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Document 52013SC0531R(01)

COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT

/* SWD/2013/0531 final/2 */

Brussels, 16.1.2014

SWD(2013) 531 final/2

CORRIGENDUM
Annule et remplace le document SWD(2013) 531 final partie 1 du 18.12.2013.
Concerne la table de matières uniquement.

COMMISSION STAFF WORKING DOCUMENT

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

{COM(2013) 917 final}
{COM(2013) 918 final}
{COM(2013) 919 final}
{COM(2013) 920 final}
{SWD(2013) 532 final}


COMMISSION STAFF WORKING DOCUMENT

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

TABLE OF CONTENTS

PART 1/4

Introduction    15

Procedural Issues, Impact Assessment Board, Use of Expertise and

Consultation of Interested Parties    15

2.1.Procedural issues15

2.2.Impact Assessment Board15

2.3.Use of Expertise and Consultation of interested parties16

Review of current Policy, Problem definition and Subsidiarity    17

3.1.The air pollution problem and the policy framework under review17

3.1.1.The problem17

3.1.2.The current policy framework17

3.2.Review of the current policy framework18

3.2.1.Past reduction of air pollutant emissions and impacts18

3.2.2.Validity of objectives and scope, and overall coherence19

3.3.Key outstanding problems20

3.3.1.Health and environmental impacts of air pollution in the EU remain large20

3.3.2.EU air quality standards are widely exceeded in densely-populated areas22

3.3.3.The EU is not on track to meet its long-term air quality objective23

3.4.The main underlying drivers or causes of the outstanding problem24

3.4.1.Exceedance of EU air quality standards24

3.4.1.1.Diesel emissions drive the NO2 and NOx compliance problems24

3.4.1.2.Small scale combustion and concentrated local pollution drive the worst PM compliance problems25

3.4.1.3.Poor co-ordination between national and local action, and lack of capacity at regional and local level26

3.4.2.The EU is not on track to meet its long-term air quality objective27

3.4.2.1.The remaining health impacts from PM and ozone are driven by emissions from a range of sectors27

3.4.2.2.Agricultural ammonia emissions drive the remaining environmental impacts27

3.4.2.3.Sustained background pollution means that local action alone cannot effectively reduce impacts28

3.4.2.4.There remain gaps in the information base for assessing and managing air pollution29

3.5.How will the problem evolve?29

3.5.1.Future trends in air pollution impacts30

3.5.2.Compliance prospects under the current legislation scenario31

3.5.3.Uncertainties and risks associated with baseline projections34

3.6.Who is affected and how?35

3.7.Justification of EU action35

3.7.1.Why can the objectives not be achieved sufficiently by the Member States?36

3.7.2.Can objectives be better achieved by action by the Community?36

Objectives    37

4.1.The long-term strategic objective37

4.2.General objectives relating to updating the present strategy37

4.2.1.Ensure compliance with present air quality policies, and coherence with international commitments, by 2020 at the latest37

4.2.2.Achieve substantial further reduction in health and environmental impacts in the period up to 203037

4.3.Specific objectives37

4.4.Coherence with other policies38

4.5.Organisation of the remainder of the impact assessment39

Achieving the compliance objective by 2020 at the latest    39

5.1.Options to achieve compliance with the existing air policy framework39

5.1.1.Option 1: No additional EU action39

5.1.2.Options 5A-5E: Further EU action to facilitate compliance with the air quality framework41

5.2.Analysis of impacts42

5.2.1.Method42

5.2.2.Environmental Impacts42

5.2.3.Economic and Social Impacts45

5.3.Comparison of options46

5.4.Conclusions48

Achieving further health and environmental impact

reductions up to 2030    48

6.1.Methodology49

6.2.The policy options49

6.2.1.Option 1: No further EU action49

6.2.2.Options 6A-6E: Additional Technical Reduction Measures49

6.3.Impact of options52

6.3.1.Health and environmental impacts52

6.3.2.Economic impacts53

6.3.2.1.Direct expenditure to reach compliance53

6.3.2.2.Affected industries and sectorial impacts54

6.3.2.3.Direct economic benefits due to reduced health and environmental impacts:56

6.3.2.4.Generalized economic benefits from reduced health-related external costs57

6.3.2.5.Broader economic impacts57

6.3.3.Social impacts59

6.4.Comparison of the options59

6.5.Sensitivity analysis61

6.5.1.Changes in the target year62

6.5.2.Interactions with climate policy62

6.5.3.Marginal deviations from the preferred option63

6.5.4.Targets for ozone, acidification and eutrophication64

6.5.5.Addressing methane emissions65

6.5.6.Robustness to variations in the key analytical assumptions66

6.5.7.Burden sharing between Member States67

6.5.8.Summary of sensitivity analysis67

6.6.Policy instruments to achieve the targets68

6.6.1.National Emission Ceilings Directive68

6.6.2.Source controls68

6.7.Competitiveness and SME impacts72

6.8.Trajectory to achieving the long-term objective by 205072

6.9.Conclusions73

Analysis of Options To Reduce emissions from Medium Combustion Plants    74

7.1.Rationale for Action74

7.2.Characteristics of the sector74

7.3.Methodology75

7.4.Policy options75

7.5.Impact analysis76

7.5.1.Environmental impacts76

7.5.2.Economic impacts77

7.5.3.Comparison of options78

7.6.Conclusions and preferred option79

Summary    80

Monitoring and Evaluation    83

9.1.Monitoring and evaluation of the revised TSAP83

9.2.Monitoring and evaluation of the revised NECD84

9.3.Monitoring and evaluation of the proposed legal instrument on MCP84

ANNEX 1 Glossary    85

ANNEX 2 Use of expertise and Consultation of Interested Parties    86

1.1.External expertise86

1.2.Consultation of interested parties87

1.1.1Online consultations87

1.1.2Stakeholder meetings90

ANNEX 3 Air Pollution Impacts and Sources    92

1.    The Main Air Pollution Impacts    92

1.1.Health Effects92

1.2.Acidification93

1.3.Eutrophication93

1.4.Ground-Level Ozone Pollution94

1.5.Climate change95

2.    The main air pollutants and their associated impact pathways    95

3.    The main sources of air pollution    96

ANNEX 4    Review of The Existing EU Air Quality Policy Framework    98

1.    Introduction    98

2.    The scope and procedure for the review    98

2.1.What was reviewed?98

2.2.How was the review organised?100

2.2.1.Design of the review100

2.2.2.Conduct of the review100

2.2.3.Dissemination and use101

PART 2/4

3.    The Thematic Strategy on Air Pollution    102

3.1.Objectives, scope and approach102

3.2.Monitoring, Reporting and Evaluation103

3.3.Relevance104

3.4.Effectiveness105

3.5.Efficiency108

3.6.Relation of the TSAP analysis to emission ceilings and ambient air quality targets110

4.    The Ambient Air Quality Directives    110

4.1.Objectives, scope and approach110

4.2.Monitoring, reporting and evaluation111

4.3.Relevance112

4.4.Effectiveness114

4.5.Efficiency121

5.    The National Emission Ceilings Directive    122

5.1.Objectives, scope and approach122

5.2.Monitoring and Evaluation123

5.3.Relevance123

5.4.Effectiveness124

5.5.Efficiency126

6.    EU Source Control Measures    127

6.1.Objectives, scope and approach127

6.2.Monitoring, reporting and evaluation128

6.3.Relevance128

6.4.Effectiveness130

6.5.Efficiency133

7.    National and Local Source Control Measures    135

7.1.Objectives, scope and approach135

7.2.Monitoring, Reporting and Evaluation135

7.3.Relevance135

7.4.Effectiveness136

7.5.Main orientations for the future137

8.    International action to reduce air pollution    138

8.1.Objectives, scope and approach138

8.2.Monitoring, Evaluation, and Enforcement Provisions139

8.3.Relevance140

8.4.Effectiveness140

8.5.Efficiency141

9.    Coherence of the overall framework    141

9.1.International pollution141

9.2.Background and transboundary pollution within the EU142

9.3.Local pollution142

9.4.Analytical framework for the Thematic Strategy on Air Pollution143

10.    Conclusions and orientations for the review    143

10.1.Validity of objectives and scope, and overall coherence143

10.2.Main outstanding problems144

10.3.Main drivers of the outstanding problems144

10.4.Orientations for the review145

Appendix 4.1     Specific evaluation studies launched for individual policy instruments and the detailed questions addressed    146

1. The Thematic Strategy on Air Pollution (TSAP)    146

2. The Ambient Air Quality Directives (AAQD)    146

3. The National Emission Ceilings Directive (NECD)    146

4. Sector pollution control policies    147

Appendix 4.2     EU versus international air quality standards    148

Appendix 4.3    Examples of national and local air quality management measures    153

Appendix 4.4:    Illustrating local action to reduce air pollutant --The Dresden case    165

Appendix 4.5    Market Based Instruments (MBIs) for promoting clean household heating appliances    158

Appendix 4.6    Lessons Learned from the "Air Implementation Pilot"    159

ANNEX 5    Future air quality projections Assuming No Change in Current Policies    161

1.    Methodology for projecting future emissions and air quality impacts    161

2.    Main assumptions and related uncertainties    161

3.    EU policies included in the current legislation (CLE) baseline    163

4.    Future air pollutant emissions under the current policy scenario    166

4.1.Sulphur dioxide166

4.2.Nitrogen oxides167

4.3.Fine particulate matter167

4.4.Ammonia168

4.5.Volatile organic compounds169

PART 3/4

5.    baseline    170

5.1Compliance with NO2 limit values170

5.2Compliance with PM10 limit values172

5.3Compliance with PM2,5 standards175

6.    Future air pollution impacts under the baseline scenario    176

6.1Health impacts from PM2,5176

6.2Health impacts from ground level ozone177

6.3Eutrophication and biodiversity178

6.4Acidification180

ANNEX 6    Elements of a Future European Clean Air Programme to support Member State Action on Reducing Air Pollution    182

1.    Introduction    182

2.    Action To Improve The Urban Air Quality    183

2.1.Action better identify and address key air pollution sources in urban areas183

2.2.Action to improve the governance of air quality management at national and EU level184

3.    Action to abate agricultural air pollution emissions    184

4.    Action at international level    185

ANNEX 7    Analysis of Policy Scenarios Related to Targets for the Period up to 2030    187

1.    Emission reductions delivered by the respective options    187

2.    Impact reductions delivered by the respective options for post 2020 targets    187

2.1.Health and environmental impacts187

2.2.Economic impacts188

2.2.1 Direct compliance costs189

2.2.2. Affected industries and sectorial impacts190

2.2.3. Direct economic benefits due to reduced health and environmental impacts193

2.2.4. Broader economic impacts194

2.3.Social impacts of gap-closure options196

2.4.Monetised impacts of gap-closure options197

3.    Policy instruments to achieve the interim targets    198

4.    Trajectory to achieving the long-term objective by 2050    200

Appendix 7.1    Emission reductions per Member State and per option in 2025 and 2030 (% vs 2005)    203

Appendix 7.2    Annual health impacts due to air pollution per option in 2025 and 2030, EU 28    213

Appendix 7.3    Impact reductions per Member State and per option in 2025 and 2030 (% reductions vs impacts in 2005)    215

PART 4/4

Appendix 7.4    Emission reductions required of the Member States in 2025 and 2030 to achieve the impact reduction objectives of the central case Option 6C*    223

Appendix 7.5    Emission reductions cost effective in individual sectors in 2025 and 2030 to achieve the impact reduction objectives of the central case Option 6C*        225

Appendix 7.6    Impact reductions in the Member States in 2025 and 2030 in the central case Option 6C* compared to Option 1    226

Appendix 7.7    Indicative emission trajectory towards achieving the long-term objective in 2050    228

ANNEX 8    Sensitivity analyses and risk assessments    233

1.    Testing the robustness of the central case for changes to the target year    233

2.    Interaction with the climate and energy package    234

3.    Emission reductions delivered by further climate change mitigation policy    238

4.    Changes to the growth projections and to progress in energy efficiency and renewables    239

5.    Burden sharing between Member States    243

6.    Further emission controls from international maritime shipping    244

7.    Policy instruments to achieve the interim targets: source controls at EU level    248

7.1.EU-wide source controls in agriculture249

7.2.EU-wide source controls for Medium Combustion Plants (MCP)250

7.3.Updated BAT Conclusions under the IED250

ANNEX 9    Sectorial impacts & Competitiveness proofing    253

1.    Context and definitions    253

2.    Scoping of the competitiveness analysis    253

3.    Supply of abatement technology    254

4.    Demand for abatement technologies: detailed measures and expenditure per sub-sector    254

5.    Sectorial Market Analysis    255

5.1.Metals (iron and steel; and non-ferrous metals)257

5.2.Chemicals261

5.3.Refining264

5.4.Agriculture and livestock rearing266

5.5.Power sector273

5.6.Other energy intensive industries277

5.6.1. Pulp and paper sector277

5.6.2. Cement sector278

5.6.3. Lime sector278

5.6.4. Glass sector279

6.    Conclusions    283

ANNEX 10    Controlling methane emissions    284

1.    Projected methane emissions assuming no change to current policies    284

2.    Differences between Member States    285

3.    Further reduction potential beyond the baseline    286

Annex 11     Detailed analysis of specific objectives related to the NECD    288

1.    Objectives    288

2.    Policy options    288

3.    Impact analysis    290

4.    Specific impacts of the policy options    291

5.    Option comparison    300

6.    Preferred option for revising the NEC D    301

7.    Monitoring and evaluation    302

Appendix 11.1    Standard cost model for assessment of administrative burden    303

Appendix 11.2    Administrative costs by Member State of preferred options (€)    307

Appendix 11.3    Monitoring of effects of pollutants in the environment    308

ANNEX 12    Detailed Analysis for Medium Combustion Plants (MCP)    310

1.    Rationale for action    310

2.    Characteristics of the sector    310

2.1.    Definition of MCP for the purpose of this assessment    310

2.2.    Development of an EU-wide dataset    311

2.3.    Reference situation in 2010    312

2.4.    Overview of current regulation    316

2.4.1.    EU legislation    316

2.4.2.    Gothenburg Protocol    317

2.4.3.    Member States’ national legislation    318

3.    Policy options    320

3.1.    Options determining the emission levels    320

3.2.    Regulatory options    321

4.    Impact Analysis    322

4.1.Methodology, assumptions and uncertainties322

4.1.1.Main methodology322

4.1.2.Uncertainties with respect to input data323

4.1.3.Modelling assumptions323

4.2.Environmental impacts324

4.2.1.SO2 emissions324

4.2.2.NOX emissions324

4.2.3.PM emissions325

4.2.4.Overview of pollutant abatement achieved by the emission level options325

4.3.Economic impacts326

4.3.1.Compliance costs326

4.3.2.Emission monitoring costs327

4.3.3.Administrative costs328

4.3.4.Total costs332

4.3.5.Impacts on small and medium-sized enterprises (SMEs)334

4.3.6.Measures to mitigate impacts on SMEs337

4.3.6.1.Phased implementation337

4.3.6.2.Sectoral exemptions or derogations337

4.3.6.3.Size-related exemptions and derogations338

4.3.6.4.Exemptions or derogations based on operating hours and/or emissions338

4.3.6.5.Financial support339

4.3.6.6.Non-financial support339

4.3.6.7.Conclusion on mitigation measures339

4.3.7.Impacts on intra-EU competition340

4.3.8.Impacts on international competitiveness, trade, and investment flows341

4.4.Social Impacts341

5.    Comparison of policy options and selection of preferred option    341

5.1.Emission reduction342

5.2.Pollutant abatement cost342

5.3.EU compliance with international obligations343

5.4.Administrative costs343

5.5.Impacts on SMEs343

5.6.Option comparision summary343

5.7.Preferred option345

6.    Monitoring and evaluation    345

Appendix 12.1    Emission Values for the different options    346

Appendix 12.2    Emission for 2025 and 2030 for options 7A, 7B and 7C.    351

Appendix 12.3    Overview of annualised compliance costs (€m/year) under options 7C, 7B and 7A (incremental costs to option 1)    352

Appendix 12.4    Annualised compliance costs (€m/year) per Member State under option 7D    353

ANNEX 13    References    354


Executive Summary Sheet

Impact assessment accompanying a revised EU Strategy on Air Pollution, a proposal for amending Directive 2001/81 on national emission ceilings for certain atmospheric pollutants, and a proposal for a Directive regulating air emissions from Medium Combustion Plants

A. Need for action

Why? What is the problem being addressed? Maximum 11 lines

Air pollution causes substantial environment and health impacts: in 2010 annual premature mortalities amounted to over 400,000 and 62% of the EU area was exposed to eutrophication, including 71% of Natura 2000 ecosystems. Total health-related external costs are in the range of € 330-940bn per year, including direct economic damages of €15bn from lost workdays, €4bn healthcare costs, €3bn crop yield loss and €1bn damage to buildings. Significant non-compliance with existing air quality standards and the EU's new international obligations (under the Gothenburg Protocol) prevent better protection of EU citizens and its environment. The number of zones not in compliance with PM10 and NO2 standards amount to 32% and 24%; 40m citizens are still exposed to PM10 levels above the EU limit values.

What is this initiative expected to achieve? Maximum 8 lines

The new strategy is set to update the pathway towards its long-term objective of reaching air quality levels that do not cause significant impacts on human health and the environment. To do so, it will set out action for promoting full compliance with the present air quality legislation by 2020 at the latest, based also on the outcome of an extensive ex-post analysis that is an integral part of this initiative. It will set new objectives for reducing health and environment impacts in the EU for the period up to 2030. It will set out the EU's priorities to enable achieving the new objectives for that period. It will include a proposal for amending the National Emission Ceilings Directive and measures for improving pollution at source. The new strategy will further promote enhanced coherence with other policies, notably climate, energy, transport, and agriculture.

What is the value added of action at the EU level? Maximum 7 lines 

Because of the persistent transboundary nature of air pollution, effective reduction at national level needs co-ordinated EU action: limits to total emissions from each Member State must take into account how its pollution will affect other Member States. EU-level source controls not only reduce the Member States' burden of pollution reduction but also deliver a level playing field for economic operators. Among these EU source controls, product controls (e.g. of vehicle emission or domestic heaters) can only be established at EU level for single market reasons.

B. Solutions

What legislative and non-legislative policy options have been considered? Is there a preferred choice or not? Why? Maximum 14 lines 

Sustained implementation of existing legislation will substantially improve compliance by 2020 , reducing the problem to a few localized but densely populated areas (6% of zones for PM10 and 8% for NO2). Five additional options were considered: additional source controls; tighter ceilings under the NECD; supporting action for further MSs measures; further international action; and amending the AAQD. The preferred option for achieving full compliance with the air quality legislation by 2020 comprises a non-regulatory programme supporting MS action including implementation of already agreed EU legislation as well as enhanced, governance, monitoring, and evaluations provisions. In addition the NECD will be revised to incorporate the EU's international commitments for 2020 under the Gothenburg Protocol (GP) as amended in 2012.

To make progress towards the EU's long-term objective during the period up to 2030, four options for strategic impact reduction targets were examined in terms of a 25%, 50%, 75% or 100% closing of the gap between the current legislation "baseline" scenario and the maximum technically feasible reduction scenario. A further option to meet the WHO guideline values was assessed but considered not within reach before 2030. The preferred option sets the next strategic objectives at the level where marginal costs and benefits are optimized (i.e. at 75% of the maximum reduction). The objectives will be implemented by further tightening of emission ceilings under the NECD for the periods 2025 and 2030. The main options considered for additional EU source measures to reinforce emission reductions were Medium Combustion Plants (MCPs), agriculture and international shipping. Source control of Medium Combustion Plants is at present the preferred policy option. It would deliver 10-20% of the required reduction for SO2, NOx and PM under the NECD leaving full flexibility to MS for the remaining reductions.

Who supports which option? Maximum 7 lines 

The main focus of most stakeholders for immediate action was on effective implementation of existing source controls for diesel emissions. Over 90% of the general public and over 80% of governments and NGOs supported strengthened emission controls going beyond current legislation. For the NECD, most NGOs supported the maximum reduction, a majority of government respondents called for substantial progress, and around 45% of business supported no reduction beyond what would be achieved by the climate and energy package. For source controls, a majority of NGOs and over 40% of government and individual experts supported EU source legislation on MCPs. For agriculture, NGOs and individual experts favoured control through NEC ceilings, Member States through source legislation, and business through support from the Regional Development Fund.

C. Impacts of the preferred option

What are the benefits of the preferred option (if any, otherwise main ones)? Maximum 12 lines

The preferred policy for 2020 will support Member States in resolving remaining non-compliance with current legislation and ensure coherence with international commitments. External costs associated with air pollution will be further reduced to €249-783bn. A fully implemented baseline will reduce impacts in 2020 by 36% for PM2,5, 23% for ozone, 17% for eutrophication and 61% for acidification, compared with 2005. The preferred option for 2025-30 will reduce impacts by 50% for PM2,5, 33% for ozone, 35% for eutrophication and 85% for acidification (relative to 2005) – i.e. an extra third of the reduction in health burden delivered by the baseline. Total external costs of air pollution will be reduced by a further €45bn (on the most conservative valuation) or ten times the compliance cost (see below). Eutrophication impacts will be reduced by 70% more than the baseline. Direct economic benefits include reduced labour productivity losses over the baseline of €2bn, reduced health care costs of €650m, reduced crop value losses of €270m, and reduced damage to the built environment of €140m. Once productivity improvements are taken into account, the policy would add around 110 thousand jobs.

What are the costs of the preferred option (if any, otherwise main ones)? Maximum 12 lines

The preferred option for 2020 entails no additional EU expenditure over the baseline except for the costs of supporting measures for national action (around €100m from LIFE). Complementary action at MS level could include low emission zones to tackle transport pollution, and for PM, accelerated replacement schemes for domestic heating appliances, restrictions on coal combustion and finance for fuel switching. Member States' costs will depend on local circumstances and can be covered in part by improved uptake of structural funds. Meeting the preferred policy objectives for 2025-30 implies annual compliance costs of €4,8bn (including investment, operating and maintenance costs for new abatement techniques as well as administrative costs also including MCP). The resulting overall GDP impact is neutral once increased productivity is taken into account, and turns to positive considering other direct benefits (reduced expenditure on healthcare and on compensating crop losses and damage to built environment).

How will businesses, SMEs and micro-enterprises be affected? Maximum 8 lines

The overall impact on the economy is fairly neutral although respective sectoral impacts can differ. Some sectors supplying pollution abatement equipment or benefitting from labour productivity will slightly gain during the period up to 2030 whilst agriculture and other sectors may be impacted more than others. Net impacts on agriculture and refineries amount to 0,21% and 0,09% once improved productivity is taken into account. Costs for the agricultural sector are further offset by reverting crop yield loss amounting to €270m, in the order of 0,1% of sectorial output. Most SME impacts would be expected in MCP and agriculture. Impacts are mostly mitigated in the preferred MCP control option (between 0.1 and 2% of gross operating surplus) by selecting a registration rather than a permitting requirement and emphasizing primary NOx control as the minimum standard.

Will there be significant impacts on national budgets and administrations? Maximum 4 lines

Administrative costs associated with amending the NECD include a one-off €6,9m and €2.5m annual cost. No significant impact is foreseen for controlling of MCPs.

Will there be other significant impacts? Max 6 lines

No; all principal impacts are covered above.

D. Follow up

When will the policy be reviewed? Maximum 4 lines 

A five-year policy review cycle is considered appropriate with the first review taking place not later than 2020 at which time the scope for tightening the air quality standards under the Ambient Air Quality Directive will also be considered.

1.Introduction

This impact assessment comprises the outcome of the review of the EU Air Quality Policy Framework. It includes the outcome of a full ex-post analysis and offers the analytical basis for updating the EU's strategy on air pollution and the development of accompanying legal proposals and non-regulatory actions.

Chapter 2 sums up procedural issues and the consultation of interested parties. Details are provided in Annex 2. Chapter 3 and Annexes 3 and 4 set out the conclusions of the evaluation of existing policy on the policy's performance, the problem definition and the basic rationale for further action. The detailed analysis of the evolution of the problems for the period up to 2030 assuming no change in policy are provided in Annex 5. Chapter 4 describes the two general policy objectives derived from the problem analysis: 1) to deliver the full impact reductions envisaged by the existing air policy framework (by resolving the current non-compliance), and 2) to set out objectives and actions for further reducing impacts for the period up to 2030.

The remaining part of the impact assessment report is organised so as to facilitate the reading of a rather complex analysis. Thus, in a slight departure from the normal impact assessment structure, Chapter 5 presents the options, impact analysis, and comparison of options in pursuit of the first objective focusing mainly on the period up to 2020. Details are provided in Annex 6. Chapter 6 then considers the options, analysis, and comparison related to the second objective with a time horizon up to 2030, in line with the Commission's overall Europe 2020 strategy and related flagship initiatives. Analytical details, including sensitivity and competitiveness analysis are provided in Annexes 7, 8, 9, 10, and 11. Chapter 7 and annex 12 provide further details on the additional impact analysis carried out for the first additional source control measure identified, i.e. controlling emissions from medium combustion plants (MCP). Chapter 8 summarises the conclusions emerging from the analysis whilst monitoring and evaluation issues are considered in Chapter 9. A glossary is provided in Annex 1 and Annex 13 lists all references used in the analysis.

2.Procedural Issues, Impact Assessment Board, Use of Expertise and Consultation of Interested Parties

2.1.Procedural issues

Lead DG: DG ENV

Agenda planning /WP reference: 2013/ENV/001

Impact assessment steering group (IASG)

The impact assessment work was followed by a European Commission Inter-Service Steering Group (ISG) set up by DG ENV which met six times between June 2012 and May 2013. The following Directorates-General (DGs) of the European Commission participated in the work of the group: DG AGRI, DG CLIMA, DG ENER, DG ENTR, DG JRC, DG SANCO, Secretariat-General (SG), DG RTD, and the European Environment Agency (EEA).

2.2.Impact Assessment Board

The draft IA report was submitted to the Board on 5th June 2013 and discussed at the Board meeting 3rd July 2013. Following the ensuing IAB opinion a number of amendments were made in the final version of the IA report. In particular, the following main changes were made:

·the problem analysis and underlying evidence were more clearly brought out by annexing an extended report on the ex-post evaluation of the existing policy framework (Annex 4).

·The scope of the package was better explained by making the links with existing policy instruments clearer, and by including an additional separate chapter (Chapter 7) explaining the necessity and expected impacts of the MCP inititive.

·The costs and benefits of options for the period up to 2020 were set out in more concrete terms in Chapter 5, by including additional quantitative analysis and data in tabular form.

·Monitoring and evaluation arrangements were further detailed and clearly presented also in tabular form

·Procedure- and presentation-wise, stakeholder views were more extensively and precisely presented throughout the text, in particular in chapters 3 and 5. A literature list was annexed to the IA report.

The IA report was resubmitted to the Board on 7th August 2013; the Board issued a revised opinion on 7th September 2013, following which additional amendments were made to the IA report. The main ones are:

·The relationship between the Package and the upcoming Climate and Energy policy framework was clarified by strengthening the analysis of Annex 8 (sensitivity analyses) and updating and strengthening the analysis on methane emission reductions (Chapter 6.5.5 and Annex10). Additional sensitivity analysis on the feasibility of NECD ceilings in case of slower implementation of the renewables and energy efficiency targets was included;

·The link between the Package and ongoing and possible additional initiatives to reduce emissions from international maritime shipping was clarified and reinforced by strengthening the analysis of benefits of designating Emission Control Areas under Marpol Annex VI rules, and by examining possible voluntary offset schemes under the NECD;

·The link with the long-term air quality objectives was strengthened by presenting a feasible trajectory to bridge the interim targets in the medium term with the 2050 targets (Chapter 6.8 and Annex 7.4);

·A thorough update of all figures was made, taking into account the most recent PRIMES 2013 energy projections. Note that this resulted in only minor quantitative modifications and did not change the validity of the previous analysis and conclusions;

·Procedure- and presentation-wise, more precise references to specific sections of the Annexes have been introduced throughout the text.

2.3.Use of Expertise and Consultation of interested parties

The review process drew on expertise built up over several decades of air quality assessments, management and review activities in the EU and internationally. This impact assessment has been prepared on that basis and complemented with several targeted studies prepared by the EEA, JRC, WHO, IIASA, and other leading experts and scientists. Consulted parties included Member State authorities responsible for the implementation of the current policy framework at all administrative levels. Five stakeholder meetings were held between June 2011 and April 2013 to ensure transparency and offer opportunities for stakeholder comments and inputs. All meetings were web-streamed to enable the broadest possible participation. In parallel, two public consultations were organised: a first consultation of competent authorities and other stakeholders at the end of 2011 focused on the evaluation of the strengths and weaknesses of the existing air quality policy framework; the second (and mandatory) on-line public consultation of all stakeholders on the main policy options available to address the remaining air quality problems ran from 10 December 2012 until 4 March 2013 (12 weeks) on the ‘Your voice in Europe’ web page. 1 A Eurobarometer survey seeking the view of the general public on air pollution issues was conducted and reported in 2012. 2 The Commission and the EEA also conducted an Air Implementation Pilot project, bringing together 12 cities from across the EU to assess local experience with implementing the air policy framework. 3

Annex 2 sets out in detail the expertise and analysis used to develop the impact assessment, the procedures for consultation of interested parties, and the feedback from the consultations by main theme. The main messages from the stakeholder consultation are integrated throughout the text.

3.Review of current Policy, Problem definition and Subsidiarity

3.1.The air pollution problem and the policy framework under review

3.1.1.The problem

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 to eutrophication, including 71% of Natura 2000 ecosystems. Total external costs of the health impacts are in the range €330-940bn (depending on whether the low or high range of possible impact valuations is taken). Direct economic damage includes €15bn from lost workdays, €4bn healthcare costs, €3bn crop yield loss and €1bn damage to buildings. Annex 3 provides a summary of the main air pollution impacts, pathways, and sources.

3.1.2.The current policy framework

EU air policy developed from the 1980s 4 , building on national and international efforts at pollution control, in particular the 1979 Convention on Long Range Transboundary Air Pollution (CLRTAP) which developed a multi-pollutant and multi-effect approach to tackle the range of air pollution problems. The policy has been substantially reinforced and consolidated since. The 6th Environment Action Programme (6EAP) adopted in 2002 by the Council and European Parliament established a common EU long-term objective for air quality: to achieve 'levels of air quality that do not give rise to significant negative impacts on and risks to human health and the environment' 5 (confirmed in the new General Union Environment Action Programme to 2020 a.k.a. the "7th EAP" 6 ). It also called on the Commission to establish a Thematic Strategy on Air Pollution that would define the pathway towards achieving this objective through integrated actions in relevant policy areas. Since then, the current EU air policy framework comprises the following main elements:

(i)    The 2005 Thematic Strategy on Air Pollution (TSAP) which sets out the overall policy direction that emerged from the 2000-2004 review of air policy, including interim objectives for 2020 towards the EU's long-term target and cost-effective actions to achieve those objectives while promotes overall policy coherence;

(ii)    The Ambient Air Quality Directives (AAQDs) which set ambient concentrations for a range of parameters to be achieved everywhere in the EU and defines the minimum standards for assessing and managing air quality in the EU Member States;

(iii)    The National Emission Ceilings Directive (NECD) which limits the total emissions from each Member State for a set of pollutants; and

(iv)    A range of measures at EU, national and international level controlling pollution at the source to achieve the objectives set in the above mentioned instruments.

(v)    International action under the CLRTAP and other international platforms, including the exchange of scientific and technical information that continue to provide an important backbone for the EU air policy framework.

These main elements of the framework have been subject to an extensive ex-post review. Annex 4 sets out in detail the procedural issues and the analysis of the relevance, effectiveness, efficiency and coherence of the principal instruments. The main conclusions and follow up options are set out in the next three sections and further taken up in the following chapters.

