Petrol Vapour Recovery Stage II - Consultation:
Analysis of Responses

SUMMARY OF RESPONSES TO PUBLIC CONSULTATION EXERCISE
STAGE II PETROL VAPOUR RECOVERY

April 2002

BACKGROUND

The UK is a signatory to the 1991 UN/ECE Protocol on the Control of Emissions of VOCs or their Transboundary Fluxes. The main requirement for parties of the Protocol is to cut VOC emissions by 30 per cent by 1999, relative to 1988 levels, which the UK has achieved. In addition to this general VOC reduction requirement Article 2 [3b(ii)] of the Protocol is a specific obligation for Parties to introduce stage II controls by no later than 30 September 2002, 5 years after the Protocol entered into force.

Stage II petrol vapour recovery addresses the vehicle refuelling process. In 1998 vehicle refuelling accounted for approximately 34.5 kilo tonnes of VOC emissions in the UK, this is equivalent to 1.8 per cent of the total 1,958 kilo tonnes of emissions for that year. Petrol sales are predicted to fall over the next decade, and therefore VOC emissions from refuelling are estimated to drop to 26.6 kilo tonnes by 2010. If stage II controls were implemented throughout the UK then, assuming 85 per cent vapour recovery efficiency, they could deliver a maximum of 22.6 kilo tonnes of VOC reduction per year.

Stage II petrol vapour recovery involves modifications to petrol pumps to enable vapour to be collected and also the installation of pipe work to return any vapour to the petrol storage tanks under the service station forecourt. The installation of the pipe work is the greatest cost, as this involves digging up petrol station forecourts incurring costs for restructuring as well as loss of revenue.

The Secretary of State for Environment, Food and Rural Affairs, Scottish Ministers, Welsh Ministers and the Department of Environment (Northern Ireland) propose to implement stage II controls in the UK by a limited negotiated agreement with UK industry. They believe that this flexible approach would be:

• the most cost-effective measure for implementing stage II petrol vapour recovery,
• offers the most protection to smaller and rural petrol stations, and
• phases in best with industry investment cycles.

Before reaching a decision on the detail of the negotiated agreement Ministers wanted to hear the views of interested parties on the broad approach proposed and the options available.

The deadline for responses to the consultation document was July 9, 2002.

RESPONSES

Fifty responses to the consultation document were received via post, e-mail and fax. Some have been summarised below as a few have requested confidentiality, while others made general points. Some of the responses addressed the questions asked in the document as well as other issues. The main questions addressed were:

• Is a negotiated approach the most flexible way of implementing stage II controls in the UK?
• Can a negotiated approach work?
• Would a 2010 deadline allow industry sufficient time to implement stage II controls?
• Should a minimum threshold be set?
• Is 2000m³ or 3000m³ the most appropriate threshold?
• Are the compliance costs quoted in this report realistic?
• Is the proposed type approval testing and monitoring regime appropriate?

The other issues examined in the responses surrounded, but were not limited to, the features that the proposed Stage II vapour recovery scheme would have. The proposed features of Stage II include:

• a negotiated agreement with industry - including an agreed implementation plan for progress to be judged against;
• a 75 per cent conversion rate of the largest petrol stations - protecting the smaller outlets from disproportionate costs;
• a rollout plan, agreed with industry, to show how this will be achieved by 2010 - to enable stage II controls to be installed in line with forecourt reinvestment strategies, as well as in all new outlets above the minimum threshold;
• type approval tests for stage II controls to ensure that they meet certain efficiency standards for vapour recovery; and
• monthly checks for blockages and leaks and annual in-site compliance testing to be carried out by the operator and recorded in a service station logbook and where appropriate reported to the local enforcing authority.

BLABY DISTRICT COUNCIL

1. The council noted that the paper refers to "local enforcing authorities". They presumed that this refers to authorities responsible for enforcing Part I of the Environment Protection Act 1990, rather than petroleum licensing authorities. However, they are unsure on this issue and would like clarification.
2. Blaby District Council stated that for the proposals to be undertaken, technical training would be required in order to undertake such inspection.

