilers and central air-conditioning
• Energy Labelling of Domestic Appliances systems in buildings and in addition an assessment of
• Combined Heat and Power heating installations in which the boilers are more than 15
years old.
A number of voluntary instruments were also adopted to
foster better cooperation with industry. The European Parlia- The Member States are responsible for drawing up the
ment and the Council has proposed a Directive to promote minimum standards. They will also ensure that the certifica-
energy end-use efficiency and energy services. The directive tion and inspection of buildings are carried out by qualified
will establish targets, incentives and the institutional, financial and independent personnel.

200 european union environmental legislation

 Related regulations are Directive 2006/32/EC on energy 5. CLIMATE CHANGE
end-use efficiency and energy services and repealing Coun- 5.1 EC and the United Nations Framework
cil Directive 93/76/EEC, Directive 2005/32/EC establishing a Convention on Climate Change
framework for the setting of eco-design requirements for en-
The United Nations Framework Convention on Climate
ergy-using products and amending Council Directive 92/42/
Change (UNFCCC), approved by the Union as Council De-
EEC, and Directives 96/57/EC and 2000/55/EC.
cision 94/69/EC, has the long-term objective to prevent dan-
Link http://ec.europa.eu/energy/demand/legislation/build-
gerous anthropogenic interference with the climate system.
ings_en.htm
Its Kyoto Protocol, signed in New York on 29 April 1998, re-
4.4 Cogeneration quires the EC (consisting of the 15 Member States of before
May 2004) to reduce greenhouse gas (GHG) emissions by 8%
Cogeneration is a technique allowing the production of heat
below 1990 levels by 2008-2012. Most of the 10 new Member
and electricity in a single process. There is considerable un-
States have the same target. The target for Hungary and Poland
exploited potential for cogeneration in the Member States.
is -6% while Cyprus and Malta are no Annex-I Parties to the
Moreover cogeneration reduces losses on the electrical grid
UNFCCC and thus have no targets.
because cogeneration installations are usually closer to the
The convention commits the Community and its Member
consumption point.
States to develop, periodically update, publish and report to the
Electricity/heat cogeneration installations can achieve en-
Conference of the Parties national inventories of anthropogenic
ergy efficiency levels of around 90%. Electricity production
emissions by sources and removals by sinks of all greenhouse
from cogeneration accounted for 11% of total electricity pro-
gases not controlled by the Montreal Protocol on ozone-deplet-
duction in the EU in 1998. With an increase to 18%, the energy
ing substances. Therefore, it is appropriate for the European
savings could be 3-4% of total gross consumption in the EU.
Commission to provide for effective cooperation and coordi-
The development of cogeneration could avoid the emission of
nation in relation to the preparation of reports, as well as re-
127 million tonnes of CO2 in the EU in 2010 and 258 million
view and compliance procedures obligations under the Kyoto
tonnes in 2020.
Protocol, as agreed at the seventh Conference of the Parties
Directive 2004/8/EC on the promotion of cogeneration is
to the UNFCCC in Marrakech (the Marrakech Accords). The
based on a useful heat demand in the internal energy market
European Environment Agency assists the Commission with
and amending Directive 92/42/EEC. The purpose of the Direc-
monitoring activities, especially in the scope of the Commu-
tive is to facilitate the installation and operation of electrical
nity inventory system, and in the analysis by the Commission
cogeneration plants. A forthcoming legislative framework on
of progress towards the fulfilment of the commitments.
cogeneration should overcome the major obstacles of inade-
Link http://ec.europa.eu/environment/climat/gge.htm
quate control of longstanding monopolies, inadequate support
from regional and local authorities, incomplete liberalisation,
regulatory obstacles having a negative effect, and lack of Eu- 5.2 European Climate Change Programme (ECCP)
ropean standards for network connection. Action by both Member States and the European Community
There are already examples of regulatory developments in needs to be reinforced if the EU is to succeed in cutting its
some Member States, such as Belgium (green certificates and greenhouse gas emissions to 8% below 1990 levels by 2008-
cogeneration quotas), Spain (new decree on the sale of cogen- 2012, as required by the Kyoto protocol.
eration electricity) or Germany (new law on cogeneration). For this reason the Commission launched in June 2000 the
Related regulations are Directive 2001/77/EC on the pro- European Climate Change Programme (ECCP). The goal of
motion of electricity produced from renewable energy sources the ECCP is to identify and develop all the necessary elements
in the internal electricity market and Directive 92/42/EEC on of an EU strategy to implement the Kyoto Protocol. The de-
efficiency requirements for new hot-water boilers fired with velopment of the first ECCP involved all the relevant groups of
liquid or gaseous fuels. stakeholders working together, including representatives from
Link http://ec.europa.eu/energy/demand/legislation/heat_ the Commission’s different departments (DGs), the Member
power_en.htm States, industry and environmental groups. The second Euro-
pean Climate Change Programme (ECCP II) was launched in
October 2005.
Energy and transport play a large part in climate change
since they are the leading sources of greenhouse gas emis-

european union environmental legislation 201

sions; this is why energy policy is particularly important in airports will be covered. One year later the scope will be ex-
the European Union’s sustainable development strategy. The panded to cover emissions from all international flights that
EU is increasingly dependent on energy imported from third arrive at or depart from an EU airport. The intention is for the
countries, creating economic, social, political and other risks EU ETS to serve as a model for other countries considering
for the Union. The EU therefore wishes to reduce its depend- similar national or regional schemes, and to link these to the
ence and improve its security of supply by promoting other en- EU scheme over time. Therefore, the EU ETS can form the
ergy sources and cutting demand for energy. Consequently, it basis for wider, global action.
is putting the accent, above all, on improving energy efficiency Link http://ec.europa.eu/environment/climat/emission.htm
and promoting renewable energy sources.
The ECCP I showed many differences of implementation 5.4 The Community Strategy to Reduce CO2 from
in the Member States. It also indicated that the existing data- Light Vehicles (Cars and Vans)
base is, as yet, not detailed enough to fully assess the impacts On 7 February 2007, the Commission adopted the Communi-
of individual policies and measures on greenhouse gas emis- cation (COM(2007)19) outlining a comprehensive new strat-
sions in a thorough quantitative manner. The Commission is egy to reduce carbon dioxide emissions from new cars and
therefore planning some further methodological work to start vans sold in the European Union. The new strategy, should be
in 2007. It further began in June 2006 a study which focuses seen together with the revision of EU fuel quality standards
on the sectoral emission reduction potentials and economic proposed on 31 January 2007 and the long-established objec-
costs for climate change. The main objective is to identify the tive of limiting average CO2 emissions from new cars to 120
least-cost contribution of different sectors and gases for meet- grams per km by 2012, a reduction of around 25% from cur-
ing post-2012 EU-25 quantitative reduction objectives for all rent levels. To encourage the car industry to compete on the
greenhouse gases, and to determine a package of cost-effec- basis of fuel efficiency instead of size and power, the Commis-
tive policies and measures for all sectors and gases towards sion is also inviting manufacturers to sign an EU code of good
meeting these objectives. This study will serve as the basis for practice on car marketing and advertising.
evaluation of new policies and measures especially to meet Link http://ec.europa.eu/environment/co2/co2_home.htm
post-2012 targets.
Link http://ec.europa.eu/environment/climat/eccp.htm 5.5 European Community Action to Reduce Ozone-
Depleting Substances
5.3 EU Emissions Trading Scheme (ETS) The Union and its member states commitment under the Mon-
In January 2005 the European Union Greenhouse Gas Emis- treal Protocol, to phase out ozone-depleting substances, in par-
sion Trading Scheme (EU ETS) commenced operation as the ticular, chlorofluorocarbons (CFCs), also contributes to limit
largest multi-country, multi-sector Greenhouse Gas emission climate change, since CFCs are potent green house gases.
trading scheme world-wide. The scheme is based on Directive The Regulation (EC) No 2037/2000 is the European Un-
2003/87/EC, which entered into force on 25 October 2003. ion’s legislative instrument to phase out Ozone Depleting
Allowances traded in the EU ETS will not be printed but Substances (ODS). ODS covered by the Regulation are iden-
held in accounts in electronic registries set up by Member tified as controlled substances in line with the definitions of
States. All of these registries will be overseen by a Central the Montreal Protocol. The Regulation includes controls on
Administrator at EU level who, through the Community inde- production, importation, exportation, supply, use leakage and
pendent transaction log, will check each transaction for any ir- recovery of controlled substances. It also establishes a licens-
regularities. In this way, the registries system keep track of the ing procedure for all imports of ODS. Since its adoption a long
ownership of allowances in the same way as a banking system list of amendments have been added. Many of these concern
keeps track of the ownership of money. specific chemical substances, while others are of more pro-
For the second trading period, running from 2008 to 2012, cedural character. A consolidated version of Regulation (EC)
the Commission adopts the Decision on the national allocation No 2037/2000, that includes all amendments until November
plans during 2007. 2006, is available.
On 20th December 2006, the Commission adopted a pro- Link http://ec.europa.eu/environment/ozone/index.htm
posal for legislation to include aviation in the Emissions Trad-
ing Scheme. The proposal provides for aviation to be brought
into the EU ETS in two steps. From the start of 2011, emis-
sions from all domestic and international flights between EU

202 european union environmental legislation

6. INDUSTRY AND TECHNOLOGY rective are required to obtain an authorisation, an integrated
6.1 The EU Industrial Environmental Regulations and permit. About 50,000 installations are presently covered by
Policies the IPPC Directive in the EU. New installations, and existing
installations which are subject to ”substantial changes”, have
The European Union has developed a considerable set of pol-
been required to meet the requirements of the IPPC Directive
icy and legal instruments to promote the environmental im-
since 1999. Other existing installations must be brought into
provement of European industry, the “greening of industrial
compliance by 30 October 2007. This is the key deadline for
production”. When issuing a license or permit for an indus-
the full implementation of the Directive.
trial productions, a list of environmental regulations have to be
The IPPC Directive is based on the principles of (1) an in-
considered. These are all integrated in a so-called integrated
tegrated approach, (2) best available techniques, (3) flexibility
permit, formulated according to the Integrated Pollution Pre-
and (4) public participation.
vention and Control, IPPC, Directive, which has the aim to
The integrated approach means that the permits must take
ascertain that an industrial production, is using the best tech-
into account the whole environmental performance of the
nique, and that the emissions are not moved between different
plant, covering e.g. emissions to air, water and land, genera-
media – air, water and soil – but cleaned, or eliminated at the
tion of waste, use of raw materials, energy efficiency, noise,
source, when possible.
prevention of accidents, and restoration of the site upon clo-
A number of “semi-legal” measures have been introduced
sure. The purpose of the Directive is to ensure a high level of
to support the environmental improvement of industries. These
protection of the environment taken as a whole.
include the introduction of Environmental Management Sys-
The permit conditions, including emission limit values
tems through the EMAS scheme, which is a Directive but with
(ELVs), must be based on Best Available Techniques (BAT), as
the unusual addition that it is not compulsory (obligatory).
defined in the IPPC Directive. To assist the licensing authorities
Secondly a system for the use of environmental labelling has
and companies to determine BAT, the European IPPC Bureau
been developed, the EU Flower. This green labelling is avail-
organises an exchange of information between experts from
able but is not compulsory to use. Similarly the development
the EU Member States, industry and environmental organi-
of standardisations is also used as a means to introduce envi-
sations. The produced BAT Reference Documents (BREFs),
ronmental improvements in many areas. Thus the wide use of
which serves to guide the introduction of BAT in the integrated
standards is contributing to environmental protection. Another
permit, are adopted and published by the Commission.
important part is the greening of the public use of products as
The IPPC Directive contains elements of flexibility by al-
the Greening of Public Procurement, GPP.
lowing the licensing authorities, in determining permit condi-
There are also a series of policy actions, which have a
tions, to take into account the technical characteristics of the
very large importance for the development of improvements
installation, its geographical location, and the local environ-
in industrial productions. These include e.g. a considerable
mental conditions.
EU support to the development of technological improve-
The Directive ensures that the public has a right to par-
ments through research and development. These actions are
ticipate in the decision making process, and to be informed
coordinated within the EU Environmental Technologies Ac-
of its consequences, by having access to permit applications
tion Plan, ETAP. The Integrated Product Policy, IPP, is another
in order to give opinions. The European Pollutant Emission
very forceful policy development. The tools promoted under
Register (EPER), which contains emission data reported by
IPP are most importantly eco-design of products, support to
Member States, are made accessible in a public register, which
Life Cycle Assessment LCA, recycling and improved materi-
is intended to provide environmental information on major
als management.
industrial activities. EPER will be replaced by the European
Below several of these policies will be shortly described
Pollutant Release and Transfer Register (E-PRTR) from 2007
and proper links provided.
reporting period onwards.
Link http://ec.europa.eu/environment/ippc/index.htm
6.2 The IPPC Directive
The EU common rules for permitting and controlling indus- 6.3 Development of the IPPC Directive
trial installations, the IPPC Directive, Directive 96/61/EC con- The original IPPC directive has been amended twice since it
cerning integrated pollution prevention and control, aims to entered in force. The first amendment reinforced public par-
minimise pollution from various industrial sources. Operators ticipation in line with the Aarhus Convention. The second
of industrial installations covered by Annex I of the IPPC Di- amendment clarified the relationship between the permit con-

european union environmental legislation 203

ditions established in accordance with the IPPC Directive and tary agreements, environmental labelling and product design
the EU greenhouse gas emission trading scheme. guidelines.
The Member States have chosen various approaches to im- The Integrated Product Policy (COM(2003) 302 final) is
plement the IPPC Directive, such as case-by-case permitting not a regulation, but a set of support measures. It will seek
or use of general binding rules for industry sectors. to identify and stimulate action on products with the greatest
The Commission has adopted in November 2005 its first potential for environmental improvement in three phases: First
IPPC Report. It includes an IPPC Implementation Action Plan research to identify products with the greatest environmental
set up to support the Member States and monitor the progress impact, secondly by identifying measures to reduce their en-
made towards meeting the deadline of 30 October 2007 for the vironmental impacts throughout their life cycles. Research in
full implementation of the Directive. phase one and two is led by the Institute for Prospective Tech-
Link http://ec.europa.eu/environment/ippc/index.htm nological Studies (IPTS) in Seville. In the third phase the Eu-
ropean Commission will seek to address policy measures for
6.4 Eco-Management and Audit Scheme (EMAS) the products that are identified having the greatest potential for
The Eco-Management and Audit Scheme (EMAS) is the EU environmental improvement at least socio-economic cost.
voluntary instrument, which acknowledges organisations that Link http://ec.europa.eu/environment/ipp/home.htm
improve their environmental performance on a continuous
basis. EMAS registered organisations are legally compliant, 6.6 Implementing the Integrated Product Policy
run an environment management system and report on their The EIPRO, Environmental Impact of PROducts (phase 1)
environmental performance through the publication of an in- study, completed in May 2006, shows that products from only
dependently verified environmental statement. three areas of consumption – food and drink, private transpor-
The scheme has been available since 1995 (Council Regu- tation, and housing – together are responsible for 70-80% of
lation (EEC) No 1836/93). It was originally restricted to com- environmental impacts of private consumption. These prod-
panies in industrial sectors. Since 2001 EMAS has been open ucts also account for some 60% of consumption expenditure
to all economic sectors including public and private servic- altogether. All other areas of consumption together account for
es (Regulation (EC) No 761/2001). In addition, EMAS was no more than 20-30%of most environmental impacts.
strengthened by the integration of EN/ISO 14001 as the en- For the Second phase the Commission concluded that Life
vironmental management system required by EMAS, and by Cycle Assessments provide the best framework for assessing the
adopting an attractive EMAS logo to signal EMAS registra- potential environmental impacts of products currently available,
tion to the outside world. but also that there is a need for more consistent data and con-
Link http://ec.europa.eu/environment/emas/index_en.htm sensus on LCA methodologies. The European Platform of Life
Cycle Assessment includes a series of studies and workshops
6.5 Integrated Product Policy (IPP) with the aim of producing a handbook on best practice, based
All products cause environmental degradation in some way, on the best possible consensus. The objective is to promote life
whether from their manufacturing, use or disposal. The Inte- cycle thinking in business and in policy making focusing on un-
grated Product Policy (IPP) seeks to minimise these by look- derlying data and methodological needs. The project started in
ing at all phases of a products’ life cycle and taking action mid-2005 and is initially planned to run until mid-2008. It is a
where it is most effective. joint project between DG Environment and the Commission’s
The life cycle of a product is often long and complicated. Directorate-General Joint Research Centre (JRC-IES).
It covers all the areas from the extraction of natural resourc- A series of policy tools to address the need for improved
es, through their design, manufacture, assembly, marketing, environmental profiles of products, eco-design initiatives, al-
distribution, sale and use to their eventual disposal as waste. ready exists and are now assembled under the IPP programme.
At the same time it also involves many different actors such The Directive 2005/32/EC on the Eco-design of Energy-us-
as designers, industry, marketing people, retailers and con- ing Products (EuP), such as electrical and electronic devices
sumers. or heating equipment, provides coherent EU-wide rules for
With so many different products and actors there cannot be eco-design and ensure that disparities among national regula-
one simple policy measure for everything. Instead there are a tions do not become obstacles to intra-EU trade. The Directive
whole variety of tools – both voluntary and mandatory – that does not introduce directly binding requirements for specific
can be used to achieve this objective. These include meas- products, but does define conditions and criteria for setting re-
ures such as economic instruments, substance bans, volun- quirements regarding environmentally relevant product char-

204 european union environmental legislation

acteristics (such as energy consumption) and allows them to environmental issues, and serve as a knowledge base for stand-
be improved quickly and efficiently. The labelling of green ards writers and stakeholders to systematically identify areas
products, the European eco-label is one more tool for promot- for improvement of the environmental profile of standards.
ing environmentally good design of products. Public procure- Link http://ec.europa.eu/environment/standardisation/in-
ment accounts for around 16% of the EU’s GDP. The Green- dex_en.htm
ing of Public Procurements (see below) is a powerful tool for
promoting environmentally beneficial markets. Standards for 6.9 Green Public Procurement
almost any product, service or process are powerful tools for Green public procurement means that public purchasers take ac-
influencing the market. Integration of environmental aspects count of environmental factors when buying products, services
in standardisation (see below) is becoming another part of the or works. Public procurement accounts for around 16% of the
IPP toolbox. EU’s GDP. As such it represents a potentially powerful econom-
Link http://ec.europa.eu/environment/ipp/home.htm ic driver to further the uptake of environmental technologies.
Two directives clarify, simplify and modernise existing Eu-
6.7 The European Union Eco-label Scheme ropean legislation on public procurement. Directive 2004/18 on
EU eco-label scheme is a voluntary scheme designed to en- the coordination of procedures for the award of public works
courage businesses to market environmentally friendly prod- contracts, public supply contracts and public service contracts
ucts and services for European consumers, both public and and Directive 2004/17 on the coordination of procurement pro-
private purchasers, by more easily identifying them. Eco-la- cedures of entities operating in the water, energy, transport and
belled (non-food) products are marked with the EU Flower, postal services sector. The Directives explain a broad range of
found throughout the European Union as well as in Norway, issues connected to Green Public Procurement.
Liechtenstein and Iceland. The EU eco-label scheme is based Performance clauses of a public procurement contract may
on Regulation 1980/2000/EC and run by the European Union include environmental considerations. The Public Procure-
Eco-labelling Board (EUEB). ment Directives explicitly state that performance or functional
The eco-label is a rapidly growing brand, covering today requirements can be taken from specifications of European, in-
both services and products in close to 30 product categories. ternational and national eco-labels. The purchasing authority
An individual product must comply with all criteria (key, best can decide to recognise an eco-label as proof of compliance,
practice and performance) in order to be awarded the EU Eco- but it also has to accept other means of proof of compliance
label. Ecological criteria for a product group are normally es- with the specifications. In certain contracts, the authority may
tablished for a period of three years. This allows for technical even ask for EMS certification or a comparable scheme. A pur-
improvements and changes in the market to be reflected when chasing officer can choose the bid offering the lowest price or
criteria are revised. ’the economically most advantageous offer, which may refer
Link http://ec.europa.eu/environment/ecolabel/index_en.htm to environmental sub-criteria.
The green procurement conditions are relevant to the pri-
6.8 Greening Standardisation vate sector as provider to the public sector. In the private sec-
European and international standards are gaining increasing tor corresponding issues are included in supply chain man-
importance as a tool to support European policies and legisla- agement. Here there are wide possibilities to select providers.
tion, based upon the model of technical harmonisation intro- However the request that a supplier has been certified accord-
duced in EU in 1987. Within this approach, legislation sets ing to an environmental management system is becoming very
the legal performance-oriented framework and objectives, common, not the least due to customers pressure.
whereas the detailed technical specifications for implementa- Link http://ec.europa.eu/environment/gpp/index_en.htm
tion are addressed in standards. Compliance with the standards
remains voluntary. 6.10 Environmental Technologies Action Plan, ETAP
European standardisation offers great potential to advance Environmental Technologies Action Plan, ETAP, is the Unions
the protection of our environment (COM (2004) 674). It sup- programme to support environmental technology develop-
ports the energy efficiency of electrical products, the recycla- ment. Since 2004 ETAP covers a spectrum of actions to pro-
bility of products and the environmental impacts of buildings. mote eco-innovation and encourage industry to develop and
One example is the European Committee for Electrotechnical take up environmental technologies.
Standardization, CENELEC, which since December 2006 of- The European Forum on Eco-Innovation mobilises relevant
fers an environmental database online. The database assists in players from business, finance, and technology development,

european union environmental legislation 205

and provides a platform to move the innovation process and recently the Strategic Environmental Assessment, SEA, has
take inventions out of laboratories and onto the market. been introduced to broaden the number of projects which will
Technology platforms are public/private partnerships on be assessed and also broaden the aspects considered, espe-
specific topics bring together all the interested stakeholders cially to social and economic aspects. EIA or SEA is legally
to build long-term visions to promote a specific technology required in most development projects in the Union.
or solve a particular issue. Areas addressed include Hydrogen Land use requires a land use development plan, normally
and Fuel Cells, Photovoltaics, Steel, and Water supply and legally established by the local authority. The plan defines
sanitation. which kind of activity can be allowed on different parts of the
Networks of testing centres (Eurodemo, Promote, Testnet, land and is the background for municipal decision on permits
Airtv) establish a mechanism to validate objectively the per- for the development of industry, residential areas, etc.
formance of new products and develop common or co-ordi- The development of land use is also addressed by the Eu-
nated protocols and practices, a service especially important ropean Spatial Development Perspective (ESDP) document
for SMEs. from 1999. This document was introduced to create a common
Setting Performance targets that are long-term and vision- framework for spatial planning in the Union. Its scope, wider
ary is important to encourage industry to take up environmen- than just environmental concerns, includes economic, social
tal technologies. EU-activities related to Performance Targets and cultural issues, as the basis for spatial management.
include the Integrated Product Policy, the EuP Directive, the
IPPC Directive, the EU Eco-Label, Environmental Products 7.2 Environmental Impact Assessment
Declaration and national experiences in the field of eco-de- Environmental assessment is a procedure that ensures that the
sign, and EMAS, many to be described below. environmental implications of decisions are taken into account
The financial instruments to support investments in en- before the decisions are made. The process involves an analy-
vironmental technologies range from classical loans through sis of the likely effects on the environment, recording those
guarantee mechanisms to venture capital, in addition to the effects in a report, undertaking a public consultation exercise
Framework-Programme on Research and Development and on the report, taking into account the comments and the report
the demonstration and investment programmes, such as LIFE- when making the final decision and informing the public about
Environment, and the Structural Funds. that decision afterwards.
A new Competitiveness and Innovation Programme (CIP) In principle, environmental assessment can be undertaken
will address eco-innovation, by stimulating the wider use of for individual projects such as a dam, motorway, airport or a
eco-efficient technologies, and by helping to bridge market factory (’Environmental Impact Assessment’) or for plans, pro-
gaps in SME finance. grammes and policies (’Strategic Environmental Assessment’).
ETAP promotes Awareness Raising and Training activities The EIA Directive on Environmental Impact Assessment
in conjunction with the development and take-up of environ- of the effects of projects on the environment was introduced
mentally friendly technologies. in 1985 (Council Directive 85/337/EEC on the assessment of
Link http://ec.europa.eu/environment/etap/index_en.htm the effects of certain public and private projects on the envi-
ronment) and was amended in 1997 (Council Directive 97/11/
EC). The EIA Directive outlines which project categories shall
7. LAND USE, NATURE PROTECTION, AND SOIL
be made subject to an EIA, which procedure shall be followed
7.1 Land Use and Spatial Planning and the content of the assessment.
Land use policy covers a series of environmentally important Following the signature of the Aarhus Convention by the
issues such as infrastructure development including roads, Community in June 1998, the Community adopted in May
railways, bridges, etc.; rural development with forestry and 2003 Directive 2003/35/EC amending amongst others the EIA
agriculture; urban development including building and traffic Directive. This Directive aligns the provisions on public par-
planning; coastal zone development and management. ticipation in accordance with the Aarhus Convention on public
The most important legal instrument in this sector is the participation in decision-making and access to justice in envi-
Environmental Impact Assessment, EIA, with the intention to ronmental matters.
assure that environmental consequences of a development are Other pieces of EU-legislation are related to the EIA Di-
carefully scrutinised before it starts. It is especially important rective. This includes the IPPC Directive on the licensing of
that alternative development options, including the zero op- industrial sites, the SEVESO Directive on preventing chemical
tion – no development – is included in the assessment. More accidents and the EMAS Regulation on environmental man-

206 european union environmental legislation

agement. An IMPEL report shows the interrelation between 7.5 Proposal for a Framework Directive on Soil
EIA, IPPC, SEVESO Directives and the EMAS Regulation In response to concerns about the degradation of soils in the
Link http://ec.europa.eu/environment/eia/eia-legalcontext.htm EU the Commission published in April 2002 a Communica-
tion ”Towards a Thematic Strategy for Soil Protection”. This
7.3 Strategic Environmental Assessment was the first occasion on which the Commission has addressed
SEA Directive (Directive 2001/42/EC), effective from July soil protection for its own sake. It outlined the first steps to
2004, assures that a wide range of plans and programmes be- the development of a Thematic Strategy to protect soils in the
gun after July 2004 now require an environmental assessment. European Union. It consists of a Communication from the
The purpose of the SEA Directive is to ensure that envi- Commission (COM(2006) 231), a proposal for a framework
ronmental consequences of certain plans and programmes Directive, and an Impact Assessment.
are identified and assessed during their preparation and be- The Communication gives the background for a high level
fore their adoption. The public and environmental authorities of soil protection, and the Strategy and explains what kind of
can give their opinion and all results are integrated and taken measures must be taken in a ten-year work program. The pro-
into account in the course of the planning procedure. After posed framework Directive (COM(2006) 232) sets out com-
the adoption of the plan or programme the public is informed mon principles for protecting soils. The Impact Assessment
about the decision and the way in which it was made. In the (SEC (2006) 1165 and SEC(2006) 620) contains an analysis
case of likely transboundary significant effects the affected of the economic, social and environmental impacts of the dif-
Member State and its public are informed and have the pos- ferent options that were considered in the preparatory phase
sibility to make comments which are also integrated into the of the strategy and of the measures finally retained by the
national decision-making process. Commission.
Link http://ec.europa.eu/environment/eia/sea-legalcontext.htm Link http://ec.europa.eu/environment/soil/index_en.htm