3.2.Review of the current policy framework

3.2.1.Past reduction of air pollutant emissions and impacts

The current policy framework already allowed to significantly reduce air pollutant emissions and impacts. Figure 1 illustrates the substantial reduction in EU-wide emissions of the main pollutants delivered by policy between 1990 and 2010. In consequence the EU's huge acid rain (acidification) problem has been broadly solved 7 , the impact of lead from vehicle fuels has been eliminated, and the ambient air health risk from other heavy metals and carbon monoxide has been greatly reduced. The health impacts of particulate matter, the main cause of death from air pollution, have been reduced by around 20% between 2000 and 2010 (see Annex 4 chapter 3 for details).

Action leading to these successes has been cost-effective, i.e. largely focusing on the most important sectors contributing to air pollution impacts in accordance with the polluter pays principle. It has stimulated innovation in pollution abatement techniques and radically improved the environmental performance of key production sectors, addressed the increase environmental concerns of consumers, and safeguarded markets without distorting competition or impairing economic growth. 8

Figure 1: EU air pollutant emissions 1990-2010 (EEA, 2012)

Despite the progress, however, the health and environmental impacts of air pollution in the EU remain large. The key outstanding health and environmental problems are set out in section 3.3.

3.2.2.Validity of objectives and scope, and overall coherence

The review has confirmed that the overall structure of air quality policy is logical and coherent. However, a better match must be ensured (in practical implementation) between source controls, ceilings and ambient air quality standards. This is required in particular to ensure that local achievement of ambient air quality standards is not compromised by (a) failure to limit pollution from significant point sources or from products, 9 or (b) high background concentrations resulting from the overall (Member State or transboundary) emission burden. The review examined for each individual policy instrument the extent to which its objectives and scope remain valid:

·For the Thematic Strategy, the underlying analytical framework remains valid for the current review, although some improvements are identified. The impacts identified in 2005 remain the priorities today (with the exception of acidification); an updated review should focus on the scope for further reducing these in the period up to 2030 (beyond which the uncertainties in the analysis become large). It should also focus on greater coherence across the range of policy instruments (including untapped synergies between the AAQD and the NECD). 10

·For the Ambient Air Quality Directives, the health relevance of the pollutants and standards of the original policy has been reviewed by WHO, and confirmed, with the caveat that the level at which certain standards are currently set (mainly for PM) provides only incomplete protection for human health. As compared with 2005 there is additional evidence on the chronic impacts of ozone and NO2, which reinforces the rationale for the respective standards. 11

·The scope and objectives of the NEC Directive are out of line with the latest scientific findings and international agreements. The NECD must be adapted to focus better on health by introducing a ceiling for PM2.5, and on short-lived climate pollutants (black carbon and methane) in line with the 2012 amendment of the Gothenburg Protocol. Objectives must be extended to 2020 to fulfil the Gothenburg requirements, and strengthened for the period 2025-30 to deliver further reductions in background pollution to enable levels of air quality that are closer to those recommended by the WHO and CLRTAP . 12

·For the EU source controls the scope and objectives also remain broadly valid. Updated emissions data and projections confirm that the sectors driving the relevant pollutant emissions were correctly identified. In the short term, the main priority is the full implementation of the existing legislation and in particular the resolution of the real world emissions issue for light duty diesel vehicles. In the longer term the main gaps relate to combustion from small and medium installations, and ammonia emissions from agriculture. 13

·The scope, objectives, and coherence of international action under the CLRTAP remain relevant to co-ordinate action in the northern hemisphere on the key air quality drivers. The recently amended Gothenburg Protocol usefully extended the scope to include action on short-lived climate pollutants (notably black carbon), and flexibility has increased thereby also enabling a broader participation. Further action should focus on facilitating ratification by Eastern European and Central Asian Countries, action on short-lived climate pollutants (including also ozone) and extended exchange of scientific and technical co-operation with other regional groups notably in Asia and North America. 14

80% of stakeholders considered that the current air policy framework is appropriate. The 6th EAP, TSAP and AAQDs are consistent and have substantially helped minimising health and environmental risks by air pollution, supporting policy makers in EU Member States. However, stakeholders commented that the coherence between air quality standards and emission ceilings and sectoral legislation should be improved. 15

3.3.Key outstanding problems 

Based on the above analysis, the following main outstanding problems have been identified.

3.3.1.Health and environmental impacts of air pollution in the EU remain large

Table 1 and Figure 2 summarize the state of play for certain headline air pollution impacts.

Air pollution is the number one environmental cause of death in the EU, responsible for 406,000 premature deaths, ten times more than from road traffic accidents. 16 In addition to premature mortality there are also substantial quality-of-life impacts (well-being and morbidity), ranging from asthma to exacerbation of cardiovascular symptoms. Health-related external costs range between €330 billion and €940 billion per year depending on the valuation methodology. 17 New evidence on the impacts of chronic ozone exposure would add around 5% to this total. 18

These costs include the impact of ill-health on those citizens who experience it, but also the direct cost to the economy. Air pollution causes more than 100 million workdays lost per year across Europe, with an economic damage in the range of €15 billion due to productivity losses. Although a full quantification remains challenging, it is estimated that increased healthcare costs of the order of €4 billion are incurred every year for the treatment of air-pollution-related chronic bronchitis alone, with total costs likely to be substantially higher.

Table 1: Health and ecosystem impacts of air pollution in 2010

Premature deaths due to PM and ozone

Restricted activity days due to PM 19

Forest area exceeding acidification limits 20

Lake area exceeding acidification limits

Ecosystem area exceeding eutrophication limits 21

Natura 2000 areas exceeding eutrophication limits

406,000

569 Million

9%

25%

62%

71%

For ecosystems the contrast between the broadly solved problem of acid rain and the outstanding problem of eutrophication is clear from Figure 2 . 22 This has substantial biodiversity and also economic impacts (e.g. from damaged fish populations). The eutrophication problem is very widespread but particularly acute in Natura 2000 protected areas, threatening more than three-quarters of sites and so jeopardising the €200-300bn annual benefits from the Natura 2000 network. 23 The tourism sector is affected by the resulting loss of amenity and recreational value of the natural landscape. 

Figure 2: Percentage of ecosystems in each area at risk of acidification (left hand) and eutrophication (right hand)

Further direct economic damage includes damage to the built environment due to acid erosion and soot soiling is estimated at above €500 million annually. (This does not include damage to cultural heritage which is assumed to be substantially higher, but is hard to quantify in the absence of an accurate valuation of the existing stock.) Finally, ozone affects vegetation in addition to its significant health impacts, and the resulting crop productivity loss in the EU is valued at €3 billion per year (source: EMRC 2013).

There are two specific problems related to these substantive impacts, as follows.

3.3.2.EU air quality standards are widely exceeded in densely-populated areas 

Part of the outstanding health and environment problem is due to the lack of compliance with existing EU legislation. Table 2 shows the situation for the AAQD 24 . For the NECD the current rate of compliance with the ceilings is 90%. 25

Table 2: Compliance with AAQD obligations in 2010

PM10 compliance 26

NO2 compliance 27

O3 attainment

PM10 population exposed above the limit value 28

NO2 population exposed above the limit value 29

O3 population exposed above the target value

68%

76%

65%

40%

6-12%

35%

Whilst broad compliance has been reached for a number of key pollutants, standards for PM10, NO2, and ozone are widely exceeded throughout Europe ( Figure   3 ). This leaves a substantial part of the EU population and environment exposed to harmful pollution levels. 30 Hence, 17 Member States are currently facing infringement procedures for failing to meet PM limit values, and further action on NO2 and NOx is likely to follow. More detail on the compliance situation with the main legal instruments is given in Section 3.5.2 and Annex 4.

Figure 3: Exceedance of EU air quality standards in 2010 for PM10 (left), NO2 (centre), and Ozone (right) in 2010 (EEA)

Dots represent monitoring stations; green indicates compliance with the standards, red exceedance.

Many stakeholders commented on the difficulty of attaining the standards, for reasons at times beyond the control of local/regional/national authorities. They highlighted a number of potential causes which are taken up in the next section, on problem drivers. 31

In this context it should be noted that, following the 2012 amendment of the Gothenburg Protocol, the NECD is no longer compatible with the EU's international commitments, in particular the new emission reduction objectives established for 2020 32 and the new objective for primary PM emissions. While baseline projections show that the obligations should be met without further measures, 33 formal transposition into the NECD is necessary for ratification, to confirm the EU's commitment to the Gothenburg outcome and to encourage ratification and implementation by other parties. 34

3.3.3.The EU is not on track to meet its long-term air quality objective

Compliance would bring significant health and environmental benefits, but it would not solve the substantial outstanding health and environmental problems beyond 2020, because the standards were set as interim objectives rather than at the low impact levels recommended by the WHO and other scientific bodies. Table 3 below shows current EU standards compared with the WHO 2005 guidelines.

Table 3: Comparison of selected EU Air Quality Standards with WHO 2005 guidelines

PM10

PM2.5

NO2

O3

EU

40

25

40

120

WHO

20

10

40

100

Note:    Figures are expressed as concentrations in µg/m3 averaged over one year (with the exception of ozone which is averaged over 8 hours).

Similarly, on the emission side, while the additional reduction commitments agreed in the Gothenburg Protocol will make progress towards the interim objectives of the 2005 TSAP, they will not achieve them. Without further action there will be no further progress towards the EU's long-term objective of no significant adverse impacts on human health and the environment. 35  

Most stakeholders highlighted that the objectives of the 6th EAP, and the interim objectives of the TSAP, have not been attained, and that significant impacts remain for health, biodiversity, and eutrophication. Roughly equal proportions advocated on the one hand, further action to address this (including setting limits at the level of WHO guidelines), and on the other, caution in developing new policy and the need to minimise adverse economic impacts. 36

3.4.The main underlying drivers or causes of the outstanding problem

The main drivers are summarised below for each problem in turn. 37 They relate partly to the pollution sources themselves, and partly to the failure to manage air quality effectively and efficiently ("governance issues").

3.4.1.Exceedance of EU air quality standards

For the non-compliance issue a short-term perspective is appropriate, i.e. up to 2020, also considering that most existing standards had to be attained in 2010. Two main pollutant-related drivers have been identified.

3.4.1.1.Diesel emissions drive the NO2 and NOx compliance problems

Type-approval emission requirements for motor vehicles have been tightened significantly through the introduction and subsequent revision of Euro standards. While vehicles in general have delivered substantial emission reductions across the range of regulated pollutants, this is not true of NOx emissions from diesel engines (especially light-duty vehicles). While this has been observed for several years, many Member States continue to promote the sale and use of diesel vehicles compared to gasoline and other cleaner fuel vehicles. Sustained high levels of NOx emissions and NO2 concentrations are particularly related to these emissions and the associated AAQD and NECD compliance issues.

The problem is due in part to the poor representativeness of the standardised test cycle used for type approval in the EU 38 and weaknesses of in-service conformity testing. 39 Under the current regime an engine type has to meet the type-approval requirements when tested according to the test cycle, but under normal driving conditions the real emissions can be much higher.

Figure 4 shows that while the NOx emission limit values for diesel passenger cars have been tightened by approximately a factor of 4 from 1993 to 2009 (Euro 1 to Euro 5), the estimated average NOx emissions in real driving conditions have slightly increased. As a side-effect of engine technology developments, the share of direct NO2 emissions in the NOx mixture has increased at the same time, posing additional challenges for the attainment of the NO2 air quality standards.

Figure 4: type approval (left) and real-world emissions (right) from diesel light duty vehicles across Euro standards (source: COPERT analysis and IIASA 40 )

The consequences of the less than hoped for effects of the vehicle standards relating to diesel passenger cars and light-duty vehicles have been exacerbated by national taxation policies favouring diesels and increasing traffic volumes in urban areas (see also governance issues) 41 .

Two-thirds of stakeholders identified the need to ensure consistency between real world emission reductions and the air quality limit values as a key issue. In particular, the implementation of Euro 6 should be managed so as to ensure proper control of real-world emissions from light-duty diesels. 42

3.4.1.2.Small scale combustion and concentrated local pollution drive the worst PM compliance problems

The zones not in compliance with the PM10 standard fall into two categories. For the first category (around 39% of zones) the margin of exceedance over the limit value is limited, 43 and the exceedances are the compound effect of a wide range of sources, including traffic (notably older diesel engines, both heavy- and light-duty), industrial sources, power production and background concentrations including also secondary aerosols.

The problems in the remaining 6% of zones are more intractable and are driven by two issues in particular: (a) domestic solid fuel combustion, and (b) concentrated local pollution sources, sometimes combined with a particular topography. The domestic solid fuel problem is localised in particular geographical areas (the area at the border between Poland, the Czech and Slovak Republic, and Bulgaria). While EU action on the marketing and use of combustion appliances (under Ecodesign 44 ) will have an impact over time, the replacement rate of those appliances is slow and open fireplaces will not be covered. Member States can tackle the problem directly by restricting solid fuel use, but the areas in question are relatively poor and the socio-economic impact of the restrictions is a deterrent.

Concentrated local pollution sources are a problem mainly in large urban centres which are usually densely-populated, making the resulting health impacts particularly significant. 45 Improved EU source controls will reduce the pollution per unit activity, but the effects of the concentration of activity must be managed by the Member State or region, also to ensure that the economic benefits are not compromised by adverse health impacts.

The role of domestic combustion in the outstanding PM compliance issues was stressed by national competent authorities in the PM workshop organised by the Commission on 18-19 June 2012. 46 The role of biomass combustion in particular, and the need to manage the interaction with climate policy on this topic, was raised by 50% of stakeholders in the first public consultation. 47

3.4.1.3.Poor co-ordination between national and local action, and lack of capacity at regional and local level

In addition to the above pollutant-specific drivers, a set of governance-related issues have been identified. Evidence from the Time Extension Notification (TEN) 48 process shows that authorities often acted late in relation to the lead time necessary to bring air pollution down, with many plans and programmes developed only as the compliance deadlines approached and not fully implemented in practice. In many cases responsibility for meeting ambient air quality standards rests at regional and/or local level, but the financial and other tools to meet those responsibilities are often lacking. There have also been insufficient platforms to enable exchange of good practice and co-ordinated action across local areas. A further issue is lack of coordination between the national authorities mainly responsible for the NECD national programmes, and the regional and city authorities responsible for the AAQD action plans, to optimise joint compliance with the two instruments.

The Air Implementation Pilot (box below) confirmed the need to better support local authorities. It also confirmed that part of the reasons for delayed or insufficient action is lack of the assessment and management capacity to develop, implement and monitor plans. (For instance, local authorities have been unable to design effective air quality plans because no adequate inventories of the contributing local sources have ever been developed. 49 The lack of common guidelines for establishing local emission inventories and for undertaking local or regional integrated assessments has hampered comparison and exchange of good practice across local authorities.)

Twelve local and regional authorities participated in the joint Commission/EEA Air Implementation Pilot project which ran over 2012 and the first half of 2013. They identified the above as the key governance issues facing them, 50 reinforcing similar conclusions from the first public consultation. 51

3.4.2.The EU is not on track to meet its long-term air quality objective

Even if compliance with current legislation is reached, major health and environment impacts will remain. Projections show that there will still be 340.000 premature deaths every year due to PM2.5 and ozone, and 55% of EU ecosystems will be affected by eutrophication. For these issues, three further pollution drivers and a further governance issue have been identified. These are particularly relevant for the period beyond 2020.

3.4.2.1.The remaining health impacts from PM and ozone are driven by emissions from a range of sectors

It is not possible to single out a particular sector as the driver of the remaining health impacts. All the main regulated pollutants are precursors of either particulate matter or ozone (or both); and every sector emits one or other of these pollutants. Thus a wide range of sectors must be addressed in order to resolve the problem. Additional effort may be required even of sectors which have been effectively regulated, such as power generation, transport, energy-intensive industries and waste management. But the potential for cost-effective reductions is greater from those sectors whose emissions have reduced less, and which now represent a larger relative share of the problem.

Among these, the emissions of combustion installations below 50MW, non-road mobile machinery 52 (including rail, inland waterway vessels and construction equipment), and the international shipping sector 53 are important. Increased biomass burning in small and medium combustion installations is already causing a worsening of PM (and carcinogenic PaH) emissions, and unless controls are put in place the trend could worsen if biomass uptake is promoted by climate and energy policies. SO2 emissions from maritime transport are set to reduce significantly following the revision of the Directive on sulphur content of marine fuels, 54 but engine-related PM and NOx emissions from vessels will continue to affect air quality levels in the EU unless further action is taken.

Agriculture now contributes substantially to PM concentrations, both through direct particle emissions and through emissions of ammonia which is an important PM precursor. Also, methane emissions from the agricultural sector contribute to ozone.

Around half of stakeholders singled out the need for reinforced source controls on a range of sectors, including (but not limited to) agriculture (NH3 limit value), emission standards for biomass burning in small (household) units, non-road mobile machinery, and (maritime) shipping. 55

3.4.2.2.Agricultural ammonia emissions drive the remaining environmental impacts

Agriculture is responsible for 90% of the remaining ammonia emissions and is the primary driver of eutrophication in Europe; through the formation of secondary aerosols, ammonia emissions are also responsible for an increasing share of health impacts due to PM. There is a large untapped potential to achieve significant and cost-effective ammonia reductions (around 30% for 2025), and many of the measures could bring benefits to farmers. 56 Many actions in this area will also have climate co-benefits, by reducing nitrous oxide (N2O), a powerful greenhouse gas.

Until now, there has been little policy action stimulating reduction in ammonia emissions, because the provisions in the NECD have been too weak (most Member States are well below the ceilings, even without additional measures); and because there has been little support within the Common Agricultural Policy for ammonia reduction (as compared with reduction of pollution to water, for instance). The Integrated Pollution Prevention and Control Directive (now integrated in the Industrial Emissions Directive (IED) 57 ) covers about 20% of pig production and 60% of poultry, but excludes cattle and other animals, which are substantial sources of ammonia (as well as PM and methane, see above). The Nitrates Directive 58 covers pollution to air only indirectly. The problem has been largely left to Member States to regulate, and there is large variation in MS controls, ranging from practically nothing to extensive national regulation, with the consequent potential for distortion of competition. Annex 4 section 6.4 provides further details.

Stakeholders consistently identified agriculture as a sector which is not currently well-controlled from an air quality perspective, and called for regulation of ammonia emissions. 59

3.4.2.3.Sustained background pollution means that local action alone cannot effectively reduce impacts

For PM and ozone, and also for eutrophication, there is a substantial background 60 component to the problem, which is beyond the control of local competent authorities. Part of the background is national and should be addressed at that level. But the transboundary share has also remained high (more than 50% for PM2.5 and more than 60% for nitrogen deposition). 61  

There are several reasons for the persisting background problems. First, there has been limited interaction between authorities responsible for implementing the NECD (and focusing on country-wide measures to meet the ceilings) and local authorities made responsible for meeting AAQD standards. Second, controls on transboundary pollution at EU level are insufficient. There is no emission ceiling for primary PM under the NECD, and for PM precursors (which are regulated) the ceilings are not stringent enough. Moreover, there is limited co-operation between Member States to address transboundary air pollution, even though this is encouraged under the AAQD. 62 Third, air pollution is now understood to travel longer distances and faster than previously assumed. 63 The rise of the global economy, notably the major emerging economies in the northern hemisphere, could therefore be part of the explanation of the persisting high EU background concentrations (notably for ozone), among a range of other factors including climate change and meteorological variability.

Stakeholders consistently commented on the importance of action at EU or international level to deal with transboundary air pollution, which cannot be addressed locally but compromises achievement of local air quality standards. 64 There is also an increased understanding on the part of national authorities responsible for implementing air policy on the need to link more closely the implementation of the NECD and AAQD. 65

3.4.2.4.There remain gaps in the information base for assessing and managing air pollution

In addition to the above pollution-related drivers, additional governance drivers were identified. The first concerns the quality and scope of the emission inventories used for assessing and managing air pollution. National emission inventories are often of limited use for local air quality assessment and management in particular where the relative importance of emission categories differs significantly from the national and local perspective. Historic (national) emission inventories are not always corrected when new and improved emission inventory methods have been applied thus limiting their usefulness for source attribution purposes done by linking measures air quality levels with emission inventories.

A key reason for these deficiencies is the limited inventory review process. There are no provisions under the NECD for a detailed annual inventory review, nor for following through adverse findings by the Commission (and EEA). Also, there is no automatic sanction for addressing incompleteness such as a provision authorising the Commission/EEA to complete any missing submissions for particular sectors or regions. Active engagement with Member States would be needed to develop solutions based also on better capacity building, and technical assistance programmes.

The second issue is the lack of systematic monitoring in the EU of the ecosystem impacts of air pollution. This is necessary for more effective assessment of the impacts of pollution reduction measures on the environment, and to fulfil the EU's international obligations under the CLRTAP.

The capacity to assess the local drivers of air quality and to closely monitor the air quality impacts also on ecosystems will become increasingly important as the most obvious problems are addressed, and greater precision becomes necessary to ensure further cost-effective policy design.

3.5.How will the problem evolve?

This section sets out the projected development of the main problems defined in section 3.2, including the impacts of air pollution on human health and on the environment and compliance with the current air quality legislation. 66 The projections are established by developing a baseline scenario based on the recent energy projections used as a reference for climate, energy, and transport policy analysis. 67 (The data presented in this section is further referenced as the baseline or "no policy change" option in chapters 5 and 6.) The focus is on the pollutant-specific drivers identified above because the governance specific drivers are expected to remain unchanged unless further action is developed.

3.5.1.Future trends in air pollution impacts

Table 4 shows the headline human health and ecosystem damage indicators projected up to 2030 and with extrapolated estimates for the period up to 2050 (although the latter remains highly uncertain).

On business as usual the impacts of air pollution will continue to reduce until about 2020, but progress will slow substantially thereafter. Current human health impacts will reduce by only around a quarter towards 2030, and only minor improvements are expected for eutrophication (with more than half of the EU ecosystem area exceeding the critical load).

Estimated external costs associated with air pollution remain substantial as shown in Table 5 . The range of €332-945 billion estimated for 2010 would reduce to €217-753 billion in 2030.

Table 4: Estimated reduction of headline human health and environmental impacts for the period up to 2050 assuming current legislation (EU28) [Source; IIASA 2013]

Headline Indicator

2010

2020

2025

2030

2050 baseline

2050 MCE 68

Premature deaths from chronic PM2,5 and short-term ozone exposure

406.000

340.000

330.000

327.000

323.000

152.000

Reduction from 2005

13%

33%

37%

40%

44%

71%

Percentage forest area exceeding acidification critical load

9

4

4

4

3

0

Reduction from 2005

32%

66%

71%

74%

74%

97%

Percentage ecosystem area exceeding eutrophication critical load

62

55

53

52

52

26

Reduction from 2005

8%

18%

21%

22%

22%

50%

Table 5: External costs associated with air pollution in the EU28 for the period up to 2030 (EU28), € billion

Health related external costs

2010

2020

2025

2030

2050 baseline

2050 MCE

Low estimate

330

243

224

212

NC 69

NC

High estimate

940

775

749

740

NC

NC

The extrapolated figures for 2050 suggest that there is now some prospect for meeting the long-term objective in the 2050 timeframe. This could be realised by a combination of technical abatement stemming from air policy, and future structural changes that should be driven by the transition towards a low carbon economy. 70 This achievement will continue to require a trajectory for reducing impacts in successive stages in the period up to 2050 with a focus on the period up to 2030 (with important milestones in 2020 and 2025) because of the increasing uncertainty of analysis beyond that period. For that reason also, external costs have not been calculated for the period beyond 2030.

3.5.2.Compliance prospects under the current legislation scenario 

As discussed in section 3.4.1 , the main compliance problems of immediate concern relate to the legally binding limit values for PM10 and NO2 contained in the AAQD. The results for PM10 and NO2 are shown in Figure 5 below.

Figure 5: Statistical analysis of non-compliance situation in the EU for PM10 and NO2

For PM, the baseline would reduce the percentage of zones substantially above the PM10 limit value (LV) from 12% in 2010 to 6% in 2020, with a further 19% of zones in the vicinity of the LV (Figure 5). For PM2,5 there is no compliance issue. 71

The improved compliance prospects are the result of several factors. The first is the introduction of diesel particulate filters from 2009 onwards, driver by the Euro 5 requirements (Euro VI for heavy duty vehicles) on PM and particle numbers. The results are increasingly substantial as the fleet turns over towards 2020. The second is the development of robust pollution controls on industrial installations, notably in the power sector and some of the most polluting manufacturing industries. 72 Those and other controls will keep reducing PM emissions and concentrations substantially in the period up to 2020, and as a consequence, implementation of current legislation is expected to resolve most of the current compliance problems by then.

However, as highlighted in section 3.4.1.2 , specific localised problems will remain for around 6% of the zones. These relate to (a) domestic solid fuel combustion, and (b) particularly concentrated local pollution sources, sometimes combined with a particular topography. The location of these residual problems (see Figure 6 ) nevertheless suggests substantial remaining population exposure.

Domestic (household) solid fuel combustion has historically been a major PM driver in many Member States, and most have restricted solid fuel use in response. For the areas where it remains the major pollution source (notably the border region of PL, SK, CZ, and BG) the required action has not been taken, but pioneering initiatives have been launched in a few locations, for instance Krakow. 73 The problem is not only continuing coal use, but also increase in biomass use, driven partly by renewables policy and (more recently) by the economic crisis. 

Figure 6: Compliance with PM10 limit values in 2010 vs. 2020 projections (by zone)

Concentrated local pollution sources are a problem mainly in large urban centres. The problem is compounded in certain locations by a topography which limits effective dispersion of pollution, a factor which was explicitly recognised in Directive 2008/50, which allowed site specific dispersion characteristics as justification for delayed compliance. Reaching compliance in such 'difficult' locations requires further action on the relevant local pollution sources, to ensure that the economic benefits of the concentrated economic activity are not compromised by adverse health impacts. 74

For NO2, the number of zones well above the standards would reduce from 21% in 2010 to about 8% in 2020, with a further 13% of zones registering levels in the vicinity of the LV. As shown in Figure 6 , the timing of improved compliance prospects is somewhat delayed compared to the PM case but then improves much faster. That is because the NO2 compliance is mainly driven by the forthcoming introduction of the Euro 6 standard foreseen in 2014, and the correction of the "real world emission" problem seen for previous vintages of light-duty diesel vehicles by 2017 at the latest. 75  

As with PM, the remaining problem areas for NO2 ( Figure 7 below) are often densely-populated, and the population exposure implications could be significant.

Figure 7: Compliance with the NO2 limit value in 2010 vs. 2020 (by zone)

For the NEC Directive, the main compliance problem concerns the NOx ceilings, where the environmental performance of diesel vehicles is again a major factor. All Member States currently in exceedance are projected to comply with the NOx ceilings under the baseline scenario by 2020, assuming the timely entry into force of the Euro-6 standard ( Table 6 ). 76 The effect of a hypothetical failure of the Euro 6 standards is shown in section 3.5.3 . 77  

Table 6 Projected Member States' compliance with the NECD ceiling for NOx assuming no change to current policy (kiloton/year; IIASA baseline projections, April 2013) (FU, fuels used emissions estimated from GAINS)

NECD

2010

2015

compliance

2020

compliance

AT

103

133 (FU)

108 (FU)

82 (FU)

BE

176

234

215

174

DK

127

129

110

87

FI

170

172

147

125

FR

810

1053

847

619

DE

1051

1413

991

751

IE

65

91 (FU)

(91 FU)

1

(82 FU)

1

LU

11

16 (FU)

9 (FU)

7 (FU)

NL

260

276

243

188

ES

847

900

801

579

SE

148

161

129

97

Note: Member States already in compliance are not shown. Footnote 1: IE reported in 2012 its NOx emissions for 2011 to be 68 kt (i.e. 3 kton above its ceiling) and likely to comply before 2015.

It is noted in this context that 6 Member States have so far failed to ratify the current Gothenburg Protocol despite several actions taken from the European Commission. Based on the compliance prospects shown above, this situation should be addressed at the earliest opportunity also to safeguard the EU's standing as a credible international partner.

3.5.3.Uncertainties and risks associated with baseline projections

As for any projection, the baseline contains a number of assumptions that are subject to uncertainties. Annex 5 describes the key assumption in further detail whilst sensitivity analysis is developed both in Annex 5 (for the baseline) and Annex 6 (for policy scenarios).

There is however a need to highlight a specific risk. The baseline assumes that introduction of Euro 6 standards for light duty (diesel) vehicles will be accompanied from 2017 onwards by a new test procedure and further enhanced in-use compliance provisions to ensure that real world emissions are aligned with the EURO limit values. 78 This will deliver a step change in the emissions of diesel light duty vehicles compared to the previous standards up until Euro 5. This is a key factor contributing to the significantly improved level of compliance with the NO2 limit values discussed in Section 3.5.2 . Figure 8 shows that in case of poor implementation, , e.g. if Euro 6 diesel vehicles again performed equivalent to Euro 4 in terms of Real Driving Emissions (RDE), the projected non-compliance in 2020 would triple. 79 Possible options to mitigate this risk are discussed in Chapter 5.

Figure 8: Baseline projected compliance with NO2 standards in case Euro 6 would not correct the real world emission problems

Analysis for the NECD shows that in case Euro 6 does not deliver, two Member States 80 will still be above their 2010 NECD ceilings in 2020. To manage this risk associated with the base case emissions from euro-6 diesel light-duty vehicles, additional monitoring provisions are needed, as described in Chapter 9.

3.6.Who is affected and how?

The remaining air pollution problem impacts many aspects of the EU. Impacts are summarized in section 3.3.1 . Below is a summary of the main actors affected and in what way. Details are provided in Annexes 4 and 5.

EU citizens: Many citizens will remain exposed to damaging levels of air pollution in 2020 and beyond. In addition to the mortality impacts listed in section 3.3 , there is a range of ill-health (morbidity) impacts which include asthma, lower respiratory symptoms (LRS), heart problems and chronic bronchitis. These are of particular concern to certain sensitive groups, notably the youngest and elderly citizens and those already suffering from weak health.

The healthcare sector: Poor health due to exposure to air pollution results in increased healthcare costs. Costs incurred every year in the EU for the treatment of air pollution related diseases are substantial and ultimately passed on to the citizens, to employers, and to the public sector.

Ecosystems: EU ecosystems will continue to endure substantial damage in 2020. Although acidification will be broadly resolved, more than 60% of EU ecosystems will remain at risk of biodiversity loss due to excess nitrogen deposition. Ozone pollution is adding to the pressure whilst also generating substantial material and economic losses as indicated below.

Economic operators: In addition to the high external costs borne by society at large, there are important costs directly impacting Farmers through significantly reduced crop yields, the tourism sector which affected by the loss of amenity and recreational value of the natural landscape, public and private economic undertakings that suffer from productivity losses due to air pollution induced workdays lost, and finally property owners that suffer damage to the built environment due to acid erosion and soot soiling.

Member States: Ultimately, Member States are bearing the consequences, not also because of having to incur a large part of the costs associated with air pollution referred to above, but also the possible consequences of the poor state of implementation. Seventeen Member States struggle to comply with AQ legislation, drawing substantial resources from competent authorities and facing the risk of financial penalties. The Member States are also affected by the lack of coherence between commitments under the Gothenburg Protocol and the NECD, as the ensuing regulatory uncertainty adds to the risks of not meeting environmental objectives.

3.7.Justification of EU action

The justification for legislative EU action on air pollution has long been established based on the transboundary nature of air pollution. The legal basis for action is Article 192(1) of the Treaty. The present EU air quality policy focuses mainly on the transboundary aspect of air pollution and related controls that facilitate Member States' actions to meet commonly agreed health and environment standards related to air quality. It incorporates the subsidiarity principle to a very large extent. Both the NECD and the AAQDs define commonly agreed targets, while leaving choice of the means to the Member States. EU enforcement is mainly focusing on whether the targets are reach rather than judging on the means to achieve them.

During the consultations there has been a broad plea for more EU measures to support implementation in Member States. 81  

3.7.1.Why can the objectives not be achieved sufficiently by the Member States?

