R
I
A
1

Section 1
Section 2
Section 3
Section 4
Section 5
Section 6
Section 7
Section 8
Appendix 1
Appendix 2
Appendix 3
C ONTENTS
Summary of Regulatory Impact Analysis
Policy Context and Objectives
Identification and Description of Options
Identification of Costs, Benefits and Impacts of Each Option
Consultation
Enforcement and Compliance
Review
Publication
13
13
14
15
16
11
12
6
7
3
4
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S ECTION 1: S UMMARY OF R EGULATORY I MPACT A NALYSIS
Department: Department of the Legislation: European Union (Stage II
Environment, Community and Local
Government
Petrol Vapour Recovery during Refuelling of
Motor Vehicles at Service Stations)
Regulations 2011 , S.I. No. 687 of 2011
Related publications: Directive 2009/126/EC
Available to download at:
Contact for queries: Eoin Deegan Telephone 053 9117350
What are the policy objectives being pursued?
1.
To transpose Directive 2009/126/EC on Stage II Petrol Vapour Recovery (PVR II) during refuelling of motor vehicles at service stations
2.
To reduce the emissions of volatile organic compounds (VOC) into the atmosphere and thereby improve local ambient air quality and also reduce the formation of ground-level ozone and photochemical smog.
The following policy options were considered:
1. No policy change.
2. Introduce legislation to require the installation of PVR II equipment as per the requirements of Directive 2009/126/EC.
3. Introduce legislation to require the installation of PVR Stage II in advance of the timelines or below the throughput thresholds set out under Directive 2009/126/EC.
1
Costs
N/A
OPTIONS
Benefits
N/A
Impacts
Failure to comply with EU obligations could result in prosecution by the European
Commission and large fines
2 Will vary from station to station, depending on a number of variables.
Average cost estimated to be around €35,000
3 Will vary from station to station, depending on a number of variables.
Average cost would be significantly higher than option 2
Human health and environmental benefits
Sooner and marginally greater realisation of human health and environmental benefits, but at a disproportionate cost increase. for non-transposition of EU legislation.
Petrol may increase by between €0.003 per litre to
€0.01 per litre.
Petrol would increase by more than the amount specified in option 2 and there could also be widespread closure of smaller rural petrol stations.
3

S ECTION 2 P OLICY C ONTEXT AND O BJECTIVES
Policy Context
2.1
Directive 2009/126/EC
1
of the European Parliament and of the Council of 21
October 2009 on Stage II Petrol Vapour Recovery (PVR II) was due to be transposed into national legislation before 1 January 2012.
2.2
The objective of Directive 2009/126/EC is to reduce emissions of volatile organic compounds (VOC) into the atmosphere from vehicle re-fuelling activities at service stations, in order to reduce the adverse impact of VOC on human health and the environment.
2.3
Petrol contains VOC, carbon-based chemicals that evaporate readily into the atmosphere. Once emitted to air, VOC are associated with several health and environmental problems: o Formation of ground-level ozone and photochemical smog; o Poor local air quality (benzene in air); o Atmospheric warming and climate change.
2.4
Once released into the atmosphere VOC can react in the presence of sunlight with nitrogen oxides emitted from combustion processes to form ground level ozone and other components of photochemical smog. The potential impacts of ground-level ozone include reduced lung function, increased incidence of respiratory symptoms, respiratory hospital admissions and mortality. Ground-level ozone can also cause damage to many plant species leading to loss of yield and quality of crops, damage to forests and impacts on biodiversity. Benzene is a VOC and a component of petrol. It is also a known human carcinogen and is associated with a heightened risk of illnesses such as leukaemia.
2.5
Directive 94/63/EC on the control of VOC emissions resulting from the storage of petrol and its distribution from terminals to service stations (often referred to as
Stage I Petrol Vapour Recovery or PVR I) has been given effect in the State since
1997 by the following Regulations: o Environmental Protection Agency Act, 1992 (Control of volatile organic compound emissions resulting from petrol storage and distribution)
Regulations, 1997 (S.I. no. 374 of 1997) 2 ; o Air Pollution Act, 1987 (Petroleum Vapour Emissions) Regulations, 1997
(S.I. no 375 of 1997)
3
.
2.6
The Environmental Protection Agency (EPA) regulates petrol storage and distribution terminals under S.I. no. 374 of 1997. Petrol storage installations
1 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:285:0036:0039:EN:PDF
2 http://www.irishstatutebook.ie/1997/en/si/0374.html
3 http://www.irishstatutebook.ie/1997/en/si/0375.html
4

