Question 1: Do you have any views on any aspect of the substantive amendments?

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1 Oil & Gas UK is the pan-industry trade association representing companies active throughout the UK offshore oil and gas industry. For the purposes of this consultation our comments relate to offshore installations and associated onshore terminals. Substantive Amendments General Questions Question 1: Do you have any views on any aspect of the substantive amendments? The UK will become more dependent on oil and gas, as primary sources of energy, over the next years. Those hydrocarbons which we do not produce ourselves will have to be imported at significant extra cost to the economy and with potentially greater environmental impact. The UK Government has clearly stated that it is of the utmost importance to our security of supply and to the environment that the UK maximises the economic recovery of its own oil and gas. The North Sea is one of the most expensive oil and gas provinces in the world with costs matching the increase in oil price, making it difficult to attract investment in marginal field developments. The economics of existing facilities and potential developments are, therefore, extremely sensitive to retrospective regulatory change and to uncertainty around future requirements. In this respect we believe that work towards better and more consistent implementation of the existing IPPC Directive would provide greater benefit than a wholesale revision. The rigid use of BREF ranges or uniform emission limits conflicts with the goal based site-specific approach. It will be particularly difficult to apply for existing plant, and will bring large unjustified cost burdens, and undermine the dialogue on BAT and the BREF Note process. Thus Art 16.3 needs to be established as a normal part of the permitting process, rather than by derogation. It will be difficult for a BREF to adequately cover the problems of retrofitting improvements to existing plant, where site-specific constraints such as plant congestion, safety considerations etc may limit what can be done on a case-by-case basis. This is particularly relevant to offshore installations. It should be established at the outset that the BREFs should not try to cover site-specific issues, and that Competent Authorities should be given flexibility to use Art 16.3 as a normal procedure. Question 2: Are you able to provide some quantified assessment of any costs or benefits you perceive may result from the matter being addressed, in addition to more qualitative comments? OGUK has not had the opportunity to generate a quantified assessment of costs at this time. Question 4: Can information in baseline reports always be quantified and should qualitative information also be recognised as having a valid place in such reports? We agree relevant data may not be quantified, and would support an amendment to delete the word quantified. Question 5: How does the requirement in Article 8 for the operator of an installation to provide at least an annual report on compliance with permit conditions to the competent authority compare to reporting requirements already embodied in extant permits? Offshore installations report via the EEMS system. Any additional requirement should be integrated with this system to avoid duplication of effort.

2 Question 6: What are the practical consequences of the substantive amendments in Article 9(2)(b) which gives an explicit role to the competent authority along with the operator in restoring compliance in the event of non compliance? - bearing in mind the current provisions of regulation 36 of the EPR Regulations and the analogous provisions in the Regulations for Scotland and Northern Ireland. It should be clarified that it is for the CA to use his powers, and for the operator to take the measures. The word immediate should be deleted from the first line of the final paragraph. Question 9: (i) How do the Commission s proposed provisions for the preparation of BAT reference documents in Article 14 and Article 29 accord with the process by which BAT reference documents have already been drawn up by the Commission, and (ii) whether the scope of the documents set out in Article 14(2) is appropriate? Ideally BREFs would be much shorter documents and easier to use (and the UK technical guidance notes are a possible model here). It will be difficult or impossible to adequately discuss the limitations on applying BREFs to existing plants. We believe there needs to be clear recognition the CA will determine BAT on the basis of site specific discussions, and will justify these decisions in writing available to the public. However, if BREFs are to become effectively prescriptive for new and existing plants, much more consideration will need to be given to the need for stable conditions for investment, and to whether the industries concerned accept the BREF. The very long investment cycles associated with upstream oil and gas activites means that major investments may be rendered useless by subsequent changes or legal challenges to permit determinations. If the status of the BREF is to be enhanced then investors may be increasingly discouraged by such risks, especially if BREFs overlap and more than one BREF applies, and they are all to be updated at different times. The situation where oil and gas terminals are subject to two or more vertical BREFS, plus a number of horizontal BREFs (storage, cooling, etc) is too complex for regulatory stability, and will discourage investment, and should be simplified,. Currently there are no BREFs specifically for upstream oil and gas operations. Operators have had to make reference to BREFs for other industry operations, primarily refineries. Oil and gas terminals experienced difficulty in the use and interpretation of a BREF note designed for refineries. BREF chapters were arranged according to refinery unit operations and made it extremely difficult to identify relevant BAT for oil and gas terminals. Many refinery BAT items relating to plant operation and maintenance were not appropriate to oil and gas terminals. An example is the use of pinch analysis and advanced control for optimisation of heat and energy recovery is unnecessary as oil terminal operations are not sufficiently complicated. Flexible application of BAT allowed operators to provide appropriate responses to the intent of the BAT requirement. Sector BREF should be relevant to the industrial process, complete and sufficient for permit determination without reference to other BREFs. An upstream oil and gas BREF note will be necessary should adherence to BREFs become mandatory. Alternatively, BAT could be determined by the CA without reference to a BREF, as provided for in Article 15(4). The latter is considered appropriate given the relatively small number of operators in the EU, the uniqueness of many installations and the technical expertise held by the offshore CA in the UK. Question 10: Are there in practice any installations for which it is not justified for the permit to contain appropriate requirements ensuring protection of the soil and groundwater and measures concerning the management of waste generated by the installation? bearing in mind that the requirements have to be `appropriate.