Action at EU level continues to be necessary because:

·The transboundary component of air pollution continues to be significant. A Member State's emissions are not just its own problem but affect also its neighbours. To decide how far one Member State must reduce pollution so as to protect another, common environmental objectives must be agreed, and these can only be set at EU level. 82 To be operational in controlling transboundary pollution, the objectives must normally be translated into emission reduction obligations per Member State (i.e. caps on national emissions, as in the NECD and Gothenburg Protocol).

·Many of the sources which must be regulated to meet these emission reduction obligations are products that are subject to the rules on the functioning of the internal market. Some of the main examples are diesel vehicles, non-road mobile machinery, domestic solid fuel boilers, paints and varnishes, and fertilisers.

3.7.2.Can objectives be better achieved by action by the Community?

Action at EU level is not strictly necessary to regulate the remaining (non-product) sources, which can in principle be regulated at Member State level. Evaluation of the emission reductions achieved under the NECD showed, however, that best compliance was achieved where a substantial proportion of emissions was regulated by EU source legislation (e.g. for SO2 as described in Annex 4). Effective co-ordination between national and regional or local levels, and between measures to achieve the NEC ceilings and measures to achieve the AAQD limit values, is for the Member States to ensure. The EU can formulate the relevant provisions to maximise coherence, and support relevant capacity-building and information exchange.

To identify whether it is proportionate to adopt source legislation at EU level a detailed analysis of those sectors from which substantial emission reductions would be required. The key issue is what effect the adoption of harmonised standards on a given sector would have on meeting the overall objectives established for air policy. In broad terms, the higher the cost increase from EU harmonisation, the less proportionate the measure (because the same emission reduction can be achieved more cheaply by other means). If the cost increase is relatively small, the benefits of a level playing field, regulatory effectiveness and administrative efficiency would justify EU controls. This analysis is presented in detail in Annex 4 for the present policy and in Chapter 6 and Annex 8 for future policy options.

4.Objectives

4.1.The long-term strategic objective 

The long-term objective of the 6th and 7th EAP – to attain air quality levels that do not give rise to significant negative impacts, on or risks for, human health and the environment – remains valid also for the current strategic exercise. 

It has been operationalized through the TSAP adopted in 2005 as called for by the 6th EAP. Although there is now an improved prospect of meeting the long-term objective for some headline indicators (see Chapter 3.5.1), the policy analysis focuses on the period up to 2030 (with important milestones in 2020 and 2025) whilst ensuring coherence with other relevant initiatives developed along the same time horizon, notably in the field of climate, energy, and transport.

4.2.General objectives relating to updating the present strategy

Two general objectives have been formulated based on the assessment of the present EU air quality policy framework and the outstanding problems and drivers identified during the ex-post evaluation described in Annex 4 and summarized in Chapter 3.

4.2.1.Ensure compliance with present air quality policies, and coherence with international commitments, by 2020 at the latest

The first general objective for the present review is to achieve compliance with the present air quality policy framework as soon as possible, thereby safeguarding at least a minimum level of protection for the EU citizens and the environment in the short term, i.e. 2020 at the latest. This objective includes the need to ensure coherence between the EU and international policy framework, notably the recently amended Gothenburg Protocol.

4.2.2.Achieve substantial further reduction in health and environmental impacts in the period up to 2030

The second priority is to make further progress in reducing air pollution impacts, i.e. to move EU air quality levels closer to the levels recommended by the WHO and other international bodies. The interim health and environmental impact reduction objectives set out in the 2005 TSAP should be updated in accordance with scientific and technical progress while extending the policy horizon to 2030.

4.0.Specific objectives

Measures to achieve the interim objectives should be identified, both at EU and national level, responding to the problem drivers identified in chapter 3. Pursuing the general objectives will require acting on the following specific objectives.

Specific objectives relating mainly to the period up to 2020:

·Ensure full implementation of current legislation and ensure that "real world emissions" of light duty vehicles are brought in line with regulatory requirements (i.e. that limit values are met under normal driving conditions). This is a matter of effective delivery of the baseline: the failure to effectively control NOx emissions from light-duty diesel vehicles has contributed substantially to current air quality compliance problems and should be rectified as a priority. In addition, options for action on existing vehicles should also be examined.

·Facilitate action on residual local compliance problems: Examine options to address the pollutant related drivers of outstanding non-compliance, principally transport and domestic combustion of solid fuels.

·Promote enhanced policy co-ordination at Member State and regional/local level: In the short term (2020) address deficiencies in capacity to assess and manage air quality, and weaknesses in co-ordinating the implementation of the AAQD and the NECD.

·Incorporate Gothenburg Protocol obligations into EU legislation and ratify the protocol: Ensure that the NECD is revised to as to ensure that the emission reduction obligations by 2020 are incorporated, and on that basis propose ratification of the Gothenburg amendment.

Specific objectives to achieve substantial further impact reduction in the period up to 2030:

·Proportionately tap the pollution reduction potential of contributing sectors, in particular those that in the past have not or insufficiently reduced their emissions, by identifying the most cost-effective policy options available for the main contributing sectors.

·Address background pollution: Achieve quantified reduction of national and transboundary background pollution within the EU, and reduce as far as possible transboundary pollution from outside the EU.

·Improve the information base for assessing policy implementation and effectiveness: At EU level, align reporting of emissions with international requirements and fill gaps in the monitoring framework, notably for ecosystem monitoring.

Quantified operational objectives are determined as part of the policy options in Chapter 6 and are therefore not predetermined at this stage.

4.1.Coherence with other policies 

The objectives of this initiative are consistent with and reinforce the Europe 2020 objectives on smart, inclusive, and sustainable growth. They should stimulate innovation that will help support green growth and maintain the competitiveness of the European economy whilst assisting the transition to a low carbon economy, protecting Europe's natural capital and capitalising on Europe's leadership in developing new green technologies. 83  Simplification and clarification of existing policy to enable better implementation is pursued where possible in the spirit of smarter regulation. 84 Where measures are introduced, care is taken to safeguard the interests of SMEs along the "think small first" principle. 85

The need to deliver coherence and optimise synergies with other policy areas applies notably to transport, industrial, agriculture and climate change policy; in particular, targets will be set so as to avoid regret investments vis á vis the new climate and energy policy framework for the 2030 time horizon that is part of the Commission work programme for 2013. This is especially important since air pollution and climate change mitigation policies often address the same pollutants and emission sources. A summary of how coherence has been addressed is provided in Chapter 8 .

4.2.Organisation of the remainder of the impact assessment

The policy analysis has two time perspectives: the period up to 2020 for the first general objective, to ensure compliance with existing legislation and international obligations; and the period up to 2030 for the second general objective, to further reduce the remaining environment and health impacts. For simplicity these two issues are taken successively in the remainder of the document although the policy options are closely related. Chapter 5 sets out the options, impact analysis and comparison for the 2020 timeframe, and Chapter 6 does the same for the post-2020 period. Chapter 7 further details the impact analysis for the new source control instruments under consideration, on medium-scale combustion plants. Chapter 8 sets out the package of measures supported by the analysis and summarises the interactions with other policies.

5.Achieving the compliance objective by 2020 at the latest

Chapter 4 set out two general objectives for further developing the present air quality policy framework. This Chapter addresses the policy options identified for achieving the first objective, i.e. to achieve full compliance with the existing air quality policy framework not later than 2020 including with the EU's international obligations. The options were developed drawing from the ex-post review documented in Annex 4 and summarized in Chapters 3.2 and 3.3 as well as the compliance outlook summarized in Chapter 3.4 and Annex 5, and consulted on with stakeholders. 86

It should be noted that the binding obligations contained in the AAQD and NECD were to be achieved already in 2010 or before. 87 The Commission has already undertaken infringement action to ensure that compliance is achieved as soon as possible.

5.1.Options to achieve compliance with the existing air policy framework

5.1.1.Option 1: No additional EU action 

Under this "baseline" option, no new EU policies are envisaged.  The baseline option is characterized in Table 7 and further summarised below.



Table 7: Option 1 –No new EU regulatory action

AAQD

NECD for 2020

EU source controls

MS source controls

EU support measures

No change. Existing limit values, attainment dates, and other provisions, are maintained; Enforcement continues and is extended where appropriate.

Reduction commitments for 2020 only in line with the 2012 amend-ment of the Gothenburg Protocol (met on the baseline trajectory).

No new EU source control measures other than relying on emission reductions yielded by current legislation, including resolution of RWE (not later than 2017). 88

All MS actions required to reach compliance with AAQD and NECD continue as guided also by ongoing Time Extension Notification (TEN) conditions and/or EU enforcement actions.

No new supporting measures other than on-going revisions of TENs, targeted workshops sup-porting that process and availability of existing EU funds. 89

On this baseline, the AAQD remains in place unchanged, and the NECD is adapted only to transpose the emission reduction obligations for 2020 in accordance with the new EU obligations agreed in 2012 under the amended Gothenburg Protocol. 90 There are no new EU source control acts adopted specifically aimed at reducing air pollutant emissions for the period up to 2020 beyond initiatives already in the pipeline. Certain implementing acts that will give effect to already agreed legislation are nevertheless adopted as planned and will deliver significant further air pollutant reductions. In this context, the enabling acts under Regulation (EC) 715/2007 to resolve the "real world emissions" (RWE) issue by 2017 at the latest and already planned for adoption by end 2013 are particularly important as stressed in Chapter 3. 91 The RWE implementing provisions will include a requirement to monitor emissions according to the new test procedure in the period before the procedure becomes mandatory for type approval (2014-17). As stressed in Chapter 3, however, any implementation defaults in the RWE area would seriously impair the prospects for attaining the compliance objective. Hence it is important it track progress carefully and for this reason a specific monitoring programme led by the JRC, to supplement the monitoring provisions in the implementing measure itself, is foreseen as described in Chapter 9.

While no new EU initiatives are envisaged, the baseline features continued action at the Member State level to ensure compliance with existing air quality standards as soon as possible. 92 Action is guided by the Member States' plans and programmes submitted in the context of the TEN's and/or infringement proceedings launched by the European Commission.

5.1.2.Options 5A-5E: Further EU action to facilitate compliance with the air quality framework

Chapter 3 summarises the compliance prospects up to 2020 for the main issues identified during the ex-post review (Annex 4), i.e. exceedances of PM and NO2 air quality standards under the AAQD, and of the NOx ceiling under the NECD. It showed that most zones would either be comfortably below the limits or within a range of 5 µg/m3, but for a small number of (densely populated) zones the gap would remain substantially larger. Hence, the further question is what contribution various additional actions possible in the period up to 2020 can make to improve compliance. Five broad categories of options have been identified as shown in Table 8 .

Table 8: Options 5A-E --Further EU Action

5A

Adopt new EU source control legislation to reduce air pollution.

5B

Amend the National Emission Ceilings Directive so as to include stricter provisions compared to the recently agreed amendment of the Gothenburg Protocol

5C

Strengthen EU Support Measures that facilitate Member State action

5D

Promote tighter air pollution controls internationally

5E

Weaken the limit values or relax the attainment dates

Option 5A entails developing, adopting, and implementing additional EU source control measures beyond those already in the pipeline and for sectors that have been identified as contributing significantly to air quality and present non-compliance cases. Bearing in mind the problem analysis summarised in chapter 3, such options would mainly focus on hitherto largely unregulated sectors such as small and medium scale combustion installations and agricultural emissions.

Option 5B comprises a tightening of the NECD beyond the levels agreed as part of the amended Gothenburg Protocol (see above). Several variants could be considered although the most realistic is to set national emission ceilings in accordance with the impact reduction objectives contained in the current TSAP as was envisaged in 2005.

Option 5C comprises a broad range of non-legislative measures at EU level to address the governance deficits summarised in Chapter 3. Such measures are detailed in Annex 6 but would principally comprise:

1.Enhanced capacity building for "local" air quality assessment and management to enable better-targeted and more cost-effective air pollution reduction strategies;

0.Fostering enhanced synergies between local and/or national air quality management and other relevant plans developed and implemented at those administrative levels (e.g. on climate change mitigation, sustainable energy, mobility, and urban development);

1.Broadening the toolbox available to national and local authorities for assessing and managing air pollution, and supporting best practice exchange nationally and across the EU (notably related to urban AQ management);

2.Fostering enhanced public awareness, participation, and support for national and local action on air pollution, including the marketing and sale of "green" products;

Option 5D includes additional EU-sponsored measures to promote air pollution reductions outside the EU aimed inter alia at promoting ratification and implementation of the Gothenburg Protocol in non-EU countries (notably in the Eastern Europe, Caucasus and Central Asia region), and promoting global air quality assessment and management actions (notably for pollutants affecting short-lived climate pollutants that are also relevant for EU air quality).

Option 5E entails relaxing the limit values for PM and NO2 and/or granting a further extension of the associated attainment dates (in addition to the extensions granted in 2008).

The second public consultation allowed for free-form responses to identify additional options not identified above, but none were proposed.

5.2.Analysis of impacts    

5.2.1.Method

Policy options for achieving the (first) 2020 compliance objective are analysed against the baseline scenario developed for the entire period under consideration (up to 2030). Compliance assessments use a method developed to simulate compliance with air quality standards at individual measuring stations. 93 Observed concentrations at measuring stations are explained in terms of background emissions (derived from the GAINS model) and local emissions, which depend among other things on the vehicle fleet composition known in the past and projected into the future. 94 The monitoring stations are allocated to zones, so as to estimate the likely percentage and geographical distribution of zones in compliance on the baseline, and on alternative pollution reduction scenarios.

5.2.2.Environmental Impacts 

The compliance outlook for the baseline (Option 1) is summarised in Chapter 3.5 and described in greater detail in Annex 5. Compliance prospects for PM10 and NO2 will significantly improve by 2020 but certain "hot spot" problem areas remain.

There will be a number of marginally-compliant zones (those within 5μg/m3 of the limit value, comprising around 19% of PM10 zones and 13% NO2 zones). The indication from national plans submitted under the Time Extension Notifications 95 and parallel analysis conducted as part of the present review 96 suggests that local action can in general deliver concentration reductions in that range. This is provided that Member States and local authorities continue to put in place measures specific to the local problems and conditions of each air quality management zone. 97 Continuing infringement action provides the necessary legal framework for reaching effective compliance, although support on the observed governance issues would be needed to ensure cost-effective attainment of the compliance objective.

In addition there will be a relatively limited number of remaining areas showing substantial non-compliance for one or other pollutant (6% for PM10 and 8% for NOx). The corresponding population exposure would remain unacceptably high, and so likewise the health impacts (11% and 16% of the EU population live in those zones and thus are potentially exposed to concentrations beyond the present LV). Hence the baseline option would not achieve the general objective, and further action is required in these areas. 98

Beyond the measures already in the pipeline (updating emission standards for non-road machinery and inland waterways, eco-design requirements for heating appliances, and IED), there is limited scope for developing, adopting, and implementing new EU-level source controls (Option 5A) that would substantially assist Member States in resolving the outstanding compliance gaps by 2020. This is mainly because the replacement rate of the durable goods that would be regulated (including heating appliances and medium combustion plants) is too low to produce the required turnover of capital stock by 2020. Moreover, some of the main drivers in certain categories (e.g. open fireplaces in domestic combustion) cannot be effectively regulated at EU level alone. Also, product standards are set so as to be proportionate across the EU, and as such may not be sufficient for some specific localised problems. Thus while such measures would reduce overall concentrations, they would not effectively target the remaining non-compliance issues described above. 99  

National emission ceilings set (in the NECD) to levels which would fully deliver the impact reductions of the 2005 TSAP (Option 5B) would deliver impact reductions beyond the baseline as outlined in Table 9 . Overall impact reductions are significant but would be achieved mainly through national action, given the limited scope for EU source controls to yield effects by 2020. The analysis shows however that that the contribution to resolving the outstanding compliance problems would be minor, i.e. only 1% more air quality zones would be brought into compliance compared to the baseline. Again, this is due to local non-compliance being related to emissions from durable goods, which in the short term are not effectively addressed by tighter ceilings. These impact reductions are compared to the economic effort required to reach them in Section 5.2.3 .

Table 9: Impacts in 2020 of tightening emission ceilings to the 2005 TSAP levels (Option 5B) compared to levels in 2005 and the baseline in 2020 (Option 1)

Health and Environment Impacts in 2020

2005

Option 1

vs 2005

Option 5B

vs 2005

Option 5B

vs Opt. 1

PM2,5-chronic-premature deaths

494000

-33%

-40%

-6%

Ozone-acute- premature deaths

24600

-22%

-25%

-2%

Eutrophication, unprotected '000 sq Km

1148

-18%

-28%

-9%

Acidification, unprotected '000 sq Km

161

-66%

-78%

-13%

AQ zones in compliance with PM10 limit values

85%

94%

95%

1%

AQ zones in compliance with NO2 limit values

71%

92%

93%

1%

The evaluation showed that additional EU measures supporting Member State compliance efforts (Option 5C) could significantly improve the efficiency and effectiveness of implementation. The Air Implementation Pilot confirmed the potential of such support measures and helped to identify the most important needs.

In areas where poorly performing small-scale solid fuel devices are driving PM non-compliance, an effective solution would be to promote either switching to different heating solutions such as gas or district heating, or the accelerated replacement of obsolete heating appliances. Analysis carried out by IIASA and JRC IPTS 100 shows that scrappage schemes to support the replacement of single house heating appliances by subsidising 20% of the investment costs would be able to reduce the residual non-compliance in 2020 from 6% to about 3%; 101 replacement of single house solid-fuel fired appliances by gas or district heating would largely solve the residual PM10 legal non-compliances, leaving less than 1,5% of zones beyond the compliance threshold. Annex 6 outlines a set of measures which could support the Member States in implementation. Finally, better coordination between national and regional/local measures could also be encouraged by requiring national emission reduction programmes under the NECD to take better into account the local air quality management challenges.

Additional support measures to encourage international action (Option 5D) such as ratification of the Gothenburg Protocol by Eastern European and Central Asian Parties to the CLRTAP, would be a necessary (but insufficient) step to reduce hemispheric pollution affecting EU air quality levels. As for Options 5A and 5B, however, the effects of broadened ratification and enhanced international co-operation will only yield substantial effect in the period beyond 2020.

Considering that the baseline would improve compliance substantially and that the remaining gap can be closed through EU-supported national and local measures, a weakening or postponement of the legal obligations under the AAQD (Option 5E) would be unnecessary and counterproductive.

5.2.3.Economic and Social Impacts

The economic and social impacts of the baseline Option 1 have been analysed in detail as part of the ex-post review of the air quality policy framework (see Annexes 4 and 5). The costs entailed by the implementation of already agreed measures for the period up to 2020 are shown in Table 10 for all sectors. 102 In broad terms, half of the additional costs for the road transport sector are geared towards controlling diesel emissions (PM and NO2) from light duty diesels following the replacement of Euro 3 and Euro 4 vehicles by Euro 5 and Euro 6. The other half relates to heavy duty vehicles following the replacement of the current fleet by Euro V and especially Euro VI, already dominant in 2020. These measures will be crucial to deliver the air quality improvements described in Section 3.4.1. After 2020, relatively few new pollution abatement measures are expected to come on stream on the baseline, explaining the projected stagnation of pollution impact reductions beyond this date. 103

Table 10 represents the costs for reducing pollution from a situation of no mitigation at all, down to the current pollution level.  If there were no mitigation at all EU pollution would be extremely high (comparable to or worse than the extreme pollution levels seen recently in Beijing, for instance), and the ambient concentrations would be at least an order of magnitude higher than at present. The resulting impacts would be several times the current impacts, 104  and so the benefits of reducing those down to the current levels can be estimated at some multiple of the current damage costs of €330-940bn. Thus the benefits hugely outweigh the implementation costs even on the most conservative estimate.

Table 10: Pollution control costs for the baseline (option 1) up to 2020 (EU28, M€)

 

2010

2015

2020

Power generation

12700

12093

10711

Domestic sector

7476

9115

9629

Industrial combustion

2435

2468

2521

Industrial processes

4760

4983

5029

Fuel extraction

976

907

770

Solvent use

1638

1964

2140

Road transport

26022

34357

42023

Non-road mobile sources

1892

4320

6975

Waste treatment

0

1

1

Agriculture

1750

1775

1786

Total

59650

71983

81584

Considering the short lead time, the potential for entirely new EU source legislation (Option 5A) to support improved compliance by 2020 is at best uncertain (see above). Accordingly, estimating the costs in 2020 associated to such measures has been considered too speculative, and the analysis focused on the time horizon beyond 2020 discussed in Chapter 6.

Implementing Option 5B would require expenditure for pollution control of 933 M€ per year in addition to the baseline costs. Assuming that the most cost-effective emission reduction measures would be taken (at the national level), 105 roughly 60% of the expenditure would be for controlling ammonia in agriculture, 20% in industry, 9% in the domestic and institutional sector (including small and medium combustion), and 6% from the energy sector.

As indicated earlier, the costs at Member State level associated with national and local action are difficult to identify, and cannot be readily compared or extrapolated at EU level. Better uptake and cost-effectiveness of such action could be promoted, however, by enhanced capacity building efforts envisaged in Option 5C using available EU funding under the new LIFE regulation. Around €100 million would cover at least 30% of the non-compliance zones and could be effectively leveraged to provide comprehensive support for the non-compliant areas, by use of twinning and information exchange, and by leveraging additional finance. This leverage could include use of other EU funds (e.g. the Structural Funds) to support specifically targeted measures such as fuel switching. 106 Such supporting actions will not increase the benefits associated with option 1, but rather help realise them.

As for EU support measures, support for international action to combat air pollution (Option 5D) would continue to be funded from existing funds and programmes. Considering available absorption capacity, support costs are unlikely to exceed €10 million for the period to 2020. Additional support could be channelled through the thematic and/or geographic components of the EU's external financing programmes, in response to the needs expressed by eligible EU partner countries. Enhanced exchange of scientific and technical experience with the US and other developed country partners of the EU would be covered by the new Horizon 2020 programmes and would not require incremental expenditure.

Relaxing the AQ standards or the legal dates for their attainment (Option 5E) would not entail any additional expenditure, but would also fail to deliver the benefits of full implementation. A more complete discussion of the economic benefits of improved air quality is taken up in Chapter 6.

5.3.Comparison of options

Table 11 (next page) compares the options to attain the objective of compliance as soon as possible based on qualitative criteria related to the effectiveness, the efficiency and coherence in achieving the specific objectives defined in section 4.3. The ratings applied are: negative (-), no effect (0), low (L), medium (M) and high (H).

From the stakeholder consultation, there was strong support among government respondents for non-legislative support actions for air quality governance to improve compliance with air quality legislation. The importance of strengthening emission controls (both in the NECD and in source controls) was recognised by a large majority of respondents. Only about 3% of respondents supported weakening the obligations under the AAQD.

Table 11: Comparison of options to promote compliance with the present air quality policy framework as soon as possible

Option

Description

Effectiveness

Efficiency

Coherence

Summary assessment

1

Baseline

0

0

0

The compliance prospects improve significantly due to the further pollution reductions yielded by the baseline. A (small) number of non-compliant zones remain, coinciding with densely populated areas. Enhanced national and local action can deliver the bulk of the additional reductions required to reach compliance, but some locations will require special effort, and capacity and governance deficiencies would need to be remedied. Benefits associated with full compliance hugely outweigh the implementation costs, even on the most conservative benefit estimate.

5A

Adopt new EU source control legislation.

L

M

M

Additional (not yet planned) EU source controls will be of limited effectiveness in delivering reductions by 2020 and will not effectively target the (mainly localised) remaining compliance problems. Consideration of new EU source controls is best left to the period beyond 2020 (Chapter 6).

5B

Tighten National Emission Ceilings to TSAP 2005 levels.

L

M

M

A TSAP variant for the NECD in 2020 would reduce overall health and environmental impacts but would not effectively target the localised non-compliance problems (it would deliver an additional 1% compliance for costs around €900 million per year).

5C

Strengthen EU Support for National and Local Action aimed at reaching compliance.

M

H

H

Targeted support addressing capacity and governance deficiencies could complement the baseline option 1. EU funding needs are estimated at about €100 million for the period up to 2020 . These funds should leverage additional funding sources (EU and other) for targeted measures required in particularly challenging areas.

5D

Promote international action

L

H

H

Support for air pollution action in third countries would also be possible from available funds (€10 million in period to 2020). Such action would be necessary, but measurable impacts would only materialise after 2020.

5E

Weaken the standards

-

0

-

This option would deliver legal compliance but at significant health and environmental costs. It would be incoherent with the EU's long-term objective.

5.4.Conclusions

Baseline measures (Option 1) such as the introduction of the Euro 6 standards for passenger cars are necessary to deliver significant air quality improvements throughout the EU. If fully implemented, they will narrow the compliance gap for PM and NO2 in many areas while delivering substantial health benefits.

The preferred policy option to ensure compliance with air quality policy by 2020 at the latest (i.e. the first general objective set out in chapter 4) is to reinforce the baseline with non-regulatory EU measures to support Member States with resolving the residual problems (Option 5C).

Non-regulatory EU measures will facilitate efforts from Member States and their sub-national authorities, which will retain the main responsibility for resolving the remaining localised compliance problems. For presentational reasons and to emphasize the need for engaging implementing authorities across all policy levels (local, regional, and national), the strengthened measures may be usefully grouped together in a European Clean Air Programme. This could include also appropriate platforms at EU level to facilitate and promote information exchange and mutual assistance in the development and implementation of effective local measures. (See outline in Annex 6.)

Additional EU source controls (Option 5A) and/or tighter NECD reductions than the Gothenburg commitments (Option 5B), would not be well-targeted on resolving the remaining localised compliance problems by 2020 at the latest. Their substantial potential to reduce overall air pollution impacts is considered for the timeframe 2025-30 as investigated in Chapter 6.

Although these options and actions to further reduce the impacts of third countries on EU air quality levels (Option 5D) will only deliver measurable benefits in current hotspots beyond 2020, promoting early action is important in view of the long lead times. Hence, support should also be provided for that purpose in the period up to 2020, including to EECCA states for ratification and implementation of the Gothenburg protocol (inter alia through the thematic and/or geographic components of the EU's external financing programmes). These support measures will also enable further advocacy on global air quality management. The EU's own ratification of the Gothenburg amendment is important to ensure its credibility in this context.

6.Achieving further health and environmental impact reductions up to 2030

To achieve the EU's long-term objective, pollution levels must be brought down to the WHO guideline levels for the protection of human health. 107 The exceedance of critical loads and levels for ecosystems must be eliminated.

This chapter therefore sets out, assesses and compares options in pursuit of the second general objective defined for that purpose in Chapter 4 and related to establishing (a) new strategic impact reduction objectives for the period up to 2030, (b) associated emission reduction targets to meet those objectives, and (c) EU legislation to reach the objectives and share the burden of measures at EU level.

It is noted that the NECD is the general instrument for delivering the required impact and emission reductions whereby Member States retain full flexibility to define the appropriate source controls. The extent to which measures should also be taken at EU level to assist Member States is explored in section 6.6 . New source controls that emerge as cost-effective from the analysis presented in this chapter are impact assessed in further detail (in Chapter 7).

It is also noted that options for revising the AAQD itself have been excluded from the review, for two reasons. The first is that it is necessary to ensure compliance with the current standards before considering any tightening (see Chapter 5). The second reason is that the current non-compliance shows that the AAQD is most effective when supported by EU control of emissions, through the NECD or EU source legislation. For that reason the priority is to ensure the required emission reductions, and only then to revise the AAQD.

6.1.Methodology

The analysis is based on a multi-pollutant multi-effect model (GAINS, Greenhouse Gas and Air Pollution Interaction and Synergies) which has a broad scope and captures the important interactions between the various pollutants and impacts. 108

One important caveat is that the GAINS analysis is mainly driven by technical measures available in 2012, with no cost adjustment or other allowance for learning over time. Thus it would not reflect the potential for further structural changes in the energy, transport and agriculture sectors, nor for geographically-targeted local measures. We have aimed to complement with analysis of non-technical measures, but possibilities are limited.

The analytical framework has been substantially improved since the 2005 TSAP. The main new element is the stronger emphasis on economic analysis, in particular a more central role for monetised benefits and costs in the comparison of options, and a detailed calculation of direct benefits, e.g. cost savings for healthcare and increased labour productivity due to better health. Not all benefits can be monetised, however, and the assessment remains broad enough to encompass also those for which a strict monetisation approach is inadequate.

The GAINS analysis was complemented by detailed sectorial analysis to assess the impacts of regulating medium-scale combustion plans, as described in detail in Chapter 7 and Annex 12.

6.2.The policy options

6.2.1.Option 1: No further EU action

This first option is the baseline option of no new measures being taken at EU level beyond the source controls established in current legislation and the NECD ceilings for 2020 (transposed from the Gothenburg Protocol). The baseline option is the same developed in Chapter 5, extended to the period up to 2030.

6.2.2.Options 6A-6E: Additional Technical Reduction Measures 

This second objective involves setting more stringent objectives for further reduction of health and environmental impacts. These sub-options are defined according to:

·The 'Gap closure' percentage –the percentage by which the new objectives would close the gap between the baseline (0%), on the one hand, and the result of applying all technically available abatement measures (100%), on the other. The latter is known as the Maximum Technically Feasible Reduction, or MTFR 109 .) A scenario that would achieve 75% of the benefits possible under MTFR is identified as a 75% gap-closure scenario.

One complication is that the various impacts are expressed in different parameters (years of life lost, premature deaths, exceedance of critical loads etc), and so no single reduction objective will cover all impacts. To make the analysis tractable, the long-term health effects of PM2,5 110 are examined first, in options 6A to 6E of Table 12 . PM2,5 impacts can be monetised and thus more easily compared with the required investments, and also deliver benefit for each of the other impacts. Sensitivity analysis then examines to what extent further objectives for those other impacts are appropriate (section 6.5 ).

·Cost-effective technical measures to deliver the required gap closure objectives (these measures may be undertaken at the national or EU level). In principle many different possible combinations of measures can deliver the same impact reduction; the difference is the distribution of burden among economic sectors.

·NECD ceilings for 2025 and 2030 for emissions of SO2, NOx, PM2,5, NH3 and NMVOC. These correspond to the emission levels (see Table 13 ) that would result from implementing the selected technical measures and which would deliver the gap closure. So as not to prejudge whether binding ceilings would be set for 2025 or for 2030, the ceilings are presented for both years.



