OPINION OF ADVOCATE GENERAL
BOBEK
delivered on 28 June 2016 (1)
Case C‑304/15
European Commission
v
United Kingdom of Great Britain and Northern Ireland
(Failure to fulfil obligations — Directive 2001/80/EC on the limitation of emissions of certain pollutants into the air from large combustion plants — Article 4(3) — Annex VI, Part A, Footnote (3) — Scope of the derogation — Aberthaw power station — Eligibility)
I – Introduction
1. Directive 2001/80/EC of the European Parliament and of the Council of 23 October 2001 on the limitation of emissions of certain pollutants into the air from large combustion plants (‘the Directive’) (2) applies to plants the rated thermal input of which is equal to or greater than 50 MW, irrespective of the type of fuel used (solid, liquid or gaseous). (3) It aims at reducing emissions of sulphur dioxide, nitrogen oxides and dust discharged by such plants.
2. The European Commission investigated the compatibility of large combustion plants including Aberthaw power station (Wales) with the requirements of the Directive. It came to the conclusion that the United Kingdom (‘the UK’) was in breach of the requirements of Article 4(3) read in conjunction with Part A of Annex VI to the Directive which require Member States to achieve significant emission reductions and sets the emission limit value for nitrogen oxides (NOx) at 500 mg/Nm3.
3. The UK claims that Aberthaw power station was allowed to emit more than 500 mg/Nm3 NOx into the air on the basis of Footnote (3) in Part A of Annex VI to the Directive (‘Footnote (3)’). That footnote carves out a derogation from the generally applicable emission limit value for plants burning solid fuels whose volatile content is less than 10%.
4. The present dispute turns on the correct interpretation of Footnote (3): does it apply to Aberthaw power station?
II – Applicable law
5. Article 4(3) of Directive 2001/80 states: ‘without prejudice to Directive 96/61/EC and Council Directive 96/62/EC of 27 September 1996 on ambient air quality assessment and management, Member States shall, by 1 January 2008 at the latest, achieve significant emission reductions by:
(a) taking appropriate measures to ensure that all licences for the operation of existing plants contain conditions relating to compliance with the emission limit values established for new plants referred to in paragraph 1; or
(b) ensuring that existing plants are subject to the national emission reduction plan referred to in paragraph 6 …’.
6. Part A of Annex VI to the Directive 2001/80 defines the NOx emission limit values to be applied by new and existing plants pursuant to Article 4(1) and Article 4(3) respectively. It sets the limit value at 500 mg/Nm3 for plants of a thermal capacity over 500 MWth. From 1 January 2016, the value of 200 mg/Nm3 shall apply.
7. Footnote (3) in Part A of Annex VI to the Directive provides that ‘until 1 January 2018 in the case of plants that in the 12-month period ending on 1 January 2001 operated on, and continue to operate on, solid fuels whose volatile content is less than 10%, 1 200 mg/Nm3 shall apply’.
8. Directive 2001/80 was recast and repealed from 1 January 2016 by Directive 2010/75/EU of the European Parliament and of the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control). (4) That new directive sets lower emission limit values. It furthermore removes the type of derogation found in Footnote (3) in Part A of Annex VI to the Directive 2001/80.
III – Procedure
9. On 29 May 2012, the Commission opened an EU Pilot file to investigate the compliance of certain large combustion plants (in particular Aberthaw power station (‘Aberthaw’)) with the emission limit values for NOx laid down by the Directive. In the course of the procedure, the UK suggested that Aberthaw benefited, on the basis of, Footnote (3) in Part A of Annex VI to the Directive, from a higher emission limit value of 1 200mg/Nm3 for NOx, as opposed to the standard limit value of 500 mg/Nm3. However, the volatile matter content (‘VMC’) of the solid fuel used in Aberthaw in 2009 was reported as being 13.5%, whereas the condition set out in Footnote (3) requires a VMC of less than 10%.
10. The UK subsequently informed the Commission that the NOx emission limit value in Aberthaw’s permit issued by the national authorities was reduced to 1 100 mg/Nm3 while the annual value of the volatile content of the coal fluctuated between 11.39% and 12.89% in the years between 2008 and 2011.