ENVIRONMENT AGENCY (EA)

1. The EA raised two questions early in their response. The first question is, "Is a negotiated approach the most flexible way of implementing Stage II controls in the UK?" The second question raised was, "Can a negotiated approach work?" The EA believes that a negotiated approach would be the most flexible way of implementing Stage II controls since it would enable the financial burden on the industry to be minimised by dove-tailing it with local refurbishing plans.
2. The EA thinks that the ability of the UK to reach the 2010 deadline would depend on the level of the threshold adopted. Thus, the lower the threshold the more difficult it would be for the industry to comply by the 2010 deadline as it would involve more sites.
3. The Agency is of the view that a vapour recovery rate between 80-85% seems to be a proportional level of performance to achieve, however testing facilities will need to be introduced to demonstrate that the service stations are actually achieving the agreed threshold level.

CHESHIRE POLLUTION GROUP

1. Cheshire Pollution Group expressed that a negotiated approach to implementing Stage II controls would be inconsistent with the regulatory regime, which is still in the process of implementing Stage I.
2. The Cheshire Pollution holds the opinion that a minimum threshold should be set above which 100% of premises should implement Stage II controls. The Group believes that a threshold of 1000m³ would be appropriate and consistent with Stage II regime.
3. A clear deadline date should be set for the installation of Stage II controls for those premises affected.
4. The Cheshire Pollution Group believes that using the existing regulatory framework would be the fairest and most transparent way to proceed.

THE ROYAL BOROUGH OF KENSINGTON AND CHELSEA

1. The Royal Borough of Kensington and Chelsea hold the view that a negotiated approach would appear to be the most flexible way of introducing these controls, as it will allow the petrol industry to install the vapour recovery system at a time that is more convenient to them. They think that it will also mean the local authorities will not be responsible for authorising the controls within a regulatory timetable, which will save them time and resources.
2. The Borough holds the view that a negotiated approach can work. However, they feel that it is not clear whose responsibility it will be to ensure that the petrol station is undertaking what is promised.
3. They also believe that the garage owners should face some kind of penalty, if the station does not upgrade according to its agreed date.
4. The Borough feels that a 2010 deadline seems very generous. The reason being that the earlier the controls are introduced the quicker the start to reduce VOC's further. In this respect they are not fully convinced that the Government, in pursuing a negotiated agreement, is confident that it will meet the requirements of the UE Protocol.
5. They expressed that a minimum threshold should be set.
6. They also pointed out that the difference in emission reductions between a station with a throughput of 500m³ and one with 1000 m³ is very small (24 kilo tonnes compared with 26 kilo tonnes) and therefore with such a small gain, the cost of installing the equipment hardly equals the cost. It would therefore appear, in their opinion, that it would not be prudent to have the threshold below 1000 m³.
7. A threshold of 3000m³ would only cover 35 per cent of stations. If a conversion rate of only 75% is anticipated, then they feels strongly that a threshold of 2000m³ is more appropriate.
8. Once equipment is installed, they proposed that regular checks on the equipment should be undertaken.
9. The Borough also feel strongly that any costs incurred by local authorities in exercising mandatory enforcement powers, to monitor the annual checks, should be fully recoverable from the garage operators as they are for the Stage I purposes.

GEO DELFT ENVIRONMENTAL

1. Geo Delft holds the view that the use of a negotiated approach is the most flexible way of implementing the Stage II control. However, they feel that a negotiated approach that is representative of all retailers' issues is going to be very hard to achieve by 30 September 2002.
2. It was also expressed that given the inherent difficulties in agreeing a negotiated approach, they feel that it might be fairer to introduce the Stage II recovery controls under legislation.
3. A 2010 deadline to introduce the controls should be sufficient time to allow the industry to introduce the measures.
4. There is need to set a minimum threshold to protect those sites that are key to rural and remote communities and that are operating marginally, where the cost of implementing Stage II controls could result in the sites closure. However, the definition of rural exempt sites would need to be carefully agreed with the industry.
5. Geo Delft holds the view that both the proposed thresholds levels appear high.
6. The costs of implementing the Stage II Vapour Recovery measures appear realistic if implemented in the normal business cycle of the forecourt redevelopments.
7. The proposed approval testing and monitoring regimes appear both practicable and reasonable and well within European Industry norms.
8. Deo Deft concluded their view on the consultation document saying that the implementation of Stage II is overdue and most European countries have already completed their conversion programmes.