Table 12 : Policy options for the post-2020 period, defined according to health gap closure percentage and least-cost measures in the main sectors

Option 6A

Option 6B

Option 6C

Option 6D

Option 6E

The 'Gap' closure

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

>100% gap closure for PM 2.5

possible cost-effective technical measures

Power generation

Low sulphur coal

Low sulphur coal

Stricter NOx control in medium-sized plants

Stricter PM controls in biomass plants

Low sulphur coal

Stricter NOx and SO2 control in medium-sized plants

Stricter PM controls in biomass plants

All technically feasible measures irrespective of cost

All technically feasible measures irrespective of cost, as well as deeper phasing out of solid fuels

Domestic sector

Low sulphur coal

Improved biomass stoves

Low sulphur coal

Improved biomass stoves, boilers and fireplaces

New coal boilers

Dust filters for coal appliances

Low sulphur coal

Improved biomass stoves, boilers and fireplaces

New coal boilers

Dust filters for coal appliances

Pellet boilers

Improved coal stoves

Low-sulphur fuel oil

All technically feasible measures irrespective of cost

All technically feasible measures irrespective of cost, as well as deeper phasing out of solid fuels;

Further energy efficiency improvements

Industrial combustion

Low sulphur fuel oil

Low sulphur fuel oil

low sulphur coal

stricter PM controls

combustion modifications

wet flue-gas desulphurisation

Low sulphur fuel oil

low sulphur coal

stricter PM controls

combustion modifications

wet flue-gas desulphurisation

high-efficiency flue-gas desulphurisation in refinery

stricter PM controls

All technically feasible measures irrespective of cost

All technically feasible measures irrespective of cost, as well as deeper phasing out of solid fuels

Industrial processes

stricter SO2 controls in steel industry

stricter SO2 controls in steel industry

stricter SO2 controls in non-ferrous metal industry

selective catalytic reduction for cement plants

stricter SO2 controls in steel industry

stricter SO2 controls in non-ferrous metal industry

selective catalytic reduction for cement plants

stricter SO2 and PM controls in lime production and glass production

All technically feasible measures irrespective of cost

All technically feasible measures irrespective of cost

Road transport and Non-road machinery

Stage IV controls for inland waterway vessels, and railways

Further alignment of NRMM emissions to heavy duty goods vehicle standards

Stage IV controls for inland waterway vessels, and railways

Further alignment of NRMM emissions to heavy duty goods vehicle standards

Further tightening of emission standards for light duty vehicles beyond Euro 6

Stage IV controls for inland waterway vessels, and railways

Further alignment of NRMM emissions to heavy duty goods vehicle standards

Further tightening of emission standards for light duty vehicles beyond Euro 6

Deeper electrification of urban transport

Agriculture

Reduced open burning of agricultural residues

Low N feed (cattle and pigs)

Covered storage of manure

Low emission application of manure

Low emission housing (pigs)

Reduced open burning of agricultural residues

Low N feed (cattle and pigs)

Covered storage of manure

Low emission application of manure

Low emission housing (pigs and poultry)

Substitution of urea fertilizer

Reduced open burning of agricultural residues

Low N feed (cattle and pigs)

Covered storage of manure

Low emission application of manure

Low emission housing (pigs and poultry)

Substitution of urea fertilizer

NH3 scrubbers in pig and poultry housing

All technically feasible measures irrespective of cost

All technically feasible measures irrespective of cost

Table 13: Emission reductions by pollutant required by the options for post 2020 - Percentage changes vs 2005.

2025, EU28

2005

1

6A

6B

6C

6D

6E

SO2

8172

-70%

-73%

-77%

-79%

-81%

n/a

NOx

11538

-60%

-61%

-61%

-64%

-69%

n/a

PM2,5

1647

-23%

-36%

-42%

-49%

-58%

n/a

NH3

3928

-7%

-14%

-21%

-30%

-35%

n/a

VOC

9259

-39%

-43%

-44%

-50%

-64%

n/a

2030, EU28

2005

1

6A

6B

6C

6D

6E

SO2

8172

-73%

-76%

-79%

-82%

-83%

n/a

NOx

11538

-65%

-66%

-66%

-69%

-74%

n/a

PM2,5

1647

-27%

-40%

-45%

-51%

-63%

n/a

NH3

3928

-7%

-14%

-21%

-30%

-35%

n/a

VOC

9259

-41%

-44%

-46%

-51%

-66%

n/a

Option 6E, compliance with the WHO guideline values, is impractical at this time, as even the MTFR would fall short in the period 2025/2030. To achieve it further structural changes would be required which cannot be assumed here, and so this option is not further analysed for the 2030 timescale. For the same reason, emission reductions required to achieve Option 6E are also not presented in Table 13 . In the long term, however, deep structural changes, innovation, technology learning and non-technical actions can set the EU on the path towards no significant air pollution impacts. This issue is taken up in section 6.8 .

The other options are analysed for comparison against Option 1 (baseline, current policies). Section 3.4.2 showed that current policies will deliver substantial impact reductions in the period up to 2020, but will flat-line thereafter, with only marginal further reductions in impact.

Annex 9 provides an in-depth characterisation of the cost-effective measures presented in Table 12 and of how they may affect individual sectors for options 6A to 6C. In terms of emission reductions required by the various options, Options 6A and 6B achieve their target mainly by reducing primary PM SO2 and ammonia emissions, while the more ambitious targets of Options 6C and 6D drive deeper cuts in NOx and VOC emissions. The associated emission reductions per Member State are given in Annex 7.

6.3.Impact of options 

6.3.1.Health and environmental impacts 

The baseline health and environmental improvements by 2025 and 2030 (Option 1), and the additional improvements delivered for those years by options 6A-D, are presented in Table 14 . The table focuses on premature mortality from chronic PM and acute ozone effects; the full range of health impacts (mortality and morbidity, see section 3.6 ) is provided in Annex 7, Appendix 7.2, along with detailed impacts per Member State (Appendix 7.3).



Table 14: Impact indicators for 2025 and 2030 compared to 2005 (EU-28)

2025

2005

1

6A

6B

6C

6D

PM2,5-chronic-premature deaths

494 000

-38%

-42%

-46%

-50%

-54%

Ozone-acute- premature deaths

24 600

-28%

-29%

-30%

-33%

-39%

Eutrophication, unprotected '000 sq Km

1 125

-21%

-24%

-28%

-34%

-40%

Acidification, unprotected '000 sq Km

161

-71%

-77%

-81%

-85%

-87%

2030

2005

1

6A

6B

6C

6D

PM2,5-chronic-premature deaths

494 000

-39%

-43%

-47%

-51%

-56%

Ozone-acute- premature deaths

24 600

-30%

-31%

-32%

-35%

-41%

Eutrophication, unprotected '000 sq Km

1 125

-23%

-26%

-29%

-35%

-41%

Acidification, unprotected '000 sq Km

161

-74%

-79%

-83%

-87%

-89%

In the absence of additional measures (baseline Option 1) air pollution impacts will continue to go down by 2025 and (then slower) by 2030. The range of improvements delivered is very similar in 2025 and 2030. The maximum technical feasible reduction (Option 6D) could yield health impact reductions of around 40% while further reducing eutrophication and acidification by respectively about 80% and 20% compared to the baseline. Option 6C, however, could reduce health impacts from PM2,5 by an additional third over the baseline, from ozone by an additional fifth, while the reduction in eutrophication would be half as big again as on the baseline. Options 6A and 6B would result in impact reductions that are closer to the baseline.

6.3.2.Economic impacts 

The economic analysis identifies the most efficient (least-cost) combination of technical measures to achieve the required gap closure. The more ambitious the objective, the more expensive each incremental reduction becomes (in economic terms, a standard marginal abatement cost curve). The broader economic impacts of the resulting compliance costs are then further analysed with the computable general equilibrium model GEM-E3. 111

6.3.2.1.Direct expenditure to reach compliance

The direct cost of policy is the annualised investments required in different sectors to install pollution abatement equipment, as well as operation and maintenance (O&M) of that equipment. These are presented in Table 15 for the EU, and compared to the baseline costs deriving from implementation of current pollution control legislation (Option 1). 112 Details per Member State are provided in Annex 7.

Table 15: Incremental pollution control expenditure by option (€M/yr, % increase in 2025 and 2030 compared to baseline for EU-28)

1

6A

%

6B

%

6C

%

6D

%

2025

87,171

221

0,25

1202

1,38

4,629

5,31

47,007

53,9

2030

92,103

212

0,23

1032

1,12

4,182

4,54

50,682

55,0

Incremental pollution control costs are modest for all but the full gap closure, i.e. maximum technical feasible reduction scenario (Option 6D), which would add over 50% to the baseline compliance costs. Costs increase from a quarter of a per cent over the baseline for a 25% gap closure (Option 6A), to around 5% over the baseline for the 75% gap closure scenario (Options 6C); the MTFR (option 6D) would add around 50% more to the total pollution control expenditure.

6.3.2.2.Affected industries and sectorial impacts

Table 16 and Table 17 show the distribution of additional pollution control expenditure by sector 113 in 2025 and 2030 for the different options and in comparison with the baseline (option 1). Detailed tables documenting how specific economic sectors are affected on the different options are presented in Annex 7 and Annex 9; a brief summary of the main conclusions is presented below.

Table 16: Effort required per SNAP sector in 2025 by option, expressed in M€ and in % increase compared to option 1 (baseline).

 2025, EU28

Option 1

Option 6A

Option 6B

Option 6C

Option 6D

Costs by SNAP sector

(million €/yr, increase compared to baseline)

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%

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%

Table 17: Effort required per SNAP sector in 2030 by option, expressed in M€ and in % increase compared to option 1 (baseline).

 2030, EU28

Option 1

Option 6A

Option 6B

Option 6C

Option 6D

Costs by SNAP sector

(million €/yr, increase compared to baseline)

Power generation

7122

36

0,50%

99

1,39%

436

6,12%

3658

51%

Domestic combustion

8928

52

0,59%

305

3,41%

1217

14%

19622

220%

Industrial combustion

2567

24

0,93%

175

6,81%

672

26%

1850

72%

Industrial Processes

5032

17

0,34%

125

2,49%

334

6,64%

4054

81%

Fuel extraction

619

0

0,00%

0

0,00%

5

0,82%

556

90%

Solvent use

1147

14

1,20%

15

1,28%

72

6,25%

12214

1065%

Road transport

52633

0

0%

0

0%

0

0%

0

0%

Non-road machinery

12271

1

0,01%

5

0,04%

146

1,19%

3007

25%

Waste

1

6

782%

7

938%

9

1148%

9

1196%

Agriculture

1784

 

61

3,44%

300

17%

1292

72%

5711

320%

Total

92103

 

212

0,23%

1032

1,12%

4182

4,54%

50682

55%

On the baseline, the transport sector bears the largest share (more than 50%), followed by the power sector, the domestic sector 114 , non-road machinery (including non-road transport) and other industries. The varying distributions for options 6A-D reflects the limited further potential in sectors that have been stringently regulated in the past, and the larger potential in those that have not (e.g. agriculture, the domestic sector and solvent applications). 115  

For a 25% gap closure (option 6A), modest additional compliance cost are concentrated in the household sector, agriculture and (to a lesser extent) energy intensive industries; for all sectors the additional effort required is less than or of the order of 0,01% of total output. For the 50% and 75% gap closures (options 6B and 6C), households and agriculture remain prominent, but energy intensive industries progressively contribute more. Option 6C (which delivers 75% of the maximum health benefits) requires additional expenditure of 0,3% of the sectorial output in agriculture, 0,07% for refineries, 0,03% for the power sector and much less for all other industries. The effort required of households is 0,023% of their total consumption, on average ca. €3/year per EU citizen.

Option 6D (MTFR) shows a rather different picture, reflecting the fact that all commercially available technical measures are tapped, irrespective of their cost. Highest additional costs are in the chemicals and consumer goods industries (food, clothing, furniture, etc.), related to relatively expensive VOC abatement measures.

6.3.2.3.Direct economic benefits due to reduced health and environmental impacts: 

Reducing air pollution delivers substantial direct economic benefits which are summarised in Table 18 for 2025 and Table 19 for 2030. More detail is provided in Annex 7:

·Labour productivity gains from reducing the lost working days: Avoided economic loss from improved productivity alone ranges between €0,7bn and almost €3bn. These can offset by more than a factor 2 the direct emission control expenditure on option 6A, fully compensates it on option 6B, and cover about half those on option 6C.

·Savings from reduced damage to the built environment: Benefits due to reduced corrosion and soiling of infrastructure and buildings range between about €53-162M per year in options 6A-6D.

·Savings from reduced crop losses: Ground-level ozone damages plants, hampering the growth of trees as well as food crops. The damage to potato and wheat alone is currently estimated at about €2,6bn per year. 116 Emission reductions can reduce this damage by between €61 and 630M per year (options 6A-D). Timber losses are not included.

·Savings from reduced healthcare costs: These are evaluated where data are available. However, due to the lack of sufficient data for a number of symptoms (including lower respiratory symptoms, restricted activity days and child morbidity), the estimate is not a full account of overall healthcare costs from air pollution. Even so, the benefits delivered by options 6A-D are substantial, ranging between €219 and 886M per year.

Table 18: Direct economic benefits of policy options for 2025 vs baseline

2025, EU28

Option 6A

Option 6B

Option 6C

Option 6D

117Lost 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

Healthcare 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

Table 19: Direct economic benefits of policy options for 2030 vs baseline

2030, EU28

Option 6A

Option 6B

Option 6C

Option 6D

Lost working days, direct economic benefits vs baseline €M

665

1307

1960

2805

Damage to built environment, direct economic benefits vs baseline €M

44

96

134

159

Crop value losses, direct economic benefits vs baseline €M

69

98

269

632

Healthcare costs, direct economic benefits vs baseline (where data available)

209

415

624

907

Total direct benefits vs baseline

988

1,916

2,987

4,503

6.3.2.4.Generalized economic benefits from reduced health-related external costs 

The health benefits described in section 6.3.1 can be translated into economic gain figures based on a well-established literature of contingent valuation used to calculate health-related external costs and changes thereof. Table 20 provides the range of the total benefit estimates compared to the baseline (Option 1). 118 Annex 7 sets out the full detail. For comparison purposes the direct economic impacts benefits calculated in section 6.3.2.3 are also reported.

Table 20: Monetised Air Quality Benefits from reductions in health-related external costs of policy options for 2025 and 2030 vs baseline, in M€/year

2025, EU28

Opt. 6A

Opt. 6B

Opt. 6C

Opt. 6D

Total reduction in external costs of air pollution vs baseline (€M, low valuation)

14 997

29 767

44 686

59 642

Total reduction in external costs of air pollution vs baseline (€M, high valuation)

50 317

100 937

150 853

200 074

Of which, total direct economic benefits (table 18) €M

1 059

2 065

3 237

4 509

2030, EU28

Opt. 6A

Opt. 6B

Opt. 6C

Opt. 6D

Total reduction in external costs of air pollution vs baseline (€M, low valuation)

13 870

27 619

41 309

59 506

Total reduction in external costs of air pollution vs baseline (€M, high valuation)

48 870

98 188

146 216

209 165

Of which, total direct economic benefits (table 19) €M

988

1 916

2 987

4 503

Additional action yielding from the respective gap closure options could further reduce the external costs between €15-50 billion/year on Option 6A and €60-200 billion/year on Option 6D. Of these external cost savings, more than €4 billion could be direct economic savings due to improved productivity and reduced healthcare costs, reduced crop damage, and reduced damage to buildings and infrastructure.

6.3.2.5.Broader economic impacts

The direct costs (expenditure to reach compliance) presented in sections 6.3.2.1 and 6.3.2.2 are not to be interpreted as societal costs. This is on the one hand because the investment demand represents an economic opportunity for the manufacturers of (e.g.) abatement technology. But also, the costs of compliance affect production costs and can impact on the competitiveness of the affected sectors, including at the international level. Further analysis therefore assessed 119 :

·Which sectors benefit from expenditure in pollution control (by delivering the investment goods), and which other expenditure would be diminished to keep budget balances;

·Price effects and their consequences for international competitiveness and for consumers.

The effect of the improved labour productivity resulting from air quality improvements also has a macro-economic impact. This was assessed by proportionately adjusting the labour supply for each option, 120 and is presented as the ‘health’ case below. Other direct economic benefits such as improved crop yields, reduced healthcare expenditure, and damage to utilitarian buildings are not included in the macroeconomic analysis, and are to be considered separately. Table 21 presents the results in terms of GDP impact and sectorial output 121 .

Table 21: GDP and sectorial output change in options 6A-C, the effects of health benefits to labour productivity are presented separately as “health” case. Source: GEM-E3, JRC-IPTS

 

6A

6B

6C

Change in sectorial output in the EU28 (2025), and GDP change; % compared to option 1

 

base

health

base

health

base

health

Agriculture

-0,01%

0,00%

-0,06%

-0,04%

-0,22%

-0,20%

Chemical Products

0,00%

0,01%

0,01%

0,03%

0,03%

0,05%

Construction

0,00%

0,01%

0,02%

0,03%

0,07%

0,08%

Consumer Goods Industries

0,00%

0,00%

-0,01%

0,00%

-0,04%

-0,01%

Electric Goods

0,00%

0,02%

0,03%

0,05%

0,10%

0,13%

Electricity supply

0,01%

0,01%

0,02%

0,04%

0,10%

0,12%

Ferrous and non-ferrous metals

0,00%

0,01%

-0,01%

0,02%

0,00%

0,03%

Natural Gas

0,00%

0,00%

0,00%

0,00%

0,01%

0,02%

Market Services

0,00%

0,01%

0,00%

0,01%

0,00%

0,02%

Non Market Services

0,00%

0,00%

0,00%

0,01%

0,00%

0,01%

Petroleum Refining

-0,01%

0,00%

-0,03%

-0,02%

-0,10%

-0,08%

Other energy intensive

0,00%

0,01%

-0,01%

0,01%

-0,02%

0,01%

Other Equipment Goods

0,00%

0,01%

0,02%

0,05%

0,06%

0,11%

Transport

0,00%

0,00%

0,00%

0,01%

-0,01%

0,02%

Transport equipment

0,00%

0,01%

0,01%

0,04%

0,04%

0,09%

GDP

-0,001%

0,007%

-0,007%

0,009%

-0,025%

-0,000%

Direct benefits not included

0.007%

0.002%

0.013%

0.004%

0.020%

0.007%

indicators calculated as relative changes do not differ significantly for 2025 and 2030. Exact figures reported are for 2025.

Excluding health effects on labour productivity (which, together with the other direct benefits of table 18, would be equivalent to 0,020% of GDP), the estimated aggregate GDP impact is very small even on Option 6C, at 0,025%. Including those productivity gains turns the GDP impact positive for options 6A and 6B, and fully offsets the direct expenditure effect on GDP for option 6C. This is without considering other direct benefits (healthcare, crop yield, infrastructure impacts); as shown in Table 20 , additional quantifiable direct benefits would amount in option 6C to 1080 M€, equal to 0,007% of GDP, and so option 6C would have an overall small positive effect on GDP.

Several of the sectors which bear additional abatements costs also benefit from increased demand for investment goods for pollution control. These sectors (ferrous and non-ferrous metals, chemicals and the power sector), see a net output increase. The sectors that bear a relatively larger share of the burden are agriculture and the refinery sector; however, impacts in agriculture are partly compensated by higher crop yields due to reduced ground-level ozone ( Table 18 , Table 19 ).

6.3.3.Social impacts 

Table 22 summarises the employment impacts of options 6A to 6C by sector. In all cases the effect is essentially neutral (max 2000 jobs in option 6C, which is within the uncertainty range), even without taking labour productivity gains into consideration. When those are considered there is a net job creation (37-112 thousand jobs). The last row in table 22 reflects the impact on aggregate household consumption. The effect is small and in all cases turns from negative to positive when labour productivity is included.

Table 22: Sectorial employment change in options 6A-C, the effects of health benefits on labour productivity are presented separately as “health” case. Last row shows the net welfare effect. Source: GEM-E3, JRC-IPTS

6A

6B

6C

Change in Sector employment in EU28 (2025) in '000 jobs; and welfare change in % compared to option 1

base

health

base

health

base

health

Agriculture

-1,697

0,631

-6,051

-1,644

-24,574

-17,589

Chemical Products

0,055

0,886

0,294

1,912

1,264

3,711

Construction

0,826

3,825

4,209

10,148

16,237

25,043

Consumer Goods Industries

-0,095

1,668

-0,132

3,345

-0,878

4,398

Electric Goods

0,097

0,487

0,576

1,413

2,173

3,379

Electricity supply

0,127

0,355

0,428

0,855

2,387

3,066

Ferrous & non-ferrous metals

0,057

1,155

-0,883

1,234

0,697

3,947

Natural Gas

0,000

0,013

-0,031

-0,007

0,043

0,085

Market Services

0,008

10,299

-0,258

19,693

2,661

32,405

Non Market Services

0,102

6,268

0,427

12,165

3,283

21,101

Petroleum Refining

-0,013

-0,003

-0,044

-0,025

-0,111

-0,082

Other energy intensive

0,014

0,785

-0,578

0,922

-1,405

0,867

Other Equipment Goods

0,464

2,727

2,357

6,638

9,602

16,223

Transport

0,025

2,400

0,106

4,729

1,471

8,450

Transport equipment

0,107

1,004

0,634

2,329

2,857

5,424

TOTAL

-0,069

37,605

0,821

73,691

2,119

112,256

Impact on aggregate household consumption

-0,002%

0,012%

-0,009%

0,017%

-0,030%

0,008%

indicators do not differ significantly for 2025 and 2030. Exact figures reported are for 2025.

6.4.Comparison of the options 

Table 23 summarises the costs (expenditure to reach compliance) and benefits delivered by options 6A to 6D compared to the baseline. Benefits are shown for the highest and lowest of the common valuations. Results are also shown for the quantified direct economic benefits alone (reduced workdays lost, healthcare costs, crop losses and damage to materials). Note however that due to methodological gaps the quantification of direct economic benefits is incomplete and should not be interpreted as an alternative valuation for total benefits.

Costs and benefits are presented as totals required and delivered by each option, and as difference vs the previous –see stringent- option. Such incremental values are useful to single out the consequences of the additional effort of moving from Option 6A to 6B, from 6B to 6C, etc.

Total benefits are always larger than total costs and incremental benefits exceed incremental costs up to the level of option 6C. Even given the limitations of the quantified direct economic benefits, they alone exceed the compliance costs up to and including option 6B.

Table 23: Summary comparison of options for post-2020

2025, EU28

Opt. 6A

Opt. 6B

Opt. 6C

Opt. 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

2030, EU28

Opt. 6A

Opt. 6B

Opt. 6C

Opt. 6D

Costs relative to baseline €M

212

1032

4182

50682

Additional reduction in health impacts beyond baseline (2005 base year)

8%

18%

27%

40%

Additional reduction in eutrophication impacts beyond baseline (2005 base year)

13%

28%

54%

78%

GDP impact taking into account productivity gains

0,008%

0,012%

0,005%

-

Other direct benefits

322

609

1027

1698

Total reduction in external costs of air pollution vs baseline (low valuation)

13 870

27 619

41 309

59 506

Total reduction in external costs of air pollution vs baseline (high valuation)

48 870

98 188

146 216

209 165

The economically rational interim objectives for air pollution policy are those which maximise net benefits (i.e. where the marginal cost equals the marginal benefit). Beyond this point, the costs of additional measures are more than the monetised health benefits they deliver. The analysis suggests that this would happen at a gap closure in the range between 76% and 92%, depending on whether the low or high end of the valuation range is chosen; the additional emission control costs would be between 4,6 and 15 b€ per annum ( Figure 9 ).

Figure 9: Total (left) and marginal (right) abatement cost and monetised health benefit curves for the year 2025, on low and high valuations

Conservative assumptions on benefits have been considered so as to avoid the risk of overestimating the benefits as compared to the costs thus securing a policy that ensure positive delivery of benefits. 122 If such conservative assumptions are used, the option which delivers the maximum net benefit is Option 6C. 123  

A majority of general public respondents to the stakeholder consultation stated that the additional progress to be pursued should be the "maximum achievable pollution reduction", and 37% called for "substantial progress" towards it. About 1/3 of expert/stakeholder respondents supported each of these two options.

The cost-benefit analysis presented here fulfils the requirements of the standard efficiency and effectiveness analysis. As the quantitative objectives are determined as part of the option analysis, efficiency can be considered to increase linearly with the stringency of targets. The positive marginal net benefits criterion indicates that Options 6A to 6C are economically efficient, whereas Option 6D is not.

Coherence with relevant other EU policies, especially as regards the forthcoming climate and energy policy framework, is ensured by (a) the essential climate neutrality of all options considered and (b) the very limited extent of potential regret measures. Section 6.7 elaborates on options to ensure that SMEs are not unduly affected.

6.5.Sensitivity analysis 

A full account of the sensitivity analyses performed is given in Annex 8. The main conclusions are summarised here.

6.5.1.Changes in the target year 

In deciding whether to set targets for 2025 or for 2030, it must be borne in mind that maximisation of net benefit in 2030 will require application of the same pool of measures as for 2025. Thus the main effect of delaying application of the targets to 2030 is to sacrifice cost-effective impact reduction between 2025 and 2030.

The second aspect to the comparison between 2025 and 2030 is the question of regret measures: that the earlier date will force the application of abatement equipment that is retired before its normal lifetime. This may pose a risk in one particular country (the UK), and would be dealt with by appropriate flexibility if 2025 were chosen as the target date (for instance, by discounting emissions from installations which under binding national energy policy would be retired within a certain number of years).

6.5.2.Interactions with climate policy 

The Commission work programme for 2013 foresees a new climate and energy framework for the 2030 time horizon which should deliver benefits in terms of air quality. The form of this policy is not clear at the time of writing, but the analysis presented in Annex 8 and summarised here has assumed a reduction in domestic GHG emissions below 1990 levels by 25% in 2020 and by 40% in 2030. 124 The analysis confirms that a more ambitious climate policy could make reaching the new air quality objectives cheaper by removing highly polluting sources such as coal plants or reducing fuel consumption. However, expanded biomass combustion can result in detrimental health impacts unless sufficiently stringent emission standards are put in place.

Based on a comparison of the available scenarios (see Annex 8.2), decarbonisation measures alone could reduce health impacts from PM2,5 by approximately 5% in 2030 and 10% in 2050 compared to the current legislation baseline. This compares with reductions from additional air pollution measures of around 30% in both years. Decarbonisation of the economy has a more substantial impact on acidification and ground-level ozone, delivering as much as two thirds of the MTFR reductions by 2050. The effect of decarbonisation on eutrophication impacts would be extremely small.

Thus while the impacts of decarbonisation are clearly positive for air, they would deliver only a sixth to a third of the health impact reduction from additional air policy, and only marginal reduction of ecosystem impacts.

This conclusion is also supported by the results of the stakeholder survey, with over 90% of general public and a strong majority of expert respondents (including 80% of government respondents) stating that the future EU air policy should set out additional measures beyond the maximisation of synergies with the forthcoming climate & energy policy.

Another important aspect to consider is the risk that climate change mitigation and air quality policies would deliver incoherent signals to investors, resulting in possible stranded costs similarly to the cases discussed in section 6.5.1 and Annex 8.1. Some sectors, such as the power and refinery sectors, may face in principle the risk that accelerated decarbonisation of electricity supply and of the transport sector could result in early retirement of large capacities and make redundant any additional pollution abatement investments on those plants. However, the time horizon of the proposed air quality policy targets (2025-2030) will give sufficient time for plant operators to develop rational investment plans that give full value to the invested capital, also taking into account that the future low-carbon policy would be based on a cost-effective pathway minimising stranded cost risks.

There are further inter-linkages between climate and air policy. Firstly, some pollutants are also short-lived climate forcers; these include black carbon and ozone, and action to reduce their concentrations will be beneficial for both climate change mitigation and air quality. Secondly, atmospheric aerosols such as sulphates reflect incoming solar light, alleviating the global warming effect; this represents therefore a possible antagonism between climate and air quality measures, although the precise climate effect of aerosols is highly uncertain and any conclusions should be taken with due caution. Further, methane is both a potent GHG and an ozone precursor contributing to the raising hemispheric background concentration of ozone (which in turn is also a GHG). Reducing methane emissions is therefore a clear opportunity for synergy between climate and air quality policies, which is further discussed in section 6.5.5.

Taking all the above elements into consideration, the overall effect of achieving the air quality objectives for the 2025-2030 period compared to the baseline is an eventual small global cooling effect on climate. Calculated over a 100 year time horizon the cooling effect corresponds to - 0,0023 C (+/-0,0003 C) and over 20 year time horizon it is only slightly lower (-0,0021 C+/-0,0002 C). The regional cooling effects in Europe and the Arctic are likely to be stronger. The European contribution to depositions of black carbon in the Arctic is reduced by about 6 % as compared to the baseline. 125

6.5.3.Marginal deviations from the preferred option

The main options (the baseline and 6A-D) are separated by rather large 'gap closure' steps (25%). Much finer-grained analysis has been done in order to compute marginal values as in Figure 9 above, and this analysis is instructive for assessing the implications of small changes in the preferred level of health and environmental impact reductions around Option 6C.

Table 24 below documents the additional expenditure by sector in the range +/- 10% around Option 6C's 75% gap closure. Options 6B (50%) and 6D (MTFR) are also reported for comparison. Impacts and expenditure by Member state are provided in Annex 7.

Table 24: Effort required per SNAP sector on sensitivity cases ranging between Option 6B (50% gap closure for PM2,5 health impacts) and Option 6D (MTFR), in M€/ year

2025

Expenditure by SNAP sector, M€ increase compared to Option 1

Option

6B

6C

6D

PM2,5 gap closure

50%

65%

70%

75%

80%

85%

MTFR

Power generation

125

195

249

470

827

1448

3519

Domestic combustion

497

1028

1439

1680

2853

4097

17791

Industrial combustion

156

395

457

641

853

1141

1811

Industrial Processes

125

233

277

331

407

488

3964

Fuel extraction

0

0

0

6

6

6

583

Solvent use

2

24

38

56

63

252

12204

Road transport

0

0

0

0

0

0

0

Non-road machinery

5

25

137

145

156

180

1451

Waste

7

8

9

9

9

9

9

Agriculture

285

586

745

1292

1459

2109

5675

Total

1202

2494

3352

4629

6633

9730

47007

This sensitivity analysis shows that expenditure per sector in the vicinity of option 6C increases proportionately in most sectors. Costs for domestic combustion increase more rapidly beyond Option 6C, explaining the steeper slope of the marginal cost curve beyond this point. Below option 6C, less effort would be required especially of the agricultural and power generation sectors; however, each 5% less PM2,5 gap closure would mean renouncing €3-10 bn/y in health benefits alone, without taking into account the loss of substantial ecosystem benefits.

6.5.4.Targets for ozone, acidification and eutrophication 

As explained above, the 75% gap closure on the PM2.5 health target (Option 6C) delivers also a certain reduction for ozone, eutrophication and acidification (because secondary PM precursors such as SOx and NOx affect those problems also). The outcomes are clearly valuable in themselves, however, and additional work was done to check for untapped potential for additional eutrophication and ozone reductions. (Acidification was not further pursued, since the ecosystem area left unprotected was already very small). 126  

The majority of respondents to the public consultation stated that the EU air policy should give equal weight to human health and to the environment; almost 60% of government respondents, however, gave priority to human health.

Taking ozone first, the technical measures delivering 75% gap closure for PM2,5 also close 42% of the ozone impact gap. Each additional 1% ozone gap closure would deliver a health impact reduction of €15M. 127 Up to 46% gap closure this marginal benefit exceeds the additional expenditure (€13M per year to move from 45% to 46%), but the next 1% further closure would increase compliance costs by more than the benefits delivered. Thus 46% gap closure is optimal in economic terms. (The total cost to move from 42% to 46% ozone gap closure is €18M per year.)

For eutrophication, the benefits of reduction are hard to express in monetary terms and so the approach taken for ozone is not applicable. Rather, a range of variants were assessed going beyond the  75% gap closure delivered by Option 6C; the costs and emission reductions are summarised in Figure 10 .

Figure 10: Additional ecosystem area protection from eutrophication and related emission control costs (M€/yr) vs. baseline and vs. Option 6C (75% gap closure for eutrophication)

Moving from 75% to 80% gap closure would protect an additional 6,7% of ecosystem for an additional expenditure of €32M per year, around 0,7% additional expenditure; beyond this level of gap closure costs start increasing more steeply. Further analysis on the achievability of these objectives under different underlying hypotheses is presented in Annex 8.

For the subsequent sensitivity checks the central case is adjusted accordingly and is summarised in Table 25 . (For the remainder of the IA it is referred to as Option 6C*.) Detailed information on impacts of Option 6C* including by MS and by sector are presented in Annex 7, Appendices 7.4, 7.5 and 7.6 .

Table 25: Summary of the central case 6C* gap closure vs Option 1 (baseline) and 6C

Gap closure objectives for main impacts, and required expenditure

PM Health

Ozone

Ecosystem Eutrophication

Expenditure in 2025

Expenditure in 2030

6C

75%

42%

75%

4629 M€/year

4182 M€/year

6C*

75%

46%

80%

4680 M€/year

4242 M€/year

6.5.5.Addressing methane emissions

Methane is an increasingly significant issue due to the impact of hemispheric emissions on background ozone concentrations and on climate change; several stakeholders have suggested that national methane ceilings should be included in the NECD. Annex 10 examines the reduction potential for methane in the EU. The baseline recently developed for the 2013 Climate & Energy policy framework 128 would cut emissions by 20% in 2025 compared to 2005, although the variation between individual Member States would be large. Beyond the baseline, a further 8% reduction (to around 26% overall) could be delivered by measures that are either cost neutral or pay for themselves through energy recovery. In 2030, the baseline would respectively deliver a24% methane emission reduction compared to 2005, while the further potential for cost-free measures is estimated at 9%) (33% overall).