11. In the Commission’s view, the condition of less than 10% VMC set out in Footnote (3) was not fulfilled by Aberthaw in any of the years between 2008 and 2011 inclusive. Therefore, the Commission considered that the standard limit value of 500 mg/Nm3 was the value applicable to Aberthaw and was not achieved by the plant.
12. Accordingly, the Commission issued a letter of formal notice to the UK on 21 June 2013 alleging that it failed to correctly apply Article 4(3), read in conjunction with Footnote (3) in Part A of Annex VI to the Directive to Aberthaw power station since 1 January 2008 and was thus in breach of its obligations under Directive 2001/80.
13. The UK responded by letter of 9 September 2013 stating that it was not in breach of its obligations under the Directive in relation to Aberthaw power station. It argued that the derogation negotiated and enshrined in the Directive in Footnote (3) had been specifically aimed at covering Aberthaw.
14. The Commission remained unconvinced. It issued a reasoned opinion on 16 October 2014. It notably took the position that a plant can only be permitted to exceed the normal emission limit value if it burns solid fuels whose VMC is less than 10%.
15. The UK responded to the reasoned opinion by letter dated 17 December 2014. It explained that Aberthaw was continuing to make investments to improve its performance, with NOx emissions expected to fall to 450 mg/Nm3 by the end of 2017. It also stated that the permit issued by the British authorities to Aberthaw had been reduced again in 2013 to set the emission limit value for NOx at 1 050 mg/Nm3.
16. Against this background, the Commission brought an action before the Court. It requests the Court to:
– declare that, by failing to correctly apply Directive 2001/80 to Aberthaw power station in Wales, the UK has failed to fulfil its obligations under Article 4(3), read in conjunction with Part A of Annex VI to the Directive 2001/80; and
– order the UK to pay the costs.
17. The UK maintains that it has at all times applied the provisions of the Directive correctly to Aberthaw and submits that the application of the Commission should therefore be dismissed and the Commission be ordered to pay the costs.
18. Written observations were submitted by the parties. Both parties also presented oral arguments at the hearing held on 21 April 2016.
IV – Assessment
19. Pursuant to Footnote (3) in Part A of Annex VI to the Directive, ‘until 1 January 2018 in the case of plants that in the 12-month period ending on 1 January 2001 operated on, and continue to operate on, solid fuels whose volatile content is less than 10%, 1 200 mg/Nm3 shall apply’.
20. In the first part of this Opinion (A), I shall offer the most natural interpretation of the scope of that provision. In the second part (B), I turn to arguments based on the legislative history of Footnote (3), discussed in considerable depth by the UK Government in particular.
A – The Scope of Footnote (3)
21. There are two elements relating to the construction of Footnote (3) on which the Commission and the UK disagree: first, the proportion of low VMC coal that is required in order to benefit from the derogation, taking into account the whole fuel diet of a power station and, second, the period of time over which the VMC of a power station is to be calculated in order to continue qualifying for an exception under that provision.
22. The Commission interprets the two aforementioned elements of Footnote (3) to require that a plant must at all times have operated on a coal blend with a VMC of less than 10% measured as an annual average.
23. According to the UK Government, Footnote (3) merely requires a ‘substantial proportion’ or a ‘de minimis amount’ of coal with a VMC of less than 10%. It claims that Aberthaw power station has at all times operated on a coal blend based predominantly on anthracitic coal with a VMC of between 6% and 15%, including a substantial proportion of coal with a VMC of less than 10%. However, it has never operated exclusively on coal with a VMC of less than 10%. The UK explains further that the power station could not work with fuel made up exclusively of coal having a VMC below 10% since it is dangerous to operate on coal with a VMC under 9% and because it is almost impossible in practice to keep the level of VMC between 9% and 10%. In addition, the UK claims that it would be impossible to source sufficient supplies of coal so as to consistently reach an annual VMC of less than 10%. It therefore challenges the way the Commission proposes to calculate VMC, considering that it should instead be measured on a monthly or even 48-hour basis.