involved in the loading of petrol into, or unloading of petrol from, mobile containers are required to apply to the EPA for a VOC permit. Further information on VOC permits issued by the EPA for petrol storage and distribution can be obtained from the EPA website at the link below: http://www.epa.ie/whatwedo/licensing/voc/
2.7
Service stations and mobile tankers are regulated by local authorities under S.I. no.
375 of 1997.
Owners of service stations are required to ensure that petrol loading and storage equipment at a service station are designed and operated in accordance with the Regulations. Local authorities appoint suitable persons to carry out assessments to ensure compliance.
2.8
Directive 2009/126/EC extends the requirement to control and recover VOC emissions to the refuelling of individual vehicles. Inside a petrol tank, petrol vapour accumulates in the space above the liquid petrol. When a vehicle is refuelled, the vapour is forced out from the fuel tank by the incoming fuel and, unless controlled, escapes into the atmosphere through the filler neck of the fuel tank (see Appendix
1).
2.9
Stage II Petrol Vapour Recovery (PVR II) captures this escaping vapour. This is done by creating a vacuum to draw back and capture the vapour through the dispensing hose and nozzle, either to the station's underground storage tank
(‘conventional’ PVR II – see Appendix 2 ) or directly back to the fuel pump (‘at pump’ PVR II – see Appendix 3). Conventional PVR II results in the vapour eventually being returned to the oil supplier via the petrol tanker, much in the same way as currently happens under Stage I Vapour recovery (See Appendix 4). The ‘at pump’ PVR II technology is a more recent development and does not require any modification of the underground pipe work of the service station. In this scenario, the petrol is recovered and resold at the usual forecourt price, however, duty and supply costs will have already been paid for the recovered fuel.
2.10
Directive 2009/126/EC obliges Member States, as a minimum, to put in place measures to provide for petrol vapour recovery during the refuelling of motor vehicles at service stations. Member States may decide, following consultation with the European Commission, to implement more stringent protective measures and/or limits than those set out in the Directive.
2.11
European Union (Stage II Petrol Vapour Recovery during Refuelling of Motor
Vehicles at Service Stations) Regulations 2011 , S.I. No. 687 of 2011 have been introduced to give effect to the provisions of Directive 2009/126/EC.
Objectives
2.12 The objective of the legislation is reduce emissions of volatile organic compounds (
VOCs) into the atmosphere from vehicle refuelling activities at service stations, in order to reduce the adverse impact on, and risks to, human health and the environment (see section 1.3 and 1.4 above).
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2.13 Directive 2009/126/EC is one of a suite of measures introduced by the European
Union to reduce emissions of VOC to air, including: o Directive 1999/13/EC
4
on Solvents Emissions (limits emissions of VOC from specified installations using solvents above prescribed thresholds); o Directive 2004/42/EC 5 on Decorative Paints (limits the VOC content of paints) o Directive 98/70/EC
6
on Fuel Quality (limits the benzene content of petrol) o Decision No 1600/2002/EC
7
(Sixth Community Environment Action
Programme established need to reduce air pollution); o Directive 2008/50/EC
8
on ambient air quality and cleaner air for Europe (sets limits for concentrations of ground-level ozone and benzene) o Directive 2001/81/EC 9 National Emissions Ceiling (which sets a limit for emissions of volatile organic compounds); o Regulation (EC) No 715/2007
10
Euro 5 and Euro 6 standards (restricts emissions of hydrocarbons from light passenger and commercial vehicles.
2.14 In addition, under the United Nations Convention on long-range transboundary air pollution, Geneva Protocol
11
on the control and emission of volatile organic compounds there is an obligation on the Parties to the Protocol to control and reduce their national emissions of VOC.
S ECTION 3. I DENTIFICATION AND DESCRIPTION OF OPTIONS
(1) No policy change.
(2) Introduce legislation to require the installation of PVR II equipment as per the requirements of Directive 2009/126/EC.
(3) Introduce legislation to require the installation of PVR Stage II in advance of the timelines or below the throughput thresholds set out under Directive 2009/126/EC.
4 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:1999L0013:20090112:EN:PDF
5 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2004:143:0087:0096:EN:PDF
6 http://eur-lex.europa.eu/LexUriServ/site/en/consleg/1998/L/01998L0070-20031120-en.pdf
7 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32002D1600:EN:HTML
8 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:152:0001:0044:EN:PDF
9 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2001:309:0022:0030:EN:PDF
10 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:2007R0715:20080731:EN:PDF
11 http://www.unece.org/env/lrtap/vola_h1.htm
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S ECTION 4. I DENTIFICATION OF C OSTS , BENEFITS AND I MPACTS OF EACH OPTION
P ROPOSAL 1: N O POLICY CHANGE O PTION
The do nothing option is primarily included for benchmarking purposes. Therefore it has not been examined in great detail as part of this RIA because it is was not a realistic option.
To take no option would mean a failure to comply with our EU obligations and could result in prosecution by the European Commission and large fines for non-transposition of EU legislation.
P ROPOSAL 2: I NTRODUCE LEGISLATION TO REQUIRE THE INSTALLATION OF PVR II
EQUIPMENT AS PER THE REQUIREMENTS OF D IRECTIVE 2009/126/EC.
New or Existing Actual or Intended throughput
New
Service Station