7.4 Nature Protection and Biodiversity

8. NOISE
Two EU Directives deal with the conservation of European
wildlife, focusing on the protection of sites as well as species. 8.1 The Directive on Environmental Noise
Council Directive 79/409/EEC on the conservation of wild Noise is an environmental problem in all EU Member States
birds, the Birds Directive, identified 193 endangered species This includes industrial noise, aircraft noise, road traffic noise,
and sub-species for which the Member States are required to railway noise, and related emission data. Directive 2002/49/
designate Special Protection Areas (SPAs). Over 4,000 SPAs EC, the Directive on Environmental Noise of June 2002, has
have been designated to date, covering 8% of EU territory. As as the main aim to provide a common basis for tackling the
a result of this action, some severely threatened species are noise problem across the EU. The underlying principles are
now beginning to recover. similar to those for other overarching environment policy di-
Council Directive 92/43/EEC on the conservation of natu- rectives:
ral habitats and of wild fauna and flora, the Habitats Directive, Monitoring the environmental problem; by requiring com-
aims to protect other wildlife species and habitats. Each Mem- petent authorities in Member States to draw up ”strategic noise
ber State is required to identify sites of European importance maps” for major roads, railways, airports and agglomerations,
and to put in place a special management plan to protect them, using harmonised noise indicators. These maps will be used
combining long-term conservation with economic and social to assess the number of people annoyed and sleep-disturbed
activities, as part of a sustainable development strategy. respectively throughout Europe.
These sites, together with those of the Birds Directive, Informing and consulting the public about noise exposure,
make up the Natura 2000 network – the cornerstone of EU na- its effects, and the measures considered to address noise, in
ture protection policy. The Natura 2000 network, implemented line with the principles of the Aarhus Convention.
during 2004-2006, already comprises more than 18,000 sites, Addressing local noise issues by requiring competent au-
covering over 17% of EU territory, was completed for EU 15. thorities to draw up action plans to reduce noise where necessary
The Natura 2000 Networking Programme will create a series and maintain environmental noise quality where it is good.
of training events, workshops and practical tools to promote The directive does not set any limit value, nor does it pre-
Natura 2000, good practice in site management and the ben- scribe the measures to be used in the action plans, which re-
efits of networking, across Europe. main at the discretion of the competent authorities. These are
Link http://ec.europa.eu/environment/nature/home.htm partly specified in a series of detailed regulations (see below).

european union environmental legislation 207

 The European Environment Agency is preparing an elec- the seven key environmental thematic strategies of the Union.
tronic reporting mechanism aimed at helping Member States It aims to help Europe become a recycling society that seeks
report their data in compliance with Directive 2002/49/EC. to avoid waste and use waste as a resource. It will draw on the
The Commission is developing a long-term EU strategy, knowledge that the thematic strategy on resource adopted at
which includes objectives to reduce the number of people af- the same time.
fected by noise in the longer term, and provides a framework The first EEC Waste Directive was adopted in 1975. A new
for developing existing Community policy on noise reduction codified Waste Framework Directive (Directive 2006/12/EC)
from source. With this respect, the Commission has made a has now replaced the 1975 version, as a legal text that replaces
declaration concerning the provisions with regard to the prepa- all the previous versions and their amendments without any le-
ration of legislation relating to sources of noise. gal or political changes. In parallel the Commission has pub-
Link http://ec.europa.eu/environment/noise/directive.htm lished a proposal for substantive revision of the Directive to
merge, streamline and clarify the waste legislation and contrib-
8.2 Existing Directives Relating to Noise Sources ute to a better regulation (Waste COM(2005) 667 final). The
There are a number of directives and other pieces of legislation European Parliament gave its first reading opinion on the re-
regarding noise from cars, aircrafts, boats, industrial produc- vision in February 2007. The Commission has, as part of the
tion and so on. process, encouraged the EU Member States to set recycling
Road traffic noise is addressed in Council Directive 70/157/ standards and develop national waste prevention programmes.
EEC “on the approximation of the laws of the Member States Waste central legislation include – in addition to the Frame-
relating to the permissible sound level and the exhaust system work Directive (2006/12/EC) – Directive 91/689/EEC on haz-
of motor vehicles”. ardous waste, Decision 2000/532/EC on establishing a list of
Railway noise and the Interoperability of the Trans-Euro- waste, and Council Regulation (EEC) N° 259/93 on the super-
pean high-speed rail system are addressed in several regula- vision and control of shipments of waste within, into and out
tions. The 1996 regulation (96/48/EC) is general. Technical of the European Community. The Union has also adopted in
specification for interoperability (TSI) relating to high-speed a Council Decision 93/98/EEC the Convention on the control
rolling stock was regulated in the Commission Decision of transboundary movements of hazardous wastes and their
2002/735/EC and the Technical specification for interoper- disposal (Basel Convention).
ability (TSI) relating to high-speed railway infrastructures is Along series of special Directives and their secondary leg-
addressed by the Commission Decision 2002/732/EC. There islation regulates waste management within a long list of sec-
are several amendments to these regulations. tors. Below follow short descriptions and proper links to most
There are a number of regulations addressing Noise from of these regulations.
Equipment for Use Outdoors (2000/14/EC) and for Miscellane- Link http://ec.europa.eu/environment/waste/strategy.htm
ous Recreational Craft Noise (2003/44/EC). The Commission Link http://ec.europa.eu/environment/waste/legislation/a.htm
has adopted in August 2003 guidelines on the revised interim
computation methods for industrial noise, aircraft noise, road 9.2 The Landfill Directive
traffic noise and railway noise, and related emission data. The Landfill Directive (Council Directive 99/31/EC on the
Link http://ec.europa.eu/environment/noise/sources.htm landfill of waste) aims to prevent or reduce as far as possible
negative effects on the environment from the land-filling of
waste in particular on surface water, groundwater, soil, air and
9. WASTE
human health. The directive is unusually detailed and intro-
9.1 Strategies and Framework Directives on Waste duces stringent technical requirements for waste and landfills.
Waste is a main environmental concern within the European In this way it plays the role of defining the BAT for landfills
Union. The amount of waste produced is still increasing, al- (There is no BREF for landfills).
though substantial efforts to increase recycling have been The directive applies to all landfills, defined as waste dis-
made. The reasons for concern are two-fold: first the envi- posal sites for the deposit of waste onto or into land, and in-
ronmental and health impacts of waste, secondly the fact that cludes all waste categories. Landfills are divided into three
wastization is poor resource management. classes: landfills for hazardous waste, for non-hazardous
As part of the 6th Environmental Action Plan the European waste, and for inert waste.
Commission proposed in December 2005 a new strategy on The acceptance of waste at each landfill class is described
the prevention and recycling of waste. This strategy is one of in Annex II of the directive. Waste must be treated before being

208 european union environmental legislation

landfilled and hazardous waste must be assigned to a hazardous biological treatment takes place will be addressed in a review
waste landfill. Municipal waste should be sent to landfills for non- of the IPPC Directive for licensing major industrial and agri-
hazardous waste, and inert waste to an inert waste landfill. Liquid cultural installations based on the Best Available Techniques
waste, flammable waste, explosive or oxidising waste, hospital (BAT). The Thematic Strategy on Soil will address the wider
and other clinical waste which is infectious is not accepted in a subject of carbon depletion in soil, which includes the use of
landfill at all. Nor are used tyres, with certain exceptions. compost as a means to increase the carbon content of soil.
A number of large-scale operations are not included in the The Commission is preparing guidelines on the application
Directive. This includes the spreading of sludge, including sew- of life cycle thinking to biowaste management policies. Updat-
age sludge, on soil, inert waste for redevelopment or restoration ed information can be found at the JRC website devoted to the
work, the deposit of unpolluted soil or of non-hazardous inert European life cycle thinking guidelines for the management of
waste from prospecting and extraction, mineral resources from municipal biodegradable waste. The final document will be
operation of quarries; non-hazardous dredging sludge alongside the first guidance document developed at European level on
small waterways, and of non-hazardous sludge in surface water. applying life cycle thinking to waste management policies.
The Directive requests an operating permit for landfill sites. Link http://ec.europa.eu/environment/waste/compost/index.htm
Applications for permits must contain information on types
and total quantity of waste, capacity, site description, methods 9.4 Mining Waste
for pollution prevention and abatement, operation, monitoring The pollution of Danube river caused by a cyanide spill fol-
and control plan, and a plan for closure and aftercare proce- lowing a damburst of a tailings pond in Baia Mare, Romania
dures. An impact assessment study is also required. in 2000 and the 1998 accident in Aznalcóllar, Spain where
In addition a landfill above a certain size requires an IPPC a damburst poisoned the environment of the Coto Doñana
permit to operate. National Park, have increased public awareness of the envi-
Landfills serving islands have less stringent regulations if ronmental and safety hazards of mining activities. These ac-
they only accept non-hazardous or inert wastes from that is- cidents, like other similar ones, have illustrated the significant
land, and has a total capacity not exceeding 15 000 tonnes or environmental and health risks associated with the manage-
with an annual intake not exceeding 1 000 tonnes. ment of mining waste.
Link http://ec.europa.eu/environment/waste/landfill_index.htm In October 2000, the Commission adopted a Communica-
tion asking for an amendment of the Seveso II Directive to
9.3 Biodegradable Waste include mineral processing of ores, tailings ponds or dams
The main environmental threat from biowaste is the produc- used in mineral processing of ores. It is also preparing a BREF
tion of methane in landfills. This accounted for some 3% of document of waste management to reduce everyday pollution
total greenhouse gas emissions in the EU-15 in 1995. The and to prevent or mitigate accidents in the mining sector.
Landfill Directive 1999/31/EC obliges Member States to re- Finally a directive on the management of mining waste was
duce the amount of biodegradable waste that they landfill to adopted. Directive 2006/21/EC on the management of waste
35% of 1995 levels by 2016, which will significantly reduce from the extractive industries stipulates measures, procedures
the problem. and guidance to prevent or reduce as far as possible any adverse
There are several alternative treatment methods for biode- effects on the environment, in particular water, air, soil, fauna
gradable waste. The Commission will provide criteria, in the and flora and landscape, and any resultant risks to human health,
form of a guidance document, to help identify the environ- brought about as a result of the management of waste from the
mentally best option for the management of biowaste. Mem- extractive industries. It requests Member States to ensure that
ber States will be required to report their treatment choices in the operator draws up a waste management plan for the minimi-
their national waste management plans (draft Waste Frame- sation, treatment, recovery and disposal of extractive waste.
work Directive). The environmentally sound management of Link http://ec.europa.eu/environment/waste/mining/index.htm
biowaste will be addressed in the Thematic Strategy on waste
prevention and recycling in 2010. 9.5 Waste Incineration Directive
Quality standards for compost are planned in the revised Directive 2000/76/EC on the incineration of waste, the WI Di-
Waste Framework Directive. The intention is to develop a mar- rective, aims to prevent or to reduce as far as possible negative
ket for compost, and overcome one of the biggest obstacles to effects on the environment caused by the incineration and co-
composting policies, the lack of user confidence and market incineration of waste. It replaces the former directives on the
acceptance. Environmental standards for facilities in which incineration of hazardous waste (Directive 94/67/EC) and non-

european union environmental legislation 209

hazardous waste (Directives 89/369/EEC and 89/429/EEC). It became waste oils (the rest is lost during use, or through leak-
asks for the reduction of pollution caused by emissions into ages, etc.), which leaves us with approximately 2.5 million
the air, soil, surface water and groundwater through the appli- tonnes of waste oil to manage every year. Waste oils are haz-
cation of operational conditions, technical requirements, and ardous waste. Waste oils leaking into rivers, lakes and streams
emission limit values for waste incineration and co-incinera- threaten aquatic life, and severe soil contamination can result
tion plants. The Directive does not include some plants, e.g. from waste oils being left on the ground.
those treating only biomass, such as non-treated agriculture According 2003 data almost 2 million tonnes of waste oils
and forestry residues. in EU were collected, giving a collection rate of 81%. Out of
The WI Directive makes a clear distinction between incin- this amount, 44% was regenerated while 46% was combusted.
eration plants (which are dedicated to the thermal treatment of That is, 20% of this oil is still illegally dumped or burnt.
waste and may or may not recover heat generated by combus- The Waste Oil Directive 75/439/EEC, as last amended by
tion) and co-incineration plants (such as cement kilns, steel or Directive 2000/76/EC, was designed to create a harmonised
power plants whose main purpose is energy generation or the system for the collection, storage, recovery and disposal of
production of material products). waste oils and protect the environment against the harmful ef-
The WI Directive sets controls on releases to water, and fects of illegal dumping and of treatment operations. The Di-
emissions to air for NOX, SO2, HCl, heavy metals, particles, and rective applies to any mineral-based lubrication or industrial
dioxins and furans. It provides for public consultation, access oils which have become unfit for their original use. It requires
to information and participation in the permitting procedure. that waste oils are collected and disposed of by processing,
Other EU regulations and Commission documents that are destruction, storage or tipping above or under ground. The
relevant to the waste incineration sector include processing of waste oils by regeneration, i.e. by refining,
should be given priority.
• IPPC Directive, as many of the plants covered by the WI
Any undertaking, which collects waste oils, must be sub-
Directive are also covered by this directive. In these cases,
ject to registration and national supervision, including possi-
the WI Directive only sets minimum obligations, which
bly a system of permits. The mixing of waste oils with poly-
are not necessarily sufficient to comply with the IPPC
chlorinated biphenyls or terphenyls (PCBs and PCTs) or with
Directive.
toxic and dangerous wastes is not allowed.
• LCP Directive (Directive 2001/80/EC on large combus-
Link http://ec.europa.eu/environment/waste/oil_index.htm
tion plants), which regulates the emissions of acidifying
pollutants, particles, and ozone precursors from large 9.7 The Disposal of PCBs and PCTs
(above 50 MW) combustion plants. The LCP Directive
Polychlorinated biphenyls and polychlorinated terphe-
encourages the combined generation of heat and power
nyls (PCBs/PCTs) are persistent and toxic man-made chemi-
and sets specific emission limit values for the use of
cals. PCBs were commercially produced world-wide on a large
biomass as fuel.
scale between the 1930´s and 1980´s. Given their extraordinary
• VOC Solvents Directive (Directive 1999/13/EC), which
chemical stability and heat resistance, they were extensively
regulates industrial emissions of volatile organic com-
employed as components in electrical and hydraulic equipment,
pounds (VOCs). The VOC Solvents Directive establishes
such as transformers, capacitors, heat transfer and hydraulic
emission limit values for VOCs in waste gases.
systems; and in open applications: as pesticide extenders, seal-
• Directive 1999/32/EC regulating the combustion of cer-
ant, carbonless copy paper, industrial oils, paints, adhesives,
tain types of sulphur containing liquid fuels to reduce the
plastics, flame retardants and to control dust on roads.
emissions of sulphur dioxide.
In the 1970´s, when their human toxicity, suspected carci-
Details of emissions from waste incineration plants and nogenicity, and environmental persistence, and a wide spec-
other industrial sources can be accessed via the European Pol- trum of adverse effects in animals and humans became known,
lutant Emission Register (EPER) several countries limited the use of PCBs. Finally in 1985, the
Link http://ec.europa.eu/environment/air/stationary.htm use and marketing of PCBs in the European Community were
very heavily restricted.
9.6 Disposal of Waste Oils The very stable PCBs still exits in large amounts in the
The EU consumed in 2003 roughly 4.4 million tonnes a year infrastructure of our society and for this reason is a main con-
of lubricant oils, such as lubricant oils for vehicles, turbines, cern especially when managing building and industrial/equip-
gearboxes and engines, hydraulic oils, etc. Some 50% of this ment waste. Directive 96/59/EC on the disposal of PCBs and

210 european union environmental legislation

PCTs aims at disposing completely of PCBs and equipment and year. Between 1997 and 2002 the growth in packaging
containing PCBs as soon as possible, and for big equipment waste generation in the EU-15 almost followed the growth in
before the end of 2010. GDP: waste increased by 10% and GDP by 12.6%. There are
The directive sets the requirements for an environmentally large variations ranging from 87 kg/capita in Finland to 217 kg/
sound disposal of PCBs. Member States have to make an in- capita in Ireland (2002), partly explained by differing defini-
ventory of big equipment containing PCBs, have to adopt a tions of packaging. Only the UK, Denmark and Austria reduced
plan for disposal of inventoried equipment, and outlines for their per capita generation of packaging waste since 1997.
collection and disposal of non inventoried equipment (small The first introduced directive on the management of pack-
electrical equipment very often present in household appli- aging waste (Directive 85/339/EEC) regarding liquid beverage
ances manufactured before the ban on marketing of PCBs). containers was too vague to achieve effective market harmo-
Furthermore, the Commission has adopted a Community nisation. A new Directive on Packaging and Packaging Waste
Strategy on Dioxins, Furans and PCBs aimed at reducing as far (Directive 94/62/EC) was adopted in 1994. It aims to harmo-
as possible the release of these substances in the environment nise national measures in order to prevent or reduce the impact
and their introduction in the food chains. As regulation No of packaging and packaging waste on the environment and to
850/2004/EC on persistent organic pollutants also covers PCB, ensure the functioning of the Internal Market. It contains pro-
the Commission has carried out a study to facilitate the imple- visions on the prevention of packaging waste, on the re-use
mentation of the waste related provisions of this regulation. of packaging and on the recovery and recycling of packaging
Link http://ec.europa.eu/environment/waste/pcbs/index.htm waste. The directive was amended by a series of secondary
packaging legislation regulating the identification of packag-
9.8 Disposal of End-of-Life Vehicles ing materials, reports of the directives, the database system,
Every year, end of life vehicles generate between 8 and 9 mil- and the conditions for derogation of plastic crates, plastic pal-
lion tonnes of waste in the Union. In 1997, the Commission lets, and glass packaging.
proposed a Directive which aims at making vehicle disman- The (prolonged) implementation of the directive in the new
tling and recycling more environmentally friendly, sets clear Member States is regulated by Directive 2005/20/EC.
quantified targets for reuse, recycling and recovery of vehicles Link http://ec.europa.eu/environment/waste/packaging/events.htm
and their components and pushes producers to manufacture
new vehicles also with a view to their recyclability. This leg- 9.10 Waste Electrical and Electronic Equipment,
islation was officially adopted in September 2000 as Directive WEEE Directive
2000/53/EC – the ELV Directive. Based on an Impact Assess- A fast increasing waste stream of electrical and electronic
ment the Commission adopted in 2007 a report on the targets equipment, reflects the increased amounts of TV sets, com-
(“2015 targets”) of the ELV Directive. puters, sound equipments and the like used in our societies.
The Commission have developed a Guidance Document Directives 2002/95/EC on the restriction of the use of certain
on the legislative acquis which, even though it is not legally hazardous substances in electrical and electronic equipment
binding, aims at facilitating the implementation of the ELV and Directive 2002/96/EC on waste electrical and electronic
Directive and its secondary legislation at national level. equipment are designed to tackle the fast increasing waste
The ELV Directive was amended with a series of detailed stream of electrical and electronic equipment and comple-
instructions. The Council Decision 2005/673/EC amended the ments measures on landfill and incineration of waste. Together
Annex II; Commission Decisions 2005/437/EC and 2005/438/ they constitute the waste electrical and electronic equipment
EC regulate the management of vehicles spare parts. The (WEEE) Directive.
Netherlands’ waste disposal system for car wrecks is adopted Increased recycling will limit the total quantity of waste
in Commission Decision 2002/204/EC. Directive 2005/64/EC going to final disposal. Therefore, through the directives, pro-
regulates the type-approval of motor vehicles with regard to ducers are responsible for taking back and recycling electrical
their reusability, recyclability and recoverability and amends and electronic equipment. This provides incentives to design
Council Directive 70/156/EEC. electrical and electronic equipment in an environmentally
Link http://ec.europa.eu/environment/waste/elv_index.htm more efficient way, which takes waste management aspects
fully into account. Consumers will be able to return their
9.9 Packaging and Packaging Waste equipment free of charge.
Packaging waste in the EU is a large and increasing concern. In order to prevent the generation of hazardous waste, Di-
The 2002 average EU-15 amount of waste was 172 kg/capita rective 2002/95/EC requires the substitution of various heavy

european union environmental legislation 211

metals (lead, mercury, cadmium, and hexavalent chromium) and more coherent and appropriate planning practices in the Mem-
brominated flame retardants (polybrominated biphenyls (PBB) ber States in compliance with the requirements of relevant EU
or polybrominated diphenyl ethers (PBDE)) in new electrical legislation.
and electronic equipment put on the market from 1 July 2006. Link http://ec.europa.eu/environment/waste/plans/index.htm
Directive 2003/108/EC amends Directive 2002/96/EC. A
number of additional legislation has been developed to detail 9.13 Waste Shipments
the restriction on the use of certain hazardous substances in Economic growth and globalization have led to a worldwide
electrical and electronic equipment. increase of waste transports across borders, whether on the
Link http://ec.europa.eu/environment/waste/weee/index_en.htm road, by railway or ship. These waste movements or shipments
sometimes involve hazardous wastes and can create risks for
9.11 Disposal of Batteries and Accumulators human health and the environment. In other cases wastes are
Directive 91/157/EEC on batteries and accumulators containing traded to replace natural resources in industrial facilities with
dangerous substances regulates the waste of batteries containing high environmental standards.
mercury, lead and cadmium. Directive 2006/66/EC, (now un- In order to control waste shipments, certain procedures and
der implementation for all batteries and accumulators) aims at requirements have been introduced in international and EU
minimising the negative impacts of batteries and accumulators law. These include Regulation (EC) 1013/2006 on shipments
on the environment and also harmonising requirements for the of waste and shipments of “green-listed” non-hazardous wastes
smooth functioning of the internal market. It prohibit the mar- to non-OECD countries; and Regulation (EC) 1420/1999 es-
keting of some batteries containing hazardous substances and tablishing common rules and procedures for shipments to cer-
contains measures for a high level of collection and recycling of tain non-OECD countries of certain types of waste. Special
batteries with quantified collection and recycling targets. provisions for waste shipments apply to several of the new
The Directive sets out minimum rules for producer respon- Member States, including Latvia, Poland and Slovakia.
sibility and provisions with regard to labelling of batteries and Decision 93/98/EEC introduces in the EU the Conven-
their removability from equipment. Producers must arrange tion on the control of transboundary movements of hazardous
financing for the collection, treatment, recycling and sound wastes and their disposal (Basel Convention); and Commis-
disposal of all types of collected spent batteries with a view sion Decision 94/774/EC amends Council Regulation (EEC)
to recycling their raw materials for use in the manufacture of No 259/93 on the supervision and control of shipments of
new products. The cost of collecting portable batteries may be waste within, into and out of the European Community.
shared among producers and national, regional and local au- Some types of waste shipments are covered by specific le-
thorities. All batteries and accumulators must bear the symbol gal regimes; in particular Directive 2000/59/EC on port recep-
indicating separate collection (a crossed-out wheeled bin as tion facilities for ship-generated waste and cargo residues, and
depicted in Annex II to the proposal). Directive 2006/117/EURATOM on the supervision and con-
Link http://ec.europa.eu/environment/waste/batteries/index.htm trol of shipments of radioactive waste and spent fuel.
Link http://ec.europa.eu/environment/waste/shipments/index.htm
9.12 Waste Management Planning
Waste management planning is the cornerstone of any na-
10. WATER
tional, regional or local policy on waste management. The es-
tablishment of a plan allows the operator to take stock of the 10.1 The Water Framework Directive
existing situation, to define the objectives that need to be met Cleaner rivers and lakes, groundwater and coastal beaches are
in the future, to formulate appropriate strategies, and identify of high priority in European Environmental policy. Early Eu-
the necessary implementation means. ropean water legislation led in the 1980’s up to binding quality
The drawing up of waste management plans is required by targets for drinking water and quality objectives for fish and
Directive 2006/12/EC, which sets out the general requirement. shellfish waters, bathing waters and groundwater. A second
Specific provisions for hazardous waste are found in Article phase of water legislation culminated in 1991 with the adop-
6 of Directive 91/689/EEC and for packaging and packaging tion of the Urban Waste Water Treatment Directive, and the
waste in Article 6 of Directive 94/62/EC. Nitrates Directive, which addressed water pollution by nitrates
To assist national, regional and local competent authorities from cities and agriculture. A fundamental rethink of Com-
when preparing waste management plans, the Commission munity water policy, asking for a more integrated approach,
has published a methodological guidance. It should promote culminated in mid-1995. A new European water policy and