Methane targets of up to a 30% reduction in 2025 and 33% in 2030 compared with 2005, suitably differentiated by Member State (see Annex 10), could thus be implemented by measures which, while requiring up-front investment, will have a positive return. Such targets would have a small but significant effect on ozone concentrations across the northern hemisphere, but more importantly could provide a negotiating platform to pursue comparable methane emission reductions internationally.

However, uncertainties in the projections are substantial (covering e.g. the impact of abolishing milk quotas), and may significantly change national methane emissions and the affordability of possible emission reduction targets. Moreover, methane is one of the greenhouse gases part of the international climate negotiations and of the Effort Sharing Decision (ESD) for reducing GHG emissions outside the ETS. Setting national ceilings for CH4 may limit the flexibility offered in the ESD to meet targets. These aspects would need to be taken into account in determining the level at which any ceilings would be set, and suitable flexibility should be allowed in their implementation.

Respondents to the stakeholder consultation from the agricultural sector expressed concerns about the possible inclusion of methane ceilings in the NECD, stating that this would not be cost-effective for their sector. Responses from governmental bodies were divided: some stated that existing international agreements are sufficient to control methane, some others argued that methane should be included in the NECD as an incentive for international action.

6.5.6.Robustness to variations in the key analytical assumptions

One of the key issues raised by stakeholders was how to handle uncertainties in the analytical assumptions. To test the impact of these uncertainties a range of analyses were run where key assumptions were varied (for details see Annex 8, section 4).

The first analysis assessed whether targets for 2025 could lead to regret investments – that is, to the deployment of abatement technology which would not be needed on a 2030 perspective (e.g. because other cheaper options would become available). These impacts are assessed to be around 0,5% of the total cost for the central case Option 6C*; they are concentrated in a particular Member State (the UK) and can be dealt with by suitable flexibility arrangements.

Of the respondents to the stakeholder consultation, just half supported 2025 as target year for the revised air policy, and almost 40% supported 2030. Among those, a majority of NGO and individual respondents chose 2025, while most government and business respondents chose 2030. However, more than 90% of the government respondents indicated that the 2030 targets should be reinforced by interim targets for 2025, with a clear preference for mandatory rather than indicative interim targets.

The second analysis assessed whether the 6C* targets would still be achievable if growth were higher than projected in the assumed baseline. 129 The conclusion is that the impact and emission reductions of Option 6C* would indeed still be achievable overall, and suitable flexibility arrangements could deal with any impacts at Member State level.

The third analysis assessed how much more expensive the objectives would be if the EU's renewable energy and energy efficiency targets were not fully met. 130 The conclusion is that the objectives would still be achievable, albeit at somewhat higher costs (additional 360 M€/year in Option 6C*). Even the national emission ceilings derived from Option 6C* (ie. those calculated as most cost-effective to deliver the reductions) would still be achievable, but would come at an additional cost of 1094 M€/yr (23% higher), almost entirely for pollution abatement in residential combustion, 131 This demonstrates the high synergetic potential of energy efficiency measures to curb energy demand and associated pollution from buildings.

6.5.7.Burden sharing between Member States

Option 6C* ( Table 25 ) would require some 0,03% of the EU's GDP for expenditure in additional pollution abatement measures. However, the distribution of effort across Member States varies from 0,003% of GDP in Sweden to 0,168% of GDP in Bulgaria. This is a reflection both of different absolute GDP levels (the cost of the same piece of equipment would represent a higher share of GDP in a lower-income country); and of differences in past effort (a smaller reduction potential in countries with a longer pollution control tradition).

The effect of capping the direct additional expenditure as a percentage of GDP (while maintaining the environment and health benefits in each Member State) was assessed. The analysis is summarised in Annex 8 (section 5), and shows that any limitation substantially increases the costs for other Member States who are often in no better position to absorb the additional costs. This confirms that the effort required on option 6C* is well balanced across Member States.

6.5.8.Summary of sensitivity analysis

The following are the main points emerging from the above reported sensitivity analysis:

·while climate policy will be substantially beneficial for air quality, climate policy alone would not be sufficient to achieve the long-term air quality objective by 2050;

·option 6C could be improved (leading to option 6C*) for ecosystem and health impacts by complementary eutrophication and ozone targets of 80% and 46% gap closure, respectively, delivered at an increased compliance cost of 1%;

·there is potential to set an EU methane reduction target at low or zero cost;

·the policy objectives are still achievable on alternative future scenarios, and while there could be some regret measures from application in 2025, these are concentrated in one sector and one Member State and would be dealt with by suitable flexibility arrangements.

6.6.Policy instruments to achieve the targets

6.6.1.National Emission Ceilings Directive

The NECD will be the main implementing instrument for the policy, and the options and related impacts of setting ceilings for the period 2025-2030 have been analysed throughout chapter 6. However, in revising the Directive a number of more detailed issues arises which are examined in Annex 11. The measures analysed for the effectiveness and costs are already part of EU and MSs commitments under the LRTAP Convention, in particular for the air emission inventories and projections as well as air pollution monitoring of ecosystem impacts. The main conclusions are that the following further provisions can be included at very modest administrative cost (around €6.9m initial cost and €2.5m annual cost EU-wide):

·Comprehensive coherent national air pollution control programmes requiring that benefits for air quality be maximised

·Requirements to bring emission inventories and projections into line with CLRTAP requirements

·Ecosystem monitoring representative of sensitive ecosystems coordinated with the LRTAP Convention to assess the effectiveness of the NECD in protecting ecosystems

·Simplification and harmonisation measures designed in particular to ensure coherence in MSs reporting

·Measures to require that specific attention is paid to Black Carbon (BC) when designing measures to meet PM reductions, in line with CLRTAP and specifically the 2012 amendment of the Gothenburg Protocol.

In the public consultation, strong majorities (85-96%) of the expert stakeholders and of the general public gave their support to requiring coordination between national and local levels in respect of emission reduction measures and air quality management.

Strong majorities (80-95%) also support the pursuit of specific complementary action to curb emissions of SLCP, and specifically of BC; only 55% of expert respondents and 40% of government respondents, however, support the inclusion of separate BC ceilings in the NECD.

6.6.2.Source controls

A number of stakeholders (including 94% of government respondents) stressed the importance of EU source controls in sharing the pollution reduction burden, and so the impacts of a range of source controls to complement the NECD have been assessed. EU-wide measures also secure single market objectives and a level playing field for economic operators being subject to the same conditions throughout the EU.

The analysis took several groups of measures and estimated the additional implementation cost if they were taken EU-wide. 132 Details are provided in Annex 8, section 7. The measures examined would entail only relatively minor cost-effectiveness compromises, and could be delivered with a combination of existing and new policy initiatives. For many sectors (including chemicals, cement and lime, refining), emission reductions could be delivered through the adoption of revised BAT conclusions under the Industrial Emissions Directive (IED) A first round of revisions is foreseen to be finalised by 2020 as mentioned in the 7EAP, while subsequent revisions of the documents will be starting around that time. Annex 8 provides a preliminary indication of the proportion of the reduction effort that could be delivered via IED implementation for the sectors considered. However, the outcome of the process of defining and establishing BAT conclusions gives a strong role to Member States through their vote on the relevant implementing Decisions in the IED Article 75 Committee. 133

Ammonia emissions from agriculture have so far been hard to regulate at EU level, partly due to the structure of the sector, and partly because emissions and abatement options from the same activity can be different in different places. 134 A revised NECD will set new national emission ceilings for ammonia for 2020 and beyond, leaving it to Member States to identify and implement the appropriate measures to reach the ceilings. The measures required to achieve the ceilings are already implemented in a number of Member States, and the effect of the ceilings would be to bring other Member States up to a comparable level. Thus there is no barrier to implementing the required reductions at Member State level.

However, additional support at EU level will be further considered. Existing BAT conclusions for large farms under the IED are due to be revised in 2014 and 2020; although these will only cover the largest pig and poultry installations, their contribution to the overall emission reduction objectives can be significant, as in 2008 these holdings represented about 25% of all EU ammonia emissions. 135 A recent review under the IED 136 concluded that reducing emissions from manure spreading offers the highest benefit-to-cost ratio, and this option will be further explored as a matter of priority, with a view to determining if and how ammonia emissions should be controlled at EU level. Ways to address ammonia emissions from urea-based fertilisers will also be considered, including in the forthcoming review of the Fertilizers Regulation. 137 Any further measures on agriculture (beyond the ammonia ceilings in the NECD) will be subject to separate impact assessment.

SO2 emissions from international shipping will be significantly reduced 138 by the recently amended Sulphur Directive at a high cost-benefit ratio 139 . The cost-effectiveness of further emission reductions of SO2 is not evident on the basis of the current analysis, but further analysis is merited to investigate in more detail. Although any decisions on additional EU measures would need a separate, more specific analysis, 140 there is clear potential for shipping to cost-effectively deliver NOx emission reductions. Designating NECA in the EU sea areas could deliver substantial benefits, 141 and Member States that do so would need to take less action on land-based sources to meet the health and environmental objectives of the NECD. Although the emission reduction commitments of the NECD do not cover international maritime traffic emission, 142 a voluntary offset mechanism could be envisaged, which could deliver substantial emission control cost reductions for land-based sources while ensuring the achievement of the environmental objectives of option 6C* in all Member States, as detailed in Annex 8, section 6.  143

An EU-level pollution levy was not considered a realistic instrument to deliver the EU-wide pollution reduction objectives. However, taxation at Member State level may well remain an effective policy instrument, also to stimulate growth and employment in a green tax reform context. Positive examples include Denmark's levy on sulphur content of fuels which has driven SO2 emissions sharply down, and its tax on NOx emitted from large and medium-sized point sources.

Combustion plants with a rated thermal input between 1 and 50 MW (hereafter Medium Combustion Plants or MCP) are generally not regulated at EU level, and have been identified as a notable gap in EU legislation. Annex 8 (section 6.2) provides an estimate of the emission reductions and associated emission control costs that would be required of the MCP sector on the central case policy option 6C*. These are estimated at 79 kiloton SO2, 108 kiloton NOx, and 13 kiloton PM2,5, for total additional emission control costs of 220 M€/year. A detailed assessment of options to achieve reductions in this order is provided in Chapter 7 and further background information in Annex 12. The analysis shows that extending the scope of such measures to an EU-wide instrument would result in emission reductions of 135 kiloton SO2, 107 kiloton NOx, and 23 kiloton PM2,5, for total additional emission control costs of 382 M€/year.

Combustion plants below 1 MW rated thermal input include millions of heating installations such as single-house boilers and room heaters. The cost-optimal policy options developed in this chapter include substantial measures for these sources (including 164 kt PM reductions in 2025 in the central case option 6C*). The sources are covered by Directive 2009/125/EC on ecodesign of energy-related products, and ecodesign requirements for solid fuel and biomass boilers (below 1 MW) and local space heaters (below 50-70 kW) are expected to be finalised at the end of 2013. As these installations are responsible for more than 40% of primary PM emissions, major air quality improvements are expected as a consequence.; It must be kept in mind, however, that the general analysis of this chapter cannot fully capture the human exposure and health damage caused by household boilers, because it cannot differentiate between low-level sources (such as road vehicles and low chimneys) and high-stack sources such as power plants. Thus, this analysis should not guide in detail the decision on the exact level of stringency to be sought for ecodesign implementing regulations.

Directive 97/68/EC on non-road mobile machinery covers engines used in a variety of applications that include small handheld equipment, construction and forestry machinery, generators, railcars, locomotives and inland waterway vessels. The NRMM sector has become an increasingly important source of air pollution owing to a steep increase in the number of non-road machines put into service, and to the less stringent emission standards compared to the road sector. Directive 97/68/EC is currently under revision, with a Commission proposal expected before the end of 2013. The cost-optimal policy option 6C* includes 64 kt NOx reductions from the non-road sector, which would be delivered mainly by setting more stringent emission requirements for inland waterway vessels, for construction and industrial machinery, and for rail engines. The same considerations and caveats on low-level sources discussed for the Ecodesign Directive apply also to these measures, and the present analysis should not preempt the outcome of the revision of Directive 97/68/EC.

Based on existing legislation, initiatives in the pipeline and the new measure on MCP proposed here, more than 50% of the emission reductions required to meet the impact reduction objectives of the proposed revised Strategy can be delivered by source control measures at EU level. Detailed analysis on the emission reductions that could be delivered by existing instruments is provided in Annex 8.

Combined, the instruments discussed above could deliver a substantial share of the emission reductions required to achieve the objectives of the 6C* option. Table 26 summarises the total reductions necessary in 2025, the costs associated, and the share of reductions and economic effort that each instrument could deliver.

Table 26: Emission reductions and economic effort required to achieve the objectives of the 6C* policy option and potential contribution EU and MS instruments

 

SO2, kt

NOx, kt

PM, kt

NH3, kt

VOC, kt

effort, M€

 

 

 

 

 

 

 

 

EU28 total

 

-753

-574

-420

-918

-975

4680

 

Ecodesign

 

0

-2

-164

0

-423

1475

 

NRMM

 

0

-64

-4

0

0

142

 

MCP

 

-135

-107

-23

0

0

382

 

IED

 

-326

-257

-29

-228

-134

1155

of which:

cement

-84

-247

-9

0

0

339

glass

-11

0

-3

0

0

29

refineries

-180

-10

-3

0

-33

289

chemicals

-51

0

-14

0

-11

52

solvents

0

0

0

0

-90

15

Pigs and poultry

-228

430

 

National measures

 

-292

-144

-200

-690

-418

1526

 

 

 

 

 

 

 

 

% National

 

39%

25%

48%

75%

43%

33%

Product-based legislation, in this case relevant for Ecodesign requirements for domestic heating appliances and for emission standards for non-road machinery, would in any case need to be put forward at harmonised EU-level to ensure the functioning of the Single Market; this would leave around 2/3 of the effort under the responsibility of the Member States. If, additionally, the EU-level emission controls described above were introduced for medium combustion plants and for several sectors under the IED, EU-level measures would overall deliver more than half the required effort, leaving under Member States’ responsibility one third of the costs and between 25 and 48% of the emission reductions, with the exception of ammonia emission reductions from agriculture, in which case the IED could cover around a quarter of the emission reductions and around 30% of the economic effort required of the sector. 144

6.7.Competitiveness and SME impacts

A full analysis of competitiveness and SME impacts is provided in Annex 9. Potential impacts on competitiveness concentrate in sectors that – because they are more exposed to international competition – will have more difficulty passing through additional costs to their markets. Examples are refineries, chemicals, iron & steel and agriculture; it is likely that at least a subset of these users will have difficulty in passing costs through. The most significantly affected sectors would be agriculture and petroleum refining. In all cases, however, the additional resources committed under the policy options considered would be below or in the order of the 1% threshold of Gross Value Added, indicating headroom to absorb the additional costs.

Implementation of the NH3 ceiling for agriculture under the NECD remains under the responsibility of the Member States; however, the analysis indicates that the required reductions can be achieved by targeting measures on larger installations covering most of the sector capacity. Residual impacts on small farms can be dealt with by Member States by exempting the smaller farms (cattle and pig farms below the 15 Livestock Units threshold and larger thresholds for poultry), and by earmarking appropriate resources under the Rural Development Fund.

Considering the type of installations and abatement measures involved, impacts on SMEs are considered significant only for measures in medium combustion plants (MCP), addressed in chapter 7.

6.8.Trajectory to achieving the long-term objective by 2050

Option 6E of Table 12 , aiming at achieving ambient air pollutant concentration below the WHO guideline values in 2025-2030, was not taken up in the analysis because there are no technical measures currently available that could achieve the WHO guidelines on that timescale. However, we have examined the possibility of reaching the WHO guidelines on a more extended timescale. A Maximum Control Effort (MCE) scenario was developed for the years 2030 and 2050, combining the effect of further phasing out of the most polluting sources (coal), increased electrification, energy efficiency gains and the application of available technical pollution control measures. The analysis shows that the MCE scenario in 2050 would achieve background PM2,5 concentrations below the 10 g/m3 limit recommended by the WHO virtually everywhere in the EU (99,5% of territory and 99% of population exposed). Even at the level of individual monitors, 90% of stations would meet the 10 g/m3 limit, while the residual 10% would be addressed by appropriate supplementary local action for hotspot management. A trajectory towards the 2050 MCE was developed, starting from the central case emissions for 2025, and is set out in Table 27 . Whilst these reductions would all be feasible under the MCE assumptions, their practical implementation would depend on structural and other changes which cannot currently be assumed. Thus the trajectory, and the implied pollution ceilings for 2030 which result, should be considered indicative. Details are in Annex 7, section 4.

Table 27: 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%

6.9.Conclusions

The analysis indicates that the option which delivers the maximum net benefit (Option 6C, the 75% gap closure for PM2.5 health impacts) offers a robust and economically sound basis for further policy consideration. 145 Sensitivity analysis suggests that this option could be further improved by adding eutrophication and ozone targets of 80% and 46% gap closure respectively, delivered at an increased compliance cost of 1% (Option 6C*).

Setting air pollution reduction objectives for 2025 rather than only for 2030 would not cause economic inefficiency or incoherence with climate and energy policy, and would deliver additional cost-effective emission reductions in the period 2025-2030. The policy would be implemented by a revised NECD, supplemented by a legislative proposal controlling emissions from Medium Combustion Plants (see Chapter 7) and a Clean Air Programme summarising non-legislative initiatives to support implementation (see Chapter 5). Compared to the baseline, this option would entail in 2025 (figures for 2030 in parenthesis, if different):

·Health benefits of 62,000 (61 000) less premature deaths from long-term exposure to PM2,5 and 1,600 from acute exposure to ozone, as well as 84 (80) million less sick days.

·Environmental benefits of 146,000 (152,000) additional km2 of ecosystems protected from eutrophication, 73,000 of which are in Natura 2000 areas; and 23,000 (21,000) additional km2 of forest ecosystems protected from acidification.

·Additional compliance costs of €4,7 (4,2) billion per annum.

·Direct economic benefits of €3,2 (3,0) billion (reduced workdays lost, healthcare cost savings, improved crop yields and reduced damage to the built environment), compensating roughly two-thirds of the pollution control costs.

·No net GDP impact when labour productivity benefits accruing from improved health are included.

·Overall benefits in the range of €45-150 (41-146) billion per annum, 10 to 35 times the compliance costs (without considering the ecosystem benefits).

The analysis remains subject to uncertainties and analytical constraints that upon further consideration may broaden the range within which sound policy decisions could be taken. However it offers a solid basis updating the TSAP also considering the need to ensure a maximum of synergies possible, not least with future climate and energy policy.

7.Analysis of Options To Reduce emissions from Medium Combustion Plants

7.1.Rationale for Action

The analysis described in the previous chapters has identified cost-effective emission reductions from combustion plants with a rated thermal input between 1 and 50 MW (hereafter medium combustion plants, MCPs) in a way that suggested a potential for cost-effective EU source legislation in this area.

This chapter presents a summary of the detailed impact assessment related to the options for delivering emission reductions from MCPs through an EU-wide legislative instrument as part of the revised EU Strategy on Air Pollution. The details are provided in Annex 12.A number of stakeholders stressed the importance of EU source controls in sharing the pollution reduction burden. However, the responses to the public consultation on this issue were rather diverse and did not allow conclusion on a clearly preferred option for all stakeholder groups. Several respondents referred to the need to limit administrative burden, stating it could become disproportionate in case of a "full" permitting regime both for operators and for competent authorities.

7.2.Characteristics of the sector

Currently, there is no EU legislation specifically addressing air emissions of polluting substances from MCPs. A number of Member States have legislation in place for all MCPs or for a part of the capacity range. Emission limits applied nationally (or regionally), however, differ significantly across Member States.

Combustion plants with a rated thermal input between 1 and 50 MW are used for a wide variety of applications, including electricity generation, domestic/residential heating and cooling, providing heat/steam for industrial processes, etc. For the purposes of this assessment, two groups have been distinguished, labelled as "boilers" and "engines and turbines" (or "others"). For Member States where no indication of the distribution between these two categories has been identified, the split has been assumed to be 80:20 boilers to others.

Taking into account the broad capacity range, the variety of applications, and that pollution abatement measures (and their costs) may differ depending on capacity, MCPs have been grouped in three capacity classes. The impacts related to each of those groups were assessed separately.

The table below (with data referring to 2010) illustrates that the three classes cover very different numbers of plants, but are comparable in term of current emissions for the three pollutants considered.  In 2010, the dominant fuel for medium combustion plants was natural gas with 67% of the total fuel use (64% for plants 1-5 MW, 73% for 5-20 MW and 60% for 20-50 MW). Solid (biomass, coal) and liquid fuels each have a share of about 12%. In some countries the main fuel used differs significantly from the overall EU average.

Table 28: Overview of medium combustion plants (data for 2010)

Rated thermal input:

1-5 MW

5-20 MW

20-50 MW

Total
1-50 MW

Number of plants

113809

23868

5309

142986

Total rated thermal input (GW)

274

232

177

683

Annual fuel consumption (PJ/year):

1971

2325

1410

5705

SO2 emissions (kt/year)

103

130

68

301

NOx emissions (kt/year)

210

227

117

554

PM emissions (kt/year)

17

20

16

53

7.3.Methodology

Data on medium combustion plants was gathered from the Member States. From these Member State data and through extrapolation based on a number of assumptions, an EU wide dataset (number of plants, fuels used, emissions, legislation in place) was developed with which possible control options were assessed through a bottom-up approach. Member State data was gap-filled using literature data and expert judgement for applicable control measures and associated compliance costs.

Impacts were assessed for the years 2025 and 2030 but as the trends for both years are very similar, with emissions and costs in all but one case either the same or just a few per cent lower in 2030 as compared to 2025. For clarity reasons, analytical results presented in this chapter focus mainly 2025. The results for 2030 are presented in Annex 12.

7.4.Policy options

In designing the policy options two aspects were considered: the emission level and the approach by which plants would be regulated, in particular whether or not a permit would be required. A summary of the different emission level and regulatory options considered is provided in Table 29 and Table 30 .

Table 29: Emission level options

Emission level

Description

Option 1

"no EU action"

This option assumes continuation of current policy measures at Member State level and no further measures for controlling emissions of SO2, NOx or PM from combustion plants <50MW in the EU. It serves as a reference to calculate the impacts of the other policy options.

Option 7A

“most stringent MS”

EU wide emission limit values for SO2, NOx and PM are set for all combustion plants (new and existing) at the level of the most stringent legislation which is currently applicable in Member States for existing plants (for each of the fuel types and size classes considered).

Option 7B

“LCP”

EU wide emission limit values for SO2, NOx and PM are set for all combustion plants (new and existing) in line with the general applicable emission limit values in the IED for existing (large) combustion plants (LCP) with a rated thermal input between 50 and 100 MW (Part 1 of Annex V of the IED).

Option 7C

“primary NOx”

A variant of option 7B, with the same ELVs for SO2 and PM, but for NOx, the emission limit values would only require uptake of only combustion modifications (primary measures) and not of secondary (end-of-pipe) measures.

Option 7D

“Gothenburg”

A variant of option 7C, differentiating between new and existing plants, ensuring alignment with the Gothenburg Protocol provisions, incorporating a number of cost mitigation measures.

Option 7E

“SULES”

A variant of option 7D, where emission limit values for new plants are set at the level of the most stringent emission limit values applied by Member States.

Table 30: Regulatory options

Regulatory options

Description

Option R1

Integrated permit similar to the Industrial Emissions Directive (IED) regime (covering not only air, but also water, soil, waste, …)

Option R2

Permit, but only for emissions to air of SO2, NOx and PM

Option R3

Registration on the basis of notification (no permit)

Option R4

General Binding Rules without permit, notification or registration

7.5.Impact analysis

7.5.0.Environmental impacts

Table 31 provides an overview of the reduction of the annual emissions from applying the five policy options 7A-7E in comparison with a "no EU action" option. The highest emission reductions would be achieved for all the pollutants under option 7A, while slightly lower, but still very significant emission reductions result from option 7B. Little difference exists between the different options for SO2 and PM.

For NOx however, only options 7A and 7B require very effective but costly secondary abatement measures. Option 7C would deliver fewer reductions while this is increasing again under option 7D and option 7E due to the introduction of secondary measures in a limited number of plants.

The NOx reductions foreseen in option 7D, where a bottom up-approach has been taken in the modelling, are the same as forecast in central case policy option 6C* (108 kilotons/year) which is based on the uptake of the most cost-effective pollution control measures in each Member State.

Table 31: Emission reduction compared with "no EU action" in 2025 (kt/y)

Option:

7A

7B

7C

7D

7E

SO2

139

127

127

135

137

NOx

338

288

76

107

159

PM *

45

42

42

45

45

*for technical reasons this is expressed as total particulate matter; to be divided by a factor 2 for convert to PM2.5

7.5.1.Economic impacts

For assessing the economic impacts of the introduction of the EU wide emission limit values, a distinction was made between (i) compliance costs; (ii) emission monitoring costs and (iii) administrative costs.

Compliance costs reflect the cost of additional abatement measures needed to be implemented within the combustion plants concerned and include both capital and operational costs. When calculating total compliance costs per Member State, account has been taken of the extent to which emissions are already regulated under national legislation currently in place.

The introduction of emission limits also requires emission monitoring to allow verifying compliance. For the assessment, only periodic monitoring was assumed as the costs of continuous monitoring are considered prohibitively high.

The regulatory options R1 to R4 result in different administrative costs for both the operators and authorities involved. Depending on the option, administrative costs include elements such as the cost of bringing installations under the regulation, costs incurred in preparatory work for issuing permits, costs of reporting and checking compliance, etc. Several cost elements do not occur under options R3 and R4.

The total annualised costs for operators related to the different options considered are shown in Table 32 below. They range between from 385 and 3486 M€/year.

Table 32: Total annual costs for operators (1-50 MW) (M€/year, 2025)

Emission level option:

7A

7B

7C

7D

7E

Regulatory option:

R1

R2

R3

R4

R1

R2

R3

R4

R1

R2

R3

R4

R1

R2

R3

R4

R1

R2

R3

R4

Administrative costs

165

90

9

5

165

90

9

5

165

90

9

5

165

90

9

5

165

90

9

5

Monitoring costs

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

25

Compliance costs

3296

3296

3296

3296

2226

2226

2226

2226

355

355

355

355

382

382

382

382

790

790

790

790

TOTAL

3486

3411

3330

3326

2416

2341

2260

2256

545

470

389

385

572

497

416

412

980

905

824

820

Compared to 'no EU action', option 7A would lead to an additional compliance cost in 2025 of nearly 3300 M€/year, which is about 1.5 times higher than option 7B. Under either of these options more than 80% of costs are associated with NOx abatement measures mainly due to the need to apply secondary measures in a high number of natural gas fired plants. Under option 7C, where only combustion modifications would be required to abate NOx, compliance costs are drastically lower (around 10% of costs under option 7A). The low costs are kept also under option 7D which foresees secondary abatement measures for NOx in new diesel engines and part of new boilers. In this case total compliance costs are only 2% higher than in option 7C and correspond to about 12% of the costs under option 7A.

Given its focus on very stringent standards for new facilities, the compliance costs for option 7E are higher than for option 7D. This is also the only option where costs in 2030 would be higher than in 2025 as the costs increase substantially as existing plants are replaced by new ones.

The administrative costs are strongly reduced under the "lighter" regulatory options (R3, R4).

SME considerations

About 75% of the medium scale combustion plants are assumed to be operated within SMEs. The direct economic impacts for SMEs were quantified by comparing the total costs per plant against the level of financial resources available to the operator for investment, expressed by using the gross operating surplus (GOS). This has shown that the impact on SMEs can vary between 0.1 to 21.7% of GOS depending on the option. Also under light regulatory options values of about 20% GOS could be reached for the most costly emission level options in cases of small enterprises operating a plant of the biggest category 20-50MW.

Therefore, in addition to the general approach of designing options with a limited administrative impact, a series of mitigation measures to further alleviate the economic burden on SMEs and to limit impacts on internal EU competition and competitiveness has been considered and assessed.

This includes in particular measures such as a later date of application of the emission limits for existing plants and exemptions for plants operating a limited number of hours and derogations for specific cases which have also been identified (e.g. in case of interruption of gas supply, in case of interruption of low-S fuel, when abatement equipment fails). Such mitigation measures would avoid requiring costly investments delivering only very limited environmental benefits and can thus be recommended. Elements of this have been reflected in options 7D and 7E which allow limiting the investment on existing plants with a limited remaining life time.

The impacts of a policy with light regulatory approach (R3, registration only), with emission level option 7D, where also some mitigation measures are already included, will amount to 0.1 – 2.4% of the GOS.

7.5.2.Comparison of options

The policy options are qualitatively compared against four key criteria ( Table 33 ) using the following symbols: high +, low -, yes Y, no N, not applicable NA.

Table 33: Comparison of options

7A

7B

7C

7D

7E

R1-R2

R3-R4

Pollutant abatement cost

+

+

-

-

+/-

NA

NA

Administrative costs

NA

NA

NA

NA

NA

+

-

EU compliance with international obligations

Y

N

N

Y

Y

NA

NA

Impacts on SMEs

+

+

-

-

+

+

-

For a quantitative comparison, the abatement cost is calculated as compliance cost divided by the associated emissions reduction. For all options, this compares very favourably with the damage costs (EMRC, 2013), except for NOx where this is only true for options 7C, 7D and 7E.

Table 34: Cost-effectiveness of options

Emission level option:

Abatement cost per ton of pollutant reduced (€/t)

Damage costs (€/t)

7A

7B

7C

7D

7E

SO2

2600

1400

1400

1400

1500

7600 – 21200

PM*

5200

2900

2900

2500

2800

14750-41650

NOX

7600

6300

500

800

2900

5500-13900

* To allow comparison in this table, damage costs for PM2.5 (29500-83300€/t) have been reduced by half to account for the complex relationship between PM and PM2,5

While the abatement costs for option 7D remains in the same range as that for option 7C, option 7D allows further emission reductions and ensures compliance with the Gothenburg Protocol.

7.6.Conclusions and preferred option

The main conclusions from the detailed MCP analysis are as follows:

·Significant and cost-effective emission reductions can be achieved for all three pollutants (in 2025, addition reductions over the baseline of 135kT/y SO2, 107kT/y NOx and 45kT/y PM on option 7D);

·For all options, cost effectiveness compares very favourably with the damage costs for all pollutants and for all options(see Table 34 ), except for NOx where high cost-effectiveness is demonstrated only for options with less stringent emission limits;

·The total annualised costs for operators can be brought down to the range of 400 M€/year when secondary NOx control is applied only for part of the new plants (as required in the Gothenburg Protocol).

·Policy can be designed so as to minimise administrative costs, by requiring only registration of plants;

·Impacts on SMEs can be reduced to within 0.1 and 2.4% of GOS (option 7D);

·The following mitigation measures for SMEs have been considered: phased implementation with existing plants to comply later than new, temporary exemption for malfunctioning, exemptions for limiting operating hours and microenterprises, simplified reporting obligations (no permit) and limited monitoring for smaller capacity classes.

From the above it is concluded that the favoured policy option in terms of emission reduction is option 7D ("Gothenburg"), coupled with a registration (option R3) for all plants. This choice combines the emission reduction option delivering a high benefit-to-cost ratio, with low administrative costs, while ensuring implementation of the international obligations arising from the Gothenburg Protocol and taking into account comments and positions expressed from the different stakeholders.

In particular situations such as for instance air quality management zones in non-compliance with limit values of the AAQD, Members States might have to adopt stricter abatement measures, as reflected in the emission level option 7E (SULES).

