COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and he Committee of the Regions a Clean Air Programme for Europe Proposal for a Directive of the European Parliament and of the Council on the limitation of emissions of certain pollutants into the air from medium combustion plants Proposal for a Directive of the European Parliament and of the Council on the reduction of national emissions of certain atmospheric pollutants and amending Directive 2003/35/EC Proposal for a Council Decision on the acceptance of the Amendment to the 1999 Protocol to the 1979 Convention on Long-Range Transboundary Air Pollution to Abate Acidification, Eutrophication and Ground-level Ozone
Date: 2013-12-18
Institutions: European Commission
Subjects: EU programme, air quality, atmosphere, health costs, industrial pollution, international convention, job creation, motor vehicle pollution, ozone, pollution from agricultural sources, protocol to an agreement, reduction of gas emissions, research and development, revision of an agreement













EUR-Lex - 52013SC0532 - EN











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52013SC0532

COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and he Committee of the Regions a Clean Air Programme for Europe Proposal for a Directive of the European Parliament and of the Council on the limitation of emissions of certain pollutants into the air from medium combustion plants Proposal for a Directive of the European Parliament and of the Council on the reduction of national emissions of certain atmospheric pollutants and amending Directive 2003/35/EC Proposal for a Council Decision on the acceptance of the Amendment to the 1999 Protocol to the 1979 Convention on Long-Range Transboundary Air Pollution to Abate Acidification, Eutrophication and Ground-level Ozone /* SWD/2013/0532 final */









COMMISSION STAFF WORKING DOCUMENT
EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT
Accompanying the documents
Communication from the Commission
to the Council, the European Parliament, the European Economic and Social
Committee and he Committee of the Regions a Clean Air Programme for Europe
Proposal for a Directive of the European Parliament and of the Council on the
limitation of emissions of certain pollutants into the air from medium
combustion plants
Proposal for a Directive of the European Parliament and of the Council on the
reduction of national emissions of certain atmospheric pollutants and amending
Directive 2003/35/EC
Proposal for a Council Decision on the acceptance of the Amendment to the 1999
Protocol to the 1979 Convention on Long-Range Transboundary Air Pollution to
Abate Acidification, Eutrophication and Ground-level Ozone
1.           Problem Definition
1.1.        Policy context
Air pollution causes substantial
environment and health impacts. In 2010, annual premature mortalities amounted
to over 400000 and 62% of the EU area was exposed eutrophication, including 71%
of Natura 2000 ecosystems. Total external costs of the health impacts are in
the range €330-940bn. Direct economic damage includes €15bn from lost workdays,
€4bn healthcare costs, €3bn crop yield loss and €1bn damage to buildings.
To address these, a body of air pollution
policy has been developed in the EU and internationally. An ex-post review has
been conducted on the main elements of the EU policy: the 2005 Thematic
Strategy on Air Pollution, the Ambient Air Quality Directives[1] (AAQDs), the National Emission Ceilings Directive[2] (NECD), and a range of legislation controlling pollution at source.
The policy has brought about a substantial
reduction in emissions between 1990 and 2010 which has broadly solved the EU
acid rain (acidification) problem.[3]
The main health impacts, from particulate matter, have been reduced by around
20% between 2000 and 2010.[4]
The overall structure of air quality policy
is coherent, but a better match must be ensured between source controls,
ceilings and ambient air quality standards to ensure effective compliance.
1.2.        Key outstanding problems
Despite these gains there are substantial
remaining impacts. Air pollution is the number one environmental cause of death
in the EU, responsible for ten times more premature deaths than road traffic
accidents,[5] as well as substantial impacts on health and resulting productivity
losses.
For ecosystems the main outstanding problem
is eutrophication. Three quarters of the EU’s most valuable ecosystems are
threatened, jeopardising the €200-300bn annual benefits from the Natura 2000
network.
Connected with these are two specific
problems. First, there are substantial breaches of air quality standards, with a
third of EU's Air Quality Management Zones exceeding the limit values for
particulate matter (PM10) and a quarter for nitrogen dioxide (NO2).