212 european union environmental legislation

framework legislation to reach “good status” of surface wa- objectives are protection of the aquatic ecology, specific pro-
ters and groundwater developed on a river basins approach. tection of unique and valuable habitats, protection of drinking
A Directive to introduce integrated river basin management water resources, and protection of bathing water. Good ecolog-
for Europe, Directive 2000/60/EC, the EU Water Framework ical status and good chemical status are asked for but without
Directive (WFD) was finally adopted in 2000. absolute standards, only referring to minimal anthropogenic
The framework directive approach rationalises the Un- impact. The effect on each body of water of full implemen-
ions water legislation by replacing seven of the “first wave” tation of all existing legislation is considered. If the existing
directives on surface water, measurement methods, the fish legislation solves the problem the objective of the framework
and shellfish water, groundwater; and dangerous substances Directive is attained.
discharges. Still a number of specific regulations are left to The role of citizens and citizens’ groups will be crucial. To
tackle particular pollution problems. Key examples are the arrive at decisions to achieve the objectives in the river basin
Urban Waste Water Treatment Directive and the Nitrates Di- management plan will involve balancing the interests of vari-
rective, which together tackle the problem of eutrophication; ous groups. The economic analysis requirement is intended to
and the IPPC Directive, which deals with chemical pollution provide a rational basis for this, but it is essential that the proc-
from industries. The Groundwater Directive corresponds to ess and the implementation of the legislation are open to those
Article 17 of WFD, and Decision 2455/2001/EC to the list of living in the basin. The Water Framework Directive requires
priority substances asked for in Article 16 of the WFD. The information and public consultation alongside when river ba-
objectives of “good ecological status” is addressed by an in- sin management plans are established.
tercalibration process comparing national classifications, and Flood protection and essential drinking water supply is
Decision 2005/646/EC sets out a network of intercalibration dealt with by providing derogations from the requirement to
sites. The results of this process are expected to be published achieve good status for these cases. Less clear-cut cases are
in late 2007. navigation and power generation, where the activity is open to
Historically, there has been a dichotomy of water pollution alternative approaches.
control: source control and quality standards. Source controls As to pollution the precautionary principle provides the ba-
alone can allow a cumulative pollution load, where there is sis. A few chemical quality standards have been established for
a concentration of pollution sources, while quality standards particular substances (nitrates, pesticides and biocides), and
can underestimate the effect of a particular substance on the these must always be adhered to. Groundwater should not be
ecosystem. For this reason, a consensus has developed that polluted at all. Quantity is also a major issue for groundwater.
both are needed in practice. The Water Framework Directive For good management, the Directive limits abstraction only
formalises this. On the source side, it requires that all existing to that portion of the overall recharge, which is not needed by
technology-driven source-based controls must be implement- the ecology.
ed as a first step. But it also includes the development of a list The first river basin management plans should be ready by
of priority substances for action at EU level, and the design of 2009 and then revised each six years.
the most cost-effective set of measures to achieve load reduc- Link http://ec.europa.eu/environment/water/index_en.htm
tion of those substances.
On March 2007, the Commission organised a conference 10.3 Drinking Water Directive
where more than 400 participants reviewed the first WFD im- Directive 98/83/EC, the Drinking Water Directive (DWD),
plementation report and launched a Water Information System concerns the quality of water intended for human consump-
for Europe (WISE). tion. The objective of the Drinking Water Directive is to pro-
Link http://ec.europa.eu/environment/water/water-frame- tect the health of the consumers in the European Union and to
work/index_en.html make sure the water is wholesome and clean. Member States
have to monitor the quality of the drinking water supplied to
10.2 River Basin Management their citizens at the tap and of the water used in the food pro-
The Water Framework directive requires management by river duction industry, and report the results every three years.
basin – the natural geographical and hydrological unit – in- The Drinking Water Directive sets standards for the most
stead of according to administrative or political boundaries. common substances that can be found in drinking water. A
For each river basin district, some of which will traverse na- total of 48 microbiological and chemical parameters must be
tional frontiers, a river basin management plan is requested, monitored and tested regularly. In principle WHO guidelines
and a River Basin Authority needs to be established. The key for drinking water are used as a basis for the standards.

european union environmental legislation 213

 In order to adapt the Directive to progress in science and 10.5 Sewage Sludge
technology and to address the changed context met after the Sludge originates from the treatment of wastewater. Due to the
enlargement of the Union, the Commission is currently (2007) physical-chemical processes, the sludge tends to concentrate
preparing a revision of the Directive addressing bacteriologi- heavy metals and poorly biodegradable trace organic com-
cal contamination, chemical substances including construction pounds as well as potentially pathogenic organisms (viruses,
products in contact with drinking water, small water supplies bacteria etc) present in the wastewaters. Sludge is, however,
and risk assessment and risk management. rich in nutrients, such as nitrogen and phosphorous, and con-
The concept of risk assessment and risk management dur- tains valuable organic matter that is useful when soils are de-
ing the production and distribution of drinking water was in- pleted or subject to erosion.
troduced by WHO in the 2004 Guidelines for Drinking Water The implementation of the Urban Waste Water Treatment
Quality. This concept was introduced in the context the Euro- Directive has increased the quantities of sewage sludge. From
pean Water Safety Plans. an annual production of some 5.5 million tonnes of dry mat-
Link http://ec.europa.eu/environment/water/water-drink/in- ter in 1992, the Community will have an estimated 9 million
dex_en.html tonnes by the end of 2005 in the EU-15, as the number of
households connected to sewers and the level of treatment in-
10.4 Urban Waste Water Treatment, UWWT Directive creases. Landfilling and incineration are the most widely used
Directive 91/271EEC concerning urban wastewater treatment methods, despite their environmental drawbacks. The reuse of
aims to protect the water environment from the adverse effects sludge accounts for about 40% of the whole.
of discharges of urban wastewater and from certain industrial The Sewage Sludge Directive (Directive 86/278/EEC)
discharges, and secure an environmentally sound reuse or dis- seeks to encourage the use of sewage sludge in agriculture
posal of sewage sludge. Directive 98/15/EC was amended to and to regulate its use in such a way as to prevent harmful
UWWT Directive to clarify the requirements on discharges effects on soil, vegetation, animals and man. It prohibits the
from urban wastewater treatment plants to sensitive areas use of untreated sludge on agricultural land unless it is in-
which are subject to eutrophication. jected or incorporated into the soil. Treated sludge is defined
Secondary (biological) treatment is the basic level, which as having undergone “biological, chemical or heat treatment,
should be provided everywhere. All discharges from agglom- long-term storage or any other appropriate process so as sig-
erations with more than 10,000 person equivalents (p.e.) within nificantly to reduce its fermentability and the health hazards
the catchments of sensitive water bodies shall, however, have resulting from its use”. Sludge must not be applied to soil
sewage collecting systems and wastewater treatment plants in which fruit and vegetable crops are growing or grown, or
more stringent than secondary treatment. For discharges in less than ten months before fruit and vegetable crops are to
coastal waters treatment may be less stringent (primary treat- be harvested. Grazing animals must not be allowed access to
ment) under certain conditions and subject to the agreement of grassland or forage land less than three weeks after the ap-
the European Commission. plication of sludge. Spreading of sludge on surface waters is
Member States should establish systems or authorisation for prohibited (WFD).
all discharges of urban wastewater, and industrial wastewater The Directive lays down limit values for concentrations
into urban sewage collecting systems, to ensure that no adverse of heavy metals in the soil and in sludge and the maximum
effect on the environment (including receiving waters) will oc- annual quantities of heavy metals, which may be introduced
cur; and ensure the safe disposal of sewage sludge. For food into the soil. Several Member States have set concentration
processing industries and agglomerations with more than 2,000 limits at levels below those in the Directive, and average con-
p.e. the directive requires that collecting system and appropriate centrations of heavy metals in sludge used in agriculture are
treatments are introduced. Member States should also protect re- significantly lower than those specified in the Directive. Seven
ceiving waters from pollution of storm water overflows via col- Member States reported using at least 50% of the sludge they
lecting systems under unusual situations, such as heavy rain. generate in agriculture.
Adequate co-operation and information exchange with Link http://ec.europa.eu/environment/waste/sludge/index.htm
other Member States has to be developed where discharges
of wastewater have a transboundary effect on water quality of 10.6 The Nitrates Directive
shared waters. The EU has been taking measures to limit nitrogen pollution in
Link http://ec.europa.eu/environment/water/water-urban- waters for over twenty years. While the initial directives con-
waste/index_en.html cerned themselves mainly with water for human consumption,

214 european union environmental legislation

more recently legislation (e.g. the UWWT Directive) attempts toxicity and bioaccumulation. So far, 18 individual substances
more to limit eutrophication. Directive 91/676/EEC on nitrates of the “candidate list I” have been regulated in five specific
from agricultural sources, called the Nitrate Directive, aims to ’daughter’ Directives. The 18 list I substances are given emis-
reduce eutrophication caused by agriculture. sion limit values in the IPPC directive as minimum require-
The directive requests that agricultural land, which signifi- ments for large industrial installations.
cantly contribute to nitrogen pollution – so-called “vulnerable List II includes substances, which should be reduced. It
zones” (NVZs) – are identified and that Action Programs to lists groups and families of substances that have a deleteri-
reduce N pollution are established. The main types of actions ous effect on the aquatic environment. It also contains all indi-
that the Nitrates directive promotes include crop rotations; use vidual list I substances that have not been regulated, that is the
of soil winter cover, that is catch crops in order to limit leach- other 114 substances of the ‘candidate list I’. For the relevant
ing during the wet seasons; use of fertilisers and manure, with pollutants of list II, Member States must establish pollution
a balance between crop needs; N inputs and soil supply, fre- reduction programmes including water quality objectives ac-
quent manure and soil analysis, mandatory fertilisation plans cording to Article 7 of the Directive 76/464/EEC. Progress in
and limitations per crop for both mineral and organic N ferti- properly implementing list II substances that are regulated un-
lisation. der Article 7 of the Directive has proved to be very slow, and
Good nitrate management is requested in this directive. the Commission has started a legal procedure.
It includes appropriate N spreading, sufficient manure stor- Link http://ec.europa.eu/environment/water/water-danger-
age and good spreading practices (less than 170 kg organic sub/76_464.htm
nitrogen/hectare/year), the use of buffer strips (grass strips and Link http://ec.europa.eu/environment/water/water-dangersub/
hedges) along watercourses and ditches, and the restriction of pri_substances.htm
cultivation on steeply sloping soils and of irrigation.
Link http://ec.europa.eu/environment/water/water-nitrates/in- 10.8 Groundwater Directive
dex_en.html The new Groundwater Directive (2006/118/EC) establishes a
regime, which sets underground water quality standards and
10.7 Priority Substances Under the Water Framework introduces measures to prevent or limit inputs of pollutants
Directive into groundwater. The directive establishes quality criteria that
In July 2006, the Commission adopted a Directive setting en- takes account local characteristics and allows for further im-
vironmental quality standards for priority substances, which provements to be made based on monitoring data and new sci-
Member States must achieve by 2015, to ensure “good chemi- entific knowledge. The directive responds to the requirements
cal surface water status”. of the Water Framework Directive (WFD). It requests assess-
Article 16 of the Water Framework Directive (2000/60/EC) ments on chemical status of groundwater and the identification
sets out a “Strategy against pollution of water”. The first step of and reversal of significant and sustained upward trends in pol-
the strategy was the establishment of a list of priority hazard- lutant concentrations.
ous substances to become Annex 10 of the Directive, adopted The groundwater directive requires groundwater qual-
as final Decision (2455/2001/EC) in 2001. The list identifies ity standards to be established by the end of 2008. Pollution
33 substances or group of substances, which have been shown trends should be studied using so-called “baseline level” data
to be of major concern for European Waters. 11 substances obtained in 2007-2008, and prevent or limit inputs of pollutants
have been identified as priority hazardous substances, which into groundwater to allow environmental objectives – compli-
will be subject to phasing out of discharges, emissions and ance with good chemical status criteria – to be achieved by
losses within an appropriate timetable that shall not exceed 20 2015. As in the WFD the reviews of technical provisions of
years. A further 14 substances were identified as being sub- the directive should be carried out in 2013 and every six years
ject to review for identification as possible “priority hazardous thereafter.
substances”. Link http://ec.europa.eu/environment/water/water-frame-
Hazardous substances were also listed in Directive 76/464/ work/groundwater/policy/current_framework/new_direc-
EEC, later codified as 2006/11/EC, on pollution caused by tive_en.htm
certain dangerous substances discharged into the aquatic en-
vironment. The Directive introduced the concept of list I and
list II substances. List I includes substances to be eliminated.
It lists 132 pollutants selected on the basis of their persistence,

european union environmental legislation 215

Case Studies

C
 Case Study 1
Oil & Sludge Treatment Inc.
Sweden L

Environmental Performance and Conditions

of Permits for a Waste Treatment Company

1. Introduction
to the need for an interim storage of oil-polluted water for a
The Company period of time. This too could be handled as a report. A report
Oil & Sludge Treatment Inc. is a company whose main busi- on the pressing of floating sludge, with the purpose of optimiz-
ness consists of dealing with the reception, intermediate stor- ing the purification of polluted water from oil separators, has
age and treatment of different types of refuse and toxic waste. also been treated by the supervising authority. At present, the
It is situated close to the city of Umeå in North Sweden with company is preparing to, firstly, initiate the interim storage of
facilities at the harbour at the Baltic Sea coast. hazardous waste (i.e. other than waste oil that the company
The company is a typical entrepreneurial company that has a licence to treat) and, secondly, start energy production
started on a small scale, with a small number of sludge trucks through burning treated waste fat.
emptying oil separators, fat separators etc and depositing the
waste at treatment facilities and dumps. The number of cars Description of Operations
and the amount of transported waste has since grown steadily The company is subject to a permit requirement at the highest
over the years. The GD and founder of the company deemed level, an integrated permit. Licence evaluation therefore takes
that there were sufficient grounds to treat the waste locally, place in the environmental court. The County Administrative
thus lowering the total amount of material transported to treat- Board is responsible for the supervision of such operations. In
ment facilities in the south of Sweden. The facility by the this case, the municipality of Umeå has exercised its right to
docks received a licence for the treatment of sludge oil and assume responsibility for the environmental supervision.
polluted sludge/gravel and was thus established. The company’s working hours are Monday through Fri-
The Managing Director also noted possibilities to treat oth- day between 7 am and 4 pm, with the exception of summer
er types of waste, such as fat waste. Such treatment, however, closedowns and national holidays. The facilities are locat-
requires a permit if exceeding 50 tonnes per year. Estimated ed at an oil port. Closest neighbours are oil companies and
volumes were approximately 3,000 tonnes per year. Awaiting similar operations. Closest populated areas are located ap-
a licence for this section of the operation, treatment of less proximately one kilometre from the facilities. The operation
than 50 tonnes per year was reported, followed by a report of generates quite a lot of local transportation work, but on the
interim storage of 1,000 tonnes per year. When a licence has whole the transportation work is decreasing since a substan-
been granted, a full scale treatment of fat waste products will tial amount of waste used to be transported to the south of
be possible. Problems with the water purification facility led Sweden. A description of the kind of waste that is handled

case study 1 219

and treated at the facility, as well as the processes used, are The ultra filtering technology has been tried before, and to-
as follows. day it is used at other facilities in Sweden, where it has proven
Sludge oil is a by-product from the oil used as fuel by to work well as a single stage purification process.
ships. Sludge oil is classified as hazardous waste. It has a
high water content (approximately 50%) and high viscosity. Oil-rich Sludge
At the treatment facility the water phase can be separated, Oil-rich sludge and gravel from oil separators, washing chan-
reducing the amount of fluid transported for conversion and nels and similar facilities are all classified as hazardous waste.
recycling by half. The sludge oil is pumped through to the The sludge is treated in a sludge groove, into which the sludge
receptor tank (2,000 m³) where water and oil are separated at trucks from the delivering companies deposit the material. The
a temperature of 50°C. The extracted water is transported to floating oil-rich sludge emerging on the surface of the sludge
an oil separator (30 m³) where further separation takes place groove is collected and compressed in a chamber filter com-
at a temperature of approximately 70°C. The water phase is pressor. Compressor water is led to the purification facility.
then sent on to a third oil separator (12 m³) with four cham- The filter bar is sent for further treatment at another facility.
bers. Extracted oil from the three stages is removed from the After a detention period, the fluid phase is pumped onto an
surface by suction and then emptied to an oil tank (50 m³). It oil separator (12 m³) where oil and water are separated. The
is handled as hazardous waste and transported to a destruc- water phase is then transported to additional oil separators
tion facility. (30 m³) for further separation. After this, the water phase con-
The water phase passes through a pipe filter, where larger tinues through the pipe filter and the inspection tank (10 m³)
particles are extracted, before it is led into a collector tank before it reaches the ultra filter.
(10 m³). From here, the water passes on to the ultra filter where Most of the dehydrated sludge and gravel from the sludge
the fluid is circulated in a closed system via membrane filters groove is transferred to the compost facility. Oil pollutions
and a processing tank. The resulting concentrate is led to a rest cleaned of gravel and sand are treated at the purification facility.
tank and treated as hazardous waste. The purified water phase
passes through a time-controlled automatic tester. A continu- Composting
ous turbidity control monitors the outgoing water and stops the Parts of the dehydrated sludge and gravel are mixed with horse
process if the turbidity is too high. Outgoing water is carried to manure and bark and placed in rows on a covered treatment
the recipient. The treatment is done batch-wise. plate for composting. Any drainage from the compost is re-
directed into the purification
process. No such drainage
has yet occurred, however.
Cleaning gravel Composting is not yet car-
Recipient Österfjärden ried out on a full scale. When
Oil waste fully operational, the inten-
Sludge
tion is that all dehydrated
IB = UB
Permit 500t
Echotech ltd sludge and gravel should be
composted at the facility.
The field of application for
Separated oil
the compost material is de-
termined from case to case
Storage
Sludge oil after consulting with the su-
pervisory authority.
Permit 3000t

Permit 1000t Cistern

Physical
Dehydrated grease
separation

Permit 50t Railway Figure 1.1 Schematic diagram

Waste water
transport of the flows and processes of the
Grease waste separator Chamber filtre press
facility. (IB = In balance, OB =
Out balance, UF = Ultra filter)

220 case study 1

Interim Storage of Waste Oil
The interim storage of waste oil uses a sealed detached tank
(1,000 m³). The material is stored until there is a sufficient
amount to warrant transport by rail.

Sludge from Fat Separation

Fat and fatty emulsions from fat separators at, for instance,
industrial kitchens are classed as waste. The water content is
about 80-90%. Collected waste fat is transferred from the com-
panies own sludge trucks to designated storage tanks. A poly-
mer is added to further solidify the fat. The waste is pumped
into a chamber filter press, where the water is extracted. The
extracted water is not considered to differ much from normal
household wastewater and it is therefore diverted into the spill-
water network. The dehydrated waste fat is sent to approved
Figure 1.2 Chamber filter press for dehydration of fat from the fat
facilities to be burned. Energy production using treated waste separator.
fat is planned by the company for the future.
Spill from the company’s transports as well as spill from
the oil burner nevertheless combine to lower the quality of air
2. Environmental Issues
locally through the release of carbon dioxide, nitrogen diox-
Water ide and particles. On the broader scale, however, transporta-
All process water from the facility is purified at a purification tion is effectively reduced through the company’s operations,
facility with ultra filters. Approximately 2,500 m³ of purified since less waste material has to be transported to destruction
process water a year is released directly to the recipient. Puri- facilities in the south of Sweden. Consequently, the company’s
fied water contains oxygen-demanding substances (COD) and operations contribute to improve the air around us. The com-
oil as well as low concentrations of heavy metals. The total pany also uses so-called clean vehicles (green cars) to further
of oxygen-demanding matters amounts to three tonnes a year; reduce the local affects on the air quality. To minimize distur-
oil makes up about ten kilograms a year and cadmium, cop- bance caused by exhaust fumes and noise in residential areas,
per and lead add up to a few g/year. The company is actively transportation is also directed along special routes predeter-
working to reduce the amount of oxygen-demanding matters mined by the supervising authorities.
in the spill water.
Process water from pressing the waste fat is redirected to Noise
a sewage-treatment plant for further purification. Storm water Noise from the planned operations comes from pumps, loading
from the facility is redirected to the harbour’s coordinated pu- and off-loading, as well as transports to and from the facilities.
rification facility for oil-polluted water to be purified before its The risk of this causing any disturbance is, however, negligible
release to the recipient. as the facilities are located far from any residential areas.

Air Risks
Primary air outlets include the oil burner that heats the premis- The largest threat caused by the handled waste materials is ac-
es, transports to and from the facilities, evaporation of volatile cidental spillage reaching soil and water. Large tanks contain-
hydrocarbons from waste materials, as well as discharged vola- ing liquid waste are therefore surrounded with ditches of soil.
tile hydrocarbons from the composting process. The discharge Spillage from these tanks is collected in the ditches and can be
of volatile hydrocarbons, VHCs, is judged insignificant enough handled through pumping the liquid through to another tank or
as not to affect the quality of the air in any determined way. tanker. The tank containing sludge oil is only surrounded with
Problems with odour may, however, occur periodically between a ditch of soil. Sludge oil is not in liquid form at temperatures
interim storage and treatment of waste fat. The company is cur- below 30°C, and is similar to tar in its cold state. Should there
rently investigation if adding lime might have a positive affect be a leakage of sludge oil, the oil collects in a congealing mass
on problems with bad odours. If this is not sufficient, installing inside the ditch. Chemicals are stored indoors, in a space with-
a carbon filter to purify the air is a possible course of action. out a drain. As it contains flammable components, handling

case study 1 221

waste oil is always associated with fire hazard. Nevertheless, member of the coordination group for risk management in the
should a fire occur, it will be contained to the tank of waste oil port, organized by the dockland companies. The company
oil. The tank’s size, as well as the distance to other tanks and also participates in the oil port’s fire drills.
nearby oil depots, is all substantial enough for the risk of fire
to be regarded as minimal. In case of fire in nearby depots Energy Consumption
where large quantities of pure petrol are handled, there is a risk Approximately 350 MWh of electric power along with 20 m³
that the thermal radiation will cause the waste tanks to com- of heating oil and 90 m³ of fuel is consumed at the facility. In
bust. As a preventative measure, the company is therefore a order to minimize the consumption of fuel, the company has

Box 1.1 Permit – Separate Judgement, given on August 5, 2000

The environmental court gives Oil & Sludge Treatment tive board, and must be presented to the environmental
(the company) permission to, in accordance with the En- court no later than December 31, 2001, together with the
vironmental Code (1998:808), at the property Hamnen in demands that the investigations may cause in the way of
the municipality of Umeå, build and operate a facility for measures and final conditions:
the interim storage of 1,000 tonnes of waste oil, as well as
1. Investigation relating to the treated process waste wa-
the treatment of, in part, 3,000 tonnes of sludge oil per
ter released by the facility regarding, firstly, the total
year from ships, including waste from the engine room,
volume and, secondly, the content of pollutions.
and, in part, a total of 500 tonnes of oil polluted waste a
2. Investigation relating to composting with regards to,
year, in the form of sludge and gravel from the sludge sep-
firstly, what results achieved by treatments, secondly,
arators, oil separators, gutters, pump holes and similar.
the presence and risk of odours and, lastly, how the
The operation shall be running no later than four (4)
end product can be used.
years from the date of the judgement, in reference to the
interim storage of waste oil, and no later than two (2) Until otherwise stipulated, the following provisionary
years from the same day with regards to the rest of the regulations are in effect:
operations. If not, the permit expires.
1. Process water separated in the facility shall be purified
For the permit, the following conditions are in force:
in an ultra filter.
1. If not otherwise stated in this judgement, the opera- 2. Process water released from the facility must not ex-
tion must include measures to reduce the pollution of ceed the guiding values and monthly mean values for
water and air, as well as other disturbances to the sur- the following pollution levels:
roundings, in accordance with what the company has
stated or assumed responsibility for in the case. Suspended 10 mg/1
2. Ditches corresponding to available tank space must COD Cr 1,000 mg/1
be organized. The arrangements must be designed in Zink 0.5 mg/1
cooperation with the supervising authority.
3. Noise from the operations must be limited, so that Copper 0.2 mg/1
outside and in residential areas noise levels do not ex- Chromium 0.2 mg/1
ceed the equivalent of 50 dB(A) on weekdays between Lead 0.1 mg/1
7 am and 6 pm, 45 dB(A) on Saturdays, Sundays and
Nickel 0.2 mg/1
national holidays, 40 dB(A) at night between 10 pm
and 7 am and 45 dB(A) at all other hours. At night, Cadmium 0.02 mg/1
momentary noises outside may not exceed 55 dB(A). Oil 5 mg/1
4. In the control programme, it shall be clearly shown in
what way the company’s readiness in case of emer- 3. The compost facility shall be operated in such a way
gencies is coordinated with the emergency planning that it does not cause any odour disturbances to the
work within the larger dock area. surrounding area.
5. Suggestions for an after treatment plan shall be es- 4. The treated process water from the facility shall be re-
tablished and submitted to the supervising authority directed to Österfjärden.
in good time before a possible closure of the opera-
The licence is only valid if the company can put up a
tions.
collateral of SEK one million (SEK 1,000,000) for incur-
Trial period ring costs. The collateral must be comprised of a deposit
The following investigations shall be carried out by the or surety, including a bank guarantee, and kept by the
company, after consultation with the county administra- county administrative board of Västerbotten.

222 case study 1

established rules against idle running of vehicles and works After the proceedings, the court will give its judgement
continuously to optimize transportation through examining with the permit and conditions for the operation. In this partic-
logistical systems. In the future, the company intends to use ular case, two issues were not sufficiently investigated, and for
waste fat as fuel in its own burner, where the waste will replace these issues only a provisional set of conditions were given.
a good quantity of heating oil. This means that the company was given a set amount of time
to investigate the issues while in operation. Below is the sepa-
Use of Chemicals rate judgement of the environmental court regarding the per-
The most common chemical used at the facility is a polymer
supplement designed to thicken the waste fat, which amounts
to approximately 18 m³ a year. A variety of chemical cleans- Box 1.2 Judgement with Final Conditions of
ers, totalling around 100 litres a year, are also used for clean- the Licence, stated on December 2, 2004
ing the facilities. The company works actively according to the
exchange principle, which means that if there are less hazard- For the licence to build and operate a facility for the
treatment and interim storage of oil waste etc., on the
ous alternatives these should be favoured to other chemicals.
premises Hamnen in Umeå, that the environmental
court in Umeå submitted a separate judgement on
May 8, 2000, the following final conditions shall be
3. Permit Authorisation applicable, in addition to the conditions established in
Background the separate judgement.
Since the operation is classified as subject to a permit require- 1. Process water released from the facility must not
ment, the operations have been tried by the environmental exceed the guiding values (monthly mean) for the
court. following pollution levels:
The authorisation process began with a consultation with Suspended particles 10 mg/1
the authorities and the concerned parties. In this the company COD Cr until 2005 12 31 1,500 mg/1
gives a brief account of the nature and extent of the opera-
COD Cr from 2006 01 01 1,000 mg/1
tions as well as the expected effects on the environment. At
Zinc 0.1 mg/1
the consultation, both authorities and concerned parties can
Copper 0.1 mg/1
make suggestions as to which aspects of the operation should
Chromium 0.01 mg/1
be looked at more closely.
Lead 0.01 mg/1
Environmental Impact Assessment Nickel 0.1 mg/1
The company then starts the process of preparing an Environ- Cadmium 0.001 mg/1
mental Impact Assessment (EIA). Should the county admin- Oil 5.0 mg/1
istrative board deem it necessary, in the light of the estimated
2. Dilution of the process waste water with the pur-
environmental effects of the operation or other pertinent is-
pose of lowering the pollution levels is not permit-
sues, the consultation group can be further extended to also ted.
include environmental interest groups and certain national 3. In case of bothersome odours or other inconven-
agencies (e.g. the Swedish Environmental Protection Agency, iences caused by composting, appropriate meas-
the Swedish Board of Fisheries and the Swedish Rescue Serv- ures to deal with the disturbances must be taken.
ices Agency). Suggestions from the previous consultation are Measures must be taken after consultation with
the supervising authorities.
included in the statement and the permit application. 4. Treatment of polluted, dehydrated sludge must
take place indoors, on a dense surface with the
The Environmental Court Proceedings possibility of collecting drainage water. Collected
The application, including the EIA, is then submitted to the drainage water must be purified in the ultra filter.
licensing authorities. When the licensing authority, as in this Supported by the 22 chapt. 25 § 3 st in the Envi-
particular case, is the environmental court, the authorisation ronmental Code, the environmental court leaves it to
process is settled in oral court proceedings. At the proceed- the supervising authority to prescribe the outstanding
ings, the company’s claims, suggestions for conditions as well conditions that may be required regarding the design
and operation of the composting facility.
as the application and the EIA are treated by the court, the
authorities and the company.

case study 1 223

mit of the company in question. Please note that the company company has established an operator’s self-monitoring con-
must offer financial collateral covering the costs of liquidation trol programme, which has been presented to the supervising
in case of bankruptcy for the permit to be valid. authority. In case of changes to the operation, the control pro-
gramme must also be revised. The most important parts of the
Trial Period Investigation programme are presented below.
After the close of the trial period, the company will show an in-
vestigation from the trial period. If the court and authorities deem Sampling
the investigation to be sufficient, a new negotiation meeting is Tests of outgoing water from the ultra filter are made every
often called to finally settle questions which have been deferred. second week, in the form of day samples. These are analysed
At the negotiation, the company’s investigation was treated separately and the monthly mean values are calculated. The
along with any new information. In this case, the investiga- sample is taken with an automatic tester. Analyses are carried
tion showed that the spillage levels of heavy metals was sig- out for suspended substances, COD, zinc, copper, chromium,
nificantly lower than the provisional conditions, spillage of oil lead, nickel, cadmium and oil index. The analyses are carried
and suspended substances were on par with the provisional out by an accredited laboratory.
conditions, while the COD spillage exceeded the allowance During the operation of the fat filter press, the company
in the provisional conditions. However, at the negotiation the will continue to carry out tests and analyse reject water from
company stated that they had very recently found the cause of the fat filter facility. Testing of reject water will take place eve-
the elevated COD levels and intended to adjust the facility to ry second press. The parameters being analysed are as follows:
lower the levels. The court therefore decided to lower the guid- BOD, COD, suspended substances, TOC, fat, tensides and oil
ing values for heavy metals, maintain the guiding values for oil index. The analyses are made by an accredited laboratory.
and suspended substances and, for a period of time, increase Results from the analyses are presented both as level and
the guiding values for COD to give the company the chance quantity values. Should significant deviations from normal
to deal with the problems of COD. Regarding the composting values be detected in the values, the supervising authorities
of sludge, the court established conditions for odour problems will be notified.
and treatment of drainage water. Other issues relating to the
composting were delegated to the supervising authority. Be- Controls of Preventive Environmental Measures and
low is the final judgment for the deferred issues. Equipment
The following are monitored regularly:
Operator’s Self-monitoring
In accordance with the Environmental Code, all environmen- • That the chemicals and hazardous waste are stored and
tally harmful operations must exercise operator’s self-monitor- protected from leakage to the surroundings.
ing control of the operation and its affect on the environment. • The ditches at the premises.
The contents and extent of the operator’s self-monitoring • That there is an absorption agent.
control for operations that requires a permit is regulated in a • That the facilities hold satisfactory standards, thereby
special statute. Violating this statute is punishable by law. The avoiding leaks.
The monitoring of the functioning of the purification equip-
ment is carried out according to practice collected in a binder
labelled “Ultrafilter Operation”. The facility is checked daily
according to the practice in the quality management system
and the environmental management system.

