Introduction
The increasing production of greenhouse gases (GHG) in the atmosphere has been linked to improper waste management and high energy consumption from non-sustainable resources[1]. The urgent need to reduce the dependence on fossil fuels and a greater consciousness of the importance of a circular economy has brought the concept of waste-to-energy to the forefront. As the search for sustainable energy sources rises, waste-to-energy provides a potential solution to convert waste into energy and waste management challenges and a need for cleaner energy production.
In the context of EU environmental law, this case highlights the importance of the use of proper waste treatment procedures before waste can be used as an energy source. Its importance lies in avoiding a potential “greenwashing” in the sense that is more climate-friendly may not always be human friendly, in the energy sector through improper waste classification, and ensuring that any adverse impact on the environment and in human health is carefully assessed and mitigated.
This case note presents the factual and legal background of the case, followed by an analysis and discussion of one of its important findings. It concludes by referring to the significance and implications of the case.
Factual Background
In Italy, natural gas is the primary source of electricity production[2]. In 2017, the country only generated approximately 20% of its energy needs through domestic production, making it significantly dependent on energy imports. Moreover, 90% of the natural gas consumed, in which methane is included, is imported mainly from Russia and in more recent years, Algeria[3] [4].
Prato Nevoso Termo Energy operates a power plant in Magliano Alpi, located in the province of Cuneo, Italy, producing both thermal energy and electricity. On the 8th of November 2016, the company submitted an authorization application to ARPA Piemonte, the Regional Agency for Environmental Protection in the Piedmont region of Italy, to replace methane for a bioliquid as the primary fuel source. The application was supported by a technical report indicating a generally positive environmental impact for the proposed replacement.
The bioliquid in question is produced by ALSO Srl., and is derived from a chemical treatment process by esterification of tainted vegetable oil. The used vegetable oil consists of a mixture of used frying oil, residues from vegetable oil refining, and residues from the washing of storage tanks used for these oils. ALSO holds a permit to market the oil as an “end-of-waste” product under Italian law, provided it has the physico-chemical characteristics specified in the permit, as well as the commercial documents stating, “produced from recovered waste for use in biodiesel production”. The biofuel is compliant with the UNI technical standard for liquid biofuels.
Authorization was denied on the 25th of May 2017, on the premises that vegetable oil is not included in the list of the categories of biomass fuels authorized defined by Italian law, which stipulates that eligible oils must be “pure and unrefined” to meet the conditions for use. Therefore, any biomass fuel used in an installation not included on the approved list would have to follow the rules on energy recovery waste.
Prato Nevoso contested by bring an action against the decision before the national court stating it violates the Waste Framework Directive (WFD) rules on end-of-waste and the Renewable Energy Directive (RED), that mandate member states to simplify any administrative procedures related to renewable energy projects. However, it was stated that the member state did not violate the Directive, reenforced by the fact that the list of authorized fuels can only be amended by ministerial decree.
Due to these facts, on 14th of February 2018, the national court preceded to ask for clarifications from the CJEU on the directives lightly referred to in supra. The CJEU upheld the interpretation of the law made by the Italian national court – Regional Administrative Court for Piedmont, as there is a certain degree of scientific uncertainty on the environmental risks associated with the substance, considering the precautionary principle.
Legal Background
The legal background for this case was built upon Framework Directive, Directive 2008/98/EC:
Article 1 ‘Subject matter and scope’ entails the measures to protect the environment and human health by preventing or reducing the adverse impacts of the generation and management of waste and by reducing the overall impacts of resource use and improving its efficiency;
Article 3 that provides the definition of “waste”;
Article 4(1) conferring the waste hierarchy priority order in waste prevention and management legislation and policy;
Article 6 defines “end-of-waste status” and the limit values for pollutants if or when necessary, which is supplemented by article 39(2) that states the measures designed to amend non-essential elements of the directive, specifically relating to the updating of the list of waste established by Decision 2000/532/EC, shall be adopted per the regulatory procedure with scrutiny. Where the criteria has not been set at a Community level, it is up to the member state to decide individually if waste has ceased to be waste.
Recitals 8, highlights the importance of waste prevention as the first priority in waste management, its impacts on the environment and human health, and the importance of reuse and recycling over energy recovery.
Recital 29 underlines the importance of promoting the use of waste as a resource for a circular economy and to reduce the use of new resources.