24. I am of the view that the position of the United Kingdom is untenable.
25. First, as to the proportion of low VMC coal that is required to benefit from the derogation in Footnote (3) looking at the whole fuel diet of a power station, the UK’s argument according to which the use of a ‘significant proportion’ of this type of coal as the fuel diet of a plant is sufficient, does not find any support in the text.
26. The expression ‘operated on … solid fuels whose volatile content is less than 10%’ offers only two possible interpretations that do not amount to twisting the natural meaning of its text: first, either all of the coal burnt must have a VMC of less than 10%. This would effectively mean that only coal with less than 10% VMC can ever be used. Second, the average of the coal blend used must have less than 10% VMC. Therefore, a power plant does not need to burn exclusively coal with less than 10% VMC in order to benefit from the derogation set out in Footnote (3). It is just that the average, calculated over a certain period of time, has to be below that threshold.
27. It is quite clear to me that only the latter interpretation is reasonable: the coal blend burned by the plant must have, on average, a content of volatile matter below 10%. The arguments in favour of that option are not just systemic, (5) but also operational. Indeed, the UK Government argued in some detail that it would be difficult if not impossible to guarantee that all individual coal shipments have the same VMC. On the other hand, a plant operator ought to be able to ensure that the coal blend it is burning has certain characteristics over a given period of time.
28. Second, as to the period over which the VMC should be calculated, the most natural meaning of Footnote (3) suggests that the average VMC should be reckoned on an annual basis.
29. Footnote (3) refers to the 12-month period ending on 1 January 2001 — that is, the aggregated average over the year 2000 — in order to qualify for the derogation in the first place. True, Footnote (3) is silent on what exact period is relevant for the ongoing application of the same exception. However, I cannot conceive of a more appropriate conclusion than drawing an internal (and hence the closest possible) analogy within the same sentence: the same annual average should also apply by analogy for the following years so as to assess whether the plant, in the words of Footnote (3), ‘continues to operate’ on solid fuels with a VMC of less than 10%.
30. For these reasons, I would suggest that Footnote (3) should be understood as meaning that the less-than-10% requirement refers to the annual average VMC of the coal blend that is burned by power plants.
31. As stated by the Commission, the 10% requirement is a cut-off threshold. Only those power plants that operated in the 12-month period before 1 January 2001 and continue to operate on a coal blend whose volatile content is under 10% on an annual average may avail themselves of the derogation set out in Footnote (3).
32. The UK explicitly acknowledged at the hearing that that was not the case for Aberthaw. The latter never operated on a coal blend that had, on an annual average, less than 10% VMC, be it in the 12-month period ending on 1 January 2001 or in the subsequent years. Accordingly, there is, in fact, no dispute that if the Footnote (3) were to be interpreted in the way outlined above, Aberthaw could not benefit from the derogation provided for in Footnote (3).
B – The Role of Legislative History
33. The UK Government claims that Footnote (3) of the Directive was specifically drafted for Aberthaw power station. The UK insists on the argument that Footnote (3) should be more accurately characterised as a tailored provision that imposes a specific and appropriate NOx emission limit value, having regard to the characteristics of Aberthaw and similar power stations.
34. The UK submits in particular that Aberthaw power station is unique amongst UK coal-fired power stations. It is allegedly designed specifically to burn coal with a low VMC in order to be able to process the type of coal predominantly found in South Wales — that is, anthracitic coal which generally has a low VMC of between 6% and 15% — whilst the coal used in conventional coal-fired power stations typically has a VMC of between approximately 20% and 35%. Since low VMC coal is more difficult to combust, it requires a specially designed boiler in contrast with conventional coal-fired power stations. Apparently, NOx emissions generated by these special boilers are always higher. Therefore, it is impossible for Aberthaw to comply with the strict NOx emissions ceilings.
35. The UK argues that Footnote (3) was specifically carved out for Aberthaw on account of its significant economic importance for the South Wales region, notably because the remaining Welsh coal mines rely on it as the only outlet for the coal they mine, as low VMC coal is unsuitable for most other markets.
36. According to the Commission, Footnote (3) contains a derogation that was not specially carved out for Aberthaw but generally aimed at a limited number of power plants located in areas where the locally sourced anthracite coal has a naturally low volatile content, like in the UK, but also in Spain.
