SECTOR ASSESSMENT: ENVIRONMENT (AIR POLLUTION)

Transcription

1 Sector Road Map Beijing Tianjin Hebei Air Quality Improvement Hebei Policy Reforms Program (RRP PRC 49232) SECTOR ASSESSMENT: ENVIRONMENT (AIR POLLUTION) A. Sector Performance, Problems, and Opportunities 1. Air pollution problems in the PRC. Decades of unsustainable economic growth in the People s Republic of China (PRC) have resulted in severe degradation of the air, water and soil quality throughout the country. In 2014, 74 of PRC s prefecture-level and higher level cities recorded annual concentrations of fine particulate matter (PM 2.5 ) exceeding the national standard of 35 micrograms per cubic meter (µg/m 3 ) by 83%, with 7 of the 10 most polluted cities in the PRC located in the Beijing-Tianjin-Hebei (BTH) region. 1 High levels of air pollution are among the first environmental problems that the PRC s leadership has addressed with an unprecedented scale of reforms and actions which include the first Action Plan of Pollution Prevention and Control (hereinafter CAAP) outlining targets to be achieved in in key regions, a new vision for the PRC s urbanization which emphasizes improved ecological environment in cities, and a new environmental protection law unleashing long-needed reforms in the government performance assessment system. 2. Air quality and emissions in Hebei Province. Hebei province (Hebei) surrounds Beijing and Tianjin Municipalities, bordering Bohai bay to the east. Despite its advantageous geographical position, Hebei s resources driven and heavy industry based economy has made the province lag behind other coastal provinces like Jiansgu and Zhejiang in terms of gross domestic product (GDP) and overall economic performance. In 2014, Hebei s GDP totaled CNY2.94 trillion with a per capita GDP of CNY39,846. The same economic structure has also caused significant environmental degradation. High emissions of sulfur dioxide (SO 2 ) and nitrogen oxides (NO X ) from Hebei have translated in some of the highest levels of PM 2.5 recorded in the PRC in 2014, averaging 95 µg/m 3 in the 11 cities in Hebei (86 µg/m 3 in Beijing and 83 µg/m 3 in Tianjin), several times higher than the PRC national standard and the recommended World Health Organization value of 10 µg/m 3 (Table 1). Table 1: Sulfur Dioxide and Nitrogen Oxides Emissions in 2012 in BTH Region and Proportions a Region Sulfur dioxide (SO 2 ) (thousand tons) Nitrogen oxides (NO X ) (thousand tons) Beijing Tianjin Hebei 1,600 2,100 Total in BTH Region 2,000 2,800 National total 21,000 23,400 Proportion to national total 9.5% 12.0% a Clean Air Alliance of China (CAAC) Can Beijing, Tianjin and Hebei Achieve Their PM2.5 Targets by 2017? Assessment of the potential for air quality improvements in the Beijing-Tianjin-Hebei region under China's new air pollution action plan, Beijing-Tianjin-Hebei - AQM policy report series. Available at: /product/6659.html Source: Clean Air Alliance of China. 3. Sources of pollution in the BTH. A 2014 study into the composition of PM 2.5 in the BTH indicates that industrial processes (steel, cement, coking industries) account for 54% of the 1 PM 2.5 is particulate matter with an aerodynamic diameter less than 2.5 micrometers. It is one of the most harmful air pollutants due to its ability to penetrate deep in the lungs.

