Directive could cause plant closure

Recent amendments by MEPs to the draft EU Industrial Emissions Directive mean that power plants will need to undergo costly upgrades to comply with air-pollution targets or close by 2016.

The business group says that could lead to a quarter of the UK’s electricity-generating capacity - up to 14 plants - being forced to close early.

The CBI is calling for power plants to be given until 2021 to prepare for the proposed changes, which will allow other low-carbon forms of energy to be built to replace the lost capacity and ensure a smooth transition.

John Cridland, CBI deputy director general, said: ’Businesses want to help cut air pollution, but this directive must be implemented in a way that doesn’t undermine the UK’s energy security.

’The timescales currently proposed by some MEPs are unrealistic and could lead to up to 14 UK power plants having to shut prematurely. Given that these plants are old and due to close in the 2020s, letting them run their course would allow for a smooth transition to new low-carbon energy sources and avoid creating a serious energy gap.

’The majority of EU member states want a phased introduction for this directive and it is vital that the new UK government makes protecting our energy security one of its top priorities.’

The directive is being voted on by the European Parliament’s Committee on Environment, Public Health and Food Safety in Brussels on Tuesday 4 May. After the vote, negotiations will take place between the Council and European Parliament, before the directive is voted on in a plenary session in Strasbourg during the summer months.

The CBI is also highlighting another worrying aspect of the directive that it says will reduce the UK’s flexibility to decide how best to meet the air-pollution targets in the most cost-effective way.

Sean McGuire, director of CBI Brussels, added: ’The current system of monitoring industrial emissions with the UK’s Environment Agency and individual plants works well, and should remain the basis for complying with the directive.

’We need a system that retains flexibility and is risk based to take account of local environmental conditions and individual business investment cycles.

’If implemented in its current form, these factors wouldn’t be taken into account and firms would be subjected to an arbitrary one-size-fits-all European approach.’

The CBI has recently published a 12-point agenda for the new government, which ranks energy security as one of the key areas for action.

A copy of ’New Government in Action: The Business Agenda’ can be downloaded from the CBI website.