3 A requirement to protect soil and groundwater is inappropriate for offshore installations. Question 11: Whether BAT reference documents (as defined in Article 14 and therefore the product of a EU-wide information exchange) should be the reference for setting permit conditions as proposed in Article 15(3) or a reference? As already discussed, BREFs cannot adequately deal with site-specific issues, and should become a reference. Question 12: (i) Whether the information exchange process by which the BAT reference documents are produced is sufficiently robust and transparent to justify the requirement that emissions limit values set by the competent authority shall not exceed the BAT-associated emission levels set out in BAT reference documents, (ii) how the BAT-reference process could be improved, and (iii) what effects this requirement may have on the contribution of information to the process by operators. Refer to our response to question 9. Industry cannot support the application of multiple BREFs, and this needs drastic simplification such that single sector BREFs become the norm. If BREFs are to set the range of allowed emissions for existing plants, then they will have to consider more examples of site-specific problems. BREFs are likely to become even longer documents, with more caveats and more difficult to use with wider ranges of BAT-AELs. Question 13: How does the `derogation in the first paragraph of Article 16(30) compare in practical effect with the provisions of Article 9(4) of the IPPC Directive? bearing in mind the reference in both to consideration of the technical characteristics and geographical location of the installation and the local environmental conditions. The practical outcomes should be similar to Art 9.4 of the existing IPPC directive. However, given the requirements for public participation, the phrase by derogation could be seen to have a negative connotation i.e that an installation is being allowed to operate outside normal standards. Question 14: Do you have any views on the principle embodied in the second paragraph of Article 16(3) that the `derogation must not result in emission limit values exceeding those set out for specific activities and installations in Annexes V to VIII of the proposed recast Directive? The current Large Combustion Plants Directive excludes industrial gas turbines (IGTs) used offshore because of the technical difficulty of handling the variable calorific value and composition of the unprocessed fuel used offshore, and because of the particular operating circumstances of offshore gas turbines. We believe this exemption should be maintained and are pleased to note that the Commission has maintained this exemption in its current proposal. Question 15: Do you have any views on the actual ELVs which are contained in Annexes V to VIII? These ELVs cannot be achieved technically or economically by all installations due to the variable calorific value and composition of the unprocessed fuel used offshore, and because of the particular operating circumstances of offshore gas turbines. In addition, some oil and gas installations combust associated gas released from the process that would otherwise be flared. This flexibility must be maintained as this will minimise the installations overall environmental impact. We would also seek confirmation that Article 15(2) will allow BERR to apply alternatives to ELVs on offshore installations. Question 17: Whether monitoring requirements set in permits based upon BAT conclusions would enable the competent authority to take a truly risk based approach to monitoring?