Second, even with full compliance with
existing EU legislation the EU is not on track to achieve its long-term
objective. Projections show that there will still be 340 000 premature deaths
from PM2,5 and ground-level ozone in 2020.
1.3.        The underlying drivers
Exceedance
of air quality standards
Diesel
emissions drive the NO2 and NOx compliance problems 
While NOx emission limit values
for diesel passenger cars were tightened by a factor of 4 from 1993 to 2009
(Euro 1 to Euro 5), estimated average NOx emissions in real driving
conditions have slightly increased. This is the single most significant driver
of current non-compliance.
Small scale combustion and concentrated
local pollution drive the worst PM compliance problems
Domestic solid fuel combustion drives the
cases where local pollution most exceeds the limit values, while certain
geographical locations combine a high concentration of emitters with a
topography that prevents effective dispersion.[6] 
Poor co-ordination between national and
local action, and lack of capacity at regional and local level, has made
compliance more difficult and costly 
Public authorities often acted late to
bring air pollution down. Part of the problem is lack of capacity to develop,
implement and monitor plans to cut pollution. Co-ordination between NECD
national programmes and AAQD action plans could be improved.
The EU is not on track to achieve its
long-term air quality objective
The remaining
health impacts after 2020 are driven by a range of sectors
All the main sectors contribute to either
PM or ozone concentrations and must be addressed. The cost-effective reduction potential
is greatest for those sectors which have reduced least (e.g. agriculture, medium-scale
combustion, non-road mobile machinery and international shipping).[7] 
Agricultural
ammonia emissions drive the remaining environmental impacts 
Agriculture is responsible for 90% of
ammonia emissions and is the primary driver of eutrophication. There is a large
untapped potential to achieve cost-effective reductions, many of which would
benefit farmers. 
Sustained
background pollution means that local action alone cannot effectively reduce
impacts
There is a substantial background[8] component to the main problems which is beyond the control of local
competent authorities. A part is national and can be addressed at that level,
but the transboundary share is high (above 50% for PM2,5 and 60% for
NH3).[9]
1.4.        How the problem will
develop
Compliance for PM10 and NO2
will improve substantially by 2020. The persisting problems are mainly in
hotspots (e.g. Rome, Lisbon), and areas where the use of coal for residential
heating is still common (e.g. PL, BG, CZ, SK), where the high population
density implies correspondingly large population exposure. All Member States
are projected to comply with their NEC ceilings by 2020.
The baseline assumes that the introduction
of Euro 6 standards will fully control real world NOx emissions from
light-duty diesel from 2017 onwards.[10] This is crucial for compliance by 2020.
Even with full compliance, health impacts
will reduce by only around a fifth by 2025, and eutrophication hardly at all.
2.           Analysis of subsidiarity
The legal base is Article 192(1) of the
Treaty. EU action continues to be necessary because of the persisting transboundary
nature of air pollution, and because of the contribution of products which must
be controlled at EU level for internal market reasons.
Health and environmental benefits of
pollution reduction are balanced against costs, to ensure that action is
proportionate. The optimal distribution of emission reduction between Member States and the EU is also examined.
3.           Objectives
The long-term strategic objective is to
attain air quality levels that do not give rise to significant negative impacts
on, or risks for, human health and the environment. There are two general
objectives:
·        
To ensure compliance with present air quality
policies, and coherence with international commitments, by 2020 at the latest.
·        
To achieve substantial further reduction in
health and environmental impacts in the period up to 2030.
4.           Policy Options,
assessment of impacts and comparison of options for the first (2020) objective
4.1.        Options considered
The baseline will deliver the reductions
required by the revised Gothenburg Protocol. Five further options were
considered to resolve the compliance problems: new EU source legislation; tightened
National Emission Ceilings (beyond Gothenburg); strengthened EU support for Member State action; promotion of tighter international controls; and amending the AAQD.
4.2.        Assessment of Impacts
The baseline
will ensure broad compliance with air quality standards, if the real world
emissions problem for light-duty diesels is solved by the introduction of Euro
6. Of the remaining compliance problems, 13-19% of zones are within 5µg/m3 of
the limit value, and only 6-8% above that (depending on pollutant).Further Member State action to reduce local air pollution should be able to address
the first category fairly easily. For the second, domestic combustion (the main
PM issue) can be regulated by restricting solid fuel combustion plus support
for fuel-switching, (e.g. through the structural funds), while NO2
pollution can be tackled by access restrictions for diesel vehicles. Adoption of new source
legislation, and further tightening of the National Emission Ceilings would not effectively target the local sources driving residual non-compliance.