TotalFinaElf (TFE)

1. TFE do not believe that a voluntary 75% conversion rate would be workable with so many potential players of vastly varying size as many are outside the arithmetic parameters necessary for a clean 75% cut. TFE would therefore propose instead an increased threshold, with 100% compliance.
2. TFE feels that the proposed timescale however does permit companies to install new equipment flexibly and in conjunction with any other works where possible.
3. TFE supports the mechanism for identifying sites where stage two would be most effective.
4. TFE also supports a threshold of 3500m³ but, as stated with a 100% compliance (not 75% as proposed in the consultation document) to be installed by 2010.
5. They feel that the additional costs associated with a 2000m³ compliance threshold would not be justified for such a small return.
6. TFE questions the mechanism by which the consultation paper derives the death figures quoted. They think that the figures have not been proven and does not take into account naturally occurring or background VOC's or ozone levels below which one could not go.
7. TFE believes that testing and monitoring should be in line with the current stage 1b testing carried out by the company. They propose a self monitored inspection built into the current part B authorisation, certified to, and fully available for verification by the local authority.

MILTON KEYNES COUNCIL

1. Milton Keynes Council does not support a negotiated approach, as they do not see any redress if there is failure to apply.
2. The Council also believes that a greater understanding of petrol filling station market is required.
3. Milton Keynes Council does not consider that a negotiated approach is the right method of seeking what is a governmental commitment to the Gothenburg Protocol as distinctive levels have been determined to reduce VOC emissions.
4. They feel that a wider threshold band will be more realistic.
5. They believe that larger sites could and hence should meet the deadline 2010 and other normal sites likewise, but this would largely depend on compliance costs.
6. Milton Keynes Council supports a minimum threshold of 0.5 million litres per year.
7. They believe that costs generally are grossly underestimated particularly if ground works are required to reply pipe work and that several dispensers currently in use would not comply.
8. The mean by which the proposed type testing approval is to take place they feel was not made clear in the consultation document. However, they do feel that whatever is adopted, that it should be consistent throughout the UK.
9. It was also expressed that monthly checks are to onerous and consider that method to be too lengthy.

PETROL RETAILERS ASSOCIATION

1. PRA does not feel that the negotiated approach is the most flexible way of implementing Stage II. They do not feel that this approach is can work at all without Government legislation.
2. They feels that the "industry" as a whole will implement Stage II & that it is individual businesses mainly micro businesses, which will examine the economic case for Stage II, if or when legislated. The 2010 deadline may make a slight difference, however it is their view that with the implementation of StageII, many businesses affected will operate up to the deadline and then close.
3. PRA made the point that if more petrol sites are to remain open then based on conventional Stage II equipment and in today's economic climate for petrol retailing, a threshold in excess of 6000m³ will need to be targeted.
4. PRA thinks that the compliance costs quoted in the consultation document are broadly correct. However, they think other costs ought to be included like that of site disruption and closure while groundwork is being carried out.

CAMBRIDGE CITY COUNCIL

1. The Council considers that the negotiated approach to be the most appropriate route.
2. However, they feel that prior to the commencement of the proposed scheme, specific guidance would need to be issued to each local authority, which should include certified Stage II equipment, testing methodology and approved testing facility, method of notifying Defra of sites which have installed Stage II petrol vapour recovery and enforcement options, if any.

HAMPSHIRE COUNTY COUNCIL

1. The Council supports the negotiated approach.
2. They support the 3000m³ threshold option.
3. The other point the Council made was in regards to Enforcement Measures. They believe those changes provide an ideal opportunity to re-examine the enforcement arrangements for vapour recovery. The Hampshire County Council believes that it makes a great deal of sense for responsibility for vapour recovery to pass to PLAs, as it will help minimise the bureaucracy, focus expertise and reduce multiple visits to premises by several enforcement bodies.