4 We see no problem with monitoring based on BAT conclusions, which should allow for risk-based monitoring. Question 18: (i) Whether a minimum frequency of the periodic monitoring should be set, (ii) whether criteria for the determination of the frequency of the periodic monitoring are desirable, irrespective of the means by which they are set, (iii) what those criteria should be, (iv) whether RPS provides an appropriate means of establishing those criteria, (v) by what other means should those criteria be established, and (vi) whether criteria should be set in the Directive itself. We support the UK s proposed amendments to Art 17.2 to clarify the need to take account of environmental risk, and to require the Commission to establish criteria on appraisal of environmental risk. Question 19: Whether the more explicit requirements in Article 22(2) upon operators whose permit conditions are to be reconsidered amount to a change in the current or envisaged practice of UK competent authorities in fulfilment of Article 13 of the IPPC Directive? Delete the word all from line 1. Question 21: How does the requirement on the competent authority to ensure the implementation of permit conditions set in accordance with Article 12(8) in respect of the avoidance of any pollution risk and site restoration upon the `definitive cessation of activities differ from current UK requirements in respect of permit surrender as set out in regulations 24 and 25 and Schedule 5 of the EPR and similar requirements in the regulations for Scotland and Northern Ireland? Question 22: (i) Are the circumstances in which a `baseline report (as defined in Article 3(15)) where an activity `involves the use, production or release of dangerous substances [as defined in Article 3(14)] having regard to the possibility of soil and groundwater contamination at the site of the installation is required clearly defined, and (ii) in any case what those circumstances should be? Question 23: (i) Whether criteria concerning the content of the baseline report are desirable, irrespective of the means by which they are set, (ii) what those criteria should be, (iii) whether RPS provides an appropriate means of establishing those criteria, (iv) by what other means should those criteria be established, and (v) whether criteria should be set in the Directive itself. Question 24: Does the requirement in Article 23(3) upon the operator to `assess the state of the soil and groundwater contamination by dangerous substances, to compare that assessed state with the `initial state established in the baseline report and then if necessary to remediate the site so as to return it to that initial state differ from current UK requirements in respect of permit surrender as set out in regulations 24 and 25 and Schedule 5 of the EPR and similar requirements in the regulations for Scotland and Northern Ireland? Consultees illuminating differences are also invited to contribute information on the cost implications of those differences.

5 Question 25: Does the requirement in Article 23(4) on operators who do not need to prepare a `baseline report but only to `take the necessary measures upon definitive cessation of the activities to ensure that the site does not pose any significant risk to human health and the environment differ from current UK requirements in respect of permit surrender as set out in regulations 24 and 25 and Schedule 5 of the EPR and similar requirements in the regulations for Scotland and Northern Ireland? Question 26: (i) What would be the additional benefits of the requirement in Article 24 requiring an operator to include in its compliance report to the competent authority a comparison `between the operation of the installation, including the level of emissions, and [BAT] as described in BAT reference documents, (ii) how operators could establish the relevant comparators within BAT reference documents, and (iii) what action should be taken in the event of an unfavourable comparison. Consultees are also invited to contribute information on the cost implications of such a requirement. This seems unnecessarily bureaucratic. Comparison with BAT is provided in the permit applications. Achievement of BAT should be one of continuous improvement and discussion with the CA. As such the CA should be aware of an installations position versus BAT and the status of improvements actions. A review against BAT should apply only during substantial revision of the permit and not on a prescribed frequency. Question 27: How do the requirements in Articles 25(1)-(4) concerning the conduct of inspections differ from the current or envisaged practice of UK competent authorities? The frequency of inspection should be determined by the CA based on risk assessment. Annual inspection of offshore installations is impractical for logistical reasons. Question 28: (i) Whether the implicit availability of inspections in Article 25(4) at intervals of more than 12 months in some circumstances may be justified by consideration of `environmental risks, (ii) whether criteria for the appraisal of `environmental risks are desirable, irrespective of the means by which they are set, (iii) what those criteria should be, (iv) whether RPS provides an appropriate means of establishing those criteria, (v) by what other means should those criteria be established, and (vi) whether criteria should be set in the Directive itself. See Q. 27 Question 29: How do the requirements for routine and non-routine inspections in Article 25(5) and (6) accord with the current or envisaged practice of the UK competent authorities? See Q. 27 Question 30: (i) How the requirement in article 25(7) upon the competent authority regarding the reporting of inspections, the public availability of reports and follow-up actions accord with the current or envisaged practice of the UK competent authorities, (ii) what is the benefits to operators and the public of these requirements, and (iii) Is there a need for inspection reports to be publicly available within two months of inspection and the practicability of that or of different timescales. The two month window may not provide sufficient time for agreement of the findings and actions between the CA and operator. Reports should not be made publicly available until agreement has been reached. Inspection reports should not contain names of individuals or other personal details. Operators should have the opportunity to request modification of inspection records being made available publicly to protect employees or commercially sensitive information.