Thus these options are taken up for the 2025-30 analysis.
4.3.        Comparison of Options
The baseline delivers widespread compliance
and the remaining problems until 2020 are due to local pollution sources. These
can be effectively tackled by local action, supported at EU level by
capacity-building and funding for structural changes such as fuel-switching. There
is no rationale for relaxing the AAQD given that compliance can be achieved.
5.           Policy Options,
assessment of impacts and comparison of options for the second (2025-30)
objective
5.1.        Options considered
In addition to the baseline, five options
were considered, as presented in Table 1 below.
Table 1: Policy
options considered for the period 2025-30
 Option 1 || Option 6A || Option 6B || Option 6C || Option 6D || Option 6E 
 Baseline || 25% gap closure for PM 2.5 between baseline and MTFR || 50% gap closure for PM 2.5 between baseline and MTFR || 75% gap closure for PM 2.5 between baseline and MTFR || 100% gap closure for PM 2.5 between baseline and MTFR || Compliance with WHO guideline values (>100% gap closure for PM 2.5) 
The focus is on PM health impacts, because
these are most damaging, and can be monetised and so easily compared with
costs. But PM controls also affect the pollutants causing ozone, eutrophication
and acidification, and thus the options will also deliver reductions in those.
Achieving option 6E, compliance with WHO
guideline values, would not be possible by 2030 without structural as well as
technical changes. The potential to achieve it in the long-term is taken up
later.
5.2.        Assessment of Impacts
The full Impact Assessment presents
analysis for both 2025 and 2030; for brevity only the 2025 results are
presented here.
5.2.1.     Health and environment
impacts
The percentage reductions in health and
environmental impact versus 2005 are presented in Table 2 below:
Table 2:
percentage reductions in health and environmental impact versus 2005
   || 2005 || Option1 || 6A || 6B || 6C || 6D 
 PM2,5-chronic-premature deaths || 494000 || -38% || -42% || -46% || -50% || -54% 
 Ozone-acute- premature deaths || 24600 || -28% || -29% || -30% || -33% || -39% 
 Eutrophication, unprotected '000 sq Km || 1125 || -21% || -24% || -28% || -34% || -40% 
 Acidification, unprotected '000 sq Km || 161 || -71% || -77% || -81% || -85% || -87% 
Option 6C reduces the health impacts of PM2,5
by an additional third over the baseline (50% reduction versus 38%), while
eutrophication impacts are reduced by more than an additional half over the
baseline (34% reduction versus 21%).
5.2.2.     Economic impacts
The economic impacts are shown in Table 3
below in €M (additional costs over Option 1(baseline), and % increase compared
to the baseline):
Table 3: economic
impacts of the options 
   || Option 1 || Option 6A || Option 6B || Option 6C || Option 6D 
 EU-28, 2025 || 87171 || - || 221 || 0,25% || 1202 || 1,38% || 4629 || 5,31% || 47007 || 53,9% 
The efforts required per SNAP[11] sector are shown in Table 4 below, expressed in €M and in
percentage increase compared with Option 1:
Table 4: Efforts
required per SNAP sector 
   || Option 1 || Option 6A || Option 6B || Option 6C || Option 6D 
 Power generation || 9561 || 44 || 0,46% || 125 || 1,31% || 470 || 4,92% || 3519 || 37% 
 Domestic combustion || 9405 || 74 || 0,78% || 497 || 5,29% || 1680 || 18% || 17791 || 189% 
 Industrial combustion || 2513 || 19 || 0,75% || 156 || 6,20% || 641 || 25% || 1811 || 71% 
 Industrial Processes || 5017 || 17 || 0,34% || 125 || 2,49% || 331 || 6,61% || 3964 || 79% 
 Fuel extraction || 695 || 0 || 0,00% || 0 || 0,00% || 6 || 0,81% || 583 || 84% 
 Solvent use || 1176 || 1 || 0,08% || 2 || 0,15% || 56 || 4,76% || 12204 || 1038% 
 Road transport || 48259 || 0 || 0,00% || 0 || 0% || 0 || 0% || 0 || 0% 
 Non-road machinery || 8760 || 1 || 0,01% || 5 || 0,06% || 145 || 1,66% || 1451 || 17% 
 Waste || 1 || 6 || 786% || 7 || 941% || 9 || 1154% || 9 || 1203% 
 Agriculture || 1783 || 59 || 3,33% || 285 || 16% || 1292 || 72% || 5675 || 318% 
 Total || 87171 || 221 || 0,25% || 1202 || 1,38% || 4629 || 5,31% || 47007 || 54% 
The SNAP sectors represent types of
activity (e.g. combustion, solvent use) that can take place in different
economic sectors (chemicals, refineries, etc). By economic sector, Option 6C
requires additional expenditure of 0,22% of the sectorial output in
agriculture, 0,1% for refineries and much less for all other industries.