Monitoring of Practices in Case of Incidents,

Interruptions and Accidents
In case major, serious interruptions (e.g. spills, leakage, fire)
the following are contacted:
Rescue services 112
Umeå Harbour 090-16 32 80 (switchboard)
Supervising authority 090-10 70 00 (switchboard)
Figure 1.3 View of the plant.

224 case study 1

 There are fire extinguishers in pump houses, by reception is due no later than March 31, the business year described in
containers and by ultra filters. The sludge tank has a powder/ this report. The report also states the volume of the year’s pro-
foam extinguisher. The facility has routines for the handling of duction, changes made and the volume of spills. The report is
leakage, spillage, stoppage and fire posted. The rescue serv- a very important supervisory tool for the authorities. The infor-
ices have updated lists of contacts for all operations within the mation contained is also used for regional and national summa-
dock area. The regulations for the operation are followed, as ries on the state of the environment. Not submitting the report,
well as the general emergency plan that has been established or submitting it too late is punishable by law. The most im-
for Umeå oil port. portant section of the report is the company’s description and
comments on how the conditions of the licence have been met.
Periodical Inspection by an Impartial Inspector Table 1.1 contains extracts from this section of the report.
Periodical inspections of the operations shall be carried out on
the company’s own initiative every other year, starting from
4. Other Authority Decisions
2003. The purpose of the periodical inspection is to:
Environmental Sanction Fees
• Examine the performance and technical quality of the
Despite a reminder from the supervising authority, the compa-
operator’s self-monitoring system.
ny’s environmental report for 2004 was submitted late. Some
• Give a basis for the judgement of whether the facilities
breaches of the regulations stated in the Environmental Code
are operated and maintained in a technically optimal way.
and regulations with support in the Code, in which delayed
• Give a basis for the judgement of whether the conditions
submission of the environmental report is included, entail a
and monitoring programme have been followed.
penalty in the form of an environmental sanction fee. The
The inspection shall be carried out by an impartial inspec- value of the penalty is dependent on the nature of the breach.
tor with expertise in the field. Before the inspection is carried The penalty for a delayed environmental report amounts to
out, an application must be submitted to the supervising au- SEK 2,000 (Euro 220). The authority was therefore authorised
thority on when the inspection will take place and who will to decide on an environmental fee for this delay.
perform it. The extent of the inspection is to be settled after The decision was formulated as follows:
consultation with the supervising authority. The Environmental and Health Board has come to the
decision, based on ch § 30 of the Environmental Code, that
Environmental Report the Company shall pay an environmental sanction fee of
Environmentally dangerous operations subjected to a permit SEK 2,000 for a breach of the § 6 of the regulations of the
requirement must submit an annual environmental report. This Swedish Environmental Protection Agency regarding the en-

Table 1.1 Conditions and regulations with comments on how conditions have been met during 2004.
Condition, active decision Comment on how conditions have been met
The licence comprises the building and running of a facility for During 2004, a total of 249 tonnes of waste oil has been
interim storage of 1,000 tonnes of waste oil and treatment of, received and transported to Reci Halmstad. 3,048 tonnes of
firstly, 3,000 tonnes of sludge oil from ships per year, including sludge oil has been received, of which 1,564 tonnes have been
machine room waste and, secondly, a total of 500 tonnes a treated. 1,624 tonnes of oil-polluted sludge has been received,
year of oil-polluted waste in the form of sludge and gravel generating 188 tonnes of oil-polluted sludge. The conditions
from sludge separators, oil separators, gutter wells, pump stipulated in the licence have been met.
holes and similar.
Process water released from the facility must not exceed the A total of 2,573 m³ of process water has been released to
guiding values and monthly mean values for the following the recipient. COD has been exceeded twice, suspended
pollution levels (see licence, final judgement). substances have been exceeded four times and chromium has
been exceeded three times. A continuous optimization of the
operation is expected to prevent any future breaches.
Banking corresponding to available tank volumes must be Banking has been designed in cooperation with the
provided. The banking arrangements must be designed in supervising authority. During 2004, no leakage has occurred.
cooperation with the supervising authority.
No dilution of the process water, with the purpose of lowering No pollution has occurred during 2004.
the pollution levels must occur.

case study 1 225

vironmental report for environmentally hazardous operations of such waste, the company was obliged to store the waste
subject to a permit requirement. temporarily awaiting the licence. The change was deemed no-
tifiable, i.e. have a legal obligation to submit a report and the
Notification of Minor Changes to the Operation supervising authority subsequently gave an order on precau-
A change or addition for an operation subjected to a permit tions for the notified interim storage.
requirement can be carried out after a notification to the super-
vising authority, in cases when the change is not subject to a The Authority’s Comments
permit requirement. The notification must contain, among oth- The company is undergoing constant development to be able
er things, a description of the change, estimated consequences to handle new wastes, new methods and new procedures. So
to the environment following the change, and a revised opera- far they have kept within the pale of the law – apart from late
tor’s self-monitoring control programme. submission of the environmental report – but there have nev-
The company submitted such a notification of change to ertheless been a few close calls. Supervising the company has
the interim storage of waste from fat separators. As the compa- involved great efforts from the supervising authority, where in
ny had not yet been granted a licence for a full-scale treatment some cases the authority has been able to allow certain chang-
es, while in others it has not.
The company’s main operations have always had the nature
Box 1.3 Decision Regarding the Notified Changes of improving environmental protection – such as, for instance,
reduced transports. In the beginning, however, the company
The Environmental and Health Board, in accordance had limited knowledge of the laws and regulations in the area
with the Environmental Code and with reference to of environmental protection. Through close cooperation with
27 § on the provision on environmentally hazard-
ous operations and health protection, charges the
the supervising and licensing authorities, however, the com-
Company with the following, regarding the notified pany has now achieved a high level of knowledge, both about
changes: the effects of their own operation and consequences for the
environment, and in the field of environmental legislation.
This decision refers to a maximum of 1,000 tonnes of The authority predicts a substantial amount of work in the
coincident interim storage of waste from fat separa-
future to revise the operation, as a consequence of the sched-
tors. The decision is in effect until such time that a
possible licence, according to the Environmental Code uled changes. Following this, supervision of the operation will
for expansion of the operation, including interim stor- mainly involve inspection of and cooperation with the com-
age of waste from fat separators prior to treatment, pany, for the development of the operator’s self-monitoring
has become legally valid. programme.
• If not otherwise stated in this order, the Company
shall follow the duties and tasks stated by the com-
pany in the notification.
• Transports to and from the facilities must be rout-
Contacts
ed through the road E12, except in those cases
where it is inadvisable from an environmental Author
point of view. Assoc. Prof. Torgny Mossing
• The company’s operator’s self-monitoring control
must be updated to include the notified change.
Department of Ecology and Environmental Science
Special note must be taken to controlling the de- Umeå University, SE-901 87 Umeå, Sweden
tection of odour problems from the interim stor- E-mail: torgny.mossing@emg.umu.se
age. A report of the updated operator’s self-moni-
toring control must reach the supervising authority Inspector
no later than 01-08-2005.
Environmental inspector
• Any odour problems occurring during interim
storage and other handling of the fat waste must Klas Köhler
be reported to the supervising authority. Should Umeå municipality office
any odour problems occur, necessary precautions, 901 87 Umeå, Sweden
such as carbon filtering of outgoing air or similar, E-mail: Klas.kohler@umea.se
must be taken.

226 case study 1

 Case Study 2
Swedish Forest Plats Ltd
Sweden L

A Court Case on Permits to use Pesticides in

a Plant Nursery

1. Introduction 2. Licensing
The Company Licensing
Swedish Forest Plants Ltd is a company, that produces plants, The Swedish environmental legislation did not until recently
mainly of pine, for the purpose of reforestation of clear-cut ar- include a general demand for a permit for plant nurseries.
eas in northern Sweden. Production started in the area in 1950 This company thus did not have to apply for a permit, but of
and has been established since then. The plant nursery is locat- course as any activity, needs to abide by the environmental
ed on a gravel and sand ridge, as such soil was needed for the legislation of the country.
particular kind of growth form (bare root) that was commonly However, in 1977 the Swedish Environmental Protection
used at the time. Approximately 3 km downstream from the Agency, EPA, issued regulations for the use of pesticides.
ridge formation is a large water supply for Umeå city of about Therefore, the plant nursery needed a permit to use pesticides
110,000 inhabitants. The area around the water catchment is within the protected area. The municipal office for environ-
protected to prevent the pollution of the water source. The pro- mental health was in this case the supervisory authority and
tected area also includes the plant nursery. responsible for approving or rejecting permit applications.

Use of Pesticides Application for a Permit in 1998 – Analysis of

Pesticides are used to protect the plants from insect attacks. Pesticides in Water
In particular some species of beetles are a serious threat to The company applied for such a permit in 1998. In connec-
plant growth. Early on DDT was used. This was discontinued tion with the application, the supervisory authority required
in 1970, when a general ban on the use of DDT was intro- that the company take samples from the ground water for
duced. Later on other insecticides were used. Also protection analysis of specified chemical agents.
of the plants against fungal growth became important and a The analysis showed that a number of chemicals were
number of fungicides are used regularly. prevalent both within the area, and downstream in the gravel

case study 2 227

ridge. The kind of chemicals found were compounds that had
been used historically since the start of the operation. Further
studies of the ground water and soil were carried out and
showed high levels of pesticides in the surface soil. Residues
from pesticide use were also found 1-2 km downstream from
the nursery.
From 1998, there was a gradual winding-up of the use of
pesticides in the plant nursery. This process was carried out
according to a termination plan designed by the plant nursery
in cooperation with the supervisory authority.

Application for a New Licence in 2001

Before the growing season of 2001, the plant nursery applied
for a permit to use four compounds (fungicides). However, Figure 2.1 A growing pine cone. (Photo © Sveaskog)
the supervisory authority – the environmental health office
at the municipality – deemed two of these compounds ques- water supply, great importance is given to the mobility of the
tionable from a risk point of view and did not allow their use. compounds in the soil and ground water.
For the risk evaluation of pesticide use within a protected Of the compounds listed (Box 1) in the applications Prop-
iconazole and Iprodion were approved while Azoxystrobin
and Tolylfluanid were not approved by the authority:
Box 1 Pesticides
The Assessment of Fungicide Use
1. Propiconazole For Azoxystrobin there was no information about mobil-
(Swedish trade name: ity. However, the Danish Environmental Protection Agency
Tilt gel) had studied the compound and was of the opinion that the
Antimoulding agent use of compounds such as Azoxystrobin should generally
be forbidden outdoors due to the risk of contamination of
the ground water. Tolylfluanid breaks down into DMST (N-
2. Iprodion methyl, N’-(4-methylphenyl)-sulfamide), a substance that
(Swedish trade name: can potentially contaminate the groundwater. The origi-
Rovral flo) nal substance, however, shows medium to low mobility
Antimoulding agent
in soil and ground water. The remaining two compounds,
Propiconazole and Iprodion, both show low mobility in the
soil.
It should be pointed out that Azoxystrobin and Propico-
nazole are both used against grey mould and Tolylfluanid and
3. Azoxystrobin Iprodion are used against the same types of fungus infesta-
(Swedish trade name:
Amistar)
tions. The supervisory authority was therefore of the opinion
Antimoulding agent that the plant nursery should be able to make do with the use
of one compound for each type of mould. The compounds
considered to cause the least risk for water pollution were
Propiconazole and Iprodion. These compounds would not
4. Tolylfluanid
pose an immediate risk to the water supply. The other two
(Swedish trade name:
Euparen) were excluded on the ground that their use would cause a sig-
Antimoulding agent nificant risk to the groundwater in the long-term. The denial
was thus a long-term preventative measure.
The supervisory authority therefore allowed the use of
Propiconazole and Iprodion during the growing season of
2001. The permit was issued with the condition that the com-

228 case study 2

pany should account for its use of pesticides during the year permit, only in exceptional cases can the act be considered
to the supervisory authority. The company was informed of insignificant. The Supreme Court also established that a vio-
the decision. lation against the permit for the use of pesticides must not
lead to imprisonment, even though imprisonment is included
in the range of punishment for environmental crimes. The
3. Inspection and Court Case
reason for this is that the rules regarding the use of pesticides
Inspection on the 2001 Permit – Charge for are only directions from the EPA and are not regulated by
Criminal Activity law or provisions.
During the revision of the 2001 report to the authority it was Should an administrative authority, such as the EPA, fill
noted that the company, apart from the approved compounds, out the punishment decree form for environmental crimes in
had also used Azoxystrobin and Tolylfluanid, which were not such a way that the crime the responsible person has been
approved in the permit. The amount used was 2.5 kg of active charged is fully stated in these regulations, the charged per-
compounds. son can not be sentenced to prison. The principle is that the
Violating the permit is considered an environmental government or Parliament must decide regulations, which
crime according to the Swedish environmental legislation. may lead to a prison sentence, that is, they must be laws or
Any person responsible for such illegal environmental activi- provisions.
ties is liable to be fined or imprisoned for a maximum of one The Supreme Court therefore convicted the responsible
year. The supervisory authority is obliged to report suspected person of conducting illegal environmental activities, sen-
violations of the environmental legislation, according to the
Environmental Code. The case was therefore remitted to the
environmental prosecutor who started a preliminary investi-
gation. The preliminary investigation resulted in a legal ac-
tion against the responsible director of the plant nursery.
It should be noted that if the company had severe objec-
tions against the conditions in the permit, they had the op-
portunity to appeal. But the possibility of appeal to a higher
court had not been used by the company.

The Procedure in the District Court – Appeal to the

Higher Court
The district court rejected the suit due to the fact that the risk
of damage was considered negligible. The environmental
prosecutor, however, appealed the case to the court of appeal
who, again, denied the complaint, commenting that the risk
was small and the action insignificant.
An appeal of the decision from the court of appeal can
only be made by the Chief Public Prosecutor and shall only
be allowed if it can be considered a matter of a principal that
the case is settled in a higher court.
In this case the Chief Public Prosecutor appealed the de-
cision from of the court of appeal to the highest authority, the
Supreme Court. The Supreme Court announced its verdict
during spring 2006. This decision is not open to appeal.

The Supreme Court Decision

The Supreme Court established that when a permit violation
has occurred, the risk of damage does not pose a basis for
whether the violation should be considered minor. If a per-
son that has applied for a permit and acts in violation of this Figure 2.2 North Swedish pine forest. (Photo @ Södra)

case study 2 229

tencing him to pay a fine according to Section 29, § 4 in the Contacts
Environmental Code.
Author

4. Comments Torgny Mossing

PhD, Associate Professor
Reflections from the Supervisory Authority Department of Ecology and Environmental Science
The plant nursery’s violation against the conditions of the Umea University, 901 87 Umea, Sweden
permit did not pose an immediate risk to the water supply, E-mail: torgny.mossing@emg.umu.se
but the purpose of excluding certain compounds was that
the use of these compounds causes a significant risk to the Environmental inspector
ground water in the long term. The opinion of the authority Klas Köhler
and the decision to exclude the use of certain compounds was Umeå municipality office
thus a long-term preventative measure. 901 87 Umeå, Sweden
Irrespective of the acute risk of pollution, it is extremely E-mail: Klas.kohler@umea.se
unfortunate from the authority’s perspective if an operator,
regardless of whether this is done intentionally or by acci-
dent, does not comply with the decisions taken. The position Internet Resources
of and confidence in the authority can be severely undermined http://apps.kemi.se/bkmregoff/Bkmblad/Propikon.pdf
when an operation that violates the authority’s decision does http://apps.kemi.se/bkmregoff/Bkmblad/Iprodion.pdf
not receive any kind of sanction. http://apps.kemi.se/bkmregoff/Bkmblad/Azoxystr.pdf
It is therefore the authority’s opinion that the fines issued http://apps.kemi.se/bkmregoff/Bkmblad/Tolyl.pdf
for the violation of the permit was a positive thing. This is
positive, firstly, because the Supreme Court shares the opin-
ion of the authority regarding the specific case and the im-
portance of adhering to the decisions and conditions of the
authority, and secondly, because the legally valid punishment
for environmental crimes show other operations that it is ex-
pensive not to follow the environmental laws and authority’s
decisions. The verdict thus has a general preventive effect.

230 case study 2

 Case Study 3
Tomaszow Landfill
Poland L

An Integrated Permit for a Landfill according to IPPC

1. The Landfill in Waste Managment Below, the procedure for the establishment of a landfill in a
Landfills small Polish town will be described. The story of the landfill is
In all countries dumps, garbage heaps or – in modern wording a little more complicated than it would have been in a western
– landfills have been the most common type of waste disposal. country, as it happened when Poland was joining the Euro-
There are thousands of landfills in our countries, many of them pean Union and thus adjusting its environmental code to the
small and unplanned. Too often they are found in places where so-called acquis communautaire, the body of EU legislation.
they leak to groundwater and constitute an environmental The case also illustrates how often new investments and
threat. In recent times regulations on waste management have environmental operations in the new EU countries involve in-
become much more strict. The traditional landfills thus have ternational cooperation, and how less reputable operators try
become illegal. Modern landfills are operations opened, run to make money by evading environmental law.
and closed by an authority, most often a municipality, which
has the responsibility for waste management. How to Construct a Landfill
In European Union policy waste management is a very
A landfill is a threat to the environment mostly because it
important area. The amounts of solid waste in Europe have
leaches contaminated water to the ground and groundwater
been increasing enormously during the last few decades; other
and emits gases, mostly methane, to the air, and creates noise.
options have had to be developed. In these reuse, recycling of
In the EU the construction of a landfill should be designed ac-
material and, finally, incineration are prioritised. Land-filling
cording to the Landfill Directive, which is very detailed; all the
is the least favoured alternative.
technical information needed is found in the Directive.
A typical landfill consists of
Legal Requirements
A landfill is today an operation controlled by a number of • a liner, the system that seals the landfill from the underly-
measures to guarantee that it is not destroying its environment, ing soil
especially not the groundwater, or is a nuisance to the neigh- • a leachate collection and management system, to allow
bourhood, for example from bad smells. The use of landfill treatment of wastewater
is today subject to considerable taxation and regulations. In • the drainage system for the water
particular land-filling of organic waste is being reduced con- • a system for collection of methane, caused by the decom-
tinuously and becoming outlawed. position of organic material

case study 3 A
• a monitoring system for methane and leachate water for localization. The authority responsible for this permit is the
• a road infrastructure for allowing trucks to deliver waste municipality. The chosen localization was close to the site of
etc the old landfill and from this point of view not controversial.
The decision on localization was taken by the municipality
When the allowed amount of waste has been added to the
as an administrative decision, signed by the Mayor. Acceptance
landfill, it has to be covered with a so-called landfill cap. In
requires that the planned localisation agrees with the spatial
this way it is secured for the future. In best cases the landfill
plan and detailed plan for the area. The plan for land-use de-
area can be used for some activities, for example a golf course
velopment is decided on by the city council and regarded as a
or the like. If organic waste was dumped in the landfill, such
local regulation. In this case the site for the landfill was located
new uses cannot be arranged earlier than after 30 years of its
in the municipality of Lubochnia. The site belonged however to
closure.
the National Forest, and was the property of the National Forest
company, but was leased by Tomaszów municipality from Oc-
2. Opening a New Landfill tober 1999. In the municipal spatial plan of Lubochnia the area
Establishing a Waste Management Company was indicated as not to be used for agriculture or forestry.
The company also had to provide an Environmental Im-
The old landfill in the town of Tomaszow had almost been
pact Assessment, EIA, which according to EU legislation is
filled up to the legally allowed level in 1997. The city needed a
required if a landfill handles more than 10 tons of waste per
new landfill, mostly for its household solid waste. The city es-
day, or more than a total of 25,000 tons of waste at the site.
tablished contact with a Belgian waste management company
This is of course the case. Ten tons is what comes on a single
and the two formed a new waste company on a 50:50 owner-
truck, and there would be much more than that.
ship basis. While the Belgian partner made some investments,
The Environmental Impact Assessment has to be made
the city contributed with the property needed for the new site.
publicly available. Those who wish may protest against the
The new company was formed and established by early
1999. The Belgian partners also had experience and compe-
tence, and especially experience of the EU Landfill Directive
from 1999 [Council Directive 1999/31/EC of 26 April 1999
on the landfill of waste]. The Landfill Directive outlines how a
landfill may be constructed and how the surroundings should
be protected.

Application for Localization

A new industrial or industrial-like activity, like a landfill, needs
to have a permit to be built and become operational on a given
property. The new company thus had to provide an application

Box 1 Regulations Involved

Part 1 Starting and building the landfill

- EU Landfill Directive from 1999
- National regulations for Environmental Impact
Assessment
- Town and country planning
- Law on Building permits

Part 2 Running the landfill after EU accession

- IPPC Directive
- Water framework Directive
- Air Framework Directive
- Noise Regulation
Figure 3.1 Localisation of the new landfill (light blue) in relation
to old landfill (dark blue), urban centres and the highway.

232 case study 3

 Box 2 Activities requiring an Integrated (IPPC)
Permit

Annex I of the IPPC Directive lists installations for

which an integrated permit is required. They are

1. Energy industries
2. Production and processing of metals
3. Mineral industry
4. Chemical industry
5. Waste management
6. Other activities

Each of them are described in detail. For category 5:

Figure 3.2 Transporting waste to the new landfill. 1. Installations for the disposal or recovery of haz-
ardous waste
2. Installations for the incineration of municipal
localization within a certain time, often 3 weeks. In this case waste
the localization was not controversial. As mentioned, it was 3. Installations for the disposal of non-hazardous
neighbouring on the old landfill, and located in the forest sur- waste, with a capacity exceeding 50 tonnes per
rounding the town, close to the highway from Warszawa to day.
Katowice. Possible noise would not be problematic. It was not 4. Landfills receiving more than 10 tonnes per
day or with a total capacity exceeding 25,000
close to residential areas or other industries. tonnes, excluding landfills of inert waste.
The localisation was accepted by the municipality (not sur-
prisingly considering it was a partly municipally owned com- The landfill of Tomaszow is included in category 5.4.
pany), and no one used the right to protest against the localiza-
tion. The requested permit was granted the new company after
the legally stipulated time of 30 days.

Application for a Building Permit

With a permit for localization the company now had to apply
3. The IPPC Permit
for a building permit for the landfill. A detailed drawing had to IPPC is introduced in Poland
be provided, as well as a description of the operations, and the The new landfill was built in 2001 and started its operations in
EIA. In particular the description had to show how the ground late 2001. The permit to start to operate dated October 4, 2001.
water would be protected and give details on noise, smell etc. Waste was collected from the municipalities of Tomaszow and
The authority responsible for a building permit of a landfill neighbouring Lubochnia.
of this size is the Powiat. A “powiat” in Poland is a regional During this time Poland was negotiating its EU member-
authority (most often translated into County), larger than a ship. In late 2003 it became clear that Poland was going to in-
municipality but smaller than a voivodship (most often trans- troduce the Integrated Prevention and Pollution Control, IPPC,
lated into Province, in Polish województwo). In case of very Directive. This directive, introduced in the EU-15 in 2000,
large installations it is the voivodship, that grants the permit. would be part of the new acquis as Poland would join the Un-
For medium-size activities it is the Powiat. ion on May 1st 2004. In Poland the Integrated Permit were re-
If documentation is complete the Powiat has only 30 days quested slightly earlier, already from January 1st 2004. From
to decide. Also here the application has to be made publicly the Annex II of the directive it is clear that landfills would need
available and anyone may protest against the building. an integrated permit.
A building permit is provided as an administrative deci- At this point the Danish government had stated a project
sion, signed by the Director (Governor) of the Powiat. The ap- to assist Poland to introduce the EU environmental legislation.
plication of the waste company was granted after the 30 days. Three voivodships became project areas for practical work.
[Building permit No 294/99/T from 28.12.1999] The activity Lodz Voivodeship, where Tomaszow is located, was one of
could start. them.

case study 3 A
 These data confirmed that the landfill required an IPPC (in-
tegrated) permit, and specified the conditions to be negotiated
with the authorities.
The next step was the preparation of the application for an
integrated permit. This is the responsibility of the owner of the
company. Very often the owner recruits a consultancy to pre-
pare the application in the cooperation with the owner.
When the application is turned in, the applicant has to pay
a fee. It varies with the size of the operation. The maximum
charge for an IPPC permit was 3,000 euros. In the case of this
landfill, which was a comparatively small operation, the com-
pany had to pay 750 euros.