6 Whilst we agree that it is reasonable for inspection findings relating to compliance with specific pieces of legislation to be made public, the inspector may also offer advice on the report, for example highlighting potential improvement opportunities based on good practices observed elsewhere. Since this advice may reflect the personal opinions and views of the inspector and the operator is under no obligation to implement this advice, we consider that advisory comments should not be made public. Question 40: Do the amendments in Article 26 provide sufficiently for access to information and public participation? Yes. Question 41: Whether the specification of the information exchange process in article 29 is sufficient for the purposes of developing and using BAT reference documents in the manner set out in Articles 14 and 16? The permit, inspection records and annual emissions report are already in the public domain. Any request for information should be made through the CA. We see no reason for NGOs to have special status in this regard... Question 43: What are your views on the deletion of Article 4(6) of the current LCPD which provides for the establishment of the NERP, which the UK implemented with effect from 1 January 2008? NERP is of enormous value in reducing the cost of the revisions to the current LCPD and provides flexibility to operators. Question 45: Is it appropriate for the Commission to as soon as appropriate measurement techniques are available within the Community to set a date from which continuous monitoring of emissions to air of heavy metals, dioxins and furans shall be carried out and this date to be adopted by means of the RPS? Monitoring requirements should be based on risk assessment. Monitoring for these species (or any other) should be based on the outcome of an assessment by the CA. Question 47: What period of time should be allowed between entry into force of the proposed recast Directive and its application to the activities listed in Articles 73(1) and (2)? The period prescribed is considered the minimum. Question 53: Do you have any views on the justification for and practicability of the amended requirements for continuous monitoring of carbon monoxide in the waste gases of gas-fired combustion plants of 100 MW or more rated thermal input in paragraph 1 of Part 3 of Annex V and for spot monitoring for specified pollutants in paragraph 3 and 4? The requirement to measure these parameters should be risk-based. For example, dust monitoring would be inappropriate for installations combusting clean gaseous fuels. Recast Combustion Plants Summary of Questions Question 1: How well does the impact assessment which accompanies this consultation document relate to your own experiences? OGUK have not had the opportunity to consider this document at this time..

7 Question 2: Can you contribute further quantification of envisaged impacts upon operators, their customers and suppliers? OGUK have not had the opportunity to consider this document at this time. Question 3: What are your views on Parts 1 and 2 of Annex V of the proposed recast Directive, taking into account all the points made in this document? As the Impact Assessment makes clear, a large proportion of the UK LCPs are NOT power stations. Such industries were almost certainly not involved in the preparation of the LCP BREF and have not accepted these elvs as economically achievable.. Question 4: How useful is any specification of minimum ELVs, given that other factors may drive competent authorities to set tighter limits? Any use of minimum elvs must take into account the limitations of existing technology and infrastructure that could not be altered without extremely high costs, both in direct costs and lost production. Question 5: What are your views on the deletion of Article 4(6) of the current LCPD which provides for the establishment of the NERP, which the UK implemented with effect from 1 January 2008? See answer to Q43 on substantive amendments. Question 10: Do you have any views on the proposed lowering of the threshold for subjection of combustion plants to IPPC from 50 to 20 MW rated thermal input? The lowering of the threshold will result in many new types of installations entering the scheme. These will need to go through a complicated permitting process. Existing BREF notes cover only installations of 50 MW thermal input or more and would be inappropriate for smaller installations. As already noted, the existing BREF notes adequately address the circumstances of all incumbent operations and priority should be given to improving these before bringing new installations into the scheme. The recast introduces an inconsistency in the approach to offshore installations. Whilst installations at or above the 50MWth threshold retain the exemption, there are several offshore installations in the MW range that will not be exempt. These installations have the same issues with fuelling and although Article 15(2) may apply, it would be better to have all offshore installations covered by the exemption. Question 11: Do you think the July 2015 date for the proposed recast Directive being applied to installations with a rated (aggregate) thermal input of between 20 and 50 MW is appropriate? Appropriate BREF notes would be required prior to this date. The proposed date would therefore seem inappropriate.