Table 5 shows the direct economic benefits and
total external costs. Additional action could reduce external costs by €60-200
billion/year beyond the baseline, of which more than €4,5 billion could be
direct economic savings.
Table
5: Economic benefits resulting from reductions in air pollution
 2025, EU28 || Option 6A || Option 6B || Option 6C || Option 6D 
 Lost working days, direct economic benefits vs baseline €M || 726 || 1421 || 2137 || 2831 
 Damage to built environment, direct economic benefits vs baseline €M || 53 || 106 || 145 || 162 
 Crop value losses, direct economic benefits vs baseline €M || 61 || 101 || 278 || 630 
 Total health care costs, direct economic benefits vs baseline (where data available) || 219 || 437 || 657 || 886 
 Total direct benefits vs baseline || 1,059 || 2,065 || 3,237 || 4,509 
 Total reduction in external costs of air pollution vs baseline (low valuation) || 14 997 || 29 767 || 44 686 || 59 642 
 Total reduction in external costs of air pollution vs baseline (high valuation) || 50 317 || 100 937 || 150 853 || 200 074 
The aggregate GDP impact is very small even
in Option 6C, at -0,025%. Including productivity gains in the macroeconomic analysis
fully offsets the GDP impact and additional direct benefits (healthcare, crop
and building benefits) give a net economic benefit of 0,007% of GDP.
5.2.3.     Social impacts
In all cases the employment effect of the
options is small (on Option 6C, there is an increase of 2000 jobs, which is
within the uncertainty range), even without taking labour productivity gains
into consideration. When those are considered there is a net job creation (37
to 112 thousand jobs).
5.2.4.     Competitiveness
and SME impacts
The most significantly affected sectors are
agriculture and petroleum refining. In all cases the impact would be below or
in the order of the 1% threshold of Gross Value Added, indicating headroom to
absorb the additional costs. Impacts on SMEs are significant for agricultural
measures and for measures in medium-scale combustion plants (MCPs). For MCP the
impacts can be reduced to under 2,4% of Gross Operating Surplus (see below). Agriculture
measures can be targeted on larger installations covering most of the capacity,
and residual impacts dealt with by appropriate support through the Rural
Development Fund.
5.2.5.     Trajectory to achieve the long-term objective by 2050
Background PM2,5 concentrations below the
WHO's 10 mg/m3 limit could be achieved virtually everywhere in the
EU (99,5% of territory and 99% of population exposed), assuming structural
changes and further technological development. An indicative trajectory to
deliver the required reductions is set out in Table 6.