Greater than 500m
3
/year (or 500,000 litres / year

Greater than 100m
3
/year (or 100,000
Deadline for installing
PVR II
1 January, 2012
Existing
Service Station litres p.a.) and it is situated under permanent living quarters

Greater than 500m
3
/year

Greater than 100m
3
/year and it is situated under permanent living quarters or working areas

Greater than 3000m
3
/year (or 3 million litres p.a.)
When existing service station undergoes a major refurbishment
Existing
Service Station
1 January 2018 or undergoes a major refurbishment
(whichever is sooner)
Costs
The costs associated with installing PVR II at a petrol station are influenced by a number of variables, such as whether the station is old or new, the annual throughput of the station, whether the work is scheduled or unscheduled, what type of PVR II technology is installed and whether underground pipe work needs to be replaced/installed.
It has been estimated that that the typical capital costs of installing Stage II controls are thought to be around €35,000 for a new service station (or an existing service station installing controls as part of a major refurbishment) which has an annual throughput of
3,000 to 3,500m
3
.
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Annual maintenance and power costs to run the technology also vary depends primarily on the number of dispensers in operation at the service station have been estimated to be €625 per annum for a service station with an annual throughput of 3,000 to 3,500m 3 (four dispensers assumed).
The inspection process (annual or every three years depending on whether the monitoring system is in-service or automatic) will also attract a fee. In addition, the authority responsible for issuing a certification of compliance will also charge an administrative fee
(the fee is approximately €64 for Stage I PVR certification).
Benefits
The prime human health and environmental benefits from a reduction in emissions of VOC will arise due to reductions in ground level concentrations of ozone, for which VOC are a key precursor. Though difficult to quantify, it can be expected that there will be a reduction in:

Acute and chronic health effects to the population due to ozone exposure

Damage to crops due to ozone exposure

Damage to forest and natural ecosystems due to ozone exposure
Given the trans-boundary nature of ozone formation, benefits, though difficult to quantify, should also arise in neighbouring countries.
Installation of PVR II assists in meeting Ireland’s target of 55 kilotonnes for limiting emissions of VOCs under the National Emission Ceilings Directive (NECD) (2001/81/EC).
In addition, future emission ceilings under the 1999 Gothenburg Protocol to Abate
Acidification, Eutrophication and Ground-level Ozone are currently under negotiation for
2020, which will include an emission ceiling for VOC.
Persons working or living above petrol stations with a throughput of 100m 3 will also benefit directly from a reduction in exposure to VOC.
Impacts
Depending on a number of variables, but primarily the through put of the station, it has been estimated that the price of petrol may increase by €0.01 per litre for stations with a throughput of 500m
3
per year to as little as €0.003 per litre for stations with a throughput of
5,000m
3
.
New stations with a throughput of more than 500m
3
will be required to install PVR II immediately, which may put them at an economic disadvantage when competing with stations which will have to install this technology by 2018 (>3,000m
3
throughput) or at the next major refurbishment (>500m
3
throughput).
P
ROPOSAL
(3) I
NTRODUCE LEGISLATION TO REQUIRE THE INSTALLATION OF
PVR S
TAGE
II
IN
ADVANCE OF THE TIMELINES OR BELOW THE THROUGHPUT THRESHOLDS SET OUT UNDER
D IRECTIVE 2009/126/EC.
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Costs
Costs would be considerably higher than option 2 above. For example, if stations with a throughput >500m
3
per annum were required to install PVR II by a specified timeframe rather than as part of a scheduled major refurbishment, this would increase the installation costs considerably. Again, costs would be dependent on a number of other variables (such as annual throughput, what type of PVR II technology is installed), but it has been estimated that unscheduled
12 installations of PVR II cost as much as €86,000 (where the dispenser installed is new and the throughput of the station is 2,000-3,000 m
3 year, 4 dispensers each with 4 nozzles).
Lowering the thresholds set out in Directive 2009/126/EC would increase the number of stations required to install PVR II which would obviously increase the overall cost in the
State of implementing the Directive.
Benefits
The benefits discussed are benefits additional to those set out in option 2 above.
Requiring the earlier installation of PVR II would bring about a faster reduction in VOC emissions, but at a disproportionate extra cost due to unscheduled installation for existing stations with an annual throughput of more than 500m
3
.
Lowering the throughput thresholds for installing PVR II would mean that more petrol stations would have the technology installed, but the reduction in VOC emissions would not be proportionate, as stations with a lower annual throughput have lower VOC emissions.
Impacts
Requiring the earlier installation of PVR II could result in new petrol stations having the advantage of lower installation costs due to the scheduled nature of the installation (see footnote 12).
Requiring the earlier installation of PVR II would most likely also result in a larger increase in the price of petrol than that set out in the impacts section of option 2 above, as unscheduled installation is more expensive.
The higher the annual throughput of a station, the lower the cost of installing PVR II becomes. Lowering the annual throughput thresholds set out in the Directive to require smaller petrol stations to install the technology could well drive such stations out of business. This would be most acute in rural areas.
12 Installation of PVR II as part of a scheduled major refurbishment is less costly as the forecourt is closed anyway for the duration of the refurbishment. In addition, the pipe work is normally upgraded as part of the refurbishment, so many of the costs associated with the installation of PVR II would be refurbishment costs incurred anyway.
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Other Impacts
There are no impacts on National Competitiveness, North South / East West Relations,
Impacts on the Rights of Citizens, the Economic Market, Consumers and Competition.
Impacts on Socially Excluded or Vulnerable Groups
Service stations are more likely to be distributed in urban areas and at the side of major roads. As such there is scope for disproportionate impacts particularly in relation to those petrol service stations situated in or close to residential accommodation where the cost of such accommodation is likely to be less costly and may attract populations which are more economically disadvantaged. The introduction of PVR II will benefit populations in the vicinity of petrol stations due to better ambient air quality.
Impacts on the Environment
The benefits, as set out above include an improvement in local air quality and a reduction in the formation of ozone.
Impacts on Consumers and Competition.
As set out above, the installation of PVR II may lead to an increase in the price of a litre of petrol of between €0.003 per litre and €0.01 per litre, depending on a number of variables set out in option 2 above. In addition, new petrol stations which require the installation of
PVR II before they can operate may be at a disadvantage compared to existing stations which do not have to install PVR until their next major refurbishment or 2018 (depending on their annual throughput).
Impacts for local authorities as the competent authority
Local authorities are already required to implement Stage I petrol vapour recovery. No significant additional resource implications are expected following transposition of the
Directive. The vast majority of service stations will not have to install the new technology until undergoing their next major refurbishment (for underground pipe work this is approx. every 15-30 years). Thereafter, local authorities will be required to issue certification every
1-3 years. Regulation 8 allows local authorities to charge a fee to cover administrative costs.
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S ECTION 5. C ONSULTATION
5.1 Local authorities were notified of the deadline for transposing the Directive at the
Recommendation for Minimum Criteria for Environmental Inspections (RMCEI) annual meeting in November 2010. The transposition of the Directive was discussed at subsequent meetings of the Environmental Enforcement Network
(EEN), attended by the EPA and key local authorities, including the most recent meeting on 11 October, 2011. No significant concerns were raised.
5.2 In addition, a consultation paper was prepared to inform the development of the transposing Regulations. The paper was uploaded on the Department’s website on
27 September, 2011 and circulated to the following:

Dept of Transport, Tourism and Sport

Dept of Communications, Energy and Natural Resources

Revenue

Environmental Protection Agency

Local Authorities – (County Managers and Environmental Coordinators)

