Since 2011, the Chinese government has made significant progress in developing comprehensive air quality plans, by adopting new ambient air quality and emission standards, deploying more than 1,000 new air quality monitors, and establishing stringent air quality improvement targets. Most recently, the National People’s Congress amended China’s Air Law, including new measures to assess and collect penalties for each day of an air quality violation.
While setting standards is a crucial first step, implementation is even more critical to ensuring that the requisite pollution reduction goals are achieved.
Licensing, or permits as they are referred to in many countries, is an essential element that ties the contents of each control measure to operating and process conditions at an enterprise to assure that the emissions standards are met continuously.
Limited Environmental Impact Assessment Focuses on Construction
The environmental impact assessment (EIA) process has been a useful tool in parts of China to establish the conditions that need to be met during the construction phase at an enterprise. In effect, the EIA has served as key condition for China’s construction permit.
However, since 2012 the Ministry of Environmental Protection (MEP) has dealt with more than 100 companies using falsely registered engineers to conduct the EIA. In some provinces, the EIA has been inconsistently applied, or used to encourage more economic development with weak environmental protections. And, the EIA conditions apply only to the construction phase(s) of a project—not to the operational phase.
Permits Needed to Address Facility Operations
China’s new Air Law, and other policy documents, emphasize multi-pollutant and regional planning, but have not addressed permitting in detail. China needs a permit system that covers the operating phase, as well as the construction phase, at each enterprise. Doing so would help Chinese air quality agencies meet their various improvement targets.
This system does not need to be the complicated American system of labor-intensive construction and operating permits, the result of four decades of litigation. A single permit could be issued to cover both phases, with an inspector auditing the enterprise to ensure that construction has been completed in accordance with the terms and conditions of the permit before approval is granted to operate the equipment or processes.
Additional record keeping and reporting terms and conditions could help Chinese air quality agencies more effectively hold enterprises accountable for complying with the applicable standards. In turn, the air quality agency could use the data to improve emissions inventories, improve the accuracy of air quality models used for planning purposes, and cross-check reported emissions against data collected by ambient air quality monitors.
Enterprise-wide Permits for Large Industrial Facilities
Drawing from the EU model (e.g. the EU Industrial Emissions Directive), which considers all processes at a particular enterprise China could first focus on the largest point sources (e.g., power plants, cement, and iron/steel) and issue construction and operating permits that apply to an entire facility for all processes and pollutants. This approach avoids the labor-intensive U.S. approach of evaluating changes or modifications at each emission point.
For example, MEP could issue a permit that covers all regulated pollutants for all of the processes at a cement factory, which may include several different processes and multiple sources of pollution. Under this approach, the factory as a whole would need to meet the conditions of the operating permit.
China’s Air Law also requires that clean energy principles be included as air quality control measures. Here, China has an excellent platform on which to build: the key elements of the Top 10,000 program for coal and energy savings can be embedded as specific terms and conditions in the enterprise-wide operating permits.
General Permits for Small Stationary Sources
China also has tens of thousands, if not more, of smaller stationary sources, and scarce resources in air quality agencies. For these sources—such as auto body shops, restaurants, screen printing operations, and dry cleaners—China could use the American model of permit-by-rule or general permits. Under this approach, MEP would write a regulation for each source category that includes specific emissions standards to be met, along with record keeping and reporting requirements. These permits-by-rule could also be multi-pollutant, and like the individual permits for larger sources, integrate energy efficiency and clean energy principles.
The permit-by-rule approach for smaller sources is also easier to adapt as China’s air quality actions become more comprehensive and stringent in the future. It is much more efficient to revise regulations and standards than to adjust the conditions in each of thousands of individual permits.
Drawing on the best practices from the U.S. and Europe and avoiding their pitfalls, China could adopt an effective permitting system aimed at reducing emissions throughout the operational life of a facility. RAP will be working with Chinese air agencies and colleagues in the coming months to discuss ways in which China can develop an effective permit system. We will share significant developments as they occur.