Table 6: Emission
reduction trajectory towards achieving the WHO guideline values in 2050;
emissions in kilotons, reductions compared with 2005 emissions
 EU28 || 2005 || 2025 || 2030 || 2040 || 2050 
 SO2 || 8172 || -79% || -82% || -87% || -91% 
 NOx || 11538 || -65% || -70% || -78% || -83% 
 PM2,5 || 1647 || -48% || -54% || -64% || -72% 
 NH3 || 3928 || -30% || -38% || -42% || -48% 
 VOC || 9259 || -50% || -55% || -64% || -71% 
5.3.        Comparison of Options
Table 7 presents a
comparison of the impact of the options relative to the baseline:
Table
7: Comparison of the impact of the options relative to the baseline
 2025, EU28 || Option 6A || Option 6B || Option 6C || Option 6D 
 Costs relative to baseline €M || 221 || 1202 || 4629 || 47007 
 Additional reduction in health impacts beyond baseline (2005 base year) || 10% || 21% || 32% || 43% 
 Additional reduction in eutrophication impacts beyond baseline (2005 base year) || 16% || 33% || 62% || 90% 
 GDP impact taking into account productivity gains || 0,007% || 0,009% || 0,000% || - 
 Other direct benefits || 333 || 644 || 1080 || 1678 
 Total reduction in external costs of air pollution vs baseline (low valuation) || 14 997 || 29 767 || 44 686 || 59 642 
 Total reduction in external costs of air pollution vs baseline (high valuation) || 50 317 || 100 937 || 150 853 || 200 074 
For Option 6C the benefits outweigh the
costs, while the additional measures brought in by 6D are more expensive than
the benefits they deliver. For this reason, option 6C is preferred. 
5.3.1.     Sensitivity analysis
Extensive sensitivity analysis on Option 6C
yielded the following conclusions:
·                        
while climate policy will be beneficial for air
quality, it alone will not achieve the long-term air quality objective by 2050;
·                        
there is additional scope beyond option 6C to
reduce eutrophication and ozone health impacts at modest cost ( an increased
compliance cost of 1%);
·                        
there is potential to set an EU methane
reduction target at low or zero cost;[12]
·                        
the policy objectives are still achievable on
alternative future scenarios.
5.4.        Instruments
to implement the preferred option
The main instrument to implement the
overall policy is the NECD, which can also incorporate measures to improve national
reduction programmes, emission inventories and projections, and ecosystem
monitoring, at a small administrative cost (6,9 M€ initially and 2,5 M€/year thereafter).
Current and pending EU source legislation
will deliver 52-75% of the required reductions for all pollutants except
ammonia, for which the figure is only 25% (from the IED). 
EU controls on medium scale combustion plants
(1-50 MW rated thermal input) would be cost-effective:
·                        
Significant and cost-effective emission
reductions can be achieved for PM, NOx and SOx;
·                        
The total annualised costs for operators can be
limited to 400M€ if secondary NOx control is applied only for part of the new
plants;
·                        
Administrative costs can be minimised by
requiring only registration of plants.
The favoured policy option is emission
reduction consistent with the Gothenburg Protocol, coupled
with registration for all plants. This reduces the
impact on SMEs to 0,1 – 2,4% of Gross Operating Surplus.
6.           Monitoring and Evaluation
There
is an extensive set of indicators and mechanisms to monitor and evaluate
implementation of EU air quality policy (e.g. the EEA and EMEP reports). These
will be used to evaluate the achievement of revised impact reduction objectives.
New NECD reduction commitments will be monitored by reinforced provisions on
inventories and projections. The policy will be reviewed on a five-year cycle
with the first not later than 2020.
[1]               2008/50/EC and 2004/107/EC
[2]               2001/81/EC
[3]               The emission reductions are due to EU legislation on
sulphur emissions from large combustion plants (LCPs), and to the low sulphur
road transport fuel requirements that also enabled the use of catalytic converters
from Euro 4 onwards.
[4]               Premature deaths from particulate matter pollution
were 379 420 in 2010, and from ozone 26 500.
[5]               EUROSTAT statistics report the number of traffic
fatalities in the range of 35 000 in the year 2010 across the EU 27.
[6]               E.g. some of the main population centres in Europe
remain in non-compliance: Milan, Madrid, Barcelona, London and others.
[7]               Particularly in countries that have not yet declared
sulphur and/or NOx control areas.
[8]               Measured pollution levels are the sum of contributions
originating from specific local sources (such as industrial sites or urban
traffic) and background pollution, which in turn is composed both of regional
sources and long-range sources.
[9]               Estimates from the European Monitoring and Evaluation
Programme (EMEP).
[10]             Euro 6 compliance is included in the baseline because
the level of ambition is set in the adopted legislation; the implementing
measure is a technical delivery mechanism.
[11]             Selected Nomenclature for Air
Pollution
[12]             Methane is not considered in the overall optimisation
because of its different lifetime (and hence the different timescale of its
ozone impacts) compared with the other ozone precursors.