WEST SUSSEX COUNTY COUNCIL

1. The Council supports a negotiated agreement with industry.
2. They support the 3000m³ threshold option.
3. They agree that there is a need to ensure that equipment installed at petrol filling stations meets suitably high efficiency and safety standards.
4. West Sussex Council thinks that all responsibilities for vapour recovery matters ought to lie with the Petroleum Licensing Authority.

MID SUFFOLK District Council

1. Mid Suffolk DC made the observation that the content of the consultation paper seems to suggest a shift in the emphasis from guided regulation by the Local Authority to the almost self regulation by the industry and is dependent on goodwill to achieve the objectives of the VOC protocol.
2. It is their view that to aim Stage II regulation at those stations with a threshold greater than 2 million litres does not correlate with the existing requirement for Stage I regulation.
3. They are unclear as to the involvement of the local authority.
4. The District Council recommends that the installation of Stage II controls should be incorporated into existing Authorisations, which could be amended so that a second authorisation document need not be issued.

MALTE PRODUCTS

1. Malte Products questions the statement issued in the consultation document with respect to VR equipment to be used in the UK that meets type approvals in Europe. They explained that the requirements in Europe are very different regarding HC efficiency, test methods and safety.
2. Malte Products pointed out that minimum efficiency in France is 80% and not 90%, also in Germany it is 85% and not 75% as quoted in the consultation document.
3. They also made a similar point with respect to safety saying that standards differ between European countries.
4. With regards to the "smart systems/equipment as mention in the consultation, they feel that the systems focus on keeping the volume rates within the legal requirements or just indicate that the system is running, rather than actually making measurements.

SAINSBURYS

1. Sainsbury's feels that that a threshold greater than 2000m³ would provide the best benefit to the environment by cutting the highest amount of VOC emissions.
2. They view the 2010 deadline to be adequate for 75% of the stations to undertake the refurbishments as part of the planned works.
3. However, Sainsbury's think that the costs quoted have been understated, especially when it compensating for loss of sales.

CROYDON COUNCIL

1. The Council welcomes the use of a negotiated agreement.
2. They feel that a 2000m³ petrol throughput (by or before 2010) is the appropriate threshold for application of the controls.
3. They generally support the proposals for monitoring the scheme by local authorities at local level and would therefore suggest that the obligations of site operators under the negotiated agreement could be written into process guidance notes and authorised permits.
4. They also support the view that the onus should be on the operator to undertake periodic checks and annual testing of equipment to make sure it is working properly.

UK PIA

1. UK PIA believes that it is important to apply Stage II in a fair manner that does not distort competition in the UK petrol market.
2. UK PIA feels that small independent owners have no incentive to volunteer to fit Stage II, hence UK PIA thinks that a mandatory approach will be better than a voluntary one.
3. They believe that there should be a mandatory fitting of Stage II vapour recovery to all petrol stations with sales greater than 3500m³ /a by 2010, thereby ensuring that the sites affected are those where Stage II is the most cost effective and least likely to close.
4. UK PIA believes that there should be type approval for Stage II equipment, that there should be regular checks for cracks, splits in hoses, annual in-situ "dry" inspection, calibration to ensure that equipment is functioning correctly and these activities be recorded in the service station log book and where appropriate report to the local authority.
5. They do not believe that the compliance cost quoted are fairly accurate but will inevitably differ between sites.

THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LTD.

1. SMMT holds the view that the proposal to enter into a limited negotiated agreement with the "oil" industry is probably the most sensible and cost effective, way forward rather than via legislated control.
2. They think that the deadline for compliance should be no earlier than 2010 and introduction should be timed to coincide with major upgrade, modification or replacement of facilities rather than a rigorous "deadline".
3. SMMT are of the view that the costs for unscheduled retrofit seem very low.
4. SMMT think that the environmental benefits of the whole scheme will stand or fall on the effectiveness of the monitoring and enforcement systems.
5. The Society would support exemption for fuel dispensing sites with a nozzle throughput less than 3000m³ per annum.