How the Permit is Prepared.

According to Polish Law the authorities are responsible for
Figure 3.3 Tanks for leachate from landfill, composting plate for preparing the integrated permit for the installation. Here the
greek waste, and slope of old landfill. owner of landfill should be prepared to negotiate with the au-
thorities regarding the operational conditions. Also in this step
The Procedure for Obtaining an IPPC Permit the possibility of public participation is required.
During the permit preparation it is necessary to take into
The procedure leading to an integrated permit may be seen as
account not only the landfill directive but also other directives
four phases as follows:
and regulations. These could be:
1. Preparatory phase including the environmental audit
• Emissions to air (collection of landfill gas)
– identification of environmental aspects
• Emissions to water and ground (possible leakage to water)
2. Introductory phase
• Noise (working machines, traffic to and from the landfill)
3. Assessment phase
4. Decision phase The IPPC Bureau in Seville has decided not to prepare the
BREF for landfills because the landfill directive is so technical
The two first phases are the responsibility of the applicant,
that it can be regarded as defining the BAT requirements with
the owner of the installation. The last two phases are the respon-
this directive.
sibility of the competent authority. However it is best if the two
After the negotiations the permit was granted to the com-
have contacts during the entire process. In the third phase a ne-
pany.
gotiation between the applicant and the authority is conducted.
Changing Ownership
Preparatory and Introductory Phases
In 2004 the owner and the board of the company were
It was first necessary to check if the landfill needed an integrat-
changed. The new owner made a lot of money by taking waste
ed permit. This is the case if it receives more than 10 tonnes
from Warsaw and used all space available. To these provoca-
per day or has a total capacity exceeding 25,000 tons. Landfills
tions was added the fact that landfill tax was not paid, and the
of inert waste are excluded. In the case of the Tomaszów land-
company went bankrupt. The new owner thus violated both
fill, due to commencement of the operation of the company
environmental and criminal law, and was removed.
during the past year of 2003, the company foresaw the follow-
In 2005 the landfill company again changed owners as it
ing output:
was taken over by SITA, a well-known French waste manage-
• waste, which is harmless on the landfill, about 120,000 ment company. The situation was also influenced in 2005 as
m3/year. As the density of communal waste is about 250 Polish environmental law was adjusting to EU law. For the
kg/m3, it will be about 30,000 tons annually. That is, landfill company the change in the Waste Law meant that
about 85 tons of waste can be stored per day waste may only be accepted from the closest places. The land-
• temporary storage of recyclable materials and hazardous fill thus could only be used by the city of Tomaszow as origi-
waste, about 3,000 tons/annually nally intended.
• composting of green waste – about 500-700 tons/annually

234 case study 3

 A New Integrated Permit
Box 3 The Contents of an Application
for an Integrated Permit SITA applied for a continued integrated permit in March 2005.
Now, however, the authorities did not grant the permit, since
the lease of the site where the landfill was located had expired
I. Formal part
General information and statements of the applicant on June 18, 2005, and the site thus was not owned by the op-
erator. Rather the Voivodeship Inspectorate of Environmental
II. Information and descriptive part Protection forced the landfill to a halt its operations on Octo-
General information on the subject of the application ber 30, 2005. Thereafter it took 1.5 year for the municpality to
Description of installations used
agree with the National Forest on a prolongation of the land
Description of environmental impact
Description of the neighbourhood lease. In the meantime SITA could not use the landfill.
Description of the quality of environment in the impact In 2006 SITA applied once again for an integrated permit
area of the company with slightly altered conditions, mostly regarding an expansion
Environmental emission impact of the operation. At the beginning of 2007 SITA was granted
this new integrated permit. With the new conditions it would
III. Operational part
III.1. Fulfilment of BAT requirements by the company
be possible to increase the landfill height to some 5 meters and
Methods of protecting the water environment further expand its area.
Methods of air protection
Methods of protection against noise and vibration
Methods for limiting noxiousness of waste management Contacts
Methods of protection against electromagnetic radiation
Technical and organizational methods for protecting Author
the environment as a whole
Environmentally safe termination of equipment and in- PhD, Ass. Prof. Barbara Kozlowska
stallation operation Faculty of Process and Environmental Engineering
Necessary scope of monitoring Technical University of Lodz
Readjustment program (optional) Wolczanska street 213, 90-924 Lodz, Poland
e-mail: barbakoz@p.lodz.pl
III.2 Applied limit values for emissions and other param-
eters
Additional parameters of the quality of the environ- Environmental inspectorate
ment The Voivodeship Inspectorate of Environmental Protection
Suggested limit emission values 90-006 Lodz, Piotrkowska street 120
e-mail: wios@wios.lodz.pl
III.3 Applied for limit value and types of produced waste
and neutralization
Monitoring of the quantity of collected water
Scope of monitoring of emission
Scope of technological process monitoring
Scope of environmental quality monitoring
Suggested principles of collecting and transferring the
results of monitoring
Other scope of monitoring
Suggested criteria of identification of substantial impact
and principles of defining monitoring requirements

III.4 Conditions of verification and changes in the content

of the permit, suggested period of validity of permit
Suggested frequency of monitoring of permit condi-
tions
Criteria for defining substantial change in the eco-
nomic activity performed
Criteria for defining “substantial deterioration of the
state of environment”

case study 3 A
236 case study 3
 Case Study 4
Krasnoselsk Cement Factory
Belarus L

ISO 14001 Surveillance Audit as Compliance Inspection

1. The Cement Factory

a 5 km connecting road. It is then milled in two self-crushing
History mills and two re-crushing mills to obtain a finer material.
The Krasnoselsk Cement factory is situated close to the town Cement, or Portland cement, is made when limestone, clay
of Vaukavysk in the Grodno region in Belarus, 50 km from the (or sand) and fuel is burnt in a sloping rotating oven, a so-called
Polish border, on the bank of the River Ros, which flows to the rotary kiln. The factory has four production lines, two with ro-
River Neman and on to the Baltic Sea. tating kilns of 4x150m, and two with kilns of 5x150m. During
The plant is the largest of three cement plants which are the process the material forms a gravel-like hard burned brick,
found in Belarus. It produces high quality cement, lime, and called clinker. The clinker is milled in the milling shop with 8
fine-granulated chalk. mills 3.2x15m together with small amounts of other material,
The history of the company dates back to 1914, when the to form the cement. The production capacity of the plant is
first two cement production lines started, and the railway track over 1,000,000 tons of cement annually.
to Ros railway station with two wooden bridges was con- In 2003, the company produced 1,140,000 tons of cement.
structed and apartment houses built. The company in historical The cement is delivered by truck or by railway. 17% of the
times provided cement to several international large projects cement was packed and delivered to customers in paper bags
such as the TV tower “Ostankino” in Moscow, the Asuan Dam of 25 or 50 kg.
in Egypt, and others.
The now active plant in Vaukavysk is newly built. It opened Environmental Concerns and Improvements
only in 2001, close to the previous, now closed, plant. It was The cement production influences the environment in the
built mainly with equipment delivered from Germany and Bel- neighboring region. In particular for many years cement dust
gium. was a problem, as was emission to the air of SOX and NOX.
By the mid 1960s, the dust problem decreased as electro-
Production static precipitators were added to the rotating kilns. In 2006
Krasnoselsk Cement factory operates a wet cement produc- the reported emissions of dust to the air was 4,000 tons.
tion process. Its main energy source is natural gas. The main The factory has invested in several improvements during
raw materials are limestone, clay, and sand, which are mined recent years. This became part of the work for receiving an
in nearby quarries using Russian-model excavators. The raw ISO 14001 EMS certificate. In this process all kinds of aspects
materials are delivered to the production lines by trucks using and impacts were looked at. Environmental improvements

case study 4 237

Figure 4.1 The landfill of the factory,
which at the inspectino received the mark
“non-conformace” since it was not managed
according to existing legal specifications.

were made, especially in the area of emissions to the air. There The company had to pay a fee (tax) for the emission regis-
were also efforts to reduce natural gas consumption. A new tered by the environmental authorities, in this case SOX, NOX,
burner was installed in 2005. In 2006 electrostatic filters were CO, VOCs both from the kilns and from the vehicles. Sec-
installed at a cost of 300,000 euro. ondly there is tax to be paid for landfill of waste. In 2006 the
As part of this process the company is updating the produc- company paid a total of 2,000,000 Belarusian rubles (about
tion lines, improving the quality and competitiveness of the 700,000 euros) for the totality of its emissions and other envi-
products, decreasing the costs of fuel and energy utilization, ronmental impacts.
as well as improving the environmental situation in the plant
itself, and in the village. Permit for Water Management
The plant receives all its water from the municipality of Kras-
noselsk and thus only needs an agreement with the municipal-
2. Permits and Certificates
ity for its incoming water.
Permit of Operation It emits all its wastewater to the municipal wastewater treat-
A plant of the size of the Krasnoselsk Cement requires a per- ment plant. In this case it requires a permit from the municipal-
mit to operate from the Ministry of Building, Construction and ity for the amounts and character of the wastewater discharged.
Architecture of Belarus. The Ministry itself is thus the compe- A permit for the discharge to municipal wastewater was issued
tent authority for this permit. to the plant by the municipality of Vaukavysk. This permit is
also annual and has to be renewed each calendar year.
Permit for Emissions
The company needs a permit for its emissions to the air and its ISO 9001 and 14001 Certificates
production and management of solid waste. Such an permit is Since the new factory opened, the plant had worked to get a
issued by the Ministry of Environment regional office, in this certificate according to the ISO system. In 2003, the company
case in the Grodno region, one out of seven such offices in the was certified according to the ISO 9001/2000 quality manage-
country. The permit is valid for one year and a new application ment standard. The focus in this management system is cus-
has to be delivered each year, including an estimation of the tomer satisfaction, which it also became for the cement fac-
expected emission the coming year. tory.
The Ministry in Minsk does itself issue certain permits, All the products of the company are certified within the
which are thus not in the hands of the regional offices. It in- Belarusian national certification system by the national certi-
cludes the extraction of water from groundwater wells and fication body.
surface water, and the use of ozone depleting substances, in The company also worked to receive an environmental man-
particular freon, for refrigeration. This was not needed for the agement system certification according to the ISO14001/2004
cement factory. standard. This was successful in July 2005. The certificate is

238 case study 4

valid for three years, to July 2008. It will require external sur- cover was only partly done. It was not fenced, and no lightning
veillance audits every year. on the road to the landfill. This landfill was thus run in conflict
with current technical specifications.

3. Inspection and Environmental Auditing Operations with Hazardous Material, Oil and
Objectives and Scope of Inspection (Surveillance) Audit Chemicals
The factory was audited according to conditions in its 14001 Another unacceptable practice was disclosed in the vicinity of
certificate in October 2006. The auditor looked at two main the plant itself. In a building, which was part of the old factory
issues: on the bank of the river, a storage place for barrels with waste
oil was found.
1. Does the plant operate in compliance with its legal permits.
The conditions for these barrels were not acceptable. The
2. Does the plant fulfill in its ISO 14001 standard require-
place, formally closed for five years, was highly polluted by
ments?
oil products. They were not protected against rain and would
The main impact to the environment from production lines in the long term start leaking. This again did not have a per-
and units and a description of natural resources involved in mit.
processes, had to be checked. It was possible to inspect the
production itself, the mining and transport of material from
the quarries, and the management of solid waste. The auditor
had, however, no possibility of monitoring emissions to the air.
But as a rule the auditor checks relevant documents, such as
permits, schedule of inspection of filtering installation, records
(protocols) of analyses, etc.
The situation at the quarries was not so good, and in par-
ticular the road from the quarries to the factory was in bad con-
ditions. The surroundings were covered with white clay dust.
In Belarus it is, for obvious reasons, not possible to interview
workers regarding the working conditions, but it is clear that
they were not always satisfactory.

Waste Management
It turned out that the landfill used by the company did not
have a valid permit and it was thus formally illegal. It was in
addition not managed in a satisfactory way. Waste coming to
the landfill from the plant was not registered. It was mixed
with solid waste received from other sources, which was not
documented or weighed either. The landfill included eg old
tires, which is not allowed on landfills, and e.g. glass, wood,
and paper, which, according to Belarusian waste management
legislation, should go to recycling. There was no system for
methane collection, but that is not required and does not exist
in Belarus.
A more serious criticism of the landfill was that leachate
water was not taken care of. A ditch surrounding the landfill
had been built to collect leachate water but did not work in
practice. The water instead seemed to penetrate to and pollute
the groundwater. There were no arrangements for monitoring
ground water in the area. Figure 4.2 The Law violation act, issued by the local environmen-
Finally the landfill was not organized in a proper way, that tal inspectorate concerning non-satisfactory waste management at
is, the garbage was not stored in a systematic way, and the the Krasnoselsk Cement plant.

case study 4 239

Non-conformances, Conclusions and Notification The company would keep its EMS ISO 14001 certificate,
The auditor could conclude that the company did not operate until next surveillance audit in the summer of 2007.
in compliance with the existing permits from authorities and
several of the practices were not acceptable from an environ- Inspection Permits by the Authorities
mental point of view. The authorities in most case only conduct desk inspection, that
The non-conformance records called for several major or is, check documents provided by the companies. If they re-
minor correction. In this case two bad practices of waste man- quest improvements is largely dependent on the assessment if
agement and hazardous material management was given the the company is economically strong enough to improve.
note “minor non-conformances”. The company were given Occasionally the regional office of the Ministry of Envi-
conditions for a renewed audit in one month’s time. ronment does make visits. These may include monitoring air
The company was then required to emissions and in general check if the company is in compli-
ance with permits. This has not been the case with the Kras-
• arrange a satisfactory storage for waste oil containers noselsk Cement.
• organize the regular monitoring of the ground water in the
area of the landfill Author
• build a fence around the landfill Assoc. Prof. Dr Siarhei Darozhka
• regularly document weight and category of waste to the Departement of Ecology
landfill Belarusian National Technical University
F. Skaryna Avenue 65
Re-audit BY-220 027 Minsk
The recurring audit was carried out later in 2006. Belarus
Hazardous material or oil products had been moved to stor- Dorozhko@ecodept.unibel.by
age in another place and in a correct way, with a cement floor
and a fire protection system.
For the landfill a process to improve the situation had
started. The documentation of waste added to the landfill had
improved, including weighing and characterization.
A fence had been built around the landfill
An agreement with a chemical laboratory had been reached
regarding continuous monitoring of the ground water around
the landfill.

240 case study 4

 Case Study 5
Foseco GmbH
Germany L

Implementing REACH, the New European Union

Chemicals Regulation

1. REACH – A New and Controversial EU- ous substances. REACH, therefore, aims at granting approval
Legislation on Chemical Substances (authorisation) only to those chemicals, for which the risks are
The background shown to be adequately handled based on valid information.
Or, in other words, No data – no market.
After a more than seven years of intensive struggle and heavy
For obvious reasons, the chemicals industry and its down-
lobbying to develop a coherent European chemicals policy, the
stream users (such as car manufacturing) are deeply affected
REACH (Registration, Evaluation, Authorisation of Chemi-
by REACH. These sectors play a very important role in the
cals) Regulation (1907/2006/EC) was finally published in the
global economy. The EU is the largest chemicals producer in
EC Journal on 30th December 2006. The regulation became
the world with about 31% of the world’s chemicals production
effective in June 2007. The REACH system is a single regula-
(US 28%). The European chemical industry, which generates
tory framework, which replaces the old dual system for assess-
a turnover of about 316 billion euros and provides some 4.7
ing the risks of existing “old” (put on the market before 1981)
million jobs, is among the largest manufacturing industries in
and “new” substances.
Europe.
Worldwide about 400 million tonnes of chemicals are pro-
The main objectives of the new European chemicals legis-
duced annually. Chemicals are found in almost all products we
lation include:
use every day. For example, during tests, 100 to 300 artificial
substances could be identified in the human body. Among the • to develop a new integrated and coherent chemicals policy
chemicals in use, there are many substances, which are con- reflecting the precautionary principle and the principle of
sidered to be dangerous for human health and which threaten sustainability.
the natural environment. However, there is a general lack of • to modernize the regulatory framework to encourage and
knowledge about the properties of chemical substances and stimulate innovation, competitiveness and the efficient
their impacts on humans and the environment. The main rea- working of the internal market.
son for this gap in knowledge is an inefficient legislative sys- • to increase the safety of humans and the environment in
tem for chemicals. Therefore, the main motivations for the re- the handling of chemicals and at the same time improve
view of the European chemicals policy and, consequently, the the competitiveness of the chemicals industry in Europe.
development of REACH were to close this gap in knowledge • to reverse the burden of proof from authorities to industry
and to reduce the risks, which result from the use of danger- for testing and risk assessment of chemicals.

case study 5 241

• to establish a European Chemicals Agency to manage the EU and on the member state level. As a conclusion, the former
registration database and participate in the evaluation and system for regulating the production and of monitoring the use of
authorisation process. chemicals in the European Union turned out to be inefficient.

Motivation for REACH The Political Process Toward REACH

So far, the EU has distinguished between so called “old“ or Table 5.1 displays the time schedule of the REACH policy de-
“phase-in” chemicals entering the market before 1981 (approx. velopment from the publishing of the so-called “White Paper”
102,000 chemical substances), listed in the so-called EINECS (1998) until the adoption of the REACH regulation on 18th
catalogue and “new“ or “non-phase-in” chemicals (more than December 2007. All relevant legislative steps within the Euro-
3,200) entering the market after 1981. The problem consists of pean Parliament and Commission are displayed.
a general lack of knowledge of those chemicals which entered
the market before 1981, because until then no formal authori-
2. How REACH Works
sation was required. Hence, the vast majority of the chemical
substances, their properties and impacts for human health and General Lay-out
the natural environment are not, or still insufficiently, known. One of the key elements of the REACH system is the shift
So far, only about 9,000 or 8% of the existing chemicals are in responsibility from EU and national authorities to industry
sufficiently investigated and evaluated. and other stakeholders. This means that the burden of proof
It has been, however, very difficult to assess the risks re- for testing and risk assessment now lies with the industry. Un-
lated to chemical substances used in every-day processes. der the premise “no data, no market” it will only be allowed
Since 1993, there is an evaluation mechanism in use to reduce to place substances on the market for which sufficient data is
this gap in knowledge based on the consideration of specific available. The newly created central REACH agency, which
characteristics of chemicals, but it is not efficient. While the is located in Helsinki, Finland, has the task to implement and
responsibility lies with the public authorities, it is the industry control compliance with the new policy.
that can provide the required knowledge. The REACH policy regulates the registration, evaluation
Additionally, there has been a patchwork of too many and of- and authorisation of new and existing chemical substances
ten not consistent regulations and legal requirements both on the which are produced, used or imported in quantities over 1 tonne
per year. This means that until the year 2018 approximately
30,000 substances will fall under the REACH legislation. The
Box 1 REACH and EINECS implementation of REACH is divided into the pre-registra-
tion, the registration, the evaluation and the authorisation (or
REACH restriction) phase with strictly determined periods of time (Ta-
ble 5.2). For an overview of the implementation of REACH in
Regulation 1907/2006/EC of the European Parliament
and of the council of 18 December 2006 concerning companies see Figure 5.1
the Registration, Evaluation, Authorisation and Restric-
tion of Chemicals (REACH), establishing a European Pre-registration Phase
Chemicals Agency, amending Directive 1999/45/EC The REACH policy requires the pre-registration of all phase-in
and repealing Council Regulation 793/93/EEC and substance between June 2008 and December 2008. Producers,
Commission Regulation 1488/94/EC as well as Coun-
cil Directive 76/769/EEC and Commission Directives importers and (down-stream) users of chemical substances have
91/155/EEC, 93/67/EEC, 93/105/EC and 2000/21/EC. to send data about these substances to the central agency in Hel-
sinki, which include the name and identification number of the
EINECS substances (CAS number). The data on type of substance and
the annual production volume will be pre-registered together
European Inventory of Existing Commercial Chemical
Substances. The EINECS contains a list and definitions with the name and address of the person representing the com-
of chemical substances that were placed on the mar- pany to the agency and serving as the communication link.
ket in the European Economic Area between 1 January One month after the end of the pre-registration phase, the
1971 and 18 September 1981. The listed substances agency will publish a list of the pre-registered substances. The
(more than 100 000) are exempt from pre-marketing idea of the pre-registration is to enable producers and importers
notification requirements.
of identical substances to share specific data and to avoid double
work on dossier research as well as costly tests and to reduce

242 case study 5

the number of animal tests. This is supposed to take place in and international market relevance. All existing (“phase-in”,
the Substance Information Exchange Forum (SIEF), which is EINECS) and newly produced (“non phase-in”) substances,
created for the phase-in substances. Phase-in substances, which which are produced or imported in quantities more than 1,000
have not been registered by December 2008, will not be allowed t/a, more than 100 t/a for environmental hazardous substances
to be produced anymore. and more than 1 t/y for CMR (carcinogenic, mutagenic or toxic
to reproduction) substances, have to be registered until Novem-
Registration ber 2010. The registration phase for substances produced in
volumes larger than 100 t/a will last until May 2013. By May
The registration of chemicals in a central database of the agency
2018, all substances, which are produced or imported in quanti-
is generally required for all substances produced in quantities
ties of more than 1 t/a, have to be registered.
larger than 1 tonne per year (t/a). Information required for the
The REACH legislation does not apply for substances
registration includes a technical dossier and a safety data sheet.
which are
The REACH legislation has laid down interim periods based
on volumes per year for the registration process to overcome • only used for scientific research,
unacceptable barriers and assumed negative consequences for • polymers,
the European chemicals industry with respect to its competition • radioactive substances,

Table 5.1 REACH development

April 1998 The EU Environment Council asks the Commission to review the set of existing chemicals legislation.
February 2001 The Commission presents its White Paper on “Strategy for a Future Chemicals Policy”.
May 2003 The Commission publishes parts of its draft legislation on the internet for public consultation. It receives
many reactions and as a result, the Commission bows to industry pressure and weakens its draft legislation,
taking out safety information for more than 20,000 chemicals.
October 2003 The Commission adopts its proposal for Regulation on Registration, Evaluation and Authorisation of
Chemicals (REACH). The proposal aims to get safety data for 30,000 chemicals of the 100,000 that are
available on the EU market.
January 2004 An Ad Hoc Working Group on chemical (national experts) starts the detailed analysis of the proposal.
March 2004 The Commission, Cefic and UNICE sign a Memorandum of Understanding, which provides for the
undertaking of further work on the impact assessment of REACH by means of a multi-stakeholder project.
NGO’s cannot endorse this study due to major deficiencies in both the methodology and transparency of
the process.
July 2004 The Commission approves Cefic’s proposal for Strategic Partnership on REACH Testing (SPORT), a pilot
project to test the workability of the REACH proposal. The project is jointly managed by the Commission,
the Member States and industry. NGOs, Trade Unions, the Network of the European Chemical Regions and
the OECD are observers in the Steering Group meetings.
January 2005 Joint public hearings are held in the EU Parliament: over 1,000 delegates from industry and non-
governmental organisations attend.
March 2005 The final report is published on the further work on business impact as provided by the Memorandum
of Understanding between the Commission, Cefic and UNICE. The study finds REACH will not lead to
withdrawal of important chemicals from the market due to cost of registration and concludes that REACH
is not bad for business.
mid 2005 The final report of SPORT is published
November 2005 First vote in the EU Parliament. Parliament votes to phase out the most hazardous chemicals but allows
huge knowledge gaps on safety for thousands of chemicals.
December 2005 The Council adopts a political agreement.
November 2006 Second Vote in the EU Parliament.
December 2006 The European Parliament and the Council reach a compromise and adopt the REACH Regulation. It is
published in the official journal of the EU.
1 June 2007 REACH Regulation enters into force in all 27 EU member state.

case study 5 243

• substances in drugs or used as nutritive additives, within REACH is designed to close the lack of knowledge and
• substances which are listed in the REACH appendix IV information of chemicals impacts on human health and the
(e.g. water, natural oils) and V (e.g. minerals, coal) as natural environment and to provide all relevant information
well as already registered or re-imported substances. and data for the registration application. Evaluation, naturally,
is the most time consuming and costly working step within the
Hence, a registration for these substances is not required.
REACH process and was, therefore, heavily disputed by the
The amount of information required for registration will
chemical industry. The above-mentioned OSOR initiative and
be proportional to the chemical’s health risks and production
the joint consortia application are options to reduce both costs
volumes. The legislation requires the provision of a technical
and workloads.
dossier including for example the identity of the producer or
importer, the identity of the substance, information on the man- Authorisation/Restriction/Rejection
ufacture and uses of the substance, the classification and label-
Authorisation of substances will be required for highly prob-
ling of the substance, guidance on safe use of the substance,
lematic substances, such as CMRs, PBTs (persistent, bioac-
summaries of studies of tests which have been carried out.
cumulative and toxic), vPvBs (very persistent and very bioac-
For substances which are produced in volumes of more than
cumulative) and other substances with serious and irreversible
10 tonnes per year, the following information is required:
effects on humans and the environment.
• a chemical safety report which includes information about The applicant has to “ensure risks from substances of very
measures of risk management undertaken, high concern are properly controlled or that they are substi-
• data on the properties of the substance tuted”. This means that the authorisation will only be granted
• an evaluation concerning the possible danger to human to these substances if risks can be adequately controlled or
health and the environment. on valid socio-economic grounds (that means if the social and
economic benefits outweigh the risks) if there are no techno-
Especially for chemicals produced in high quantities and for
logical alternatives. If less risky alternatives exist, the sub-
dangerous substances, the amount of data required for the regis-
stance under consideration has to be substituted.
tration is enormous. Therefore, the Commission has accepted a
British-Hungarian initiative, the so-called OSOR strategy (One
Substance, One Registration). This is proposed particularly to
3. Implementing REACH in Germany
SMEs to reduce their efforts by sharing the duties linked to the
REACH implementation by forming consortia to apply jointly Germany’s Role in the Political Process
for registration. The OSOR strategy, however, bears some prob- Germany’s Government played an important role in the deci-
lems particularly related to data sharing (see below). sion and realization process of the REACH policy. As Ger-
many is home to the largest chemicals industry within the EU
Evaluation there was a controversy between consumers protection asso-
Evaluation of chemicals and substances can be based on either ciations and NGOs on the one hand and the requirements of
dossiers or substance testing including animal tests. This step the industry on the other hand to weaken the original REACH

Table 5.2 Schedule for the REACH Implementation Process

1 June 2007 REACH enters into force
June 2007 until June Former chemicals regulations are still in force.
2008 During that period of time, the industry (including downstream users) is supposed to inform itself about the
new legislation and carry out an inventory of their substances used to identify the substanes which have to
be pre-registered
June 2008 until Pre-registration phase
December 2008
January 2008 The agency will publish the list of pre-registered substances
November 2010 First registration phase: substances > 1,000 t/a, > 100 t/a for environmental hazardous substances
(R50/53), > 1 t/a for CMR-substances
May 2013 Second registration phase: substances > 100 t/a
May 2018 Third registration phase: substances > 1 t/a

244 case study 5

goals, which were aiming at the immediate re-evaluation and REACH Helpdesks in Germany
eventual substitution of up to 30,000 chemicals based on the Due to the fact the REACH system is quite complex and de-
volume-oriented approach of involving all produced volumes mands additional work and responsibility for the industry,
larger than 1 tonne per year under REACH. a number of information and training campaigns have been
Through its representatives and relevant channels the Ger- started by public authorities, industry associations but also pri-
man delegation put pressure on both the EU Parliament and vate consultancies both on the European and on the national
the Commission to alter the REACH requirements relative to level to help the industry to prepare for the new legislation.
its draft proposal. In the end, it was mainly Germany that al- Especially SMEs, which often have little experience with the
tered the produced volumes of chemicals for which REACH registration of chemical substances, and no particular adminis-
would account for. The final version of the regulation which trative department, are especially affected by REACH. There-
was adopted on 18th December 2006 by the Parliament and fore, the respective public authorities of the EU member states
Council did not include the immediate “1 tonne per year” have been prompted to install REACH helpdesks on their web-
requirement anymore but shifted that quite low volume ap- sites.
proach to a much later time period (May 2018). Instead the The helpdesk of the Federal institute for Occupational
REACH requirements are in the first phase restricted to those Safety and Health (BAuA, see links), the official German
chemicals with a production of more than 1,000 tonnes per helpdesk, is a good example. It includes a glossary, FAQs (fre-
year. quently asked questions), a guideline for the definition and
This meant that the numbers of chemicals to be re-evalu- classification of substances, an explanation of the pre-regis-
ated was assumingly reduced from the originally ca. 30,000 to tration phase and describes the demands for downstream us-
approx. 10,000. Without Germany’s involvement the REACH ers. Under “What do I have to do with REACH?” a question-
regulation would most likely have been more strict and con- naire leads companies through a set of questions concerning
sumer friendly. their kind of business and the chemical substances they use

Decision for implementing REACH

Determination of annual production volumes

yes
< 1 T/yr-1 Applies not for REACH blue = high risk
black = low risk

Registration Evaluation Authorisation and

no Restriction

Risks on
= 1/T yr-1 human health measured
and and be
environment? handled?