Chapter 6.6.2 estimates the emission reductions that would be required in 2025 from MCPs under the central case policy option 6C* at 79 kT/y SO2, 108 kT/y NOx, and 13 kiloton PM2,5, for a compliance cost of 220 M€/year. An EU-wide instrument to control emissions from these plants would extend to all Member States the technical measures identified as cost-effective in the multi-sectorial analysis of Chapter 6. Designing such an instrument based on the preferred options would lead to a compliance cost of 382 M€/year and emission reductions of 135 kT/y SO2, 107 kT/y NOx, and 45 kT/y PM (corresponding to about 22.5 kT/y PM2,5). The increased emission reductions from the sector over option 6C* are commensurate with the increased cost.

8.Summary

This Chapter summarizes the analysis of the policy options developed in Chapters 5 through 7 to address the outstanding problems defined in Chapter 3 in accordance with the objectives formulated in Chapter 4.

To ensure achieving full compliance with the air quality legislation by 2020 at the latest (the first general objective), six policy option were considered in Chapter 5: the baseline (Option 1); additional source controls (5A); tighter ceilings under the NECD (5B); supporting action for further Member States' measures (5C); further international action (5D); and amending the AAQD (5E). The preferred policy option comprises the non-regulatory programme supporting Member States' action including implementation of already agreed EU legislation as well as enhanced, governance, monitoring, and evaluation provisions. In addition the NECD will be revised to incorporate the EU's international commitments for 2020 under the Gothenburg Protocol (GP) as amended in 2012 (baseline option 1).

To achieve further health and environmental impact reductions during the period up to 2030 (second general objective) four options for strategic impact reduction targets beyond the baseline (i.e. the same scenario as considered in Chapter 5 but up to 2030) were examined in Chapter 6. These were defined in terms of the percentage closing of the gap between the baseline and the maximum technically feasible reduction scenario related to health impacts due to PM: 25% (Option 6A), 50% (Option 6B), 75% (Option 6C) or 100% (Option 6D). A further option to meet the WHO guideline values (Option 6E) was assessed but considered not within reach before 2030. The main options were further characterised in terms of the NECD reductions for 2025 and 2030 and the technical measures required to meet them. The preferred option for setting the next strategic level is at 75% of the maximum reduction feasible with respect to PM related health impacts, further optimized for additional reductions in eutrophication and ozone (Option 6C*). This option is to be implemented by further tightening of emission ceilings under the NECD for the periods 2025 and 2030.

The preferred policy will support Member States in resolving remaining non-compliance with current legislation (including by rectifying failures in current EU source controls) and ensure coherence with international commitments by 2020 at the latest. A fully implemented baseline will reduce impacts in 2020 by 36% for PM2,5, 23% for ozone, 17% for eutrophication and 61% for acidification, compared with 2005. By 2030, the reductions relative to 2005 will be 53% for PM2,5, 35% for ozone, 39% for eutrophication and 87% for acidification. External costs associated with the baseline will be further reduced to €212-740bn in 2030. The preferred policy for option 2025-30 will reduce the remaining health burden from air pollution by a third more than the baseline (relative to 2005). Eutrophication impacts will be reduced by 55% more than the baseline.

The preferred option for 2020 entails no additional EU expenditure over the baseline except for the costs of supporting measures for national action (around €100m from LIFE). Costs will depend sensitively on local circumstances and can be covered in part by improved uptake of structural funds. Local emitters affected by measures taken at national level to reduce diesel and domestic combustion emissions up to 2020 will inevitably include some SMEs as users of light duty diesel vehicles. The preferred policy for the period 2025-30 will reduce total external costs of air pollution by €45bn (on the most conservative valuation) compared to the €212bn in the baseline, including direct economic benefits amounting to more than €3 billion: €2bn from reduced labour productivity losses, reduced health care costs of €650m, reduced crop value losses of €270m, and reduced damage to the built environment of €140m. Meeting the policy objectives for 2025-30 implies annual compliance costs of €4,7bn (investment, operating and maintenance costs for new abatement techniques) or about one tenth of the external cost savings. Overall GDP impact is very low (-0,025%) and entirely offset once increased productivity is taken into account, without considering other direct benefits. Once productivity improvements are taken into account, the policy could add around 112 thousand jobs. A target year of 2030 rather than 2025 would result in loss of net benefits in the period 2025-30. Introducing harmonised EU controls for MCPs increases the total costs by about €160m. Administrative costs associated with amending the NECD include a one-off €8m and €3.5m annual cost).

The main affected sectors for the period 2025-30 are agriculture and refineries. Gross impacts amount respectively to 0,24% and 0,10% of sectoral outputs which are reduced to 0,21% and 0,09% once improved productivity is taken into account. Costs for the agricultural sector are further offset by reverting crop yield loss amounting to €270m, close to 0,1% of sectorial output. Two other industrial sub-sectors are affected (cement and sulphuric acid production) although in neither case impacting international competition. Most SME impacts are concentrated in MCP and agriculture. Impacts are mostly mitigated in the preferred MCP control option (registration rather than permitting and emphasizing primary NOx control as the minimum standard); less than 2% of gross operating surplus.

From the sensitivity analysis it was concluded that new NECD ceilings are required in addition to climate policy, and that the regret investment risk can be managed by appropriate policy design. Regarding the potential trade-off with biomass combustion, Ecodesign measures would help achieving the required reduction in emissions from solid fuel combustion (including biomass burning). For the remaining unregulated component of combustion (1-50MW) further action was required to manage the increased PM (and PaH) emissions resulting from climate and energy induced biomass uptake (see below). Regarding the control of methane (both a GHG and an ozone precursor), it was concluded that methane ceilings under the NECD could bring down emissions cost-effectively although flexibility would be needed in the ultimate design of the policy instrument to avoid undue interference with the implementation of the Effort Sharing Decision 406/2009/EC.

The main options considered for additional EU source measures to reinforce emission reductions were Medium Combustion Plants (MCPs), agriculture and international shipping.

With respect to MCP, five options were considered in Chapter 7 for delivering emission reductions in the range of 10 to 20% of the required reduction for SO2, NOx and PM under the NECD. The preferred policy option would set emission performance standards that are derived from the amended Gothenburg Protocol (option 7D) coupled with a registration requirement (option R3) for plants. In particular situations such as for instance air quality management zones in non-compliance with limit values of the AAQD, Members States may have to adopt stricter abatement measures (Option 7E). This will yield annual emission reductions of 135 kT SO2, 107 NOx, and 45 kT PM (corresponding to about 22.5 kT/y PM2,5) while increasing the costs of option 6C* with 382 M€/year. The preferred policy option avoids significant impact on administrative costs and SMEs.

Further (future) work will focus on detailed impact assessments related to possible additional source controls in agriculture (ammonia) and international shipping in EU waters (NOx). For agriculture emissions that focus has been particularly on ammonia but also of primary PM as these remain substantial contributors to health and environment problems. Measures relating to the agricultural sector already in the pipeline or an advanced stage of analysis include a requirement on Member States to implement specific "emission reduction measures" for ammonia in the context of implementing the NECD national programmes; the revision of the existing BREF under the IED for agriculture to deliver further reductions from large pig and poultry farms (noting that, the IED does not cover at present cattle farms which is a main emitting subsector.); and other ammonia abatement measures that could be facilitated through EU financial support to farmers for ammonia abatement such as adopting sustainable fertilization strategies (provided that MS gives priority to this in their national Rural Development Programmes). This work, including additional consultations with the sector, will be taken forward in dedicated fora established to ensure the objectives of the new strategy (and NECD) are reached. For emissions from international maritime traffic, previous studies and this review suggest that additional measures such as NOx Emission Control Areas are cost-effective. This option will also be pursued further together with Member States and stakeholders, possibly in combination with assessing appropriate incentive mechanisms such as NOx funds or linkages to flexibility mechanisms under the NECDs.

In conclusion, the package of proposals supported by this Impact Assessment supports the further development of the following package of proposals:

·A Communication on an updated EU Thematic Strategy on Air Pollution (TSAP) setting out a policy focus on effective implementation of the baseline so as to ensure compliance with the Ambient Air Quality Directive by 2020 at the latest and updated impact reduction objectives for the 2025 and 2030 accompanied by cost-effective implementation pathways for Member States' and sectorial action. The Communication will include An outline for strengthened non-regulatory EU action plan which the Commission will promote, using the funding opportunities provided under the LIFE Regulation to support active engagement of implementing authorities at all relevant levels (local, regional, national, EU, and international) and to promote early action on the implementation of the new strategy (presented as an updated European Clean Air Programme).

·A proposal for a revised National Emission Ceilings Directive incorporating the Gothenburg Protocol obligations for 2020, and setting ceilings for 2025 and 2030 to achieve the new TSAP impact reduction objectives; and

·A proposal for a legal instrument controlling air pollutant emissions from medium combustion plants (MCP).

9.Monitoring and Evaluation

The ex-post analysis confirmed that the overall monitoring and evaluation provisions for the TSAP was adequate. Certain gaps were nevertheless identified that required attention. The updated monitoring and evaluation provisions will be addressed as follows.

9.1.Monitoring and evaluation of the revised TSAP

Progress in achievement of the ambient air quality standards will be monitored by the Member States, the Commission, and the EEA as required by the AAQD and summarised annually in the EEA's air quality report. Member State action on localised exceedances will be monitored through the existing reporting provisions of the Ambient Air Quality Directive and through the strengthened network on implementation Uptake of available funds will be monitored in co-operation with DG REGIO and DG AGRI.

Resolution of the real-world emissions problem will be monitored against the procedural milestones outlined in the CARS 2020 Communication: adoption of a new test cycle by end 2014; monitoring of emissions according to the test cycle thereafter; and type-approval in accordance with the new test cycle by 2017 at the latest. The implementing provisions will include requirements to monitor and reporting of the "real world emissions" according to the new test cycle and in-use provisions in the period before it becomes mandatory for type approval (2014-17); this will be complemented by monitoring by the Commission's Joint Research Centre involving, where possible, independent test centres.

Progress towards the strategic impact reduction objectives will be monitored using the same indicators in which the targets are expressed ( Table 35 ). The health impacts will be monitored by periodic health impact assessments conducted by the Commission with assistance of the EEA and other expert bodies using a methodology consistent with the analysis presented here and concentration data obtained from the monitoring network under the AAQD. For ecosystem impacts of air quality, there is currently no requirement to monitor these under EU legislation. As discussed in section 6.6.1 , it is proposed that the revised NECD should only include a requirement for air pollution ecosystem monitoring in sensitive ecosystems representative for the Member States and coordinated with the effect-oriented monitoring of the LRTAP Convention. The monitoring will also use assessments from the GMES Atmosphere Service, Eye on Earth, air pollution modelling exercises and other available information sources.

Table 35: Selected indicators for monitoring progress towards the new strategic impact objectives

Objective

Indicator

Method

Responsible authority

50% reduction in premature deaths due to chronic PM2.5 exposure by 2025

Number of premature deaths due to PM health impacts per year in EU

Calculated from (a) monitored/modelled PM2.5 concentrations; (b) concentration-response relations; (c) population and (d) baseline health statistics.

Calculations by DG ENV using external contract or by the EEA.

33% reduction in premature deaths due to acute ozone exposure by 2025

No of premature deaths due to acute ozone exposure

Calculated from (a) monitored/modelled ozone concentrations; (b) concentration-response relations; (c) population and (d) baseline health statistics.

As above

34% reduction in ecosystem area unprotected from eutrophication by 2025

Ecosystem area for which critical loads are exceeded.

(i) Assessment based on combined monitoring and modelling of nitrogen deposition to ecosystems

(ii) Direct monitoring of sensitive ecosystem impacts under NECD (list parameters)

(i) EEA

(ii) Member States under Article 7.5 of revised NECD

80% reduction in ecosystem area unprotected from acidification by 2025

Ecosystem area for which critical loads are exceeded.

(i) Assessment based on combined monitoring and modelling of nitrogen/
sulphur deposition

(ii) Direct monitoring of sensitive ecosystem impacts under NECD (list parameters)

As above.

Progress in addressing third country emissions of air pollutants which affect EU air quality will be monitored procedurally (the number of ratifications of the revised Gothenburg Protocol) and regarding substantive pollution reduction in the context of the CLRTAP's monitoring and reporting mechanisms.

The implementation of the revised TSAP will be evaluated every five years by the Commission with reporting for the first time not later than 2020. On that occasion, the scope for tightening the air quality standards under the Ambient Air Quality Directive will also be considered.

9.2.Monitoring and evaluation of the revised NECD

Progress towards the EU and Member States emission reduction commitments for PM2,5, SOx, NOx, NMVOCs, NH3 and CH4, for 2020 and 2025/30 will be monitored and assessed based on (reinforced) provisions in NECD relating to emission inventories and projections. The effect of the ceiling reductions on background concentrations of air pollutants will be assessed through the monitoring under the AAQD, and the impact reduction achieved will be monitored through the TSAP monitoring as described above.

The implementation of the new NECD will be evaluated every five years (in combination with the TSAP review) and for the first time not later than 2020.

9.3.Monitoring and evaluation of the proposed legal instrument on MCP 

Monitoring of the implementation and impact of measures on MCP will be based on streamlined and targeted reporting requirements on the Member States focusing on the key data which are necessary to assess the extent to which the objectives of the legislation are being achieved. The Commission will evaluate the results of this policy and report them at least every five years.

 

ANNEX 1    Glossary

BAT    Best Available Techniques

CAFE    Clean Air For Europe Programme

CH4     Methane

CLRTAP    Convention on Long-range Transboundary Air Pollution

CO2     Carbon dioxide

EC4MACS    European Consortium for Modelling Air Pollution and Climate Strategies

EEA    European Environment Agency

EMEP    European Monitoring and Evaluation Programme

GHG    Greenhouse gases

HDV    Heavy Duty Vehicles (heavy trucks and buses)

IED    Industrial Emissions Directive

IIASA    International Institute for Applied Systems Analysis

IPPC    Integrated Pollution Prevention and Control (directive)

JRC    Joint Research Centre of the European Commission

kW    kiloWatt (1000 Watts, measure for power and power capacity)

LCP    Large Combustion Plants (directive)

LDV    Light Duty Vehicles (passenger cars and small trucks)

MARPOL    International Convention on the Prevention of Pollution from Ships

MCP    Medium Combustion Plants (between 1 and 50 MW thermal input)

MTFR    Maximum Technically Feasible Reduction: the lowest level of pollution achievable by deploying all commercially available technical solutions irrespective of cost

MW    MegaWatt (1 million Watts, measure for power and power capacity)

NEC    National Emission Ceilings (directive)

NH3     Ammonia

NMVOC    Non-methane volatile organic compounds

NRMM    Non-Road Mobile Machinery (include diverse products ranging from hand-held power tools to large construction and agricultural machines)

NOx     Nitrogen oxides (NO and NO2)

O3     Ozone

PM    Particulate Matter of any size

PM10    Particles with an aerodynamic diameter of less than 10 µm

PM2.5    Fine particles with an aerodynamic diameter of less than 2.5 µm

SO2     Sulphur dioxide

SOx    Sulphur oxides (including SO2, SO3)

TEN    Time Extension Notifications related to the Ambient Air Quality Directive

TSAP    Thematic Strategy on Air Pollution

VOC    Volatile organic compounds

WHO    World Health Organisation

ANNEX 2    Use of expertise and Consultation of Interested Parties 

1.1.External expertise

The review process draws on a long-standing knowledge base that is widely available as well as on expertise built up over several decades in air quality review and management activities 146 . The impact assessment has been prepared also with the support of several targeted studies prepared on behalf of the European Commission by consultants, the EEA, the JRC, the WHO and other leading scientists.

Specific information was collected through the following streams:

Quantitative modelling of baseline emissions and associated impacts, of the scope for further emission reduction options, and of cost-effective emission reduction strategies was conducted with the GAINS Integrated Assessment Modelling suite. 147

Broader socio-economic and competitiveness impacts associated with different pollution reduction options and under different assumptions on the potential use of market-based and fiscal policy instruments were analysed by JRC-IPTS with the use of the GEM-E3 Computable General Equilibrium Model and of Environmentally Extended Input Output Models

Additional insights on the extra-EU burden of pollution to EU air quality were provided by a specific study focusing on Hemispheric Transport of Air Pollutants 148

Specific review studies were conducted to supplement the information base for the most critical pollutants in terms of health risks:

Particulate Matter, Heavy Metals and PAH; the study was also complemented by a dedicated expert workshop on Particulate Matter

Ozone; with a focus on assessment of current situation, reasons for non-compliance and the relationship between ozone concentration and precursor emissions

The WHO European Centre for Environment and Health provided an update of the knowledge base on the health burden of air pollution and of the Health Impact Assessment model used for the analysis underpinning this Impact Assessment 149

A study led by the Danish Centre for Environment and Energy supported the update of the EMEP EEA Emission Inventory Guidebook (the central reference manual used to support countries in estimating emissions under the NECD and the UNECE LRTAP Convention), in particular on methodologies for black carbon emissions

The analysis of recommendations for the Air Quality assessment and management regimes provided by the AQUILA and FAIRMODE groups

A DG RTD-funded initiative reviewed the latest scientific findings of EU RTD projects relevant to the EU Air Quality policy and gathered them into a single report aimed at the identification of key scientific messages relevant for the revision and implementation of EU Air Quality legislation. The report covered the following research review streams: Nitrogen; Particulate Matter; Ozone; Air Quality and Climate; Air Quality and Health; Integrated Assessment.

1.2.Consultation of interested parties

Stakeholders were widely consulted through a series of formal and informal stakeholder events: two online questionnaires, a Eurobarometer survey, and a continued dialogue with interested stakeholders through multi- and bilateral meetings. Input from stakeholders has been taken into account when refining the quantitative analysis, assessing the different possible options to curb air pollution where considered appropriate (particularly with regard to the design of the policy mix), possible unwanted effects and impacts on specific sectors and Member States, and implications on subsidiarity. Consultation with Member States on matters related to the IA also took place in the meetings of the Air Quality Expert Group, which is the expert preparatory group for implementing measures under the NEC Directive and the Directives on Ambient Air Quality.

1.1.1    Online consultations

A first scoping on-line public consultation was carried out at the end of 2011 with a view to broadening the information base for the initial development of the policy options to be carried forward in the following process.

The on-line public consultation on the main policy options analysed in the Impact Assessment (Options for the revision of the EU Thematic Strategy on Air Pollution and related policies) ran from 10 December 2012 until 4 March 2013 (12 weeks) on the European Commission’s ‘Your voice in Europe’ web page. 150 . The consultation used two questionnaires: a total of 1934 individuals responded to a shorter questionnaire for the general public; for the longer questionnaire for experts and stakeholders, 371 responses were received.

The questionnaire for experts and stakeholders had 38 questions (not including sub-questions). Of these, 17 were open questions allowing written comments and the others were closed, multiple-choice questions. The questionnaire covered the following themes:

·Ensuring compliance with EU air quality requirements and coherence with international commitments

·Reducing exposure to damaging air pollution in the long term

·Revising the ambient air quality directive (AAQD)

·Revising the national emission ceilings directive (NECD); and

·Addressing major air pollution sources

The questionnaire for the general public had 13 questions covering all these themes except the last, air pollution sources. In order to provide comparability between the two questionnaires, 12 of the 13 questions were closed, multiple-choice questions also used on the questionnaire for experts and stakeholders. The last question was an open question allowing written comments.

Key strengths of the consultation responses include: the high number of responses from citizens and from experts and stakeholders; responses received from a broad range of economic sectors, government bodies and NGOs. However, limitations should be noted: for example, relatively few responses were received to either questionnaire from EU12 Member States. Key results from the consultation are here summarised per theme:

Theme 1: Ensuring compliance with EU air quality requirements and coherence with international commitments

Regarding options to ensure Member State compliance with current air quality legislation, just over 90% of respondents to the questionnaire for the general public, along with over 80% of government, NGO and individual expert respondents to the questionnaire for experts and stakeholders, support strengthening emissions controls (though few business respondents supported this option).

Theme 2: Reducing exposure to damaging air pollution in the long term

In terms of how future EU air pollution policy should interact with EU climate and energy policy, over 90% of respondents to the questionnaire for the general public, along with over 80% of government, NGO and individual expert respondents to the questionnaire for experts and stakeholders, support the option that EU air pollution undertakes additional measures beyond synergies with climate and energy policy. A majority of business respondents, however, feel that a new air pollution action should not go beyond synergies with climate and energy policy.

Regarding the target year for a revised Thematic Strategy, just over 80% of NGO respondents and just over 60% of individual experts indicate 2025. However, a majority of business and government respondents instead choose 2030.

In response to a question about the extent of progress for a revised Thematic Strategy, a majority of the respondents to the general public questionnaire (55%) chose ‘maximum achievable pollution reduction’ as the level of additional progress to be pursued, and 37% called for ‘substantial progress’ that is lower than the maximum reduction. On the expert/stakeholder questionnaire, a majority of NGO responses called for the maximum reduction; a majority of government responses called for substantial progress; and just over 45% of business responses called for the ‘level delivered by the forthcoming climate and energy framework for 2030’.

A further question asked whether priority should be given to human health or the environment in air pollution policy. Just over two-thirds of general public responses indicated that equal weight should be given to human health and environmental impacts. About 60% of NGO and individual expert responses chose this option; almost 60% of government respondents, however, indicated human health impacts as the priority. A large share of business responses, 25.4%, chose ‘other’: in written comments, many of them referred to socio-economic factors.

Theme 3: Revising the Ambient Air Quality Directive (AAQD)

Over 80% of respondents to the general public questionnaire, similar shares of NGO and individual expert responses to the questionnaire for experts and stakeholders, and just over 55% of government respondents call for the indicative limit for PM2.5 to be mandatory. However, 55% of business respondents are opposed to this proposal.

High shares of public, NGO and individual experts also call for AAQD limit values to be made more stringent to bring them closer to WHO guidance values. Almost 60% of government respondents, however, indicate that this should happen ‘once the EU has made further emissions reductions’, and almost 50% of business responses call for ‘no change’ on this topic.

Regarding monitoring and regulation for black carbon, a majority of public, NGO and expert responses favour both monitoring and a binding limit value; government respondents prefer either a non-binding target value plus monitoring, or only monitoring.

Regarding ozone limit values, a majority of NGO and expert responses indicated that current non-binding limit values for ozone should be replaced with binding limit values at more stringent levels. Just over 50% of business responses (50.9%) and over just 60% of government responses, however, prefer ‘no change’ in this area.

There is strong support for the option that zone-specific plans be consolidated into national plans: this option is favoured by almost 80% of respondents to the questionnaire for the general public, similar shares of NGO and expert respondents to the questionnaire for experts and stakeholders, and almost 60% of government respondents.

Theme 4: Revising the National Emission Ceilings Directive (NECD)

In the general public questionnaire, 91.2% of respondents indicated that national emission ceilings should be adopted for black carbon/elemental carbon; among the expert/stakeholder responses, over 60% of NGO and individual expert responses agreed with the option; in contrast, about 60% of business and 45% of government responses were opposed.

Strong majorities of all respondents were in favour of coordination between national and local levels in respect to emissions reduction measures and local air quality management.

With regard to mechanisms for flexibility in the NECD management framework, a majority (63%) of respondents in governments indicated that compliance checking be made on multi-year average. This was supported also by business respondents (60 %) but not by the NGOs (7% support).

Further, the government respondents (60%) also supported the option to allow limited adjustment of the emission inventories after the approval by the Commission, but not (20%) of the ceilings. The option to allow adjustment of the inventories also had some support from NGOs (37 %) and business (44%)

Theme 5: Addressing major air pollution sources

Only the questionnaire for experts and stakeholders included questions on sources.

Respondents were asked to rank measures to address emissions from road transport. The highest-ranking option was to introduce with minimum delay the new test procedure to ensure that ‘real world emissions of Euro 6 light duty diesel vehicles are as close as possible to the type approval limit values’. The second-ranking option was to improve ‘in-service compliance with emissions standards’.

For non-road machinery, the highest-ranking option was for ‘a more stringent Stage V standard’. The second-highest was to ‘ensure that approval emission tests reflect ... emissions in real world circumstances’.

For measures to address emissions from the agricultural sector, NGO and individual expert responses gave the highest average ranking (i.e. lowest score) to the option, ‘Set tighter emission ceilings for ammonia for 2020 and 2030 in the NEC Directive, leaving flexibility to Member States on how these ceilings can best be reached’. Government responses gave the highest average ranking to the option: ‘Where cost effective, introduce new or revise existing EU legislation to establish EU-wide specific rules for e.g. improved manure storage, management and spreading techniques’. Business responses gave the highest average ranking to: ‘Promote good practices in manure management and manure spreading in Member States through support from the Rural Development Fund’. In written comments, representatives of the agricultural sector emphasised that new measures should mainly take through this fund.

A majority of NGO respondents and over 40% of government and individual expert respondents supported two options to address emissions from small and medium combustion installations (i.e. below 50 MW):

·Develop a supplementary and more stringent standard for installations below the Ecodesign capacity threshold for use in national and local measures such as fiscal incentives to be applied in zones that are in non-compliance with air quality limits.

·Regulate combustion installations above the Ecodesign capacity threshold but below the 50MW threshold set in the Industrial Emissions Directive (IED).

For business responses, however, the highest share of responses, about one-quarter, went to ‘Don’t know’, followed by ‘No additional measures’ (just under 20%).

Two options to address emissions from the shipping sector were chosen by at least 50% of government, NGO and individual expert responses:

·Promote the extension of the Sulphur Emission Control Areas to additional EU sea areas such as the Irish Sea, the Gulf of Biscay, the Mediterranean and/or the Black Sea provided that such a measure is cost-effective.

·Promote the designation of NOx Emission Control Areas in EU regional seas where cost-effective (those listed above and/or the Baltic and the North Sea including the English Channel) provided that such a measure is cost-effective.

None of the options regarding shipping received more than 24% of business responses. In written comments, respondents from the shipping industry as well as some other government sectors underlined that shipping should be regulated through the International Maritime Organisation.

1.1.2    Stakeholder meetings

The impact assessment process has been accompanied by a broad and extensive stakeholder consultation process.

A Stakeholder Expert Group (SEG) has been set up, including representatives of the Member States, of key concerned industry associations and of relevant NGOs. The SEG met 5 times between June 2011 and April 2013

Care was taken to ensure the minimum standards for consultation were fulfilled:

·Clear background documents were provided in all circumstances. For the public consultations, concise explanations were inserted before each section of the questionnaire, and a more detailed explanatory document was provided. At all stakeholder meeting, comprehensive consultant reports have been distributed ahead of the meeting, accompanied when necessary by guiding sheets containing lists of key questions on which the stakeholders were invited to reflect in advance.

·In order to make sure that all questions of the final on-line stakeholder survey were as clear and unambiguous as possible, the draft questionnaire was preliminarily consulted with the IASG and revised following the inputs of the IASG.

·All relevant target groups were consulted. Specific consultant reports were prepared and consulted with the stakeholders in specific sectors: mobile sources, international maritime shipping, small- and medium-scale combustion plants; agriculture.

·The consultation was publicised on Your Voice in Europe and a press release put out on RAPID:  http://europa.eu/rapid/press-release_IP-12-1337_fr.htm

·The consultation was open for 12 weeks, and at least 20 days' notice was given to stakeholders ahead of each consultation meeting.


·ANNEX 3    Air Pollution Impacts and Sources

1.The Main Air Pollution Impacts

According to the EEA, more than 80 % of the EU’s urban population is exposed to PM levels above the 2005 WHO Air Quality Guidelines, depriving citizens of more than eight months of life on average – with life expectancy reduced by up to two years in the most polluted places.

As well as health risks, air pollution causes significant damage to our environment and ecosystems. Ground-level ozone damages materials, as well as agricultural crops, forests and plants, reducing their growth rates. Nitrogen oxides (NOx), sulphur dioxide (SO2) and ammonia (NH3) harm soil, lakes and rivers by acidifying them, causing loss of animal and plant life. Ammonia and NOx also disrupt land and water ecosystems by introducing excessive amounts of nutrient nitrogen – a process known as ‘eutrophication’. It is estimated that two-thirds of the protected sites in the EU Natura 2000 network are currently under severe threat from air pollution.

1.1.Health Effects 

There is a large body of evidence on the health impacts of air pollution. Health effects related to air pollution are divided into short-term and long-term exposure effects. Effects caused by short-term exposure (in the order of days or hours) are described as acute effects. Those caused by long-term exposure (in the order of months or years) are identified as chronic effects. Impacts on mortality relate to people dying earlier than they would in the absence of exposure by air pollution. Morbidity relates instead to illness, ranging from minor effects such as coughing to life threatening conditions that require hospitalization.

The Table A3.1 below summarizes the key health effects for major air pollutants. Of particular concern are particulate matter (PM) – a type of fine dust – ground-level ozone (O3) and nitrogen dioxide (NO2).

The latest study from the World Health Organization (WHO) 151 links long-term exposure to very fine particles (PM2.5) with cardiovascular and respiratory deaths, as well as increased sickness, such as childhood respiratory diseases. There is also new evidence for the negative effects of long-term exposure to ozone on mortality and reproductive health.

Table A3.1: Overview of key health effects for major air pollutants (EEA)

Pollutant

Health effects

Particulate Matter (PM)

Can cause or aggravate cardiovascular and lung diseases, heart attacks and arrhythmias, affect the central nervous system, the reproductive system and cause cancer. The outcome can be premature death.

Ozone

(O3)

Can decrease lung function; aggravate asthma and other lung diseases. Can lead to premature mortality.

Nitrogen oxides (NOx)

NO2 can affect the liver, lung, spleen and blood. Can aggravate lung diseases leading to respiratory symptoms and increased susceptibility to respiratory infection.

Sulphur oxides (SO2)

Aggravates asthma and can reduce lung function and inflame the respiratory tract. Can cause headache, general discomfort and anxiety.

Non-methane volatile organic compounds (NMVOC)

NMVOC, important O3 precursors, are emitted from a large number of sources including paint application, road transport, dry-cleaning and other solvent uses. Certain NMVOC species, such as benzene (C6H6) and 1,3-butadiene, are directly hazardous to human health.

Carbon monoxide (CO)

Can lead to heart disease and damage to the nervous system and cause headaches, dizziness and fatigue.

Arsenic (As)

Inorganic As is a human carcinogen. It can lead to damage in the blood, heart, liver and kidney. May also damage the peripheral nervous system.

Cadmium (Cd)

Cadmium, especially cadmium oxide is likely to be a carcinogen. It may cause damage to the reproductive and respiratory systems.

Lead (Pb)

Can affect almost every organ and system, especially the nervous system. Can cause premature birth, impaired mental development and reduced growth.

Mercury (Hg)

Can damage the liver, the kidneys and the digestive and respiratory systems. It can also cause brain and neurological damage and impair growth.

Nickel (Ni)

Several Ni compounds are classified as human carcinogens. It may cause allergic skin reactions, affect the respiratory, immune and defence systems.

1.2.Acidification 

Acidification damages plant and animal life in forests, lakes and rivers, as well as buildings and historical sites by corrosion.

Acidification of soil is related to the build-up of hydrogen cations (acid) thereby causing a reduction of the pH value. It is caused by the deposition of nitric acid and sulfuric acid (which are common components of acid rain). Acidification also occurs when cations such as calcium, magnesium, potassium and sodium are leached and lost from the soil through the action of acid rain. Soils and waters with poor buffering capacity are the most sensitive to acid rain. Plants take base cations (mainly potassium, magnesium and calcium) from the soil as they grow, donating a hydrogen cation (proton) in exchange for each base cation. Where plant material is removed, as when a forest is logged or crops are harvested, the base cations the plants have taken up in its biomass are permanently lost from the soil. Many nitrogen compounds, which are added as fertilizer, also acidify soil over the long term through the production of ammonium in the soil. Acidification therefore also occurs as a result nitrogen emissions into the air that end up deposited into the soil.