MALVERN HILLS DISTRICT COUNCIL

1. The Group's views are that it would not be unreasonable for the largest petrol stations with an annual throughput over 3000m³ per annum of petrol to be required to have Stage II recovery installed by the 1 January 2007, with petrol stations with a threshold of more than 2000m³ by the 1 January 2010.
2. The question on VOC's from this source could be reviewed in 2010, according to the Council and a decision made at that time as to whether the threshold annual throughput needs to be reduced to 1000m³ for instance.

SEVENOAKS DISTRICT COUNCIL

1. Sevenoaks District Council is of the view that a negotiated agreement with industry, rather than formal regulation, is not considered likely to be effective in ensuring Stage II controls are introduced across the country.
2. The District Council is of the view that a 2000m³ ought to be a maximum and lower figure should be set.
3. They also pointed out that in view of some of the profits reported from the oil industries, it may not be an unreasonable cost for them to install the appropriate equipment and technology for Stage II in a reasonable timescale.

AA

1. AA proposes that the requirements should be agreed by negotiation with the industry rather than by legalisation.
2. In view of the adverse effects on the viability of many smaller filling stations, AA thinks that, it is reasonable to apply the requirements to those over 2000m³ to get 80% of the possible benefit.
3. Due to the adverse effects of Stage II according to AA, it will be best to phase it in over a period up to 2010.

FREIGHT TRANSPORT ASSOCIATION (FTA)

1. FTA believes that vehicle operators who store petrol should be exempt from Stage II legislation, which can be achieved by having a general threshold of at least 500m³.

MANCHESTER AREA POLLUTION ADVISORY COUNCIL (MAPAC)

1. MAPAC believes that the negotiated approach needs to be backed up by regulations.
2. MAPAC agrees with the 2010 deadline for installation. They also added that there should be a clear target for the numbers of petrol stations that will have installed the vapour recovery controls by that date and a deadline for installation at all stations along with an agreed threshold for a fair and consistent BATNEEC standard across the industry.
3. It is their view that the most appropriate threshold would be the existing criteria for larger stations >1000m³, under the Environmental Protection Act.
4. MAPAC think that the proposed type approval testing and monitoring regime appropriate and cost effective.
5. The Council suggested that consideration is given to seeking an agreement with the oil companies for sponsorship of part or all of the installation costs of the required facilities for Stage II at stations where their petrol is sold.

THE ASSOCIATION FOR PETROLEUM AND EXPLOSIVE ADMINISTRATION (APEA)

1. APEA believes that it would be best to introduce Stage II by regulation.
2. They think that a minimum threshold of 2000m³ to should be set by regulation for 2010 and reduced to 500m³ by 2015.
3. The Association thinks that the compliance costs were overstated and there are cheaper Stage II options available.
4. APEA supports the use of the Petroleum Enforcing Authorities to enforce legislation for Stage II to ensure that safety issues are dealt with.

LOCAL AUTHORITIES COORDINATORS OF REGULATORY SERVICES (LACORS)

1. LACORS supports a negotiated agreement with industry to implement Stage II.
2. They agree that there is a need to ensure that equipment installed at petrol filling stations meets suitably high efficiency and safety standards and should be controlled by the conditions of the Petroleum Licensing Authority.

CLEAN AIR

1. CleanAIR thinks that a negotiated approach, to implement Stage II, should prove the most flexible, however, they think that it may not prove to be the most effective.
2. They think that the negotiated approach can work if there is explicit criteria; an effective overseeing body; an effective mechanism to ensure compliance and a government regulatory backstop powers in case the self-regulation does not prove effective.
3. CleanAIR believes that the 2010 deadline is sufficient time to implement Stage II controls.
4. CleanAIR supports a minimum threshold of 2000m³.

THE FORECOURT EQUIPMENT FEDERATION (FEF)

1. FEF support the implementation of Stage II Vapour Recovery. However they do not think that it can deliver the targeted 75% implementation by 2010 unless appropriate enforcement is put in place.
2. The success of Stage II would be the monitoring of the operational effectiveness of the vapour recovery equipment.