= 10/T yr-1 yes

yes no

no
Pre- Dossiers Substances
= 100/T yr-1 Registration Authorisation Restriction
registration evaluation evaluation

= 1,000/T yr-1
Authorisation or
restriction not required

Figure 5.1 Flow sheet on the decision of implementing REACH into an SME [taken from: Silivia Guether/SAXONIA, 2006]

case study 5 245

 Figure 5.2 Aerial view of Foseco
GmbH Borken, Germany, which is
hosting the REACH coordination team
for all European sites. The Borken Plant
had in 2006 a total area of 94,000 m2,
681 employees and 30 trainees.

in a simple way in order to help them identify their role under Foseco operates an integrated management (IMS) system
REACH and the tasks they have to fulfil in order to comply consisting of
with the legislation. • Quality Management, QMS (ISO 9000:2000 series)
• Environmental Management, EMS (ISO 14000:2004
series)
4. Implementing REACH in the Multinational
• Occupational Health and safety Management (mainly
Enterprise Foseco GmbH
based on the British OHSAS 18000 standard)
The Foseco Company
The British-German based company Foseco, founded in 1932, As part of the IMS, Foseco started early to adapt to the
develops, produces and distributes products and processes, REACH requirements using – besides others – students and
which are used for the formation, casting and smelting in the expertise from the University of Applied Sciences Zittau/
steel and foundry industry worldwide. In fact, the company Goerlitz. Students are involved in all steps of the implementa-
is the world market leader in products and solutions for the tion process as part of their diploma theses.
improving foundry and steel mill performance. Foseco, which
Dealing with the new REACH Legislation
produced a total of approximately 116.000 tonnes gener-
ated a turnover of about 592 million euros in 2006, operates With respect to the REACH system, Foseco can be classified
74 branches (sites) in 32 countries including 29 plants in 17 as a downstream user and importer of chemicals. This means
countries and employs about 3,100 people. In Europe, Foseco that Foseco is not a producer of chemicals. For its metallur-
is located in Germany, the Benelux Countries, France, Great
Britain, Italy, Poland, Portugal, Russia, Sweden, Spain, Czech Box 2 REACH Help Desks
Republic, and Turkey. Today, Fosecos’s ongoing commitment
is evident in the benefits they deliver to the foundry and steel REACH regulation Article 121 stipulates that member
mill industries worldwide: improved yield, reduced scrap, bet- States shall establish national helpdesks to provide ad-
ter quality, increased productivity and improved safety and en- vice to manufacturers, importers, downstream users
vironmental performance. Their impact is experi-enced daily and any other interested parties on their respective
responsibilities and obligations under this Regulation.
by many through the metal industry’s output, much of which is
used in the auto-motive and transport markets.

246 case study 5

 Responsible
Management Foseco
Europe

Coordination of REACH
Foseco GmbH
Borken/Germany

Participation in
workshops/seminars REACH – Coordination – Membership in panels
on REACH Team

REACH Project Group

REACH – Work Group 1 REACH – Work Group 2 REACH – Work Group 3

Communication with Identification and IT – tool and IUCLID 5
suppliers/Customers evaluation of (official software for
substances REACH)

Figure 5.3 Organization of

REACH for Foseco Europe

gical products and services Foseco is processing a relatively of internal experts from the departments of health, safety and
large number of chemical substances (approx. 500) of which a environment, IT, purchasing, marketing, and research and de-
number will apply for REACH. The current duties and tasks of velopment (R&D). Since 2004, Foseco´s employees actively
the company with respect to adoption of the REACH require- participate in different industry association and regularly take
ments are part in informative meetings and workshops about REACH
provided by different associations, agencies and consultants.
• to establish an efficient, legally compliant and workable
Additionally, telephone conferences are regularly carried out
REACH system
regarding the diverse RIP (REACH Implementation Process)
• to determine a REACH operation representative who
projects.
reports directly to the responsible management repre-
It proves to be difficult to estimate the right time to start
sentative
with the REACH implementation process. On one hand, there
• the acquisition of more detailed information and require-
seems to be still enough time for the pre-registration and sub-
ments on REACH, as there is hardly any experience to
sequent registration. On the other hand, the implementation
benefit from.
process will consume a lot of time. Many activities could al-
In detail, this includes the registration process (data re- ready be carried out but others, such as sending out detailed
quirements, costs, dossiers etc.), the establishment of a work- questionnaires to suppliers and customers, should be carried
able communication down the supply chain, the categories of out at a later more appropriate date. With respect to the time
use and exposition of chemicals, and, as a downstream user, to management, the option of using external support has to be
complete the safety data sheets on all chemicals used in any of considered as well as the risk of false estimation of the time
the plant’s processes. needed has to be taken into consideration.
It is important to note that all European plants and sites
have to be included in the REACH implementation process The Project Team
subsequently. So far, a project group as well as several work- The installed project team in the German Foseco headquar-
ing groups have been installed at Foseco GmbH in Borken, ter location at Borken has already taken up work. Currently,
Germany for the implementation of REACH. This consists they are being informed and trained on specific features and

case study 5 247

 REACH-Implementation Process

Registration
Pre-registration >1,000
Data Communication CSA/CSR Dossier
11/2008 tons/year, CMR
11/2010

Collecting
SIEFF With customers Carry out CSA Develop dossier Hand in dossier
information

Raw materials Consortia With suppliers Develop CSR

Data collection Along the Improved

Documentation
supply chain MSDS

Replacement of Determination
raw materials of Data
Abbreviations
Substances Data analysis CSA Chemical Safety Assessment
CSR Chemical Safety Report
SIEF Substance Information Exchange Forum
Handing in of MSDS Material Safety Data Sheet
pre-registration CMR Carcinogenic, Mutagenic, Reprotoxic

Figure 5.4 REACH implementation process [after S. Schneider/ Foseco, translated by G. Pollack]

requirements of REACH. Communication with Foseco´s sup- tion and training on REACH, the identification of missing data
pliers and customers are taking place and they are working on per substance under the consideration of waiving, analogy es-
the evaluation of all chemicals in use on any of Foseco´s sites. timation, the calculation of the annual volumes of each sub-
This means looking at the substance registers, the classifica- stance and an estimation of the total costs, and the pre-registra-
tion of applied substances according to the REACH policy, tion of the demanded substances within the REACH process.
the calculation of annual consumed quantities of individual Thanks to its innovative and future-oriented management,
substances per plant and the classification of the applied sub- Foseco belongs to those industrial enterprises which seem to
stances according to CAS (Chemical Abstracts Service) reg- have understood the complexity and scope of the new Euro-
istry number, international standard labelling for chemical pean chemical policy REACH early enough. Due to the early
substances, EINECS and ELINCS (European List of Notified start in dealing with the issue and the early and pro-active par-
Chemical Substances) numbers, respectively. At present the ticipation in informative meeting and workshops, the company
team is reviewing the some 500 chemical substances used in has the chance to be adequately prepared for the REACH re-
the company to see which of these have to undergo REACH quirements and thus, has a good starting point for fulfilling the
registration. REACH requirements due to the legislation becoming effec-
Figures 5.3 and 5.4 illustrates the organisation and the indi- tive in June 2007.
vidual steps of implementing REACH into Foseco´s IMS. Foseco regards the fulfilling of the REACH requirements
as a chance to improve its competitiveness.
A Competitive Advantage
Future activities of the REACH project team include further
development of the project plan, ongoing information collec-

248 case study 5

5. Comment on REACH and its Consequences implementation tools such as national helpdesks will find
Advantages and Costs of REACH for Companies practical and case related individual solutions to adapt to the
REACH requirements at an acceptable level of time consump-
“Once you go through the REACH process, you have chemi-
tion and financial burden. Finally SMEs, too, may understand
cals that have a ‘blessing’, and you can create better markets”
that the benefits of implementing REACH will outweigh the
argues Robert Donkers, the environmental counsellor to the
negative consequences and help to improve competition and
EU´s delegation to the United States and the person credited
better trading in general.
as the author of REACH. (From 1 April 1999 until 1 October
2003, Robert Donkers was Acting Head/Deputy Head of the
Chemicals Unit and inter alia responsible for coordinating the Abbreviations
development of the new EU Chemicals policy and legislative
Cefic Conseil Européen de l’Industrie Chimique /
framework.)
European Chemical Industry Council
REACH is, no doubt, to all parties involved a necessary and
UNICE Union of Industrial and Employers’ Confederation
useful approach to improving both knowledge and handling of
of Europe
chemical substances in every day processes. This improves,
OECD Organisation for Economic Cooperation and
on one hand, consumers confidence in buying products and
Development
at the same time helps to improve industrial competitiveness
CAS Chemical Abstracts Service; 2540 Olentangy River
within the European market mainly by reducing risks and li-
Road; Columbus, OH 43202, USA
abilities associated to the application of not sufficiently evalu-
SIEF Substance Information Exchange Forum
ated chemicals and their potential hazards. REACH is, on the
SMEs Small and Medium Sized Enterprises (up to 500
other hand, considered a heavy burden particularly to small
employees)
and medium sized enterprises (SMEs). This may be concluded
from the considerable workloads and costs resulting from in-
dividual implementation steps such as pre-registration, regis- Contacts
tration, consortia building, dossier evaluation, tests evaluation
etc. As this was recognized by the Commission during a quite Company
early state of the REACH development process, a suggestion
Sebastian Schneider,
from the U.K. and Hungary – the so-called OSOR initiative
Foseco GmbH, Gelsenkirchener Straße 10,
(One Substance, One Registration) – was proposed particular-
D-46325 Borken, Germany
ly to SMEs to reduce their efforts by sharing the duties linked
http://www.foseco.com/
to the REACH implementation.
http://www.foseco.de/
The Data Sharing Dilemma
Soon enough it turned out that the OSOR approach required the
sharing of a certain amount of confidential data and informa-
tion of several kinds. This is not accepted voluntarily by those
who are involved. After a first phase of enthusiasm particularly
SMEs feel frustrated due to the fact that, though they are in
many cases the “junior” partners, they fully have to share all
costs within a consortium, They feel that the larger compa-
nies in some cases try to use process or product related data
on chemicals and substances displayed and shared within the
consortia for their own purposes (e.g. identification and subse-
quent copy of specific formulas) and, thus, they fear a loss of
competitiveness. This, of course, has never been the intention
of REACH but was maybe not thought of deeply enough by
those who designed the new European Chemicals Policy.
It may turn out that – like other legislative innovation
– industry together with relevant authorities and experienced

case study 5 249

Authors Internet Resources
Gudrun Pollack, German Federal Institute for Occupational Safety and Health
Univ. Applied Sci. Zittau/Goerlitz, http://www.baua.de/en/Topics-from-A-to-Z/Chemicals-
Theodor-Koerner-Allee 16, Act-biocide-procedure/Notification-Unit-Chemicals-Act.
D-02763 Zittau, Germany html__nnn=true

Sebastian Schneider, The REACH official legislative text:

Univ. Applied Sci. Zittau/Görlitz http://eur-lex.europa.eu/LexUriServ/site/en/oj/2006/l_396/
Theodor-Koerner-Allee 16 l_39620061230en00010849.pdf
D-02763 Zittau, Germany
in diploma session at Foseco GmbH Information about REACH from the European Commission:
http://ec.europa.eu/enterprise/reach/index_en.htm
Franz-Dieter Biernath
Foseco GmbH Information about REACH from Cefic:
Gelsenkirchener Strasse 10 http://www.cefic.org/Templates/shwStory.
D-46325 Borken, Germany asp?NID=494&HID=441

Bernd Delakowitz, The official German REACH helpdesk:

Univ. Applied Sci. Zittau/Goerlitz, http://www.baua.de/de/Chemikaliengesetz-Biozidverfahren/
Theodor-Koerner-Allee 16, Neue-Chemikalienpolitik/Helpdesk/Reach-Helpdesk.
D-02763 Zittau, Germany html__nnn=true

References
Delakowitz, B. (2006). REACH – The Thorney Road to a Co-
herent European Chemicals Pol-icy based on the Principles of
Precaution and Sustainability. In: Filho, W.L., D. Greif, B. De-
lakowitz (eds.). Sustainable Chemistry and Biotechnology – A
Contribution to Rivers Man-agement. Peter Lang Europäischer
Verlag der Wissenschaften, Frankfurt a. M.

Güther, S. (2006): Konzeption für die Umsetzung der Chemi-

kalienpolitik REACH in kleinen und mittleren Unternehmen
der Edelmetallbranche am Beispiel der SAXONIA Edelmet-
all GmbH, Halsbrücke. Unpublished Diploma Dissertation,
Hochschule Zittau/Görlitz

250 case study 5

 Case Study 6
Roskilde Electroplating Ltd
Denmark L

Voluntary Action Makes Licensing Easy

1. Introduction
In the zinc plating bath an electric current between the ob-
The Company ject (which becomes the cathode) and an anodic surface of
Roskilde Galvanisering A/S (Roskilde Electroplating Ltd) is metallic zinc makes the zinc move and be deposited on the
one of Denmark’s largest electro-technical industries founded object, which thus is “plated” with the metal. The plating is
as early as 1946. It moved to its present location in Roskil- followed by a series of rinsing steps.
de not far from Copenhagen in 1972. Major expansions and Each line has four sequences or ‘baths’:
technological modernisations occurred in 1979 and 1995. The
a) alkaline degrease
number of employees is presently around 25 people.
b) priming
The basic operation in electroplating is to cover metal sur-
c) electrolytic degrease and
faces with a thin protective layer of zinc. A total of some 20
d) coating.
tonnes of zinc is used yearly for this purpose. This is equivalent
to surface-treating some 200,000 m2 of material a year. After each sequence the items are water-rinsed in a total
The production is organised in four separate zinc-galvaniz- of five rinses. The water from the rinses goes through an ion-
ing lines with the latest line set up in 1999. All kinds of objects exchanger, in which remaining zinc is picked up to be used
are treated from small screws to large metal sheets, used in again. The rinsing water then continues to an internal waste-
industries. Many objects are also covered with chromium after water cleaning system and is recycled to be used again for the
zinc plating, and some with a copper surface. rinsing.
It is obvious that this kind of industrial production is en- For some objects additional chromium plating are made.
vironmentally hazardous. Large amounts of heavy metals as The chromium layer increases the resistance to corrosion and
well as other environmentally hazardous components are used improves the capacity for lacquering or painting of the objects.
and these may not be released to the environment. The chromium layer itself may also be given various shades
from blue, yellow, black etc.
Techniques Used In addition some objects are given a plating of copper.
In the production lines the objects are either mounted to be
dipped, or mounted on cylindrical drums to be rotated, treated Environmental Impacts
in a series of baths. The broadest surfaces covered are up to 7 The environmental concerns are mostly caused by the use of
meters in width. large amounts of heavy metals, the release of wastewater from

case study 6 251

 2. Environmental Permits and Certificates
Environmental Permits
An environmental permit was requested for Roskilde Electro-
plating for the first time after its expansion in 1979. The permit
was issued in 1981.
A new and comprehensive licensing procedure was initi-
ated after the 1995 expansion. This was now for the first time
made in accordance with the IPPC directive, then newly im-
plemented in Danish environmental regulation. The licence
was issued in 1996.
After 10 years of operation, a review of the 1996 licence
was initiated, in 2006. No major changes in production had
however been made since 1996. In May 2007 in the permit
was renewed without any important changes of the terms of
Figure 6.1 Rinsing bath. Last rinsing before going to the bath for
the licence.
the electroplating, i.e. being covered by a thin layer of zinc. You see
‘spray-rinsing’ instead of dipping the whole item in the bath. Means Environmental Management Systems
less polluted water in the process. (Photo: Roskilde Municipality The company has done a considerable work to introduce both
Environmental Inspection office) an environmental and a quality management system. It is today
certified according to ISO 9001:2000 and the ISO 14001:2004
the process, and solid waste management. An additional con- standards.
cern is the use of electric power.
Net use of water, measured as water discharged to the pub- Environmental Award
lic sewage system, is in the licence maximised at 4,000 m3/ The Roskilde Bank gave in 2001 their environmental award
year at a temperature of max 35oC and a pH-value between to Roskilde Galvanisering Ltd. The company is one of the
6.5 and 9.0. polluting industries in Roskilde, but the prize was never-
As mentioned above the total use of zinc is in the range the-less well deserved, the awarding committee stated. The
of 20 tons/year. Some 30% of this is lost in the process, but company had over many years made remarkable – and suc-
retained with the sludge in the water cleaning process. From cessful – efforts to reduce the environmental impact from its
here it is sent for recovery and reuse as part of the waste man- production. An example is a 93% reduction of water usage
agement system. This is discussed further below. over the last 15 years while the production in the same period
All along, work has been done to minimise resource use has increased by 100%. It is also confirmed by the fact that
and environmental impact. Already when moving to the new the company is certified according to the ISO 14001 environ-
premises in 1972, purposely built for an electroplating indus- mental standard.
try, environmental impact reduction was part of the planning
process. Floors were constructed as ‘double’ floors to allow for
collection of spillage in the production hall before it went to 3. Applying for a Permit According to the IPPC
the drain as well as other measures to prevent direct spillage Directive
and impact on the environment in the vicinity. Savings in use
Application
of raw materials and process chemicals and other substances
As an ‘Installation for surface treatment of metals and plastic
became a driving force later in the 70’s and into the 80’s. For
materials using an electrolytic or chemical process where the
management it quite quickly developed into an outright ‘sport’
volume of the treatment vats [storage containers] exceeds 30
to see, how far one could go and for which input. This will be
m³’, Roskilde Electroplating is on the Annex-1 list to the IPPC
illustrated below.
directive and thereby also on the Danish Annex-1 listing for
companies. Thus an integrated permit is required for its activ-
ity. As an Annex-1 company it is subject to the most intensive
scrutinizing subsequent control and inspection. It is a so-called
‘i-marked’ industry.

252 case study 6

 In order to obtain a comprehensive licence, the ‘i-marked’ - Production volume (ex. calculated from the consumption
companies must submit an extensive application, describing of zinc anode)
all aspects of environmental relevance in great detail and doc-
umenting how BAT/cleaner technology requirements are met The wastewater treatment plant:
or handled. - Consumption of chemicals (sulphuric acid, sodium hy-
The application (for Denmark, see Ministerial Order 1640 droxide, hypochlorite) for the different tanks.
of 13/12/2006) should supply the Comptetent Authority with - Results from analyses in order to maintain the resin plant
all necessary background for issuing an environmental licence. (see the wastewater permit)
The licence should include the conditions necessary to make - Quantity and time for export of hazardous waste, name of
the company reach a high level of environmental performance. transporters and receiver of export.
The licence should be supplemented by monitoring and in- - Quantity and receiver of incombustible waste and paper
spection to the extent needed. In the case of Roskilde Elec- for recycling.
troplating, the Municipality of Roskilde was the Competent
Authority, and the application was managed by its office for Conditions for avoiding air pollution
environmental inspection and control. - Measures to ensure that air pollution may pass through
the pipes
Environmental Reporting - Measures to protect against unnecessary noise to the sur-
There is an extensive duty for the company to provide environ- roundings,
mental information in relation to licensing. - Measures to ascertain that the gates and other natural
Being ‘i-marked’ the company is automatically obliged openings have to be closed unless the production prevents
(Ministerial Order no. 1515 14/12/2006) to provide Annual this.
‘Green Accounts’ alongside the financial Annual Accounts.
These ‘Green Accounts’ should state the environmental per- Reports on changes
formance of the company for the financial year. - Changes and extensions, which influence the environment,
have to be reported to the environmental authorities.

4. The Environmental Permit Discharges and Noise

Topics Covered in the Permit The permitted discharges to the air are summarized in Ta-
The topics in the licence were the following: ble 6.1. It includes specific concentrations of the heavy met-
1. Production capacity, layout, technology and process hours als nickel, chromium-VI, chromium-III, copper, and zinc. It
2. Discharge to air should be noted that chromium of valency 6 (chromium-VI)
3. Noise is particularly toxic and has a low b-value (0.0001 mg/m3) to-
4. Solid and hazardous waste gether with nickel.
5. BAT/cleaner technology initiatives Several other chemicals used in the electroplating proc-
ess are also toxic, such as cyanide and its organic compounds,
Production Data Requested in the Report caustic soda (NaOH) and hydrochloric acid and are regulated
The terms of the 1996 licence were that production data should but on a higher level.
be available for the environmental authorities on request and The terms for noise are summarized in Table 6.2. The to-
kept for 5 years. They should comprise information on: tal contribution of noise may not exceed the given maximum
standards. The values are lower during nights and off normal
Resource use: work hours.
- Consumption of raw materials, especially cyanide and
heavy metal containing raw materials, at the (then) three Storage of Hazardous Substances and Spillage
production lines The licence has standards for storage of hazardous substances,
- Water consumption in the production (see the terms of the requiring that they are stored
wastewater permit). • in a locked room
- Electricity consumption for the production processes and • so that mixing cannot occur
for lighting. • in drums no bigger than 200 L
- Consumption of oil for heating.

case study 6 253

• in a room with a floor prohibiting spillage to the soil and BAT/Cleaner Technology Initiatives
to the sewage system The renewed 2007 licence includes conditions regarding
• under roof and with capacity to contain liquid at the cleaner technology (BAT) initiatives. It was addressed by the
amount, equivalent to the biggest container stored company in the following way:
1. An EMS in place, including a certified ISO 14001 system,
Following the Daily Work – Monitoring securing collection of all relevant production and environ-
The permits also include conditions for safety procedures to mental data on a current basis; this requires good order
minimize risk for spillage in day time as well as outside work- and effective maintenance of equipment and update of
ing hours, and standards for self-monitoring of on air pollution procedures
and noise. 2. Management had on a current basis over the years
The standards set for annual reporting on emission data, improved and optimized the production lines leading to
for use of water, cyanide and raw materials containing heavy less use of resources and reduced environmental impact.
metals. The introduced techniques included ion-exchangers to
The report should as far as possible include performance recycle metals; spray-rinsing and other effective rinsing
indicator, such as use or emission per tonne or m2 of ready- techniques made recycling and reuse of water possible; a
made goods. substantial reduction of the total water consumption
3. Reduction of spillage and waste of chemicals and raw
materials throughout the process. This included the ship-
ment out of the company of solid and hazardous waste for
recovering and reuse.
Table 6.1 Materials in pipes. The concentration of materials in the
4. Substitution of more hazardous chemicals with less
pipe may not reach the following mass stream and emission limits: hazardous materials. This included the substitution of zinc
cyanide with ‘sour’ zinc; the use of electrolytic degreas-
Substance Main Mass Emission B-Value ing to replace degreasing chemicals with volatile organic
Group stream Limit (mg/m3)
components and with water-based degreasing chemicals
Limit (mg/m3)
(g/h) 5. Annual ‘Green Accounts’ with detailed figures on per-
formance on key parameters, making the relation between
Nickel 1 0.5 0.5 0.0001
achievements and stated aims directly measurable.
Chromium (VI) 1 0.5 0.5 0.0001
Chromium (III) 2 25 5 0.001 Licensing
Copper 2 25 5 0.01 The very developed Environmental Management profile and
Zinc 2 25 5 0.06 the achievements on preventative measures led the Municipal-
Cyanide 2 25 5 0.06 ity to the conclusion, that the 2007 renewal of the environ-
NaOH 2 25 5 0.005
mental licence did not require tightening or change of terms
already included in the 1996 licence. This had partly to do
Cyanides 2 50 5 0.06
with the ISO 14001-certification, which implies, that all the
Hydrochloric Acid 2 50 100 0.05 production and emission data will be provided by the com-
pany on a current basis, which increases the transparency of
Table 6.2 Noise levels. The total contribution of noise in the equiva- the company activities and makes access to data easy.
lent corrected noise level in db (A) may not exceed the following There was a clear and, for the environment, very positive
maximum standards – monitored outdoors at the property limit to
the North:
synergy between licensing requirements, the ISO 14001 and
Green Accounts requests to the company. Roskilde Electro-
Monday to Friday 7:00 AM to 6:00 PM 55 db (A) plating was able to take stock of the managerial and financial
6:00 PM to 10:00 PM 45 db (A) ‘investment’ made over a long time, taking the company to a
Saturday 7:00 AM to 2:00 PM 55 db (A) high level, also and not least in the eyes of the municipality.
2:00 PM to 10:00 PM 45 db (A)
Sunday 2:00 PM to 10:00 PM 45 db (A)
All days 10:00 PM to 7:00 AM 40 db (A)

254 case study 6

 Wastewater Characteristics
As described above the zinc galvanizing lines each has four
baths: alkaline degrease, priming, electrolytic degrease and
coating. After each sequence the items are water-rinsed in a
total of five rinses. The water from the rinses goes through an
ion-exchanger to an internal wastewater cleaning system and
is then used again for the rinsing.
The company can use a maximum of 4,000 m3 of water
annually, measured as water discharged to the public sewage
system. The released wastewater may have a maximum tem-
perature of 35oC and a pH-value of no more than 9.0 and no
less than 6.5. The standards set in the wastewater permit for
the key substances used in the process are given in Table 6.3. A
considerable amount of metal is, as already explained, recov-
ered from the water though ion exchange before it is released
in the wastewater. Some 6 tonnes of zinc is recovered in the
sludge from the wastewater treatment.