In addition, the Directive 2009/28:
Article 2 providing the definition of “bioliquids”;
Article 13 stating the administrative procedures, regulations, and codes of the obligations and responsibilities of the Member State on authorization, certification and licensing procedures applied as well as these are objective, transparent, proportionate and do not discriminate applicants and the particularities of individual renewable energy technologies are taken into account;
The initial request was made to the national Italian court, under the following Italian law Directives: Legislative Decree No 152 of 3 April 2006:
Article 184-ter(1) establishing rules in environmental matters transposes Article 6(1) of Directive 2008/98 into Italian law;
Article 268(eee-bis) of that decree defines ‘fuel’ as ‘any solid, liquid or gaseous matter, the use of which for the production of energy by combustion is provided for in Annex X to Part V, with the exception of waste’;
Article 293(1) of that provides that ‘installations regulated by Title I and Title II of Part V, including civil thermal installations whose power is below the threshold value, can use only fuels intended for those categories of installations by Annex X to Part V, under the conditions specified therein. The materials and substances listed in Annex X to Part V of this Decree may not be used as fuel within the meaning of this Title if they constitute waste within the meaning of Part IV of this Decree. The combustion of materials and substances which are not consistent with Annex X to Part V of this Decree or which in any event constitute waste … shall be subject to the legislation on waste in force’.
Legislative Decree No 152/2006 – Code on the Environment:
Annex X to Part V, Title II, Section 4, that indicates the terms in which the biomass fuels used is authorized for the production of energy;
Article 281(5) and (6) in accordance with the amendments and updating of the annexes to Part V of that decree ‘shall be adopted by Decree of the Minister for the Environment, the Protection of the Territory and of the Sea [(‘the Minister for the Environment’)], together with the Minister for Health, the Minister for Economic Development and, in matters of concern to him, the Minister for Infrastructures and Transport, after the Unified Conference … has been heard’.
Legislative Decree No 28 of 3 March 2011:
Article 2(1)(h) that transposes Article 2(h) of Directive 2009/28 into Italian law.
Article 5(1), states ‘the construction and operation of electrical energy production installations powered by renewable sources, the associated works and the infrastructures essential for the construction and operation of the installations, and also substantial alterations to the installations themselves, shall be subject to the single authorisation provided for in Article 12 of Legislative Decree No 387 of 29 December 2003.
Precautionary Principle;
Principles of Proportionality, Transparency, and Simplification.
Under the directives and Decrees mentioned above, the Italian Court – Tribunale amministrativo regionale per il Piemonte- referred the following questions to the CJEU for a preliminary ruling:
Question 1:
Article 6 of Directive 2008/98 and the principle of proportionality prevent national laws from classifying a bioliquid as waste if it meets technical requirements for use as fuel but is not listed in a specific annex, regardless of environmental impact assessments or disputes over its technical characteristics?
Question 2:
Does Article 13 of Directive 2009/28 and the principles of proportionality, transparency, and simplification prevent a national law (Article 5 of Legislative Decree No 28/2011) from not coordinating with another procedure (Legislative Decree No 152/2006) when authorizing the use of biomass as fuel in plants emitting into the atmosphere, or from assessing the proposed solution within a single authorization procedure with predefined technical specifications?
Legal Reasoning
In the present case, since the bioliquid in question – vegetable oil – is not on the Italian list of “authorized fuels” under Article 296(1) of Legislative Decree No. 152/2006. Therefore, according to Italian law, the substance must be classified as waste and not fuel, excluding its usage as a substitute for methane as a fuel source. Neither does it pose as an opposition to Directive 2008/98 Article 4 entitled ‘Waste hierarchy’ and Article 6 headed ‘end-of-waste status’, as the issue lies on the usage of the bioliquid. Specifically, the intended use is in an installation releasing emissions into the atmosphere, rather than being used as a resource to produce biofuel, as it is marketed as: “produced from recovered waste for use in biodiesel production”, also in accordance with Decreto Legislativo No 152, Article 293, paragraph 1. Moreover, Article 13 of Directive 2008/98 does not apply in this context, since it does not concern the regulatory procedures for the adoption of end-of-waste status criteria.
From the proceeding case Tallinna Vesi, C-60/18, EU:C:2019:264 the ruling allowed for the possibility that competent authorities could decide on a case-by-case basis, whether waste had ceased to be waste. This assessment is based on whether the substance fulfills technical requirements and meets existing legislation and standards due to the absence of European standards. In the present case, the competent authority is the ministerial body of the Member State, which hold the competence to change the list of authorized fuel in accordance with the Italian law Decreto legislative No 152, Article 281(5)
As per the precautionary principle in article 191(2) TFEU, and Article 6(1)(d) of Directive 2008/98, waste shall cease to be waste if it meets certain conditions, including that its usage “will not lead to overall adverse environmental or human health impact”. The existence of a certain degree of scientific uncertainty regarding the environmental risks associated with the use of the bioliquid, the Member State has the legitimacy to decide not to include that substance in the list of authorised fuels.