2 2 primary fine particulate matter emitted in Hebei; residential sector (coal and stalk burning) accounts for 29%; industrial boilers contribute to 6%; transportation and power sector to 4% each; and heating to the remaining 3%. Sources of secondary PM 2.5, include (i) SO 2 emitted by industrial boilers, industrial processes power and residential coal burning; (ii) NO X emitted by transport, industrial boilers, power sector, heating, and industrial processes; (iii) volatile organic compounds (VOCs) emitted by solvent use and industrial processes such as coking, paint, and pharmaceuticals production; and (iv) ammonia (NH 3 ) emitted by nitrogen fertilizer application and livestock farming the estimates for the latter sources still being highly uncertain. 2 Pollution sources in the region, especially Hebei, contribute to 28% 36% of PM 2.5 recorded in Beijing, and under certain weather conditions, to as high as 50%. B. Government s Sector Strategy 4. The Ten Articles composing the national CAAP provide that the PRC s PM 10 drops by about 10% by 2017 compared to 2012 levels, and by 25%, 20% and 15% in the BTH Region, Yangtze River Delta Region and Pearl River Delta Region respectively. The above articles represent the strictest air pollution control measures ever adopted in the PRC, with a shift from total emission control to air quality targets. These targets for the key regions including the BTH and several priority cities in Hebei, showing that the BTH region was assigned the toughest goals (Table 2). Such efforts require adequate knowledge of the sources and composition of the PM 2.5 which is currently limited by insufficient ambient air quality and air emission monitoring capacity, both hardware and software, especially in Hebei. Recent modeling studies suggest that it is unlikely that the BTH targets will be achieved because of inadequate targets to control NO x and VOCs, significant ingredients of PM 2.5 in the BTH. 3 Additional reductions of NO x and VOCs emissions from iron and steel making industries; power generation; petrochemical, industry, and road transport are needed to achieve the provincial and regional targets. Table 2: Average Annual PM 2.5 Concentration Reduction Targets Province Target (%) (key area) (baseline year: 2012) Beijing -25 Tianjin -25 Hebei -25 Category 1 polluted cities a -33 Category 2 polluted cities b -30 Shanxi -20 Shanghai -20 Shandong -20 Guangdong -15 Chongqing -15 Inner Mongolia -10 Jiangsu -20 Zhejiang -20 a Shijiazhuang,Tangshan, Baoding,Langfang, Dingzhou, and Xinji. b Xingtai and Handan. Source: Asian Development Bank. 2 Secondary PM 2.5, formed through the chemical transformation of gaseous primary pollutants such as sulfur dioxide (SO 2), nitrous oxides (NO x), certain volatile organic compounds (VOCs), and ammonia (NH 3), accounts in Hebei for 59% of the total fine particulate. 3 Clean Air Alliance of China (CAAC), Can Beijing, Tianjin and Hebei Achieve Their PM2.5 Targets by 2017? Assessment of the potential for air quality improvements in the Beijing-Tianjin-Hebei region under China's new air pollution action plan, Beijing-Tianjin-Hebei - AQM policy report series. Available at: product/6659.html

3 3 5. Hebei Province environmental policy framework. Following the release of the national CAAP, Beijing, Tianjin and Hebei have issued their own strategies to comply with the targets set forth at national level. The Implementation Program of the Air Pollution Prevention and Control Action Plan in Hebei Province (hereinafter HCAAP) targets four key industries, including steel, cement, flat glass and electricity production. These four sectors have been imposed reduction targets to be achieved by 2017 (60 million tons of steel, 60 million tons of cement, 40 million tons of coal and 38 million weight cases of glass). Enterprises in these four key sectors have been forced to invest in de-sulfurization, de-nitration, and particulate matter control technologies, for a total of 606 air pollution emission control projects since Out of a total of Fifty Articles, ten of the measures listed in the HCAAP aim at improving the existing environmental regulatory enforcement. These measures include an emphasis on (i) monitoring and supervision capacity; (ii) accountability of local governments in enforcing environmental laws, with the inclusion of the attainment of PM 2.5 targets as a legally binding socio-economic development indicator; (iii) environmental information disclosure; and (iv) leverage on public participation in the enforcement of environmental regulations. 6. Apart from stringent and comprehensive policies addressing criteria pollutants (particulate matter, SO x and NO x ), the HCAAP also calls for control of VOCs emitted by organic chemicals, pharmaceuticals, surface coating, plastic products, packaging, printing and other key industries to be achieved by However as of September 2015, the Province is yet to issue an emission standard for VOCs emissions from its key industrial sectors, leaving a significant source of PM 2.5 for Hebei and the entire BTH basically uncontrolled. 7. Hebei environment protection department (HEPD) has also yet to issue Management Methods for Motor Vehicle Exhaust (amendment) aiming at vehicle emissions control. As of now, no guidelines do specifically target emissions from the provincial heavy duty diesel fleet (estimated to comprise about 500,000 trucks) and there is no plan to include this category in the above policy document. HEPD currently lacks sufficient information on the categorization of these vehicles or their emissions, likely to be important contributions to NO X and particulate matter pollution. Tailpipe measures targeting heavy duty diesel vehicles have proven successful in air pollution control in Tokyo, Japan, and some European countries in the past and would contribute to overall pollution reduction in Hebei and the region. It is urgent to address this source of pollution. 8. More than 50 policy documents have stemmed from the national CAAP and HCAAP to upgrade the provincial regulatory framework on air pollution. These include provincial Regulations on Air Pollution Prevention and Control - to be issued by the end of December providing more and/or updated details on (i) plans and targets in air pollution prevention and control, (ii) prevention and control measures, (iii) how to deal with heavy pollution weather, (iv) unified prevention and control in Beijing, Tianjin and key regions, (v) supervision and inspection, and (vi) legal responsibilities of county level and above government departments and bureaus in air pollution prevention and control. Additionally the Hebei Provincial Policy on Environmental Accountability Measures to be issued by the end of December 2015 will have to provide clear and implementable mechanisms to monitor and evaluate Communist Party leaders and other government officials ecological and environmental accountability, so far one of the weakest links in the whole environmental enforcement system of the PRC. As the national and provincial policy agenda evolves, the relationships, roles, and responsibilities need to become more clearly defined and while the aforementioned documents are meant to go in that direction, additional assistance is required to improve them and ensure they include all the provisions which enable their effective use.