Forecourt Bureau of Ireland

Irish Petrol Retailers Association

Irish Petroleum Industry Association

RG Data

Society of Irish Motor Industry

National Standards Authority of Ireland
4.3 Submissions were invited before 21 October, 2011. Eleven submissions were received. These were as follows:
Government Departments:
Dept of Jobs, Enterprise and Innovation (Competitiveness & Climate Change)
Dept of Transport, Tourism and Sport (National Sustainable Transport Office)
Local authorities
Cavan County Council
Dublin City Council (Dublin Fire Brigade)
Leitrim County Council
Wexford County Council
Non-governmental organisations & individuals
Association for Petroleum and Explosives Administration (APEA)
Irish Petroleum Industry Association (IPIA)
Maxol
Topaz
Stage I Approved Assessor (one individual)
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S ECTION 6. E NFORCEMENT AND C OMPLIANCE
6.1 As set out in section 2.7 above, local authorities already regulate petrol stations in terms of Stage I PVR recovery.
6.2 Local authorities have been designated as the competent authority under the
European Union (Stage II Petrol Vapour Recovery during Refuelling of Motor
Vehicles at Service Stations) Regulations 2011 , S.I. No. 687 of 2011 and have been given powers to enforce the legislation.
6.3 Local authority responsibilities include the following:
 maintaining and updating a register of service stations in their functional area, including details of applications for installation certificates and certificates of testing of PVR II systems as well as the business address of the owner;
 assessing applications for certificates of installation and certificates of testing;
 approving a panel of persons they deem competent to act as ‘approved assessors’ to undertake periodic testing of PVR II systems;
 determining whether repair works on existing service stations constitute a
‘major refurbishment’; and
 authorising officers to enforce the legislation in their functional area and taking prosecutions against non-compliant stations where appropriate.
6.4 The Regulations provide that local authorities with the option to charge a modest fee to cover administrative costs associated with the issuing of certificates etc. The amount currently charged by local authorities for similar administration under the
PVR I Regulations is €63.50. This amount has not been revised since 1997.
6.5 The Regulations also provide for the following penalties for offences under the
Regulations:
(a)
€5,000 and /or 3 months imprisonment for summary offences, and
(b)
€100,000 and / or 1 year imprisonment for indictable offences.
6.6 The above penalties were provided as EU law requires that penalties for infringements of EU-derived legislation must be proportionate, effective and dissuasive. These criteria would require that the maximum permitted penalty fine would be significantly higher than the cost of compliance. The costs involved in installing the technology have been estimated to be in the region of €86,000 (where the dispenser installed is new and the throughput of the station is 2,000-3,000 m
3 year, 4 dispensers each with 4 nozzles).
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S ECTION 7. R EVIEW
Under Directive 2009/126/EC the Commission of the European Union is tasked with reviewing the implementation of this Directive and, in particular:
(a) the 100 m 3 /year threshold referred to in Article 3(1)(b) and (2)(b) of this Directive and
Article 6(3) of Directive 94/63/EC;
(b) the in-service compliance record of Stage II petrol vapour recovery systems; and
(c) the need for automatic monitoring equipment.
Ireland will participate accordingly as appropriate in any such review, which may involve the Department writing to the local authorities. The Commission shall report the results of that review to the European Parliament and to the Council accompanied, if appropriate, by a legislative proposal.
S ECTION 8. P UBLICATION
This Regulatory Impact Analysis is to be published in conjunction with the European
Union (Stage II Petrol Vapour Recovery during Refuelling of Motor Vehicles at Service
Stations) Regulations 2011 , S.I. No. 687 of 2011 on the Department of The Environment,
Community and Local Government’s website, www.environ.ie
13

V e h i i c l l e
’ ’ s s P e t t r o l l T a n k
Appendix 1
P e t t r o l l v a p o u r
L i i q u i i d p e t t r o l l
P e t t r o l l v a p o u r
L i i q u i i d p e t t r o l l
14

Appendix 2
S t t a g e I I I I P V R
– “
C o n v e n t t i i o n a l l ”
P e t t r o l l D i i s p e n s e r r
V e h i c l l e F u e l
T a n k
P e t t r r o l l
V a p o u r r
L i i q u i i d P e t t r r o l l
P / V
V e n t
V a l l v e
U n d e r r g r o u n d
P e t t r r o l l S t t o r r a g e T a n k
P e t t r r o l l L i i q u i i d p u m p
15

Appendix 3
S t t a g e I I I I P V R
– “
A t t p u m p
”
16