1.3.Eutrophication 

Eutrophication refers to an excess of nutrients in water or soil. It threatens biodiversity through the excessive growth of "simple" plants which damage other plants and animals in soils, rivers and lakes. The two major causes of eutrophication are excess nutrient nitrogen (mainly nitrates and ammonium) and excess phosphates in ecosystems whereby the former source is most relevant from an air pollution perspective. 152

Sources of these nutrients include animal wastes, agricultural runoff, sewage municipal water and nitrogen deposition from the air. The ecosystem quickly experiences an increase in algae and other simple plants, as these organisms thrive in the presence of the added nutrients. An algae bloom occurs as the algae accumulates into dense, visible patches near the surface of the water, prohibiting light from penetrating deeper areas of lake or stream. Other plants species are unable to survive without this light, and may become extinct. An even more serious problem arises when the algae begin to die and sediment to the floor of the rivers and lakes. At this point, oxygen-demanding bacteria take over the ecosystem, decomposing the organic material of the dead algae and using up dissolved oxygen in the process. 153 This lower concentration or in severe cases complete lack of oxygen causes many fish to suffocate, and as they die, the number of oxygen-demanding decomposers increases even more.

Several measures are known to control eutrophication. In addition to controlling air pollution induced pressures, mitigation methods can include measure to control runoffs from feedlots, planting vegetation along streambeds to slow erosion and absorb nutrients, controlling application amount and timing of fertilizer.

1.4.Ground-Level Ozone Pollution

Ozone (O3) in the lower atmosphere (ground-level ozone) is an air pollutant with harmful effects on the respiratory systems of humans and animals as well causing significant environmental damage, including the "burning" (necrosis) of sensitive plants and the corrosion of materials and buildings. Ozone is not directly emitted into the atmosphere but formed from a chain of chemical reactions following emissions of precursor gases including NOX, methane (CH4) and non-methane volatile organic compounds (NMVOC), and carbon monoxide (CO).  154 The atmospheric lifetime of ozone is about 22 days in the atmosphere which means that it travels across continents and to be considered a global pollutant. Its main removal mechanism is deposition to the ground, and particular through the uptake by plants. There is also a global atmospheric background concentration of ozone (tropospheric ozone), partly resulting from photochemical ozone formation globally and partly from the downward transport of stratospheric ozone to the troposphere.

Ozone has a marked effect on human health. High levels cause breathing problems, trigger asthma, reduce lung function and cause lung diseases (WHO, 2008). Short-term exposure by current O3 concentrations in Europe have adverse health effects, especially in the summer, on pulmonary function, lung inflammation, lung permeability, respiratory symptoms, increased medication usage, morbidity and mortality. Several European studies have reported that acute mortality rises with increases with ozone exposure (WHO, 2008). Epidemiological health evidence of chronic effects from exposure to ozone is now emerging indicating considerably larger mortality effects than from acute exposure alone (WHO, 2013).

High levels of O3 also damage plants, impairing reproduction and growth, leading to reduced agricultural crop yields, decreased forest growth and reduced biodiversity. Ozone decreases photosynthesis, thereby reducing also plant uptake of carbon dioxide (EEA, 2010a). Ozone also increases the rate of degradation of buildings and physical cultural heritage. Even low concentrations of ozone in air are very destructive to organic materials such as latex, plastics, and lungs. Ozone is also a short-lived climate pollutant (see below).

1.5.Climate change 

Atmospheric pollution and climate change are both distinct and linked in several ways. Contrary to greenhouse gases (GHG), air pollutants are toxic and create direct impacts on health and the environment. GHG generally have long lifetimes in the atmosphere, with about 12 years for CH4 and about 100 years for CO2. Classical air pollutant like SO2, PM and NOx have lifetimes of a few week to months As some of the classical air pollutants also have an effect on climate these are termed Short-Lived Climate Pollutants, i.e. substances that affect both air quality and the climate. 155

Air pollution and greenhouse emissions often relate to the same sources, hence GHG reduction measures (e.g. on power generation and transport) can deliver substantial reductions also of air pollutants such as SO2 and PM. This is furthermore an increasing shared interest in reducing emissions of the Short-Lived Climate Pollutants. But decarbonisation tends not always towards reducing emissions of PM, one of the air pollutants of highest concern. That is the case for example, where fossil fuel combustion is substituted for biomass burning, often considered climate neutral by convention, yet leads to increased emissions of PM and other carcinogenic substances such as PAHs.

2.The main air pollutants and their associated impact pathways

Over the past decades, a substantial scientific knowledge base on the causes and effects of air pollution has been established and validated.

Figure A3.1 presents a compact summary of the main air pollutant emissions considered and their associated impact pathways.

Figure A3.1: The problem of air pollution: Emissions and Impact Pathways (EEA)

3.The main sources of air pollution 

Emissions of air pollutants are closely linked to economic activity through combustion and/or other processes which sustain that activity.

Observed particulate matter (PM) concentrations in the atmosphere are the sum of a number of components which originate from different sources including primary and secondary sources. The most relevant sources are set out below.

Primary PM from combustion sources as well as some non-combustion and also natural processes; sectors and activities of particular importance are:

·Traffic, through the exhaust of diesel vehicles as well as new generation gasoline direct injection (GDI) vehicles. Non-exhaust particles from traffic (tyre and break wear, re-suspension) also contribute especially to the coarse PM fraction. Traffic emissions enter the atmosphere in or close to densely populated areas and thus contribute to population exposure in increased proportion.

·Off-road vehicles and machinery (which include ships and vessels, aircrafts, construction machinery, diesel trains, tractors, small hand-held engines, etc), which are currently regulated less stringently than road transport.

·Residential heating, especially related to biomass (wood and pellets), solid fuels (coal, coal briquettes), and certain liquid fuels; these installations and/or products are currently not covered by EU-wide regulation which would limit the emission of PM.

·Open burning of agricultural waste, which is banned in some of the Member States but continues to be widespread practice in others.

Secondary PM in the form of inorganic aerosols formed in the atmosphere by atmospheric reactions between SOx, NOx and NH3, and organic aerosols formed by reactions involving VOCs and oxidants.

Ozone is not directly emitted but is formed in the atmosphere through a number of reactions between ozone precursors. The most important ozone precursors are:

·VOCs, emitted by a large range of processes and applications such as energy use and supply systems, road and other transport systems (petrol vapour), industrial and domestic solvent use, agriculture and natural sources (trees and other plants).

·NOx, emitted by traffic, especially diesel engines (also from off-road machinery); the power sector and industrial combustion sources, including small-scale combustion installations (SCI); boilers and heating appliances fired by liquid fuels and natural gas; and international transport (air and marine).

·CO, which is the product of incomplete combustion. CO emissions have decreased substantially over the years through the introduction of EURO standards for vehicles (oxidation catalyst) and improvements in residential heating devices.

·Methane (CH4) Because of its long atmospheric lifetime, methane plays a much more significant role in the generation of hemispherically-transported O3 than in the locally-produced episodic O3 which has been the focus of control up until now.

Sulphur Dioxide (SO2) is emitted by a number of energy intensive industrial processes and power generation. Over the last 20 years SO2 emissions have substantially decreased thanks inter alia to effective implementation of emission controls at source of large combustion installations (regulation for Industrial Emissions) and improved fuel quality with low levels of suphur.

Another large source of SO2 emissions is international shipping, which has traditionally relied on unabated high sulphur content residual fuel oil. Formerly, such emissions have been considered of lower significance because they occur at sea rather than on land, but with the reduction of land-based emissions following the progressive introduction of effective legislation on industrial emissions, maritime SO2 emissions account for a progressively larger share of total emissions.

The vast majority of ammonia NH3 is produced by agricultural activities through emissions from fertiliser and manure application and storage, and animal housing facilities. For some activities, such as intensive pig rearing and chicken farming, the application of best available technology (BAT) is required through the Industrial Emissions Directive, but many large contributors, in particular cattle farms, are not subject to BAT requirements under EU legislation. Low-emission manure spreading techniques exist but are applied unevenly in different Member States. Overall, NH3 emissions have remained stable in the last decade and are not projected to decrease in the future, in the absence of further measures.



ANNEX 4    Review of The Existing EU Air Quality Policy Framework

1.Introduction

The EU air policy framework was developed building on national policies developed in Member States at the time and international work in the 1979 Convention on Long Range Transboundary Air Pollution (CLRTAP) which developed a multi-pollutant and multi-effect approach to tackle the range of air pollution problems. The first EU air quality directives and emission controls were established in 1980 and the policy has been substantially reinforced and consolidated since. 156 The 6th Environment Action Programme (6EAP) adopted in 2002 by the Council and European Parliament established a common EU long-term objective for air quality: to achieve 'levels of air quality that do not give rise to significant negative impacts on and risks to human health and the environment'. 157 It also called on the Commission to establish a Thematic Strategy on Air Pollution that would define the pathway towards achieving this objective through integrated actions in relevant policy areas. 158  

2.The scope and procedure for the review 

The present review incorporated a full evaluation of the functioning of the current EU framework for air quality policy in line with the Commission guidelines. 159 This section outlines what was evaluated, as well as the fact-finding and consultation processes. The outcome is presented in sections 3 through 9 as a critical review of the relevance, effectiveness, efficiency, and coherence of the respective components of the policy framework, including a comprehensive analysis of the present compliance problems and the underlying reasons. In detail: sections 3 to 5 focus on the main air policy instruments (the TSAP, the AAQDs and the NECD); sections 6 to 8 evaluates EU and national source controls and international air pollution policy, and section 9 addresses the overall coherence of the various policy elements. Section 10 summarizes the review of the policy framework as a whole and formulates the principal guidance for the review emerging from it. Those key conclusions are taken up in the main body of the Impact Assessment, principally from section 3 onwards.

2.1.What was reviewed?

The main elements of the air quality policy that were reviewed are:

·The Thematic Strategy on Air Pollution (TSAP) adopted in 2005 160 . Having established that the long-term objectives stated in the 6EAP were not achievable within its time horizon, the strategy set interim objectives for 2020 and outlined strategic priorities and actions to better co-ordinating the various strands of EU policy instruments to achieve them. (See section 3)

·The Ambient Air Quality Directives (AAQD). The original Air Quality Framework Directive 96/62/EC and its four daughter Directives setting ambient air quality standards for a range of pollutants: Directive 1999/30/EC covering SO2, NO2, PM10 and lead, Directive 2000/69/EC covering benzene and carbon monoxide, and Directive 2002/3/EC addressing ozone. These were consolidated into the Ambient Air Quality Directive 2008/50/EC as proposed in the 2005 TSAP, with the addition of a set of controls on PM2.5 and the possibility for an extension of the original deadlines for compliance with the limit values for PM10, NO2 and benzene. It provided for the adoption of consolidated provisions on reporting (adopted as Commission Decision 2011/850/EU) and the consequent repeal of Decision 97/101/EC on Exchange of Information. The 4th Daughter Directive, 2004/107, covering heavy metals and poly-aromatic hydrocarbons (PAHs), was recently adopted at the time Directive 2008/50 was proposed, and thus remained as a separate instrument. (See Chapter 4)

·The National Emission Ceilings Directive 2001/81/EC (NECD). The NECD was adopted prior to the 2005 TSAP. As the name implies it caps the total amount of emissions of each of four pollutants (SO2, NOx, non-methane VOCs and ammonia) for each Member State, with the caps designed to limit exceedances of acidification and eutrophication critical loads and to limit the formation of ozone so as to protect both health and ecosystems. The 2005 strategy indicated that the Directive should be revised so as to align the emissions ceilings for the relevant pollutants with the strategic health and environmental impact reduction objectives for 2020, but the revision planned for 2008 was not adopted. (See section 5)

·Source legislation. Whilst the AAQDs and the NECD comprise commonly agreed EU air quality and air emission standards, the Member States are generally considered to be best placed to determine the pollution reduction measures needed to achieve them. Hence, national and local source legislation and non-legislative policies are an essential component of the EU air quality policy framework (See section 7). However, EU source legislation has played an equally important role, e.g. where emissions from products contribute substantially to air pollution problems and such products must be regulated at EU level (e.g. light- and heavy-duty road transport, non-road mobile machinery, etc.). For a range of other pollution sources (typically large stationary sources) the co-legislators have determined also that control of emissions at source at EU level is appropriate (for instance the Directives recently consolidated into the Industrial Emissions Directive 2010/75/EU). EU Source Controls are discussed in section 6; National and local source controls are discussed in section 7.

·International Action. The CLRTAP and its Protocols form an important backbone for EU policy development and implementation. The TSAP pointed up the need to reinforce cooperation to tackle regional and global background pollution and to continue to support the Convention's scientific and monitoring activities (See section 8).

The most detailed review focused on the core elements of the current policy framework: the TSAP, the AAQDs and the NECD. In determining the extent to which these instruments met their objectives, their overall coherence also with other legislation, including the relevant EU source legislation is a key question and is addressed in section 6. However, an assessment of the fitness to its specific purpose, of each element of the source legislation individually, is beyond the scope of this exercise. The legislation in question often has policy objectives over and above the control of emissions to air, and has in many cases recently been subject to separate review of its effectiveness. 161 In other cases, an ex-post analysis is forthcoming for which the present review will serve as a useful benchmark. 162 , 163

2.2.How was the review organised?

2.2.1.Design of the review

This initiative is part of DG ENV's annual evaluation plan for 2013. The evaluation unit of the DG has been involved and has actively overseen the process since the beginning of 2012.

An inter-service group was set up for the review on 4 February 2011. The overall framework for the review was presented at the first meeting of 23 February 2011 and formalised in Staff Working Document SEC(2011)342 of 14 March 2011, which announced the establishment of a Stakeholder Expert Group (SEG) and a public consultation evaluating the effectiveness of existing policy. The SEG (also including the relevant Commission services) was established on 6 June 2011 to advise, support, and ensure the quality of the review. The framework for review was presented and endorsed at the first meeting 6-7 June 2011.

2.2.2.Conduct of the review

The review was based on the series of questions set out in the first stakeholder consultation: These questions related to:

·The adequacy of the air quality legislation in relation to the objectives of the 6th EAP;

·The coherence and synergy of the EU air pollution policy tools, in particular the air quality directives, the national emission ceilings directive; and the sectoral directives;

·The coherence and synergy of the air quality standards with emission standards;

·The coherence and synergy of EU air pollution policies with other environmental policies (climate change, biodiversity, and noise), sectoral policies (in particular regarding transport, energy, and agriculture), and international policies.

The initial public consultation was a free-response questionnaire sent to the SEG on 17 June 2011 with a deadline of 15 September 2011 (later extended to 29 September 2011). The first results were presented to the SEG on 21-22 January 2012 and the final report was published on 29 May 2012.

In parallel a fact-finding process was conducted, comprising the launch of a series of additional studies for the review of each key policy instrument - the TSAP, the AAQD, the NECD and the source legislation covering key sectors. Specific questions were identified for each assessment. A list of the questions addressed and the studies launched for each policy instrument is provided in Appendix 1. 164

The national authorities responsible for implementation and enforcement of the TSAP have been involved extensively and at all levels (national, regional and local). For the initial evaluation questionnaire all Member States were consulted; 13 provided very detailed assessments which were a key input for the problem definition. Implementing authorities were also involved in the review through a workshop on particulate matter held on 18-19 June 2012, 165 through a pilot project on implementation of air legislation in urban areas co-organised with the EEA (involving 12 cities), 166 and as reviewers of all the evaluation material in the Stakeholder Expert Group. During the review process, there have also been interactions with regional groups including European city representatives, and the Committee of The Regions subsequently issued an own-initiative opinion setting out its views on the review. 167  

Member States were consulted on the draft evaluation conclusions and problem definition in October 2012, and the draft was presented to the 4th Stakeholder Expert Group in December 2012 and published as background to the second public consultation (on policy options). The minutes of the 4th Stakeholder Expert Group confirm the SEG's support for the review and problem identification presented. A follow-up Member State expert group in February 2013 was consulted on possible options for resolution of the governance issues identified, including options for better co-operation between authorities responsible for implementation. This meeting brought together for the first time representatives from the Member State Competent Authorities' responsible for the implementation of the AAQD and the NECD and was instrumental in encouraging the two communities to see the AAQD and NECD as complementary rather than separate instruments. Finally, the issue of air pollution was taken up by the Irish Presidency as the subject of the informal Environment Council discussion on 22 April 2013, including a preceding seminar. 168  

2.2.3.Dissemination and use

The SEG and Impact Assessment Steering Group (comprising concerned DGs) were consulted on the focus of the individual studies and the terms of reference. Reports (including interim drafts) were published on CIRCABC and final reports on the review website. A draft review of the existing policy framework, and draft problem identification, was presented to Member States on 24 October 2012. A revised draft was published as background to the second public consultation on 7 December 2012. The outcome of the fact-finding and consultation processes has been used as the basis for drafting this annex and the relevant parts of Chapter 3 and for each main conclusion a reference is provided to the relevant substantiating documentation.

(1)      The consultation used two questionnaires: a total of 1934 individuals responded to a shorter questionnaire for the general public; for the longer questionnaire for experts and stakeholders, 371 responses were received. See http://ec.europa.eu/environment/consultations/air_pollution_en.htm  
(2)      Results are available in Eurobarometer 2013.
(3)      For full results see EEA 2013B.
(4)      The first EU air quality directives and emission controls were established in 1980 for SO2 and suspended particles, in Directive 80/779/EC.
(5)    Article 7(1) of Decision N° 1600/2002/EC of the European Parliament and of the Council laying down the Sixth Community Environmental Action Programme. OJ L 242, 10.9.2002, p. 1.
(6)      Recital 13 of the Codecision on the General Union Action Programme (to be published).
(7)      The emission reductions were triggered by 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.
(8)      A fair proxy for the overall economic activity induced is the €60 billion annualised investment expenditure associated with air pollution management. Total air pollution control costs in 2010 as estimated in TSAP Report #10, March 2013.
(9)      For instance the issue of real-world emissions from light-duty diesel vehicles – see section 3.4.1.1 for details.
(10)      Annex 4 section 3.
(11)      Annex 4 section 4
(12)      Annex 4 section 5.
(13)      Annex 4 section 6.
(14)      Annex 4 section 8.
(15)      Report of the first public consultation, Part 1, p37. Available on: http://ec.europa.eu/environment/air/pdf/review/Survey%20AQD%20review%20-%20Part%20I%20Main%20results.pdf .
(16)      EUROSTAT statistics report the number of traffic fatalities in the range of 35,000 for EU 27 in 2010.
(17)      Annex 4 Section 3.5.
(18)      EMRC 2013
(19)      Including work loss days, asthma symptom days
(20)      Percentage of EU ecosystem area exceeding so-called critical loads for acidification (maximum sustainable annual deposition of acidifying pollutants).
(21)      Percentage of EU ecosystem area exceeding critical loads for eutrophication.
(22)      Eutrophication is the disturbance of an ecosystem's balance by nutrient pollution, which causes some species to multiply rapidly and choke out others.
(23)       http://ec.europa.eu/environment/nature/natura2000/financing/docs/Economic%20Benefits%20Factsheet.pdf
(24)      Note that 2010 was a meteorologically favourable year; preliminary indications are that population exposure will be higher (around 50%) in 2011.
(25)    Percentage of the 108 ceilings under the National Emission Ceilings Directive which are complied with.
(26)    Percentage of air quality management zones in compliance with the PM limit value.
(27)      Percentage of air quality management zones in compliance with the NO2 limit value.
(28)      Percentage of the population (source IIASA modelling) living in zones in exceedance.
(29)      Percentage of urban population (source EEA, Air Quality in Europe Report). Note that NO2 exceedances are largely driven by traffic emissions, and therefore closely related to roadside impacts.
(30)      A comprehensive overview of the state of air quality in the EU is found in the EEA's Annual Air Quality in Europe Report for 2012, available at http://www.eea.europa.eu/publications/air-quality-in-europe-2012.
(31)      Report of first consultation, p24. Op cit.
(32)      Annex 4 section 5.3.
(33)      Including Eastern European, Caucasus and Central Asian (EECCA) states.
(34)      Annex 4 section 3.4 shows that the baseline (which will achieve the Gothenburg reductions) will not achieve the TSAP 2005 objectives. Those objectives in turn were simply interim milestones towards the long-term objective.
(35)      Report of first public consultation, pp18-19. Op cit.
(36)      Annex 3 presents the drivers and causes of air pollution in general. The detailed evaluation in Annex 4 identifies the specific causes and drivers set out here (see in particular the summary in Section 10.3 of Annex 4).
(37)      The New European Driving Cycle (NEDC).
(38)      In addition to the intrinsic weakness of the NEDC, some vehicles seem to be designed to respect the limits only when tested on this cycle. Moreover, there is increasing evidence of illegal practices by some end users that defeat the anti-pollution systems to improve driving performance or save on the replacement of costly components.
(39)      https://circabc.europa.eu/sd/d/2f169597-2413-44e2-a42c-35bbbde6c315/TSAP-TRANSPORT-v2-20121128.pdf
(40)      See also OECD, 2013
(41)      Report of first stakeholder consultation, p22. Op cit.
(42)      Of the order of around 10µg/m3.
(43)      Principally implementing regulations for solid fuel and biomass boilers (Lot 15).
(44)      Some of the main population centres in Europe remain in non-compliance, e.g. Milan, Madrid, Barcelona and London.
(45)      See report, 'PM workshop Brussels 18-19 June 2012', TNO 2012, p22.
(46)      Report of first public consultation, p23. Op cit.
(47)      The possibility under Directive 2008/50/EC (Article 22) for Member States to notify a postponement of the attainment deadlines for particulate matter (PM10), nitrogen dioxide and benzene, under certain conditions and subject to approval by the Commission.
(48)      In some cases, capacity has been further reduced in the wake of the economic crisis, including at the national level. 
(49)      EEA Report No 7/2013, 'Air Implementation Pilot', pp6-7. Available on http://www.eea.europa.eu/publications/air-implementation-pilot-2013.
(50)      See 'Air quality assessment', p28, 'Air Quality Management', p31, and 'Issues regarding governance', p33, in report of first public consultation. Op. cit.
(51)      Note that the ongoing revision of the Non-Road Mobile Machinery may already address the problem to a certain extent.
(52)      Emissions from maritime transport in EU seas were in 2005 equal to 25% of all EU land-based NOx emissions, and 21% for SO2.
(53)      1999/32/EC, amended by 2012/33/EU.
(54)      Report of first public consultation, p23.
(55)      Notably integrated management of the nitrogen cycle. There is now increased knowledge available on the nature of the nitrogen cycle and cost-effective solutions. See the European Nitrogen Assessment published by the CLRTAP Task Force on Integrated Nitrogen Management.
(56)      Directive 2010/75/EU.
(57)      Directive 91/676/EEC.
(58)      See, ‘Report on the consultation of options for revision of the EU Thematic Strategy on Air Pollution and related policies’, p61. Available on http://ec.europa.eu/environment/air/review_air_policy.htm .
(59)      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.
(60)          Estimates from the European Monitoring and Evaluation Programme (EMEP).
(61)      The AAQD calls on the Member States concerned to organise cross-border meetings to deal with transboundary pollution, with the Commission to be notified and invited to take part. Few such discussions have taken place to date. The only meeting of which the Commission is aware took place between DE and PL.
(62)      See Air Pollution Studies No20: Policy-relevant science questions  http://www.unece.org/index.php?id=25373  and UNEP Atmospheric Brown Cloud Regional Assessment www.unep.org/pdf/ABCSummaryFinal.pdf .
(63)      Report of first public consultation, p31. Op. cit.
(64)      The views of national competent authorities became progressively more supportive over successive consultation meetings in the context of the Stakeholder Expert Group and the Expert Group on Air Quality.
(65)      Annex 5 reports the baseline emission projections as well as the underlying assumptions. The section focuses rather on impacts (substantive, and on compliance).
(66)      The "PRIMES" energy baseline projections show gross inland energy consumption declining by 12% in 2030 compared to 2005 (in 2020 9%); in 2020 CO2 emissions 22% lower than in 1990 (32% in 2030); share of Renewables increasing to 21% in 2020 and to 24 % in 2030; biomass use 80% higher in 2030 than in 2005. Details are presented in Annex 5.
(67)      MCE stands for "Maximum Control Effort", and includes not only all technical measures, but also the further structural changes in the energy, transport and agriculture sectors that would be needed to meet the 2050 decarbonisation objectives of the low-carbon economy roadmap (http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=SEC:2011:0288:FIN:EN:PDF Global Climate Action, effective technologies scenario).
(68)      NC= Not Calculated: 2015 is not a target policy year, and estimates for 2050 are too uncertain.
(69)      See, e.g., 'A Roadmap for moving to a low carbon economy by 2050', COM(2011)112 final.
(70)      There is currently a target value (25µg/m3) which in 2015 will become a binding limit value, but projections show that compliance will be very high, with around 96% of stations meeting the standard in 2015 and 99% in 2020. If the limit value were tightened in 2020 (to 20µg/m3 as the AAQD provides for subject to feasibility) there would still be 92% compliance. However, if the limit value were established at the level of the WHO guideline of 10µg/m3, only 35% of zones would comply in 2020.
(71)      See also recently adopted BAT conclusions for Iron and Steel (Decision2012/135/EU), and cement (2013/163/EU).
(72)    See new Krakow air quality action plan: http://www.wrotamalopolski.pl/root_BIP/BIP_w_Malopolsce/root_UM/podmiotowe/Konsultacje+projektow/Programy+i+projekty/Konsultacje+spoleczne+Aktualizacja+Programu+ochrony+powietrza+dla+wojewodztwa+malopolskiego/
(73)      From internal assessment of plans submitted fin support of time extension notifications for the PM10 and NO2 limit values.
(74)      The Commission is preparing implementing legislation for adoption by the relevant Member State Committee towards the end of 2013 so as to enable the timely introduction of Euro 6 and address the real world emissions. 
(75)      There is some residual uncertainty over the prospects for compliance for LU.
(76)

     A separate analysis based on official reports from the concerned Member States largely confirms the conclusions presented here of the macro-economic modelling approach.

(77)      Euro 6 compliance is included in the baseline because the level of emission requirements is set in the adopted legislation; the implementing measure is a technical delivery mechanism.
(78)    The projected percentage of stations substantially above the limit value would increase from 3% to 10%.
(79)    Belgium and Luxembourg.
(80)    Many stakeholders, including 94% of government respondents to the stakeholder consultation, stressed the need for additional EU source controls to complement national emission reductions.
(81)      e.g. as EU impact reduction targets (TSAP 2005), or as concentration limits for individual pollutants (AAQD).
(82)     http://ec.europa.eu/europe2020/priorities/sustainable-growth/index_en.htm
(83)     http://ec.europa.eu/governance/better_regulation/key_docs_en.htm#_br
(84)     http://ec.europa.eu/enterprise/policies/sme/small-business-act/index_en.htm
(85)      The draft options were developed based on the problem identification endorsed by the 3rd Stakeholder Expert Group on 21 June 2012. They were consulted on informally with Member State authorities in an Air Quality Expert Group of 24 October 2012, and published in the second public consultation on 7 December 2012. The public consultation allowed free-text replies to highlight other options not listed.
(86)      In certain circumstances extensions are allowed for NO2 from 2010 to 2015.
(87)      See CARS 2020 Communication (COM/2012/0636 final)  
(88)      Note in this respect that Member States have not made extensive use of available EU funding. For example, where there has been EU funding available under the European Structural Funds only an estimated 20% has been applied for.
(89)      Although the Gothenburg commitments represent a substantial emission reduction over the 2010 NECD ceilings, in fact they will be achieved by the baseline emission trajectory; as such they will not require additional technical measures beyond those already decided.
(90)      Real-world Euro 6 compliance is treated as part of the baseline because the level of emission requirements was established by the co-legislators in Regulation 715/2007; the implementing measures (the new test procedure) are simply technical apparatus to deliver it. The CARS 2020 Action Plan confirmed the development by 2014 of a revised test procedure that ensure compliance with the emission limit values under real driving conditions, with transitional arrangements for its implementation from 2014 up to 2017.
(91)      The range of possible national and local actions that Member States are undertaking is very broad. These and other potentially cost-effective actions are illustrated in Annex 4 and summarized in Chapter 3.
(92)      See IIASA TSAP Report no 9.
(93)      A full description of the methodology –recently peer-reviewed by the Member States, by the scientific community and by industry stakeholders is provided in http://www.ec4macs.eu/
(94)      The possibility under Directive 2008/50/EC (Article 22) for Member States to notify a postponement of the attainment deadlines for particulate matter (PM10), nitrogen dioxide and benzene, under certain conditions and subject to approval by the Commission.
(95)      E.g. in the Air Implementation Pilot.
(96)      Examples are provided in Annex 4 and Appendices.
(97)

     In addition, continued vigilance will be required because in the case of delays or poor implementation, the prospects for compliance would be seriously compromised for 2020 and beyond notably for NO2. As explained in Chapter 3.5, the compliance projection is particularly dependent on the delivery of the required real-world driving emissions from light duty diesels.

(98)      Consideration of these options is nevertheless taken up in Chapter 6 which focuses on the analysis of options related to the second general objective (to reduce overall health and environmental impacts by 2025-30).
(99)      IIASA and JRC IPTS (2013).
(100)      Between 2,9% and 3,6% depending on the exact scope of appliances covered by the subsidy scheme.
(101)      Projections for the pollution abatement expenditure associated with the baseline until 2030 are further discussed in chapter 6.
(102)      Additional measures in the period beyond 2020 will be addressed in Chapter 6.
(103)      Although impacts are not linear over the whole concentration range, this is a reasonable first approximation.
(104)    The methodology applied for conducting this analysis is the same as applied for assessing the options in Chapter 6 and as described in Chapter 6.1
(105)      The cost range is based on extrapolating estimated funds required under a new Life programme to reduce the number of people living in zones showing non-compliance by about 50%.
(106)      See the Co-decision on the General Union Environmental Action Programme, paragraph 52(a).
(107)      Reviews have confirmed its fitness for purpose for strategic guidance, although assessment of measures in particular sectors may require additional analysis more detailed than can be included in any economy-wide and EU-wide model. See also Annex 4.
(108)

     MTFR includes technical measures commercially available in 2012. It does not include structural changes from a more ambitious climate and energy policy or other policies such as agriculture. It does not encompass technical and non-technical measures that may be taken at national and local level. Finally, it does not incorporate any allowance for the impact of learning on reducing over time the cost of achieving a given unit emission reduction. Given these exclusions it can be regarded as a highly conservative estimate of the scope for impact reduction (or that the costs to achieve a given level will have been overestimated).

(109)

     Expressed in cases of premature death. The metrics for long-term health effects due to air pollution most frequently used by experts is actually Years Of Life Lost (YOLL); for more accessible reading the impacts in YOLL are here converted in cases of premature death.