4 4 9. Hebei Province environmental protection analytical tools. To achieve the desired policy results in the most cost-effective way, the investment in air pollution abatement strategies has to be complemented by investment in (i) air quality management analytical tools, which allow evaluation of cost-effectiveness of control strategies and the progress towards the achievement of targets, and in (ii) monitoring technologies to verify the compliance with emission standards. Lack sound scientific information on the actual levels of pollution, its sources, its composition and its regional transportation patterns is still very severe in Hebei. This is because the capital investment in air pollution monitoring technology is not sufficient or in some instances, such as for VOCs ambient air quality levels, not complemented by adequate investment in operation and maintenance resources. Technical capacity of both Provincial level and local environmental protection offices poses a significant challenge to the implementation of the air pollution policies. HEPD divisions involved in air pollution control, monitoring and supervision, as well as their counterparts in local (cities, counties and townships) need capacity development. This is fundamental to ensure proper functioning of the hardware, adequate interpretation of data and overall improvement of the analytical framework. It is critical to ensure the allocation of budget for this task. 10. The Hebei Implementation Plan requires the HEPD to strengthen the cooperation with the meteorological department to set up heavy pollution weather monitoring and early warning system (by the end of 2014). A proper heavy pollution episodes forecasting warning system is fundamental for the protection of human health and the design of emergency response strategies aimed at effective prevention of pollution episodes. Hebei issued the Hebei Heavy Pollution Episodes Emergency Plan in December This plan includes provisions for building air quality (modeling and) forecasting platforms at all government levels and lists the emergency measures to be communicated and enforced by public services for the mitigation of human exposure to heavy pollution episodes and by polluting sources to control their contribution to air pollution. This is a very comprehensive plan, similar to the one implemented in Beijing. However, lacking a good air quality forecasting system, the emergency measures it foresees will be triggered on a post-facto basis, limiting their efficacy in protecting people s health. While an Environmental Emergency and Heavy Weather Forewarning Center (EEHWFC) was established under the HEPD, its actual regional forecasting capacity is hindered by limited technical capacity of staff and limited monitoring capacity due to lack of financial resources. 11. Continuous emission monitoring systems (CEMS) are traditionally used to measure compliance with emission standards or the exceedances of the standards. CEMS are required under many US and EU air emission standards and their mandatory use was introduced in the PRC in 2004 for most coal-fired power plants to measure SO 2 emissions - later expanded to NO X and total suspended particulate matter. However the current number of CEMS installed in Hebei is extremely low, representing about 1% of the total polluting sources according to informal communication of the Hebei Environmental Monitoring Center and HEPD Information Center, (lacking access to emission inventories). The Information Center of the HEPD collects air and water quality data measured by about 765 CEMS installed on key enterprises, whereby key sources are defined as those whose aggregate emissions total at least 85% of national and provincial industrial emissions). Out of these 765 devices, about 270 monitor air emissions of SO 2, NO X, and total suspended particulate matter from designated national level key enterprises in Hebei and less than 25 from designated Provincial level key enterprises in Hebei. C. Necessary Policy Reforms and Actions 12. The Policy Based Loan (PBL) ultimately aims at supporting efforts improve air quality in BTH. Given Hebei s important contribution to air pollution in the region and given its financial and