Monitoring and Control

Other important terms and conditions in the wastewater permit
are concerned with monitoring and control, including strict
regulations for the samplings, e.g.:

• Samples must be taken at the first well after the discharge

from the production, i.e. from the company wastewater
treatment plant and taken during normal production hours.
Figure 6.2 Sample solutions. The solutions in the baths (samples • Samples must be taken and analyzed by an accredited lab-
in plastic bottles) are analysed. This makes it possible to add the oratory and methods chosen for the analysis able to detect
correct amount of chemicals to have the baths operate properly. 10-times lower limits than the annual average standards.
(Photo: Roskilde Municipality Environmental Inspection office)
• Roskilde Municipality (the Competent Authority) must be
informed about planned sampling a week in advance and
5. Wastewater Discharge Permit – Parameters the results of the analysis sent to the authority within 5
and Terms weeks of the sampling. If it deviates from the terms in the
permit, the company must supplement the report with expla-
Wastewater Discharge Permit nations and description of steps taken to avoid reoccurrence.
Wastewater discharge is regulated by a – separate – waste-
water discharge permit, which sets the terms for the compa- Table 6.3 Key substances in wastewater. The average daily value
ny’s discharge of wastewater, either directly to surface water may not at any time exceed the annual standard average with more
via its own wastewater treatment facility, or by connecting than a factor of two.
to the municipal wastewater sewage system. This last option Parameter Yearly average Maximum
is used by Roskilde Electroplating. Roskilde Municipality Standard (mg/l) Annual
is the competent authority to issue the wastewater discharge Quantity (kg)
permit. Chromium 0.5 2.0
The wastewater permit is normally issued, and reviewed, Copper 0.5 2.0
in connection with the issuance and reviewing of the environ- Nickel 0.5 2.0
mental licence, to secure the holistic approach to licensing,
Zinc 0.5 2.0
targeted by the IPPC directive. But the wastewater permit is
Cyanide (total) 0.5 2.0
a separate document and may be reviewed and terms changed
independently from its licensing procedure and time frame. Cyanide (Chlorine ox.) 0.1 0.4

case study 6 255

• The company must monitor use of water, recycling of sludge, which was treated as toxic waste, and sent to the Dan-
water and discharge of wastewater on a daily basis, and ish Joint Municipal Toxic Waste Incineration Plant. This plant
every fortnight sample the ion-exchangers and analyse for only deposited it without any attempt at recovery. High and
iron-content and register total amount of wastewater pass- increasing charges had to be paid for the sludge delivered to
ing through. All results should be recorded in the water the station, which made this a quite costly solution.
manual. From 2003 the sludge has been sent to a German facility
• In case of production or discharge irregularities between instead, which has been able to regenerate the zinc and send it
sampling periods potentially or actually leading to back to the company for use.
violation of the terms set in the permit for one or more Today zinc has become 3 times more expensive than earlier
parameters the company must immediately inform the and it may be worthwhile trying to recover the zinc directly
municipality from the rinsing vessels. It will mean a dramatic savings on the
sludge, which can then be treated as non-toxic.

6. Environmental Reporting – the Results so Far Water Consumption and Wastewater Discharge
Total Resource Use and Recycling Water consumption was in the late 1970’s and early 1980’s
The exact use of raw materials and amount of waste of dif- at the level of 150 m3/day. There was a sensor in each vessel
ferent kind is documented in the Green Accounts from where with the baths consisting of water and the active substance(s).
the following key figures are extracted. Total environmental Whenever the concentration of the active substances became
impact over the five years period 2001/02-2005/06 is summa- too high, fresh water was added automatically until the con-
rised in Table 6.4. centration was adjusted. By introducing more rinses it was
Most remarkable is that the recycling of material as chemi- possible to make the baths work with lower concentrations,
cal, paper and metal waste has increased dramatically, while and the water from the rinses was led back to the vessels when
deposited waste has decreased by almost 90%. Resource use supplements were needed. At the end of these efforts water
has not changed much, although total chemical use has de- consumption was reduced dramatically. It is now at about
creased by 10% over the 5-year period. 10-12 m3/day or in total 4,000 m3 yearly. This is a reduction
of more than 90% in water consumption. At the same time
Zinc Recycling now the production has expanded to four lines compared with
Zinc is a main resource used in the company. Over the years 1½ lines at the time of the 150 m3/day in water consumption.
several attempts were made to recover zinc, which was lost in Some investments were needed, but at a reduction rate at this
the process with the rinsing baths. First the company tried to level, the pay back time is short.
recover the zinc from the rinsing vessels, but the cost at the The discharges to wastewater have also been reduced.
current prices of zinc was too high. The cost/recovery rate was From Tables 6.5a and 6.5b it is clear that discharges of met-
2:1. This led to a substantial amount of zinc ending up in the als and cyanide in wastewater in the period 2003-05 was well

Table 6.4 Environmental impact over 5 years 2001/02 – 2005/06. Key parameters, in kgs. when not stated otherwise: (Source: Annual Green
Accounts 2005-2006)

Parameter/ year 01/02 02/03 03/04 04/05 05/06

Electricity/kWh 1,253,853 1,296,737 1,236,950 1,170,881 1,160,641
Water use, m 3
3,701 3,690 3,527 3,409 3,371
Anode use 25,948 19,380 20,550 18,870 21,600
Chemicals, total 150,175 177,604 147,601 146,595 134,329
Waste water m 3
3,023 3,157 2,842 2,678 2,722
Chemical waste (deposited) 19,650 974 3,240 916 2,530
Flammable waste (incineration) 3,020 5,450 7,140 3,140 4,000
Chemical waste (recover) 0 17,320 18,060 16,110 18,410
Paper/Cardboard (recover) 3,520 3,340 4,520 4,765 7,410
Scrap metal (recover) 6,260 2,640 8,300 2,500 6,180

256 case study 6

Table 6.5 Wastewater. below the values in the permits. It is also clear (Table 6.5a) that
A: Total content of heavy metals and cyanide during the three years the real discharges have decreased considerably.
2003-2005 and related to the terms of the Wastewater Permit. All
figures in kgs.
Production and Performance Indicators
B: Relative content of heavy metals and cyanide during the four
years period 2003-2006 related to the terms of the Wastewater Per- Table 6.6 reports on production and performance indicators
mit. All figures in mg/l. A for the 6-year period 2000/01-2005/06 for the four production
lines. All lines except No 3 use less zinc although the number
Parameter/year 2003 2004 2005 Permit
of items is about the same. Also for all lines except No 3 the
Copper 0.16 0.01 0.01 2
amount of zinc per item has decreased.
Chrome 0.01 0.05 0.03 2
Nickel 0.01 0.00 0.00 2
7. Final Remarks
Zinc 0.61 0.07 0.05 2
Tin - - - 2 A successful case
Total cyanide 0.03 0.03 0.03 2 The case demonstrates, that also smaller companies in a some-
what environmentally difficult sector have all the potentials
Volatile cyanide 0.01 0.01 0.01 0.4
needed to become an environmental front-runner. Getting the
B positive spiral up and running is the key to success. Manage-
Parameter/year 2003 2004 2005 2006 Permit ment must be attentive and ready to act constructively if and
Copper 0.129 0.058 0.019 0.015 0.5 when the Competent Authority brings the necessary and well-
Chrome 0.107 0.386 0.004 0.018 0.5 timed and patient push to the company’s decision-making on
environmental impact and investment.
Nickel 0.046 0.002 0.005 0.004 0.5
When changes are made at an early point in time in relation
Zinc 0.337 0.512 0.150 0.135 0.5
to the requirements, further steps are logical and not difficult
Tin - - - 0.001 0.5 to take, and more often than not they bring benefits to the com-
Total Cyanide 0.253 0.253 0.054 0.752 0.5 pany. These may be in terms of cost reductions for raw materi-
Volatile Cyanide 0.056 0.056 0.013 0.058 0.2 als and auxiliary substances and inputs needed.

Table 6.6 Performance indicators. Presentation of the results in the period 2005-2006 with results and reference figures as far back as 2000.
Measures in kgs. when not stated otherwise. Remarks: The increase from 2004/2005 to 2005/2006 on line 1 is due to a change in the product mix.
Line Parameter/Year 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06
1 Zinc (kg) 21,302 19,400 10,729 13,525 12,820 14,675
Goods items 10,529 9,985 8,614 9,593 8,559 8,650
kg/item 2.02 1.94 1.25 1.4 1.50 1.70
2 Zinc (kg) 723 775 819 1,025 650 575
Goods items 4,742 4,228 5,192 5,560 4,771 4,622
kg/item 0.15 0.17 0.16 0.18 0.15 0.12
3 Zinc (kg) 3,250 3,899 5,765 3,775 1,875 4,800
Goods items 4,449 561 6,655 5,409 4,386 5,180
kg/item 0.73 0.85 0.87 0.70 0.43 0.92
4 Zinc (kg) 2,050 1,875 1,995 2,225 2,050 1,550
Goods items 4,321 3,330 4,318 5,506 5,328 5,344
kg/item 0.47 0.56 0.46 0.40 0.38 0.29
1-4 Zinc (kg) 27,325 25,949 19,308 20,550 17,395 21,600
Goods items 24,041 22,104 24,779 26,068 23,044 23,796
kg/item 1.14 1.17 0.78 0.79 0.76 0.91

case study 6 257

Synergy Between Voluntary Measures and Regulation Sources
The case of Roskilde Electroplating shows the synergy be- Licences
tween the different elements of environmental instruments The 1996 environmental licence for the company
and requirements. It started with technological developments The 2007 renewal of the licence
in the production process in 1995. It continued with the full Annual ‘Green Accounts’ for 2005-2006, covering data for the
environmental licensing in 1996, the Annual ‘Green Accounts’ last 5 years of Accounts
in 1998, the licensing according to ISO 9000 and ISO 14001
leading up to a completely unproblematic renewal process of Acts and other regulations:
the environmental licence in 2007. The company even got a EU-IPPC-Directive
great deal of praise from the Competent Authority on these 10 DK Ministerial Orders, making the transposition and imple-
years of achievements. mentation of the directive.
In this way Roskilde Electroplating has had an ‘easy go’
with the environmental regulation and the implementing au- Interviews:
thorities. In this the company has been able to focus all its Director of Roskilde Galvanisering, Mr. Joern Jensen
attention on its core business activities. Environmental coordinator at Roskilde Galvanisering, Ms.
Effective implementation of the environmental regulation Birgitte Jensen
is helped greatly by competent management – and is highly A civil servant, previously employed by the Roskilde Munici-
dependent upon the correct understanding of its role and clev- pality
er action by the Competent Environmental Authority.

Internet Resources
Information on plating techniques
Contacts
http://electrochem.cwru.edu/ed/encycl/art-e01-electroplat.
htm
Company contact
Quality and environmental coordinator Birgitte Jensen IPPC directive Council Directive 96/61/EC of 24 September
Roskilde Galvanisering A/S 1996
Byageren 15
http://eur-lex.europa.eu/LexUriServ/LexUriServ.
DK-4000 Roskilde Denmark
do?uri=CELEX:31996L0061:EN:HTML
Phone +45-4635 2425
mail@ro-galva.dk Danish environmental regulation, implementing the IPPC
http://www.ro-galva.dk directive
(Ministerial Order no. 1640 of 13/12/2006)
Author
http://www.retsinfo.dk/_LINK_0/0&ACCN/B20060164005
Børge Klemmensen
Senior Lecturer in Law Danish Ministerial Order no. 1515 14/12/2006 on Green
Roskilde University Accounting
Postbox 260
http://eogs-lw.lovportaler.dk/showdoc.
DK-4000 Roskilde
aspx?docId=bek20061515-full
Danmark.
e-mail: bklemme@ruc.dk Green accounts (Environmental reports) of Roskilde
Galvanisering A/S may be ordered at
http://www.cvr.dk/Site/Forms/CompanySearch/
ListCompanyReports.aspx?cvrnr=33911114

258 case study 6

 Index

A Authority. See also Competent authority

Aarhus Convention 94, 95, 111, 203, 206 business-authority cooperation 77
Accident performance of the authority 175
accidental release 128 role of authorities 171
Baia Mare (Romania) accident 209 role of state 29, 30
Bhopal accident 35, 199 state authorities 119
Coto Doñana National Park accident 209
Minimata disaster 28, 105
practices in case of accidents 224 B
Sandoz accident 199 Basel Convention on movement of hazardous waste 208, 212
Seveso accident 36, 42, 198 Baseline-and-credit system 154
Accidental spillage 221 BAT. See Best Available Technique
Acid rain BATNEEC 96
cost of acid rain damage 29, 147 BAT Reference Documents (BREFs) 45, 94, 100, 107, 172,
Acquis communautaire 231 203
Agriculture for cement production 106
sustainable agricultural production 146 for the chlor-alkali process 105
Air pollution Batteries, disposal of 212
aviation as source of 195 Belarus 192
avoiding 253 Bentham, Jeremy 30
from vehicles 195 Best Available Technique (BAT) 56, 94, 96, 97, 100, 103,
ozone as air pollutant 194 104, 107, 172, 203
particles as air pollutants 194 cleaning of wastewater 190
ships as source of 195 cleaning technology 107, 190
taxes 144. See also Tax continuous improvement 107
Air quality economic aspects 100
daughter directives on air quality 194 interpretation on company level 110
legislation 189, 194 interpretation on sector level 104
new directive on ambient air quality 194 Biocides 28, 198
plan 195 Biodiversity 93, 207
report on air quality data 194 loss of biodiversity 49
standards 195 protection of 49
Appeal 229 Biofuels in transport 200
right to appeal 131 Black triangle 29
within the administrative system 133 BREF. See BAT Reference Documents
within the court system 133 British Standard 7750 20
Application. See IPPC permit, Licence and Permit Brominated flame retardants 212
Audit Brundtland Commission 77
external environmental audit 56, 61 report 21, 46
internal 56 Building permit 232, 233
Authorisation process 223 Business Accountability 19

index 259
Business Action for Sustainable Development (BASD) 80 Chromium-plating 251
Business Charter for Sustainable Development 21, 22 Civil sanctions 134
Business Council for Sustainable Development (BCSD) 31 Clean Air for Europe (CAFE) 193, 194
Business for Social Responsibility (BSR) 68, 69 Clean Development Mechanism (CDM) 151, 155
Cleaner Production (CP) 32, 33, 111
Cleaner Technology (CT) 33, 254
C Clean vehicles 221
Canadian Chemical Producers Organisation 35 Climate change 34, 48, 201
Cap-and-trade system 154 convention on 34, 192
Car economic costs for 202
-related taxes 143, 145 mitigation of 157
annual circulation taxes 145 policy 156
carbon dioxide-based tax 145, 147 Closure of a site 124
EU strategy to reduce carbon dioxide from cars 202 Codes of conduct 66
industry 145 environmental 118
registration tax 143, 145 implementation of 67
repair shops 171 standardised 67
Carbon Cogeneration 201
Carbon Capture and Storage (CCS) 199 Command and control 19, 24
prices and mitigation options 158 Common good 138
taxes and emission reduction 158 Common Market 39. See also European Union
Carbon dioxide Communication
level in atmosphere 157 of environmental performance 65, 66
Cement production 106, 111, 237 skills 175
dust emissions 237 Company environmental coordinator 171
emission to the air from 237 Competent authority 92, 97, 116, 253
rotary kiln 210, 237 chart for Sweden 174
Ceramics production 55 confidence in the 230
Certification decentralization of 120
according to ISO14001 238 in Central and Eastern Europe 120
according to ISO 9001 238 in Nordic countries 120
Charges inspection authority 97
emission charges or fees 140 inspection authority annual report 175
environmental 139 legal process against 133
for water services 140, 144 municipality as competent authority 255
user fees/charges in Denmark 139 on regional and municipal level 119
Chemical Abstracts Service (CAS) number 242, 248 on state level 119
Chemicals organization of 173
authorisation of 196 Compliance 67, 87
control of industrial chemicals 28, 196 and the market 117
evaluation of chemicals 244 as a platform for improvements 125
phase-in chemicals 242 cycle 123, 125
pre-registration of 242 enforcement 116
registration of chemicals 196 and corruption 117
responsibility of industry for 242 and deterrence 117
restrictions of use of 196 and policing 117
spillage of 253 going beyond 87, 118
use of 223 in consumer-oriented companies 117
Chemicals Inspectorate 119 inspection 123, 128, 129, 237. See also Inspection
Chlor-Alkali Industries 105 management responsibility for 124
Chlorofluorocarbons (CFCs) 202 monitoring 116, 122, 123. See also Monitoring and Self-
Chorzow emission trading 150 monitoring

260 index
 programme 115, 116 Covenants 24, 79, 80, 83, 84. See also Environmental Agree-
and IMPEL criteria 117 ments
evaluation of 124 Crime (environmental crimes) 130, 229
promotion 116 criminal law 173
public awareness and compliance 117, 118 legal action against environmental crime 124, 229
securing compliance 125 punishment for 131, 134, 229, 230
spectrum 122
systems 121
typology 122 D
Compost 220 Daly, Herman 150
market for 209 Damage compensation 147
standards for 209 Daughter directives 190, 194. See also Directive on
use of compost material 220 DDT 227
Conflict management 175, 176 Deal between authority and company 134
Consumer protection 67 Decentralization of environmental regulation 121
Continuous improvement 110 Decoupling of economic growth and environmental impact
and permits 107 32, 84, 87
inspection 123, 129 Deposit-refund schemes 144
Convention of Long Range Transboundary Air Pollution Design for the Environment (DfE) 66, 70
(CLRTAP) 29, 194 Desk inspection 129, 240. See also Inspection
Protocol on POPs to the CLRTAP 198 Deterrence 117
Conventions 50, 92, 192, 193 Dialogue with management 123
Conviction of illegal environmental activities 229. See Diffuse environmental impacts 138
also Crime Dioxin (TCDD) 198
Corporate Social Accounting 68 EU strategy on 211
Corporate Social Responsibility (CSR) 67, 68, 78 Directive of European Union 92, 119, 189
CSR reporting 70 amendments to 189
Corporate voluntary initiatives evaluation 73 appealed 189
Corruption and environmental regulation 117, 121 codifications of 189
Cost history of 189
environmental cost and taxation 147 implementation into national legislation 119
external environmental 138 transfer of EU-directives 119
full environmental costs 138 Directive on 195
of acid rain damage 29, 147 air quality framework directive 194
of carbon dioxide and emission reductions 157 batteries and accumulators 212
of pollution 29 Birds Directive 50, 207
social costs of environmental damage 68, 84, 138 classification, packaging and labelling of dangerous sub-
County administration 172 stances. 197
County administrative board 219 drinking water 213
Court 97, 99, 172, 219, 223 Eco-Management and Audit Scheme (EMAS) 92
district court 229 ELV (Emission Limit Values) Directive 211
environmental court 97, 219 energy efficiency (SAVE) 200
of appeal 229 Environmental Impact Assessment (EIA) Directive 23, 24,
of concession 97 42, 92, 93, 206
of justice 44 environmental noise 207
proceedings in the environmental court 223 Existing Chemical Substances (EINECS) 197
process 131 groundwater 213, 215
role of the courts 133 habitats 207
rulings 133 hazardous waste 208
Supreme Court 229 landfill 208, 231
system 133 LCP (large combustion power plants) 195, 210
Linking Directive 155, 156

index 261
 management of mining waste 209 growth and environment 30, 32, 49
National Emission Ceilings (NEC) directive 199 incentives 87
Nitrates Directive 212, 214, 215 market-based economic instruments 149
packaging and packaging waste 150, 211 penalties 130
promotion of cogeneration 201 policy instruments 137, 138, 191
promotion of electricity produced from renewable energy Electroplating 251
sources 201 EMAS. See Eco-Management and Audit Scheme
public works contracts 205 EMEP programme for monitoring and evaluation of air pol-
SEA (strategic environmental assessment) Directive 207 lution 194
soil framework directive 207 Emission
urban wastewater treatment 212, 214 charges or fees 140
VOC (volatile organic carbon) Solvents 210 from large combustion plants 195
waste framework 208 from traffic 195
waste incineration (WI) 209, 210 greenhouse gas emissions
waste of electrical and electronic equipment (WEEE) 71, 1990-2004 156
211 cost of CO2 and emission reductions 157
waste oil 210 GDP growth rate and GHG emission reduction 157
Directorates General (DGs) 44 nitrogen dioxide 214
DG XI Environment, Nuclear Safety and Civil Protection permit for emissions to air 238, 253
41 sulphur dioxide 194
Drinking water 213. See also Water Emission Limit Values (ELV) 96, 100, 104, 203
for dust 196
for NOX 196
E for SO2 196
Eco-design 66, 70, 203 for VOCs 210
initiatives 204 for waste incineration 210
of Energy-using Products (EuP) 200, 204 in IPPC directive 94
strategies in 70 in the IPPC permit 101
Eco-efficiency 31, 32, 33, 80, 111 local concerns 101
Eco-innovation technology programme 206 Emission trading 150
Eco-label 47, 66, 203 allocations in 152
as proof of compliance 205 assessment of 153
award schemes 73 bubble in 151
Eco-labelling Board (EUEB) 205 burden-sharing agreement 153
EU criteria 205 caps 154
EU flower 72, 205 ceiling in 150, 151
European Eco-label catalogue 72 grandfathering 152
European Union Eco-label scheme 205 implementation 153
Swan eco-label 72 Emission Trading Scheme of EU (EU-ETS) 152, 153, 199,
Type I, II and III eco-label 73 202
Eco-Management and Audit Scheme (EMAS) 20, 21, 54, 57, electronic registries 202
58, 203, 204 National Allocation Plan (NAP) 152
and compliance 59 National Allocation Plans for phase II 154
and ISO 14001 requirements 59 National emission allowances 152
certificate 62 National Emission Ceilings (NEC) directive 199
directive 92 prices of carbon emissions 154
implementation of 61 registry of emission allowances 153
Ecological tax reform (ETR) 158, 159 results 154
Economic Employee
assessment 56 involvement and EMS 63
database on environmental economic policies 192 participation 56
environmental economic policy 146 training of 56

262 index
End-of-pipe 29, 30, 91 declaration of intent 82
End of Life Vehicles (ELV) 85, 211 Dutch 82
Energy EU Commission and 85
and environment 199 for base metal industry 83
certification of buildings 200 for packaging waste handling 85
consumption 222 for printing industry 83
efficiency 199, 200 for pulp & paper 85
efficiency measures into national legislation 200 for the chemical sector 83
European low-carbon energy system 156 government-industry agreements 82
labelling of domestic appliance 200 implementation of 82, 85, 86
policy for Europe 200 International environmental agreements 193
promoting renewable energy sources 199, 202 negotiations of EAs 86
taxation 142, 146. See also Tax review of 84
Enforcement 92, 123, 130, 174 sector level Implementation Plan 83
informal enforcement response 131 Environmental Impact Assessment (EIA) 206, 232
officials duties 133 and IPPC directive 93
preventive 174 directive 23, 24, 42, 92, 93, 206
process 133 directive, Annex I 93
programme 130 methods of 59
selection of enforcement response 131 of products 108
Environmental preparing an 223
accountability 19 public participation in 93
action plan 56 Environmental Impact of PROducts (EIPRO) 204
aspect 55 Environmental legislation. See Legislation
assessment 206 Environmental Management Accounting (EMA) 68, 69
award 252 Environmental Management Accounting Network (EMAN)
code 190 69
impacts 55, 56 Environmental Management Instrument 73
improvement 61 Environmental Management Systems (EMS) 20, 54, 87, 112,
legislation. See Law 224
licence. See Permit certification 56
management 55 company competitiveness and EMS 63
mapping 112 comparing management systems 57, 59
performance 56. See Permit compliance 59, 62
permitting cycle 109 monitoring 123
policy 56, 137 programme 122
report. See Report and reporting continuous improvement 61
review 55 environmental performance and EMS 60, 61, 62
statement 60 environmental review 112
stewardship 67 for local authorities 54
supervision 219 for public authorities 55
taxes. See Tax for universities 55
technologies 206 Green Network EMS in Denmark 54, 57, 58, 118
Environmental Action Programme (EAP) of EU 41, 48 implementation process 56, 63
1st Environmental Action Programmes 41 insufficiencies of EMS 60
2nd Environmental Action Programme 41 licensing and EMS 112, 113
3rd Environmental Action Programme 42, 43 management commitment and EMS 63
4th Environmental Action Programme 41, 42, 46 standards 20
5th Environmental Action Programme 46, 47, 79 Stockholm City EMS 54
6th Environmental Action Programme 24, 48, 79, 85 Environmental Protection Agency (EPA) 29, 119
Environmental Agreements (EAs) 24, 25, 80, 81, 86 Environmental Quality Standard (EQS) 99, 101, 103
Company Environmental Plan (CEP) 83 for priority substances in surface water 215

index 263
Environmental Technologies Action Plan (ETAP) 203, 205 Environmental Action Programmes (EAP). See Environ-
network of testing centres 206 mental Action Programme
Environment and Health 193 Existing Substances Program 197
Ethical investing 68 Forum on Eco-Innovation 205
Euroatom directive 40, 189 global cooperation 192
European Chemicals Agency (ECHA) 196, 197, 242 headquarter 44
European Climate Change Programme (ECCP) 199, 201 history 42
European Committee for Electrotechnical Standardization international negotiations 50
(CENELEC) 205 National legislation and EU 171
European Court of Justice (ECJ) 45, 119 nature protection policy 207
European Economic Area (EEA) 192 neighbourhood policy 192
community legislation in EEA 192 Paris Declaration 226
European Economic Community (EEC) 39 Parliament 44, 45, 191
European Environment Agency (EEA) 42, 45, 84, 192 Presidency 44
European environment information and observation network programmes 189
(Eionet) 45 Single European Act 171
European Free Trade Association (EFTA) 192 Single European Market 171
European Initiative for Democracy and Human Rights (EI- strategies for environmental improvement 48
DHR) 192 structural funds 50, 146
European Inventory of Existing Commercial Chemical Sub- subsidies programme 146
stances (EINECS) 197, 242 treaty 189
European LIst of Notified Chemical Substances (ELINCS) Article 100 A and opt-out clause 42, 43
197 Article 100 on harmonisation of national law 40
European Maritime Safety Agency (EMSA) 199 Article 130R-T 41
European Neighbourhood and Partnership Instrument (ENPI) Article 174 95
192 Maastricht treaty of EU 108
European Neighbourhood Policy (ENP) of Rome 171
for Belarus 192 Eutrophication 213, 214, 215
for Ukraine 192 Extended Producer Responsibility (EPR) 71
European Pollutant Emission Register (EPER) 94, 203
European Pollutant Release and Transfer Register (E-PRTR)
94, 203 F
European Spatial Development Perspective (ESDP) 206 Fees 139. See also Charges
European Union (EU) 92, 119 for licensed emissions to air 238
agencies 45 Fines and financial penalties 130
and External Trade 50 Fisheries charges 144
and the United Nations 192 Flood protection 213
Commission 44, 49 Formal notice of EU Commission 191
communications of the Commission 189 Framework Convention on Climate Change (FCCC) 151
decisions of the Commission 189 Framework Directives 190. See also Directive on
reasoned opinion of Commission 191 Freons, CFCs 28
Common Agricultural Policy (CAP) 146 Fuel
Council of Ministers 44 ethanol content in petrol 195
Cross-Border Cooperation (CBC) programme 192 prices and fuel efficiency relationship 158
Declarations 189 quality specifications 195
Directorates General (DGs) 41, 44 standards for transport of 195
division of power 44 Fuel cell 71
enlargement 50
environmental
legislation 25, 39, 173, 189, 191 G
policy 23, 40, 50, 95, 191 Gene technology regulation 78
tax- and fiscal issues 23, 191 Global