NATIONAL WEIGHTS AND MEASURES LABORATORY (NWML)

1. NWML has some concerns that a voluntary scheme without the legislation normally associated with type approval and inspection will lead to problems.
2. It is not clear how a petroleum licensing officer could refuse to license a premise on the grounds of inadequate vapour recovery facilities without the underpinning legislation. There was also another concern as petroleum licensing may be removed.

JOINT NATURE CONSERVATION COMMITTEE (JNCC)

1. JNCC is concerned that the overcall cut in VOC emissions as a result of Stage II is significant, but represent only a very small proportion of the total UK emission.

SCOTTISH NATURAL HERITAGE

1. The Scottish Natural Heritage thinks that there should be no delay to the 2010 deadline for implementing Stage II petrol vapour recovery at a 2000m³ threshold.

THE SCOTTISH MOTOR TRADE ASSOCIATION LTD. (SMTA)

1. SMTA agrees in principle that the introduction of Stage II petrol vapour recovery should be by a negotiated agreement. They think that this approach is flexible and could more easily be accommodated with planned refurbishment of forecourts by 2010.

EAST AYRSHIRE COUNCIL

1. The Council thinks that of unanimity on a 3000m³ threshold limit can be reached, it would make price of installing Stage II equipment worth paying.
2. They also believe that implementing Stage II via a negotiated approach could work if the government is confident that this approach can achieve the desired objective.

ABERDEN CITY COUNCIL

1. The Council feels that the negotiated approach would have minimal impact to Petroleum Licensing.

THE HIGHLAND COUNCIL

1. The Council agrees that a negotiated approach is the way to introduce Stage II controls.
2. Highland Council thinks that there is no need to introduce legislation in this area.
3. They think that the majority of the service stations will be able to comply within the 2010 deadline.
4. The Council supports the need for a minimum threshold in order to protect the fragile economies of the Highland. They support a 3000m³ threshold.
5. They also hold the view that there is need for type testing approval and compliance to British Safety Standards.

NORTH LANARKSHIRE COUNCIL

1. The Council thinks that the negotiated approach is the most realistic approach.
2. They also think that the 2010 deadline is realistic
3. It is their view that to protect the smaller stations a minimum threshold should be set. They deem 3000m³ the most appropriate threshold.
4. It is the opinion of this Council that more research needs to be done to determine compliance costs.
5. The council thinks that the proposed type approval testing and monitoring regime is appropriate.

GLEANER OILS LTD.

1. Gleaner Oils Ltd. asked that all the islands of Scotland and filling stations in rural areas be exempted from Stage II vapour recovery.
2. They are of the opinion that the threshold is set at 4000m³.
3. They also asked for it to be considered that government financial assistance for vulnerable filing stations, as they are vital for rural sustainability.

DUNDEE CITY COUNCIL

1. The Dundee City Council thinks that it is essential that National Weights and Measures Laboratory are involved in the implementation process and that consideration be given to help fund the testing of equipment in situ, perhaps by the weights and measures authority.
2. The Council was disappointed by the fact that Defra took no account of the increased costs to local authorities in checking the installation and the sound operation of the Stage II systems.
3. Dundee City Council think that a < 2000m³ threshold would be appropriate.

CYNGOR MONMOUTHSHIRE COUNTY COUNCIL

1. The Council will support Stage II once the threshold is set at a high level.
2. In principle they agree with the negotiated approach, but question how it can be effectively "policed" and who will determine if the targets are met.
3. They added that if the above point cannot be reached they would prefer regulation as a means of implementing Stage II controls.

ASSOCIATION OF UK OIL INDEPENDENTS

1. The Association agrees that the negotiated approach is the most flexible way of implementing Stage II controls in the UK.
2. They also think that a negotiated approach can work & that there is no need for legislation.
3. They disagree with the 2010 deadline and they feel that Stage II controls should only be implemented in line with major refurbishment works at the petrol stations, which may be after 2010.
4. They do not think a minimum threshold should be set for supermarkets, only for other members of the industry.
5. They recommend a 2000m³ threshold for supermarkets and a 3000m³ threshold for other members.
6. The association is of the view that compliance costs are underestimated.
7. They also deem the type approval testing and monitoring regime appropriate.