5 5 technical capacity constraints, the financial assistance disbursed with this PBL will complement the province s and central government s investment in upgrading and retrofitting the heavy industrial base at the foundation of Hebei s economy as well as upgrading monitoring capability instrumental in the evaluation of the effectiveness of the above policies. 13. Hebei has already started upgrading its legal and regulatory framework, now quite similar, at least on the paper, to the national best practices. The suite of environmental standard already issued in the Province is quite large and comprehensive. However, it is also quite fragmented for example not targeting important sources such as the heavy duty trucks and not adequately complemented by investment in monitoring technology and training of human resources. 14. Some fundamental legal instruments, such as those for VOCs control, are still missing. VOCs are an important ingredient in the formation of PM 2.5 in the BTH. Yet, Hebei has to address key sources of VOCs with a dedicated standard aiming at substantial emission reductions. Through ADB s policy dialogue under the proposed PBL, Hebei will issue a new VOCs emission standard for eleven key industrial sectors, including coking, paint, and pharmaceuticals production, with emission limits comparable with those demanded in Beijing and Tianjin. The new standard will also include provisions for its effective implementation such as recommendations for best available technologies, detailed protocols for monitoring and penalties of non-compliances. 15. Additionally, the upcoming Amendment to the provincial Ambient Air Quality Pollution Prevention and Control Regulations and Policy on Environmental Accountability Measures provides an opportunity for the proposed PBL to increase its legal robustness and effectiveness. ADB will provide inputs into the Amendment, specifically by (i) including clear and implementable provisions on provincial VOCs emissions targets, (ii) providing recommendations for regional mechanisms for unified prevention and control in BTH, and (iii) providing recommendations for legal responsibilities of county level and above government departments and bureaus in air pollution prevention and control. 16. The proposed PBL will kick-off the province s strategy to address air pollution contributed by the heavy duty vehicles fleet, by inducing the new division of Vehicle Emission Control in HEPD to carry out a study to (i) assess contribution from this specific vehicle fleet; (ii) identify best available technologies and practices to reduce their emissions; (iii) design appropriate scheme of market based technology promotion and/or financial incentives for the purchase of the technologies, installation and maintenance; and (iv) identify inspection and enforcement practices, including penalties for non-compliance. 17. Shortfalls in monitoring capacity currently limit in Hebei the assessment of the effectiveness of environmental policies and the progress towards expected results. It is therefore urgent to allocate budget for the improvement of the monitoring capacity, both in technology and in human resources. Within the proposed PBL, the Hebei provincial government commits to upgrade of the air quality monitoring networks managed by the Hebei environment monitoring center and 11 cities in Hebei with (i) at least one station each to monitor NH 3, VOCs, heavy metals, and elemental/organic carbon; (ii) a total of 30 monitoring stations located in Hebei industrial parks; and (iii) a total of six background and regional transport monitoring stations. Overarching capacity building is needed in HEPD, environment monitoring center and environmental emergency and early warning center to ensure proper functioning of the hardware, adequate interpretation of data and overall improvement of the analytical framework. Under ADB s PBL Hebei will give priority to a specific technical training plan on (i) air quality monitoring,

6 6 modeling, and forecasting, and (ii) regulatory enforcement in counties and townships for at least 100 technicians in the above mentioned divisions and bureaus. 18. ADB-KfW s intervention will be used to expand the CEMS coverage with at least 1000 additional key polluting sources. Traditional tools to monitor compliance with emission standards, the CEMS are limited in number in Hebei, covering approximately 1% of the air pollution sources in Hebei. The enhancement of direct monitoring of emissions at the stack of polluting sources that the Hebei committed to through the proposed PBL will provide additional information on pollution patterns in the province and the BTH, and will enable the HEPD Supervision Bureau to evaluate compliance with emission standards.