264 index
 citizenship 360, 74 ecology 34
emission trading scheme 152 symbiosis 111, 149
environmental issues 50 Information
Globalisation of production 65, 67 by authorities 172
Globally Harmonised System (GHS) 198 on hazards and risks of chemicals 196
Global Reporting Initiative (GRI) 68, 69, 70 public access to information on environmental performance
Green accounting 68 of industries 111
Greenhouse gases (GHG) emissions 34, 201. See also Emis- public access to information on monitoring 125
sion Initial Environmental Review 55, 59
Greening of industrial production 203 Input-oriented measures 53
Greening of Public Procurement (GPP) 203, 205 Input and output 55
Green Network EMS in Denmark 54, 57, 58, 118 balances 99
Groundwater 227 consideration in integrated permits 108
assessments on chemical status of 215 Inspection (environmental inspection) 116, 127, 129, 172
leakage to 231 after complaints 128
and control 97
and educating the operator 124
H announced inspection 129
Hazardous authority. See Competent authority
substances campaign 121, 128
in electrical and electronic equipment 212 conditions of 177
operation with 239 differentiated inspection 122
storage of 199, 221, 253 drive-by inspection 129
substitution of 254 EU Parliament recommendations 177
waste follow-up 128, 178
incineration of 209 institutional arrangement for 174
storage of 150 inventories of sectors for inspection 172
transboundary movements of 208 minimum criteria for 177
treatment of 219 objectives of 179
Heavy metals 251 objects of inspection 171
in wastewater 257 A- and B-levels 171
limit values for heavy metals in soil 214 C-level 171
monitoring 224 U-level 171
substitution in electronic equipments 211 on-site inspection 177, 179. See also Site visit inspection
Holistic approach 48 periodic inspection 128, 225
plan 177, 178, 179
quality of 174, 175
I reactive inspection 128
IMPEL 170, 172 report 175, 179
AC-IMPEL for EU candidate countries 172 role, functions and goals of 127, 128
guide for reporting 125 routine inspection 128
minimum criteria for a compliance program strategy 117 typology for 128
minimum criteria for site visits inspections 130 unannounced inspection 129
reference book for environmental inspection 172 walk-through inspection 195
Indicators. See also Performance indicators Inspector
environmental indicators 112 best practices of environmental 176
environmental performance indicators 69 credibility of 176
performance indicators 226 environmental inspector work 180
production-related indicators 104 job description for 171
Industrial Inspectorate
accidents 199. See also Accidents maintenance of 174
database of industrial installations 177 Polish State Environmental Protection Inspectorate 120

index 265
 quality management system of 174 procedure 97, 98
resources of 175 IPPC permit 83, 111, 171
Institute for Energy (IE) 45 and continuous improvements 110
Institute for Environment and Sustainability 45 and guiding material 110
Institute for Prospective Technological Studies (IPTS) 45 application 98, 121, 234, 252
Integrated conditions in the 99, 101
application for an integrated permit 234, 235 for landfills 209
approach 96 information in IPPC applications 111
assessment of industrial plants 108 local conditions and 104
Integrated Environmental Target Plan (IETP) 82 polluting substances considered 100
Integrated Management System (IMS) 54 production data for 253
licence 95, 252. See also IPPC permit public participation and the 97
permit 107, 203, 219. See also IPPC permit rehabilitation plans in 101
Integrated Pollution Prevention and Control (IPPC) directive. updating the conditions in 97
See IPPC Directive ISO (International Organisation for Standardization) 20, 21,
Integrated Product Policy (IPP) 203, 204 57, 73
Intergovernmental Panel for Climate Change (IPCC) ISO 14000 series 20, 54
4th Assessment Report 156, 157 ISO 14001, EMAS and the Green Network comparison 58
International Chamber of Commerce (ICC) 21, 22, 80 ISO 14001 certificate 237, 238, 246
International Labour Organisation (ILO) Report 21 ISO 14001 standard 20, 57, 58, 204, 254
Investments ISO 14001 surveillance audit 237
environmentally oriented investments 31 ISO 26000 68
financial instruments to support environmental technologies ISO 9001 certificate 238, 246
206 ISO Technical Committees (TC) 21
IPCC. See Intergovernmental Panel for Climate Change Ispra 45
IPPC Directive 23, 47, 83, 87, 91, 92, 94, 172, 203, 252
annex I 94, 95
annex III 100 J
annex IV 99 Johannesburg 2002 Earth Summit 35, 78
bureau 45, 94, 100 Joint Implementation Projects (JI) 155
emission limit values for IPPC installations 100 Joint Research Centre (JRC) 45
emissions of pollution 96
first IPPC Report 204
flexibility in the 94, 203 K
implementation of 94 Kyoto protocol 48, 151, 195, 201
industries covered by 95 car taxation 145
in Poland 233 distance-to-target indicator (DTI) for 151, 152
integrated approach in IPPC directive 94, 203 emission trading 156
interrelation with EIA, SEVESO and EMAS directives 113, EU obligations 151, 152, 200
207 EU strategies for implementation 201
IPPC reference documents (BREFs). See BAT reference
documents
LCP Directive and IPPC 196 L
national compliance program 121 Labelling. See Eco-label
principle of prevention and IPPC 95 Labour standards 67
public participation 94, 203 Landfill 231
review of the 97 cap 232
transparency 97 directive 208, 231
waste management and IPPC 95, 210 for hazardous waste 208
IPPC licence. See IPPC permit impact assessment study 209
IPPC licensing. See also IPPC permit integrated permit for 231, 233
and EMS 113 leachate water from 239

266 index
 legal requirements for 231 and compliance monitoring 116
localisation of 233 and environmental regulation 120
management 239 environmental administration 116, 121
methane emissions from landfills 209 Localization permit 232
of sludge 214
opening a new landfill 232
permit for landfill sites 209 M
registration of waste for landfills 239 Maastricht treaty of EU 50
tax 144, 238. See also Tax Management. See also Environmental management
Land use development plan 206, 232 management systems and self regulation 53
Large combustion power plants (LCP) 195 review 56
Law standards 21
administrative law 173 Marine Environment strategy 190
enforcement 173 Marine Pollution Convention (MARPOL) 195
implementation 122 Market
legal action 116 -oriented solutions 88
legal follow-up of national implementation 191 economy 30, 32
legal framework 92 mechanisms 149
private law 173 Marrakech Accord 201
rule of law 133 Material Flows Perspective 108
Lead-free telephones 70 MEDA programme of EU 192
Legislation (environmental legislation) Mercury
areas of EU environmental legislation 191 emissions from industry 105
breaches of EU environmental law 191 mercury cell process 105
implementation of regulation in member states 50 pollution 105
national legal prerequisites 181 Metallurgic industry 251
origin of EU environmental legislation 40 Mining environmental hazards 209
Liability insurance for products 108 Monitoring 123. See also Self-monitoring
Licence 92. See also Permit by authorities 171
and continuous improvements 110 performance 56
and industrial investment cycles 109 role of 123
application for 223 Montreal protocol 28, 201, 202
meeting conditions in 225 Municipal. See also Local authority
trial period 224 environmental services 150
Licensing office of environment & health 172
cycle and EMS 112
department of Competent Authority 124
environmental licensing conditions 103 N
integration with environmental management 112 National Environmental Policy Plan 81, 84
interlinking with political goals and objectives 113 Natura 2000 207
legislation 173 Nature
process as a dynamic cycle 110 and biodiversity 48
Life cycle conservation 207
approach 65 protection 207
assessment (LCA) 66, 203 Negative publicity 130
assessment on products 108 Negotiation 116
European Platform of Life Cycle Assessment (LCA) 204 culture 19, 24
perspective 66 for a permit 224
LIFE programme of EU 50, 146 techniques 175
Linking Directive 231 NEPP. See National Environmental Policy Plan
Lisbon agenda 48, 49 Network for the Implementation and Enforcement of Envi-
Local authority ronmental Law (IMPEL). See IMPEL

index 267
NGOs, environmental 119 also Licence
Nitrate application of 227
directive 212, 214, 215 conditions in 223, 228
good nitrate management 215 economic investment cycle and permit 111
vulnerable zones (NVZs) 215 environmental permit and policy framework 98
Nitrogen dioxide 194 financial conditions for a permit 224
Noise 207, 221 for landfills 231
local noise 207 for localization 108
monitoring of 207 for oil & sludge company 222
railway noise 208 for plant nurseries 227
road traffic noise 208 for smaller and/or less polluting installations 97
terms for noise 253 implementation control measures 115
Non-compliance 127, 131 periodical review of permits 96
agreement on non-compliance 134 provisional conditions for a permit 223
confiscation of gains 131 renewal of 254
corrective actions 130 reporting requirements 111
notification of non-conformances 240 suspension of 130
penalty payment and fees 140, 174 violation of 128, 229. See also Non-compliance
recommendations 130, 131 Persistent, bioaccumulative and toxic (PBT) substances 197
warnings of 131, 174 Persistent Organic Pollutants (POP) 198
withdrawal of licence 174 Stockholm Convention on POPs 198
Norwegian Financial Mechanism 50 Pesticides
Notices of violation 130 in surface soil 228
Notification permit to use 227, 228
decision on notified change 226 taxes or charges on 144
of activity 171 Petrol station 171
of minor changes 226 Picking the low-hanging fruits 31, 62
of non-conformances 240 Plant protection products 198
Policy implementation 81
Polish environmental law 234
O Polluter Pays Principle (PPP) 25, 29, 40, 139, 147
OECD. See Organisation for Economic Co-operation and Pollution prevention (P2) 31
Development and waste minimization 33
Oil spills at sea 199 strategies 111
One Substance One Registration strategy (OSOR) 244, 249 Pollution Prevention Pays (3P) 31
Organisation for Economic Co-operation and Development Polychlorinated biphenyls (PCB) 28
(OECD) 86, 192 disposal of 210
approach to integrated licensing 108 in building and industrial/equipment waste 210
environmental requirements for industrial licensing 109 production and use and marketing in EU 210
OSPARCOM 105 Polychlorinated terphenyls (PCT) 210
Our Common Future 46 Powiat 233
Our Future, Our Choice 48 Precautionary principle 241
Ozone Precedence cases 133
EU action to reduce ozone depleting substances 202 Prevention
hole 28 from control to prevention 30
preventive effect of verdicts 230
preventive environmental measures 224
P principle of prevention 40
Paris Declaration 41 Price elasticity 147
Peak Oil 158 Producer responsibility
Performance indicators 104, 112, 178, 254, 257 for batteries 212
Permit (environmental permit) 83, 87, 92, 95, 238, 252. See Producer Responsibility Organization (PRO) 71

268 index
Product Redesign 70
chain 71 Registration, Evaluation and Authorisation of CHemicals
liability insurance for 108 (REACH). See REACH
rethinking the product 71 Regulatory. See also Legislation and Law
shared use 71 cycle 173
Profit, People and Planet (PPP) 69 instrument other than permits 111
Promise Manual 66 instruments for environmental management 23
Proportionality principle 40, 134 policy instruments limitations 138
Prosecutor Report and reporting
Chief Public Prosecutor 229 environmental report 66, 171, 219, 225, 253, 256
Environmental prosecutor 229 Global Reporting Initiative (GRI) 68, 69, 70
role of 133 good reporting 125
Public on changes 253
-private dichotomy 29 Resource use minimisation 252
-private partnership 82 Responsibel Care Initiative (REI) 35, 36, 54
complaints 172 code of practice of 36
participation 93, 234 Rio de Janeiro 1992 Earth Summit 34, 46
procurement contract 205 Risk
evaluation of pesticide 228
fire risks 222
Q management 35, 221
Qualified Majority Voting (QMV) 42, 44 management group 222
opt-out clause of QMV 44 related to chemical substances 242
Quality Management System 224, 246. See also ISO 9001 River basin
certificate authority 213
management 213
management plan 213
R Russian Federation
REACH 24, 87, 196, 242 Strategic Partnership with EU 192
authorisation of chemicals 244
burden of proof on chemicals use 241
chemical safety report (CSR) in 197 S
company based REACH system 247, 248 Sanction 130
development of 243 environmental sanction fees 225
helpdesks 245, 246 Self-monitoring 113, 123, 124, 127, 224, 254
implementation of 197, 241, 244, 245, 248 and IPPC permits 97
industry obligations in REACH 196 control programme 224
Information required for registration 244 of wastewater 255
interim strategy 197, 243 regimes in IMPEL 124
REACH Implementation Process (RIP) 247 requirements 101
registration of chemicals 197, 242, 243 schemes 171
sharing confidential data in REACH 249 system 225
Recyclability of products 205 Self-regulation 19, 20, 53, 78
Recycling 71, 73, 256 Settlements 134
and reuse of resources 254 Seveso. See also Accident
electrical and electronic equipment 211 Seveso Directive 36, 199. See also Directive on
market for recycled materials 142, 149 Seveso II Directive 23, 24, 36, 92, 199, 209. See also Direc-
of batteries 212 tive on
of glass 150 Sewage sludge. See Sludge
of packaging waste 211 Shared responsibilities 20, 78, 79, 80, 86
of paper 150 Silent Spring 28, 39
of scrap metal 150 Single European Act 41

index 269
Single European Market 42 principle of 241
Site visit inspection 123, 129, 130. See also Inspection, on- reporting framework 70
site Sustainable
ad-hoc 130 development 48, 156
analysis 178 development reporting 35
programmed site visits 130 economic development 84
Sludge 214 industrial production 19
directive 214. See also Directive on production and consumption 34
incineration of sewage sludge 214 society 159
landfilling of 231 Swedish Environmental Protection Agency (SEPA) 39
reuse of sewage sludge 214 Sweep-all-Article 235, 40
treatment of 214
Sludge oil
from ships 220 T
treatment of 219 TACIS programme of EU 192
Social Taking back electrical and electronic equipment 211
performance 68 Tax (environmental taxes) for 88, 140, 144
responsibility 68 aggregates (sand and gravel) 144
responsibility accounting 68 air pollution 144
skills 176 carbon dioxide 144
Soil management 209 energy taxation 142, 146
Spatial planning and land use policy 206 fertilisers 141, 144
Special Protection Areas (SPAs) 207 fuels 140, 142, 143, 146, 154
Stakeholder 56, 60, 68 green taxes 25
consultation 191 landfilling of waste 140, 141, 142, 231
relations 74 minimum taxes for fuels and electricity 143
Standardisation natural resources 158
european standardisation 205 passenger car taxation 147
integration of environmental aspects in standardisation 205 pesticides 144
Stern Report 157 price elasticity of 147
Strategic Environmental Assessment (SEA) 93, 206 product taxes 140, 144
Subsidiarity principle 40, 44 revenues from 141, 145
Subsidies 146 sulphur dioxide 140
direct 146 Technical harmonisation 205
environmental subsidies 146 Technological research and development 203
financing investments and 146 Technology choices and permit application 111
indirect subsidies 146 Technology platforms 206
to households 146 Thematic strategies of EU 190
Substance Flow Analysis (SFA) 111 for soil protection 207
Sulphur content of petrol and diesel 195 on air pollution 194
Supervision 219. See also Inspection on resource 208
Supervisory authority 227. See also Competent authority on waste prevention and recycling 209
Supplemental Environmental Projects (SEPs) 134 Towards Sustainability 47
Supply chain Tradable pollution permits 150. See also Emission trading
management 65, 205 Trading warm air 152
requirements 108 Transport
SustainAbility 69 environmentally friendly transport 49
Sustainability 34 growth 49
accounting 68 permits 221
agenda 79 Treaty of Rome 40
economic growth and 80 Trial period licence 224
economic policy instruments and sustainability 159 Triple Bottom Line 69

270 index
U Wastewater 214
Ukraine characteristics 255
ENP Action Plan for Ukraine 192 discharge of wastewater 255
United Nations Environment Program (UNEP) 32 discharge permit 214, 254
United Nations Framework Convention on Climate Change industrial wastewater into urban sewage 214, 238
(UNFCCC) 201 management 251
Unleaded petrol 195 treatment 139, 214, 221, 253
US enforcement practice 134 treatment and IPPC 96
User fees. See Fees and Charges Water
US Federal Environmental Protection Agency (EPA) 39 consumption 256
US National Environmental Policy Act 39 drinking water quality 214
European water safety plan 214
good chemical and ecological status of 213
V legislation history 212
Vehicle minimal anthropogenic impact on water 213
dismantling and recycling 211 municipal and industrial water costs 140
scrapping 171 permit for water management 238
spare parts 211 pollution of 213, 215
Violations 134. See also Non-compliance pollution tax 144
Voivodship 233 process water treatment 221
Voluntary quality legislation 189
action and licensing 251 quality standards 213
corporate initiatives 65 storm water pollution 214
Walk-through inspection 129. See also Inspection Water Framework Directive (WFD) 190, 212
Walking the Talk 33 economic analysis requirement in WFD 213
Waste first WFD implementation report 213
beverage containers 211 priority hazardous substances in WFD 215
biodegradable waste treatment 209 public information and consultation 213
co-incineration plants 210 Water Information System for Europe (WISE) 213
fat treatment 219, 221 Wildlife conservation 207
incineration of non-hazardous waste 209 Win-win concept 30, 31, 50
market for waste 149, 150 World Business Council for Sustainable Development (WBC-
mining waste 209 SD) 32, 33, 68, 80, 87
municipal waste 71, 142, 209
national resources and waste 48 Z
oil waste 210
packaging waste 150, 211 Zero Emissions 33
shipments of 208, 212 Zero Waste 34
solid waste management 139, 150, 252 Zinc 251
solid waste sector charges 140, 144. See also Charges galvanizing 251
storage of chemical waste 239 recycling 256
storage of hazardous waste 224
strategy on the prevention and recycling of waste 208
toxic waste management 256
waste management 71, 142, 239
company 232
legislation 231
life cycle thinking for 209
methodological guidance for 212
national programmes 208, 209
plan 212
strategy 190

index 271
The Baltic University Many arrangements for students
The Baltic University courses attract close to 10,000 students
Programme yearly in some 350 student groups. The courses are run sepa-
http://www.balticuniv.uu.se rately by each university but there is much communication
between course groups. Video conferencing, audio-telephone
conferencing and computer conferencing over Internet allow
A regional university network students from different countries to meet and discuss. During
The Baltic University Programme is a network of 190 universi- summers many different activities are arranged, including a
ties and other institutes of higher learning in the Baltic Sea re- sailing seminar on the Baltic Sea and other summer courses.
gion. All countries within or partly within the Baltic Sea drainage Student conferences and a student parliament is organized
basin are represented: Belarus, Denmark, Estonia, Finland, Ger- every year.
many, Latvia, Lithuania, Poland, Russia and Sweden and more
marginally Czech Republic, Norway, Slovakia, and Ukraine.
A large network of researchers and teachers at the universi- A variety of courses
ties has developed. The number of individuals who have con- The Programme offers a variety of courses for studies of the
tributed at some stage in the Programme are more than 1,500. region, its environment, social change, and sustainable de-
The network is coordinated by a Secretariat at Uppsala Uni- velopment. These constitute the combined efforts of a large
versity, Sweden. number of scientific experts from all over the Baltic Sea re-
gion. The course material, consists of books, booklets, films
and websites. The language is English but some material has
Sustainable development and democracy been translated into Polish, Russian, and Latvian. Printed ma-
The Programme focuses on questions of sustainable develop- terial, films and websites contribute to a rich learning environ-
ment, environmental protection, and democracy in the region. ment for the students.
The aim is to support the key role that universities play in a Our courses are multi-disciplinary, international, problem
democratic, peaceful and sustainable development. This is oriented, based on ongoing research at the participating uni-
achieved by developing university courses for students but versities and they all have an element of regional studies. This
also to participate in applied projects in cooperation with au- book is one in a series of four on environmental management
thorities, municipalities and others. and also the basic material for a Baltic University course.

The Baltic University Centre at Belarusian National Technical Uni- Lecture on the ship S/Y Fryderyk Chopin while sailing the Baltic Sea
versity in Minsk (Photo: Lars Rydén). (Photo: Agnieszka Trzupek).

Read more about The Baltic University Programme at http://www.balticuniv.uu.se/

 The Baltic University
Environmental Management Courses
Environmental Management is a package of four The four partial courses each have a course book,
courses on master level for higher education in the Bal- accompanied by a CD containing films, work tools,
tic Sea region. The courses convey knowledge of envi- databases, material for training, and the textbook in
ronmental management in all kinds of organisations, PDF-format.
particularly in the industrial sector, and describe how Each course corresponds to 7.5 ECTS credits, or
environmental issues are addressed by different stake- the whole set to half a year of full-time studies.
holders in a society. The courses describe the environ-
mental authorities and the legal and economic tool used
for inspection and control, including the directives of Web support
the European Union; the formal management systems, The web page of the course package features teach-
such as ISO 14001 and EMAS, applicable to all kinds ing guides for teachers and additional material for
of organisations; industrial production and how to re- students, such as proposed tasks for group work. The
duce environmental impact and increase resource effi- links in the books are kept updated on the web page,
ciency; finally the design of products and how to asses and new links are added. Figures etc. from the books
the complete life cycle of products in society. may be downloaded to be used in PowerPoint or other
The courses provide a platform for environmental types of presentations.
management education in all parts of society. They are You will find the web pages for the EM courses at
well suited for competence development of profes- http://www.balticuniv.uu.se/ under the menu: Courses/
sionals. Environmental Management.

1. Environmental Policy
– Legal and Economic Instruments
This course describes legal and economic policy instruments, including environmental impact assessment,
environmental legislation permits, and inspections and controls. Special emphasis is made on how com-
panies and organisations can work to improve environmental performance and quality themselves, e.g. by
green labelling, certification, and proper management tools. The role of inspections, both for control and
in consultation to improve environmental performance in a company, is discussed. Environmental fines
and taxes, although mostly of national concern, are described. The EU legislation is treated in some detail
as well as the most important national legislation.

Course book: 276 pages; theoretical part and cases.

Films: Cases from Sweden and Lithuania (on CD).
Data base: European environmental legislation (on CD).
Website: Teachers’ guide and group work for students.
2. Cleaner Production
– Technologies and Tools for Resource Efficient Production
Cleaner technologies refer to production processes where pollution is minimized at the source and ef-
ficiency of resource use is carefully improved. The course describes a series of production processes and
how to improve energy, water and material resource management and improve production technologies. It
describes how the implementation of cleaner technologies not only improves environmental performance,
but also economic viability and the quality of the production process.

Course book: Approx. 324 pages; theoretical part and 6 cases.

Films: Cases from Sweden and Lithuania (on CD).
Data base: Cleaner Production Practices (on CD).
Website: Teachers’ guide and group work for students.

3. Product Design and Life Cycle Assessment

The design of products and their use are major concerns to improve environmental performance and re-
source flow in society. The course treats this by applying environmental management, ecodesign and life
cycle assessment techniques. A series of indicators for environmental impact are examined, throughout the
life cycles of products. The techniques are illustrated by many cases of ecodesign, dematerialisation, use
of indicators and LCA calculations.

Course book: 312 pages; theoretical part and 7 cases.

Films: Case from the Netherlands (on CD).
Data base: Applications for Life Cycle Assessments (on CD).
Website: Teachers’ guide and group work for students.

4. Environmental Management
Systems and Certification
The basis of environmental management is the systematic review, or audit, of an activity in an organisa-
tion, industry, or business to map environmental impact and resource use. The course describes how this is
done and gives a series of tools to reduce impact. The practicalities of ISO 14001 and EMAS certification
are described.

Course book: 266 pages; theoretical part and 7 cases.

Films: Cases from Sweden and Germany (on CD)
Data base: Tools for EMS (on CD).
Website: Teachers’ guide and group work for students.
 Baltic University Press
Our books are interdisciplinary, international,
and based on latest research

Environmental Science Translations:

© 2003. 824 p. SEK 500. Belarusian
by: Rydén, L., Migula, P and M. Andersson (eds.). Latvian
Contents: Environmental Science is an extensive and interdisciplinary Polish
review of environmental issues with a focus on the Baltic Sea region. Russian
Ukrainian
English for Environmental Science
© 2003. 166 p. SEK 150.
by: E. Korshuk, I. Kryba, E. Savich, P. Solovyov, A. Tamarina.
Contents: English language course using texts and concepts from the
Environmental Science text book.

The Baltic Sea Region – Cultures, Politics, Societies

© 2002. 676 p. SEK 375.
Contents: Regional development; history, culture, languages, democ-
racy, multicultural societies, peace and security, social conditions and
economies in the Baltic Sea region.

A Sustainable Baltic Region

© 1997. 10 booklets, 50 pages each. SEK 50 each.
Contents: Sustainable development is treated in ten thematic booklets;
energy, material­ flows, agriculture, industrial production, transport and
habitation, ethics and law, ecological economics, and Agenda 21.

Sustainable Water Management

© 2000. 3 books, 230-250 pages each. SEK 200 each.
Contents: Hydrology, water quantity and quality, water management in
agriculture, cities and industry, water and cities, transport, fishing, tour-
ism and environmental protection, institutions and law, management
plans, water conflicts, and international cooperation.

Sustainable Community Development (Superbs Case Studies)

© 2002. 4 booklets, 80 pages each. SEK 75 each.
Contents: City development, energy, material­ flows, urban planning,
transport and habitation, illustrated by 35 case studies from 10 cities in
the Baltic Sea region.

Film material
Video tapes/CDs that add to the books, and other written material, are also available for most of the courses.

To order our books and films, please visit: http://www.balticuniv.uu.se/webshop