(110)      www.GEM-E3.net. Further details on the methodology and models used are provided in annex 7.
(111) It is important to note that the pollution control expenditure shown for Option 1 is not to be interpreted as the additional investment that on business as usual would be committed between the present day and 2025/2030; on the contrary, it represents an estimate of the accumulated annualised cost of all pollution abatement equipment accumulated in the economy, compared to a hypothetical situation of no emission controls at all..    In this hypothetical situation, all power plants would burn the lowest grade of available fuels and would not have any end-of-pipe pollution abatement, motor vehicles would not have any exhaust gas after-treatment, domestic heating would still be in the conditions that led to the Great London Smog in 1953, etc. Pollution levels would be extreme.
(112)      Sectors are here defined by SNAP classification (Selected Nomenclature for Air Pollution). Note that the costs in in the tables are allocated by type of activity (combustion, solvent use, etc.) but these activities can take place in different economic sectors as defined in national accounts (chemicals, refineries, etc).
(113)      The domestic sector includes residential, commercial and institutional activities. The pollution control measures attributed to this sector are improvements to heating appliances. The corresponding expenditure is calculated as the cost premium for the improved appliance compared to the basic type. Note that the pollution abatement costs for private cars (such as the cost of catalytic exhaust systems) are attributed not to the domestic but to the transport sector.
(114)      EU27 + CH and NO
(115)      External costs of air pollution on the baseline were already shown in Table 5 and discussed in section 5.3.1.; These are projected to reduce by about 40% in 2025-2030 compared to 2005, but in absolute terms they would remain high (230-760 and 217-753 billion/year respectively in 2025 and 2030).
(116)      These aspects were analysed with the CGE model GEM-E3. The required investments and other direct costs per industry were introduced as additional expenditure in the corresponding sectors. Any possible measures with negative costs (i.e. no regret measures that would provide savings for operators at no extra compliance cost) were removed and excluded from the analysis.
(117)      The supply was adjusted by +0,008 to +0,031% for options 6A to 2D; see table 18.
(118)    The estimate of macroeconomic impacts calculated with computable general equilibrium (CGE) models is less reliable when the divergence from the equilibrium benchmark is larger; for this reason, CGE modelling results are not shown for the MTFR option 2D, but can be assumed to be substantially more negative than in option 2D.
(119)      The most conservative (lowest) of the four valuations of health impacts was chosen. See Annex 7 for methodology.
(120)      To derive more accurate marginal figures, the analysis has been done with finer granularity, which results in MC=MB at 76.2% gap closure, to be precise.
(121)      Recent IIASA analysis (See Chapter 3.1, IIASA 2012B) based on the Global Climate Action/ effective technology scenario developed for the low carbon economy roadmap (SEC(2011) 288 final )
(122) Calculations made by JRC IES with the FASST tool
(123)      For simplicity the sensitivity analysis is presented only for option 6C.
(124)      From long-term ozone exposure.
(125)      See L. Höglund-Isaksson, W.Winiwarter and P. Purohit (2013) Non-CO2 greenhouse gas emissions, mitigation potentials and costs in EU-28 from 2005 to 2050, Part I: GAINS model methodology, 30 September 2013, IIASA, Laxenburg
(126)      The so-called PRIMES 2012-13 Reference Scenario is the basis for all the analysis presented. The PRIMES 2010 reference scenario was used as an alternative; it assumes higher growth than PRIMES 2012-13, but differs also in many other respects.
(127)      At the level of the policies currently enacted in the Member States; this is represented by the 2013 PRIMES Baseline scenario, which assumes that achievement of legally binding national targets on renewable energy, Effort Sharing Decision and energy efficiency depends on currently adopted national measures and policies. Total energy consumption in the EU in 2030 is thus 2,82% higher than in the Reference scenario, and the share of renewables 1,7% of total consumption lower.
(128)      €998M/year.
(129)      Note that measures related to product standards are always assumed to be taken at EU-wide scale due to single market provisions. These include: emission standards for road vehicles and non-road machinery; solvent content of consumer products; minimum standards under the Ecodesign directive.
(130)      Through this vote Member States will have the decisive role in determining the level of stringency of the BAT conclusions and so the share of emission reduction between EU and national measures.
(131) Due to factors such as soil and climate conditions, the properties of various types of manure (linked to feed, species, age and weight), the timing and rate of application of manure to agricultural land, the type of housing facilities and manure storage systems, the proportion of time spent indoors or grazing, different local farm traditions and practices etc.
(132)    Source: SEC(2007) 1679.
(133)    Report from the Commission on the reviews undertaken under Article 30(9) and Article 73 of Directive 2010/75/EU on industrial emissions addressing emissions from intensive livestock rearing and combustion plants. COM(2013) 286.
(134)      Regulation 2003/2003/EC
(135)      In SECA (in the EU: Baltic and North Sea) the sulphur content of marine fuels will be reduced from 1.50% to 0.10% as of 2015 and it other sea areas from 3,50% to 0,50% as of 2020.
(136)      Benefits outweigh costs by a factor of 5 to 25. SEC(2011) 918 final
(137)      Further studies would need to take into account a variety of factors including: low-sulphur fuel price premiums; the availability of cost-effective alternative technical solutions (scrubbers), and the exact definition of control areas.
(138)      The findings show the cost-benefit ratio in the range of 1 to 3,2-11,1 in the Baltic Sea (source: own elaboration based on VITO, IIASA and EMRC) and 1 to 1,6-6,8 in the North Sea (source: Danish Ministry of the Environment, 2012); the North Sea assessment uses however less recent benefit estimates.
(139)      This is the reason why emission reductions from international shipping are considered separately from the cost-effective emission reduction options 6A-6D.
(140)      Annex 8 presents as an example the case of designating NECA in all EU sea areas, delivering €137M/yr NOx control cost reductions for land-based sources in 2025.
(141)      Possible further measures to restrict emissions from manure storage and application and from mineral fertilisers are not considered.
(142)      To derive more accurate marginal figures, the analysis has been done with finer granularity, which results in MC=MB at 76.2% gap closure, to be precise.
(143)    See Annex 3 which summarises the air quality knowledge base
(144)    Study conducted under external contract with the International Institute for Applied Systems Analysis (IIASA).
(145)    Study conducted under external contract with the Norwegian Meteorological Institute using the EMEP Atmospheric Chemistry and Transport Model (Norwegian Meteorological Institute, 2012A).
(146)    (REVIHAAP project (WHO, 2013B):: "Evidence on health aspects of air pollution to review EU policies". Among other specific objectives, this analysis assessed the evidence on the health effects of NO2 and of specific components and characteristics of particulate matter (aerodynamic diameter, chemical composition). The HRAPIE project further performed extensive meta-analysis of the available literature to update the key relative risk estimates according to latest scientific evidence (WHO, 2013A).
(147)      See EC, 2012A
(148) WHO (2013) a
(149)

     Unlike nitrates, phosphates (PO43-), are not water-soluble; they do not usually dissolve in water. However, they do adhere to soil particles, and as such often accumulate in soil and erode along with soil into aquatic environments.

(150)      BOD is the amount of oxygen required for the decomposition of organic compounds by microorganisms in a given amount of water. It is usually measured in milligrams of oxygen consumed per liter of water. Biological oxygen demand is important because it affects the amount of dissolved oxygen available to all species in an aquatic ecosystem. A higher BOD indicates a lower level of dissolved oxygen.
(151)      NOx plays a complex role in ozone chemistry: close to its source it will actually deplete ozone due to the scavenging reaction between the freshly emitted nitrogen monoxide (NO) and ozone.
(152)      The main ones are black carbon (BC, a sub-fraction of particulate matter), methane and ozone.
(153)      For SO2 and suspended particles in Directive 80/779/EC.
(154)    Article 7(1) of Decision N° 1600/2002/EC of the European Parliament and of the Council laying down the Sixth Community Environment Action Programme. OJ L 242, 10.9.2002, p. 1.
(155)      Air policy has close links with many other policies but perhaps most so with climate change which also deals with atmospheric pollution and its impacts and covers many of the same sources. Measures reducing greenhouse gases (e.g. on power generation and transport) can deliver substantial reductions also of air pollutants such as sulphur oxides, and there is a shared interest in reducing emissions of so-called Short-Lived Climate Pollutants (substances that affect both air quality and the climate). But decarbonisation tends to be not or less effective in reducing two of the main air pollutants: primary particles and ammonia (respectively impacting health and ecosystems). For example, while shifting away from coal use reduces the emission of primary particles, intensified biomass use increases it. Hence these and other "overlapping" areas must be carefully managed.
(156)      COM(2001)31 final.
(157)      COM(2005)446 final.
(158)      For instance the IED deals in an integrated way with emissions to air, water and land as well as resource efficiency. Industrial emissions policies were impact assessed as part of the of the proposal for an Industrial Emissions Directive SEC(2007) 1679; or in the forthcoming fitness check for EU vehicle emissions policy.
(159)      See for example, the VOC Stage II legislation, i.e. Directive 2009/126/EC, which is yet to enter into force in full and which will be reviewed in detail in the future.
(160)      Likewise, an assessment of the cumulative effect of EU policies on particular sectors, covering not only air policy but also other environmental and non-environmental policies, is beyond the scope of this exercise. A series of sector-specific fitness checks has been launched for this purpose and the progress has been followed closely from the perspective of the review.
(161)      All reports are available at http://ec.europa.eu/environment/air/review_air_policy.htm unless otherwise specified.
(162)      See report 'PM Workshop Brussels 18-19 June 2012', TNO 2012.
(163)      Final report on http://www.eea.europa.eu/publications/air-implementation-pilot-2013 .
(164)      Opinion of the Committee of the Regions on 'Review of EU air quality and emissions policy', 2012/C 225/03. Available on:http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2012:225:0011:0019:EN:PDF.
(165)      REF forthcoming
Top

Brussels, 18.12.2013

SWD(2013) 531 final

COMMISSION STAFF WORKING DOCUMENT

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

{COM(2013) 917 final}
{COM(2013) 918 final}
{COM(2013) 919 final}
{COM(2013) 920 final}
{SWD(2013) 532 final}


3.The Thematic Strategy on Air Pollution

3.1.Objectives, scope and approach

Box A.4.1: Summary of the environmental and socio-economic scope and context of the TSAP

The environmental and socio-economic scope of the TSAP 2005 is summarized in Box A.4.1.

It incorporates the above mentioned multi-effect, multi-pollutant and multi-sectoral methodology developed at the international level.

The analysis underpinning the 2005 TSAP was based on a previous generation of the same suite of models used for the current assessment. 1 The objective of the analysis was to identify to what extent cost-effective progress could be made by 2020 towards the 6EAP objectives of no significant impact on human health or the environment from air pollution, focusing on five major impacts of air pollution: health impacts of particulate matter; health impacts of ground-level ozone; plant impacts of ozone; ecosystem impacts of acidification; and ecosystem impacts of eutrophication.

Impacts were calculated based on spatial modelling of pollution concentrations and depositions taking into account meteorological and topographic conditions that were characteristic for the respective regions in the EU. For ecosystem impacts, the depositions are compared with ‘critical loads’ calculated for each ecosystem type, which are deposition rates beyond which the ecosystem suffers damage, to determine the ecosystem area affected. For human health, the concentrations were combined with population data to determine exposure to those concentrations, and those were in turn combined with concentration-response functions established by the WHO based on a thorough scientific review, and baseline health impact data for the endpoints in question, to estimate the resulting years of life lost, or premature deaths.

Based on this assessment, the 2005 TSAP set out interim objectives for headline health and environmental indicators ( Table 1 ) and accompanying pollutant emission reduction objectives ( Table 2 ) for 2020 that would be required to meet those impact objectives. 2  

Table 1: TSAP Health & Environmental Targets (target year 2020)

Headline Health and Environmental Impacts

2020 "Interim Targets"

%Δ vs 2000

%Δ vs 2005

Loss of life expectancy due to PM exposure

47%

40%

Acute mortalities due to ozone exposure

10%

0%

Excess acid deposition in forest areas

74%

67%

Excess acid deposition in fresh surface water areas

39%

32%

Areas or ecosystems exposed to eutrophication  3

31%

29%

Forest Area exceeded by ozone (M Km2) 4

15%

12%

Table 2: TSAP Emission Reduction Targets (indicative for target year 2020)

Headline Emission Reduction Targets

2020 "Interim Targets"

%Δ vs 2000

%Δ vs 2005

Primary Particulate Matter (PM2.5)

59%

52%

Nitrogen Oxides (NOx)

60%

56%

Sulphur Oxides (SOx)

82%

76%

Non-Methane Volatile Organic Compounds (NMVOC)

51%

38%

Ammonia (NH3)

27%

24%

The TSAP objectives were politically endorsed by Council and EP conclusions but have no formal legal status. 5

3.2.Monitoring, Reporting and Evaluation 

Progress towards the TSAP objectives is monitored through several indicators, most directly through trends in air pollutant emissions based on national emission inventories established by the Member States according to the requirements of the NECD (referring to the guidelines adopted by the CLRTAP-EMEP) and collated by the EEA. 6

Impacts on health, acidification and eutrophication are calculated regularly and published on the occasion of comprehensive reviews conducted by the European Commission and the EEA or the CLRTAP. 7 The effectiveness of the TSAP has also been tracked through the EEA’s annual report on Air Quality in Europe which collates monitored air quality data reported through EIONET in accordance with the implementing decisions adopted under the Ambient Air Quality Directives (See section 4). 8  

The TSAP was furthermore evaluated in the review of the 6EAP with regard to the breadth and quality of its analysis.  9 The review process builds on these monitoring and evaluation mechanisms and included extensive further consultation of stakeholders.

3.3.Relevance

The analysis under the current review of EU air policy has confirmed that the overall scope, objectives, parameters and sources identified in the TSAP remain relevant and appropriate to address the main air pollution challenges in the EU. The main impacts focused on in 2005 remain the key air quality impacts today. Successive reviews of the science underlying the problems have confirmed that the pollutants addressed are indeed the main problem drivers. 10 A review of evidence has confirmed that particulate matter and ozone are the two substances for which the evidence of health impacts in the EU is strongest. 11 For ecosystem impacts, while acidification has reduced dramatically, eutrophication remains substantial. 12 The modelling framework was further developed and updated in the period 2006-2013, with in-depth stakeholder consultation. 13 It was concluded that the approach to identify pollution reduction objectives, sources and legislative instruments remains valid.

Stakeholders have stressed the importance of maintaining, and where possible extending, the inter-relation between air quality and climate change policy analysis. 14 Likewise, the inter-relation between the AAQD and the NECD could be strengthened. 15 A number of tasks related to climate change and its effect on air pollution also require consideration on broader spatial scales whilst at the same time there is increasing need for more detailed information on pollution levels within Member States' territories that require assessments with finer spatial resolution.  16 It was noted that EU provisions for monitoring ecosystems were lacking (See section 5 on NECD below. Finally, it has been suggested that in addition to the coverage of "traditional" sectors such as energy, industry, and transport, increasing attention should go to agriculture and maritime emissions as well as emissions from small and medium scale combustion. 17  

3.4.Effectiveness

As shown in Figure 1 below, substantial reductions have been achieved between 1990 and 2010 for the main air pollutants tracked by the TSAP.

Figure 1: EU air pollutant emissions 1990-2010 (EEA, 2012)

In consequence the EU's huge acid rain (acidification) problem is set to be broadly solved 18 , the impact of lead from vehicle fuels has been eliminated, and the ambient air health risk from other heavy metals and carbon monoxide has been greatly reduced. The health impacts of particulate matter, the main cause of death from air pollution, have been reduced by around 20% between 2000 and 2010. Figure 2 shows the comparative success in eliminating acidification versus the large outstanding eutrophication problem.

Figure 2: EU ecosystems at risk of acidification and eutrophication

The present review has also developed updated projections related to the air pollutant emissions and air quality impacts for the period up to 2030 assuming no changes to current policy (see Annex 5).

Despite the progress made in addressing air pollution, several of the 2005 TSAP objectives will not be met - the health and environmental impacts of air pollution in the EU remain large.

As shown in Table 3 , projected emission reductions without further measures will fall short of the 2020 TSAP targets for all main pollutants, most importantly for PM2.5 and ammonia (NH3) and to a lesser extent for NOx and NMVOC. 19  The reasons for this shortfall are further discussed in the section relating to the NECD and source controls.

Table 3: Distance to TSAP Emission Reduction Targets for 2020 (latest projections)

Headline Emission Reduction Targets for 2020

%Δ vs 2005

%Δ vs 2005

TSAP 2005

Projected 20

Primary Particulate Matter (PM2.5)

52%

24%

Nitrogen Oxides (NOx)

56%

51%

Sulphur Oxides (SOx)

76%

65%

Non-Methane Volatile Organic Compounds (NMVOC)

38%

34%

Ammonia (NH3)

24%

15%

As a consequence of failing to achieve the emission reduction targets, there is also under-achievement of the TSAP's headline health and environmental targets for reduction of PM2.5 mortality, eutrophication and forest acidification ( Table 4 ).  21  However, the target for fresh water acidification will be met, as well as the ozone mortality target (the latter represented a 10% reduction compared to 2000).

Table 4: Distance to TSAP Health & Environmental Targets (latest projections)

Headline Health and Environmental Impacts for 2020

%Δ vs 2005

%Δ vs 2005

TSAP 2005

Projected 22

Loss of life expectancy due to PM exposure (M)

40%

26%

Acute mortalities due to ozone exposure (M)

0%

13%

Excess acid deposition in forest areas (M Km2)

67%

64%

Excess acid deposition in fresh surface water areas (M Km2)

32%

n.a.

Areas or ecosystems exposed to eutrophication (M Km2)

29%

17%

Ozone flux (Forests (mmol/m2 above effects threshold))

12%

13%

The updated human health impacts in the EU due to PM and ozone air pollution in 2010 are presented in Table 39. 23 The associated external costs and costs of implementation are discussed in the following section on efficiency. Air pollution remains the number one environmental cause of death in the EU, responsible for an estimated 406 000 premature deaths or ten times more than fatalities due to road traffic accidents. 24 In addition to premature mortality there are also substantial quality-of-life (well-being and morbidity) impacts, ranging from asthma to exacerbation of cardiovascular symptoms, which result in restricted activity days with associated productivity losses.

Table 5: Health Impacts in the EU Due to PM and Ozone Air Pollution in 2010 (EU28)

Acute Mortality (All ages)

Premature deaths

O3

26,525

Chronic Mortality (All ages) *

Life years lost

PM

4,030,653

Chronic Mortality (30yr +) *

Premature deaths

PM

379,420

Infant Mortality (0-1yr)

Premature deaths

PM

1,829

Chronic Bronchitis (27yr +)

Cases

PM

316,685

Bronchitis in children (6 to 12 years)

Cases

PM

6,231,812

Respiratory Hospital Admissions (All ages)

Cases

PM

142,243

Respiratory hospital admissions (>64)

Cases

O3

19,117

Cardiovascular Hospital Admissions (>18 years)

Cases

PM

108,989

Cardiovascular Hospital Admissions (>64)

Cases

O3

86,279

Restricted Activity Days (all ages)

Days

PM

436,351,761

Asthma symptom days (children 5-19yr)

Days

PM

11,290,673

Lost working days (15-64 years)

Days

PM

121,378,612

Minor Restricted Activity Days (MRADs all ages)

Days

O3

108,845,140

Notes: * These rows represent alternative measures of the same effect on mortality, and hence are not additive..

3.5.Efficiency

Promoting cost-effective air pollution abatement actions

One of the principal aims of the TSAP was to promote cost-effective air pollution abatement actions in the EU and internalise externalities through the adherence to the polluter pays principal and optimal market based solutions.

As is set out in section 6 on EU source controls, the main focus of current air pollution policies has been on the major polluters. External costs associated with air pollution in the EU remains, however, very large. Table 40 below builds on table 39 above and shows the external costs associated with the main health impacts in the EU due to air pollution.

Table 6: External Costs Associated with Main Health Impacts in the EU Due to Air Pollution in 2010

Impact

€M/year

Acute Mortality (All ages)

Premature deaths

O3

1,531 – 3,679

Chronic Mortality (All ages) LYL median VOLY *

Life years lost

PM

232,569 – 559,052

Chronic Mortality (30yr +) deaths median VSL *

Premature deaths

PM

413,567 – 842,312

Infant Mortality (0-1yr) median VSL

Premature deaths

PM

2,990 – 6.090

Chronic Bronchitis (27yr +)

Cases

PM

19,001

Bronchitis in children (6 to 12 years)

Cases

PM

3,664

Respiratory Hospital Admissions (All ages)

Cases

PM

316

Respiratory hospital admissions (>64)

Cases

O3

42

Cardiac Hospital Admissions (>18 years)

Cases

PM

242

Cardiovascular hospital admissions (>64)

Cases

O3

192

Restricted Activity Days (all ages)

Days

PM

40,144

Asthma symptom days (children 5-19yr)

Days

PM

474

Lost working days (15-64 years)

Days

PM

15,779

Minor Restricted Activity Days (MRADs all ages)

Days

O3

4,571

Core median VOLY

327,691

Core mean VOLY

657,913

Core median VSL

505,120

Core mean VSL

937,434

Notes: * These rows represent alternative measures of the same effect on mortality, and hence are not additive.

The implementation costs of existing policy are given per sector in Table 41. Note that these are the costs for reducing pollution from a situation of no pollution mitigation at all, to the current pollution level. The pollution which would result from today's activity levels if there were no policy at all would be extremely high. The concentrations in such circumstances would be at least an order of magnitude higher than current concentrations, and although impacts are not linear over the whole concentration range, the impacts would also be several multiples of the current impacts.



Table 41: Pollution control costs for the baseline up to 2020 (EU28, M€)

 

2010

2015

2020

Power generation

12700

12093

10711

Domestic sector

7476

9115

9629

Industrial combustion

2435

2468

2521

Industrial processes

4760

4983

5029

Fuel extraction

976

907

770

Solvent use

1638

1964

2140

Road transport

26022

34357

42023

Non-road mobile sources

1892

4320

6975

Waste treatment

0

1

1

Agriculture

1750

1775

1786

Total

59650

71983

81584

It can be seen that even on the most conservative valuation, the benefits of implementation of current policy hugely outweigh the costs. Despite the very substantial progress, the remaining impacts in 2010 still place a huge burden on society.

Enhancing the overall coherence of the principle TSAP instruments

Another principal efficiency related aim of the TSAP was to enhance the overall coherence of the main instruments put in place to achieve the TSAP objectives including the balance between Member State and EU action.

Whilst detailed comments are provided in the below sections relating to the respective instruments, the following areas for reinforcement of the strategy (and its underlying analysis) have been identified based on the public consultation for the TSAP review:

·A reinforced analysis of the impact of emission reductions (from source controls and national emission ceilings) on compliance with the AAQD air quality standards (it is now possible for the first time to model this at EU scale); 25

·the interaction with other policies, in particular with the forthcoming climate and energy package; 26

·the robustness of the proposed policy with respect to variations in the underlying analytical assumptions; 27

·alternative instruments to those brought forward in 2005 (e.g. fiscal instruments); 28

·how action at Member State level can be supported and reinforced at EU level; 29

·additional flexibilities in instruments compared with those assessed in 2005. 30

3.6.Relation of the TSAP analysis to emission ceilings and ambient air quality targets

The TSAP modelling delivered as one of its direct outputs emission reduction objectives for SO2, NOx, NMVOCs, ammonia and PM2.5 not only for the EU as a whole but for individual Member States. These reductions took account of the transboundary impacts of the pollution concerned by determining the optimum spatial and sectoral profile of pollution reductions across Europe, so as to meet the desired health and environmental objectives. Thus the outcome of the modelling translated naturally into national emission ceilings for the various pollutants. The NECD had been adopted in 2001, and while it addressed human health impacts from ozone exposure, its main focus was on ecosystem impacts. The level of the ceilings set did not correspond to those required to meeting the 2005 TSAP objectives, and importantly, the Directive did not include a ceiling for PM2.5. The TSAP proposed that these points be rectified by a revision of the Directive.

However, the relation of the TSAP and its associated modelling to the ambient air quality standards adopted was less direct. Those standards had been adopted based on scientific advice from the WHO, and on an assessment of the current levels of concentration and achievability of reduced levels. 31 The TSAP analysis was not optimised to achieve compliance with the air quality limit values, but rather to maximise the reduction in air pollution impacts across Europe. Nor was it possible to determine in detail the impacts of achieving the impact reduction objectives on compliance with the air quality standards, as the resolution of the model grid was too coarse (at 50x50km). The TSAP thus did not propose any adjustment to the limit values already adopted under framework and daughter directives on air quality, but did allow an extension of the timescale for meeting these values based on evidence that Member States had taken all possible action and still certain limit values were unlikely to be reached by the required deadlines.

4.The Ambient Air Quality Directives

4.1.Objectives, scope and approach

Legislation on ambient air quality stems principally from the Air Quality Framework Directive 1996/62/EC. That Directive set out a framework for the establishment of ambient air quality standards and for air quality assessment, public information, and management with the aim of establishing a uniform minimum level of protection for human health and the environment. It also listed a set of key pollutants which had been identified as posing the most significant threats to human health and the environment. Standards for these pollutants were initially set in four subsequent ‘daughter’ Directives that were governed by the Framework Directive.

For SO2, NO2, PM10, lead, benzene and carbon monoxide the standards were set as limit values, to be achieved everywhere; while standards for ozone were set as target values, in recognition of the difficulty in ensuring that the required concentration is met given the complex atmospheric chemistry involved in ozone production. The 4th Daughter Directive, 2004/107, covering heavy metals and polyaromatic hydrocarbons (PAHs), also established target values, on the basis that the desired concentrations of ambient air concentrations of arsenic, cadmium, nickel and polycyclic aromatic hydrocarbons (i.e. concentrations which would not pose a significant risk to human health) could not be achieved in a cost-effective manner in specific areas. 32 The implementation of target values does not require that measures entailing disproportionate costs be taken; 33 for an ambient air quality limit value, on the other hand, the obligation is binding as to the concentration to be achieved and Member States are obliged to put in place the necessary plans and programmes to reach compliance.

The 2005 TSAP was accompanied by a legislative proposal for amending the Ambient Air Quality Directives –eventually adopted as Directive 2008/50/EC. It significantly streamlined the legislation by merging the Air Quality Framework Directive and its first three daughter directives. It also included new flexibilities by introducing the possibility of time extensions for the PM10, benzene, and NO2 limit values originally established in 1999. New air quality standards were introduced for particulate matter (PM2.5), based on the increasing evidence that health effects were dominated by long-term exposure to this pollutant. Finally, it called for further streamlining the existing implementing acts and further adapt them to reduce the administrative burden through making better use of electronic and automated data collection and processing technology. The latter consolidation was completed in 2011 through the adoption of the Commission Decision 2011/850/EU, consolidating and amending three implementing acts.

A particular innovation of Directive 2008/50/EC was to include a different kind of regulatory parameter for PM2.5 in addition to the traditional ambient concentration: an average exposure indicator (AEI) designed to reflect the population exposure to PM2.5 in an individual Member State, and with two related objectives. 34 The rationale was that there was no identifiable threshold below which PM2,5 would not pose a risk, and so a mechanism was needed to prompt a general reduction of concentrations in the urban background to ensure that large sections of the population benefit from improved air quality. This would supplement the PM2.5 limit value, the role of which is to ensure a minimum degree of health protection everywhere. 35

Since the recent consolidation, ambient air quality standards are contained in the Directive 2008/50/EC and 2004/107/EC.

4.2.Monitoring, reporting and evaluation 

The implementation of the ambient air quality standards is monitored according to specific provisions established in the relevant Directives and including provisions on zoning, the determination of the required assessment regime, criteria for location of sampling points (macro-scale and micro-scale siting), data quality objectives, reference methods for the assessment of concentration of pollutants, and the conditions under which modelling could be used in combination with fixed measurements. 36

Data collection, quality assurance, and reporting of the resulting data is managed by the European Environment Agency (EEA). The EEA provides annually a consolidated report on implementation of the Directive. 37 Detailed data sets are maintained and publically available in the EEA's Airbase. 38

It is noted that under the provisions of the new Decision 2011/850/EU a transition to electronic reporting compatible with the INSPIRE Directive will take place in 2014, allowing for further streamlined reporting and evaluation as well as enhanced public access to relevant air quality information. 39

4.3.Relevance

The main issue of relevance for the Ambient Air Quality Directives is whether the pollutants regulated are indeed those of principal health concern, and whether the controls are set at the correct level. As part of the 2013 air policy review, the Commission asked WHO to carry out a review of the health effects of air pollution according to a series of questions identified in consultation with stakeholders. 40 Among the key questions were:

whether any developments in evidence would justify modifications to the emphasis on the main pollutants currently regulated (PM10 and PM2.5, NO2 and ozone), including:

owhether any fractions of particulate matter should be regulated in preference to particulate mass;

owhether new evidence affected the assumptions regarding a no-effect threshold for any pollutant;

owhether the health evidence related to NO2 indicated that it impacted directly on human health, or was a marker for some other component of air pollution.

·whether any parameters could be consolidated or deleted from the regulatory framework, or whether any should be added;

·which metrics, health outcomes and concentration-response functions could be used to assess the health impacts of PM, ozone and NO2.

These questions covered all the main issues raised by stakeholders in the first public consultation. 41 The question of the independent health impacts of NO2 was particularly important given (a) the widespread non-compliance with the NO2 limit value and (b) the fact that while vehicle related PM pollution has been decreasing (due e.g. to implementation of the diesel particle filter), NO2 concentrations have been stable and often above the EU AQ limit value, and in several places increasing levels.

The main conclusions from the WHO analysis are as follows:

·While there is some evidence linking particular sub-components of PM2.5 with specific health impacts (for instance the sub-components related to primary combustion), the balance of evidence favours retaining PM2.5 mass as the target for policy measures; 42

·Evidence still supports the absence of a threshold for PM2.5. 43 For ozone the evidence is inconclusive, but any threshold, if it exists, is likely to lie below 90 μg/m3. 44 (The EU target value is 120μg/m3.) Since 2005 there is new evidence indicating potential severe health impacts (premature mortality) of chronic exposure to ozone.

·Evidence indicates that there are independent effects of NO2 on short-term health outcomes; the evidence for independent long-term effects is less clear-cut but still suggestive of a causal relationship.

·There are independent rationales for each of the current PM limit values. 45 In addition there is a potential rationale for a limit value on short-term average concentrations (as well as the current annual average). 46

· Specifications on the metrics and concentration-response functions appropriate for health impact assessment were provided in this and the follow-up project (HRAPIE), and used in the ex-ante impact assessment for the new Strategy. 47 The recommendation was that air pollution health impact assessments should focus on chronic PM2.5 exposure and acute ozone exposure, as in 2005, but that sensitivity analysis on chronic ozone impacts and chronic NO2 impacts would also be warranted.

·While the parameters of the current legislation are all separately justified based on the health evidence, there is evidence indicating the need to revise WHO guidelines for PM, ozone (long-term exposure), NO2 and SO2. 48  

With regard to the level at which the EU limit and target values are set, with the exception of the NO2 annual limit value these are less strict than the current WHO guidelines, and no values have been tightened since they were originally established. The WHO advised in particular that the levels at which the PM limit values are set are not sufficient to adequately protect human health. 49 Thus, even full compliance with the existing Ambient Air Quality Directive would be insufficient to protect human health: very substantial health impacts would remain.

The review also examined the levels at which controls are set for the substances regulated in the AAQD in the EU's main trading partners and the WHO guidelines. Appendix 2 sets out the levels established in the EU as compared with the WHO guidelines and the limit values in the USA, Japan, Switzerland, China, Korea, and India. The limit values set are broadly comparable to those of the EU even in emerging economies. For the health problem of most concern (PM2.5), the USA limit value is substantially tighter than the EU limit (at 12 μg/m3, as compared with 25μg/m3 in the EU). For the pollutants for which compliance in the EU is most difficult, the following observations are made:

·NO2 annual average: the limit in the USA is substantially higher (100μg/m3 as compared with EU’s 40μg/m3), but China and India are the same and Switzerland is tighter (30μg/m3).

·PM10 daily average: this is difficult to compare given the crucial role of the number of allowed exceptions. USA looks less stringent (at 150μg/m3 as compared with the EU’s 50μg/m3), but (a) the USA strictly regulates the PM2.5 sub-fraction of PM10 and (b) it allows only one day’s exceedence a year as opposed to the EU’s 35 days.

4.4.Effectiveness

The effectiveness of the AAQDs in achieving their objectives has been assessed in terms of the extent of compliance with the limit values set.

Figure 3 presents the summary compliance picture in graphical form. It shows the percentage of monitoring stations in exceedance of the limit or target values (left), and the percentage of the EU population potentially exposed to concentrations above those values (right).

Figure 3: The 2010 AAQD Compliance and Population Exposure Picture (EEA)

Widespread compliance with the limit values for benzene, lead, CO, and SO2 in the Directive has been achieved ( Figure 4 ).

Figure 4: Status of compliance in 2010 with EU legally binding air quality standards for Benzene, Lead, CO, and SO2 (clock wise from upper left onwards); EEA 2012

In addition, the non-binding target values for heavy metals (arsenic, cadmium, nickel) are also broadly complied with ( Figure 5 ). 

Figure 5: Level of compliance with non-binding target values for heavy metals (arsenic, cadmium, and nickel) in the EU