37. On the materials submitted to the Court, it is difficult to conclude unequivocally that the derogation contained in Footnote (3) had been specifically carved out for Aberthaw.
38. First, the derogation was initially devised for new plants, as opposed to existing plants. This is apparent when comparing Directive 2001/80 and its predecessor, Council Directive 88/609/EEC. (6) Annex VI to Directive 88/609 set different emission limit values for NOx depending on the type of fuel used by a power station and allowed up to 1 300 mg/Nm3 for solid fuel with less than 10% VMC. However, nothing indicates that the drafters of Annex VI to Directive 88/609 had Aberthaw (an existing plant) in mind given that the derogation in Annex VI to that directive only applied to new plants and not to existing ones.
39. Second, no evidence emerges from the travaux préparatoires on the Directive to indicate that Footnote (3) was a tailored provision for Aberthaw. No conclusive proof was presented to the Court on this matter. In its submissions, the UK Government relied on a range of materials produced by various individuals, Members of the European Parliament, or various UK officials in and around the legislative process leading to the adoption of the Directive. These materials are limited, however, only to letters, notes from such individuals and to records of floor debates in the European Parliament. None of these documents reflect, however, the official position of an EU institution involved in the legislative process, which could be said to state a clear legislative intent of an EU institution taken as a whole.
40. Lastly, the Directive explicitly names in other provisions specific installations that enjoy a derogation from the standard emission limit values set by the Directive. That is notably the case for ‘two installations on Crete and Rhodos’ where a specific limit value applies (Annex VI, Part B). The same legislative technique could also have been relied on to deal with Aberthaw’s specific situation. Yet, the legislator chose not to do so.
41. In any case, whatever the legislative intent might have been, I would suggest that in this particular case, it is not decisive.
42. In general, it is clear from the established case-law of the Court that legislative history and the legislative intent bear some relevance for the interpretation of both, secondary (7) as well as, more recently, primary (8) law.
43. However, stress ought to be put on the word ‘interpretation’, as opposed to judicial ‘rewriting’. Argument based on legislative intent is a permissible, indeed, useful argument in cases of textual uncertainty or ambiguity. In my opinion, however, it can carry the interpreter no further than the textual ambiguity itself permits; interpretation must remain within the bounds of the written text and its conceivable semantic vagueness.
44. Therefore, even if it were established that Footnote (3) had been carved out specifically for Aberthaw, which was not proven in the present proceedings, such a conclusion might perhaps be of relevance for potential annulment (9) of such a hypothetically stillborn provision. However, in my view, it could not lead to the judicial rewriting of a clear figure, number, or percentage, chosen and stated by the legislator in the text of the law. This would amount to interpretation ‘contra legem’, that is, interpretation going against the clear wording of a provision, which the Court has set as the outer limit of any interpretative endeavour. (10)
45. Such interpretative limits are clearly reached in the present case. Interpretative ambiguity might reasonably be said to be present with regard to the way in which and the period over which VMC is calculated, as outlined in the previous section. There is, however, no ambiguity with regard to the 10% threshold. Ten per cent means 10 per cent.
46. As a consequence, discussion of the legislative history of Footnote (3) cannot change the conclusion that the UK failed to correctly apply Article 4(3), read in conjunction with Footnote (3) in Part A of Annex VI to the Directive to Aberthaw power station and was thus in breach of its obligations under Directive 2001/80.
V – Costs
47. Under Article 138(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Commission has applied for costs to be awarded against the United Kingdom and the latter has been unsuccessful, the United Kingdom must be ordered to pay the costs.
VI – Conclusion
48. For the reasons outlined above, I propose that the Court should:
(1) declare that the United Kingdom of Great Britain and Northern Ireland failed to correctly apply Article 4(3), read in conjunction with Footnote (3) in Part A of Annex VI to the Directive 2001/80/EC of the European Parliament and of the Council of 23 October 2001 on the limitation of emissions of certain pollutants into the air from large combustion plants to Aberthaw power station in Wales and was thus in breach of its obligations under Directive 2001/80;
(2) order the United Kingdom of Great Britain and Northern Ireland to pay the costs.