Critical Assessment
The chemical process of esterification plied to vegetable oil – transesterification, to be more precise – leads to the production of two main chemical components: Ester and Glycerol. The Ester produced through this process is designated as crude biodiesel, which will need to undergo a further process of purification to remove any impurities or residual catalysts before it can be considered usable biodiesel[5] [6] Taking into consideration that the raw material used is of low quality – mixture of used frying oil, residues from vegetable oil refining, and residues from the washing of storage tanks used for these oils – this bioliquid most likely contains higher levels of toxic components (pesticides and traces of metals) particularly from refining residues than pure vegetable oil[7] [8]. However, determining whether these toxicity levels pose a significant risk to environmental or human health when used for combustion is another question. Therefore, considering the reference to the commercial document of ASLO for the bioliquid one may concur that the liquid in question is crude Biodiesel.
While substituting methane for a bioliquid may have environmentally positive outcomes in terms of reduction of GHG emissions, direct use of crude oil without appropriate emissions control technologies or pre-treatment lacks robust and concrete scientific evidence at the time, invoking the precautionary principle. This highlights the rationale behind Decree No 152/2006, Annex X to Part V (1)(a) and (b) of the Italian Law, which remain pertinent despite a “general positive” environmental technical assessment, aligning with the Italian Court’s ruling at the time.
Another outlook on the case, is that had the authorization been approved to Prato Nevoso Termo Energy would have a free pass to use the bioliquid without having to comply with the Industrial Emissions Directive 2010/75/EU that sets environmental standards to reduce pollution from industrial activities, including waste incineration. For the inclusion on the “list if authorised fuels” sets out the “categories of biomass fuels that can be used in an installation producing atmospheric emissions without having to comply with the rules on the energy recovery of waste”, Part II, Section 4 of annex X to Part V of Legislative Decree No 152/2006 of the Italian Law. Thus, the facility would have significantly reduced its expenses on emissions control technologies, raising concerns on an environmental and human health level regarding the scientific knowledge at the time.
However, had the present case been brought to the Italian court after December 16, 2022, the ruling may have favoured Prato Nevoso due to the amendment to Part Five, Annex X, Part II, Section 4, Paragraph 1 of Legislative Decree No. 152 of April 3, 2006, adding point h(c) to include “raw or refined products consisting mainly of glycerides of plant origin, having the characteristics laid down in the following table, obtained by extraction processes using n-hexane (…).” This is, it depends on if the bioliquid in question holds the characteristics in question.
Conclusion
It is important to evaluate the environmental profile of renewable fuels for the identification of sustainable fuel production and usage thereby avoiding potential greenwashing of what may be believed to be a “greener alternative” in the race towards carbon-zero emissions. The application of the precautionary principle is vital when addressing scientific uncertainty, ensuring decisions are guided by the best available evidence at the time, even if future developments in knowledge later contradict the initial assessment, prioritizing environmental and human health in the transition to sustainable energy systems.
[1] Chrysikou LP and others, “Waste Cooking Oils Exploitation Targeting EU 2020 Diesel Fuel Production: Environmental and Economic Benefits” (2019) 219 Journal of Cleaner Production 566.
[2] “Italy: Natural Gas Supply by Origin 2024” (Statista) <https://www.statista.com/statistics/1325804/natural-gas-supply-in-italy-by-origin/> accessed December 13, 2024.
[3] “Italy Energy Statistics” (Worldometer) <https://www.worldometers.info/energy/italy-energy/> accessed December 10, 2024.
[4] “Italy Natural Gas Reserves, Production and Consumption Statistics” (Worldometer) <https://www.worldometers.info/gas/italy-natural-gas/#gas-imports-exports> accessed December 10, 2024.
[5] Gharby S, “Refining Vegetable Oils: Chemical and Physical Refining” (2022) 2022 The Scientific World Journal 1.
[6] Fernanda, “BIODIESEL PRODUCTION THROUGH ESTERIFICATION APPLYING IONIC LIQUIDS AS CATALYSTS” (Dissertation for the master’s degree in chemical engineering, Instituto Politécnico de Bragança 2008) <https://objects.scraper.bibcitation.com/user-pdfs/2024-12-16/c8ede360-0d9d-40a8-bfca-29df0300da6b.pdf> accessed December 15, 2024.
[7] Gharby S, “Refining Vegetable Oils: Chemical and Physical Refining” (2022) 2022 The Scientific World Journal 1.
[8] Frota de Albuquerque Landi F and others, “Environmental Assessment of Four Waste Cooking Oil Valorization Pathways” (2022) 138 Waste Management 219.
