This study aims at assessing the impacts of different approaches to IPPC implementation on competitiveness of companies in two industrial sectors (electric steelmaking and domestic glass production). As the provisions of the IPPC Directive allow a certain flexibility for Member States to set permit conditions and to apply the concept of Best Available Techniques (BAT), the implementation of the IPPC Directive is likely to differ across the EU. Furthermore, the Directive does not contain any detailed requirements concerning later stages of the “regulatory cycle” like monitoring and inspections which also may influence competitiveness. Therefore, while differences in implementation of the IPPC Directive across the EU might be justified due to specific circumstances, this may result in distortion of competition and an influence on the competitiveness of certain production sites and industry sectors within and across Member States. There may also be competitiveness impacts relative to non-EU competitors.
The implementation of the IPPC Directive can conceptually be separated into three successive steps: the legal transposition into MS’ law, the application of national regulatory regimes and the delivery of the permitting process. The main focus of this study is on the potential economic implications of the permitting process from the point of view of individual plants, but knowledge about the other two steps is of course a prerequisite for carrying out the study. In particular the institutional context is of relevance in exploring the wider impact of IPPC implementation on competitiveness.
The concept of competitiveness is approximated in the study using a bundle of different indicators representing influencing factors on the input and output side of plants and companies (e.g. physical and human capital, productivity, profitability, plant growth etc.). As it is challenging to link competitiveness indicators and measures of environmental regulation, the study highlights risks and opportunities having a (hypothetical) influence on competitiveness (indicators) and identifies various competitive advantages and disadvantages from one plant or country to the next.
It should also be stressed that the study shows a largely qualitative character, does not trigger any statistical generalisations and does not aim at extrapolations from the specific sector level (electric steelmaking and domestic glass production) to the overall sector level (all glass or steel) or to other industries.
Department conducting the study: Environment, Regions and Transportation
Assessment of different approaches to implementation of the IPPC Directive and their impacts on competitiveness – Some evidence from the steel and glass industry Tilmann Rave, Ursula Triebswetter ifo Forschungsberichte Munich: Ifo Institute for Economic Research, 2007; 266 p.; 25,- EUR. ISBN-10: 3-88512-462-7 ISBN-13: 978-3-88512-462-9
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