Consultation on modernising environmental permitting for industry

Back-up generators ensure power supply is available during emergency situations and power outages. Most industries and critical services have some form of back-up power generation in place.  

Back-up generators have the potential to be harmful to people and the environment when they operate as they often combust diesel without abatement for nitrogen oxides (NOx), which then produces high levels of NOx emissions. However, the very limited operating hours (for testing) of true back-up generators can mean they are a low-risk activity outside of an emergency. 

Back-up generators above 1MWth are currently in scope of the EPRs and will require a permit. However, for back-up generators there are no emission limit values (ELVs) set and there is limited compliance activity due to their restricted use during emergency situations in power outages. 

Published figures through the MCP Directive impact assessment estimate there are around 9,000 back-up generators in scope of permitting. A  recently published research project commissioned by Defra on the small to medium industrial combustion sector suggests the number of diesel back-up generators to be in the tens of thousands. Proportionate regulation of back-up generators has the potential to reduce burden on both industry and the regulator – four options to enable this are detailed below.  

Exploring options for the proportionate regulation of back-up generators is dependent on maintaining a clear distinction that back-up generators are for emergency situations and testing only. If a generator wants to self-supply for any reason outside of an emergency the operator would need to seek the appropriate permit.  

Removing carbon monoxide and nitrogen oxides monitoring for back-up generators 

One option is to remove the requirement for carbon monoxide (CO) and NOx monitoring for back-up generators. Schedule 25B of Annex III of the MCP directive currently requires operators of back-up generators to monitor CO and NOx emission. However, no emission limit values are set for back-up generators due to their restricted use during emergency situations and power outages. The requirement to monitor CO and NOx emissions is therefore not related to a compliance activity and the reported data is not used by the regulator. The monitoring would also incur costs for operators. In some instances, the requirement to monitor could mean back-up generators were operated solely for the purposes of monitoring which is incoherent.  

For these reasons we consider the monitoring requirement to be both disproportionate and unnecessary. This option would remove the requirement for operators of back-up generators to routinely monitor CO and NOx emissions.  

Registration for back-up generators 

Back-up generators (above 1MWth) are currently in scope of the EPRs and will require a permit. The EA can permit back-up generators under standard-rules and has consulted on reduced subsistence for operators of some back-up generators, which in itself is a proportionate approach that balances regulatory requirements and environmental risk.  

One option is that a registration approach for genuine back-up generators, rather than permitting, may be a more proportionate approach and have the potential to reduce burden both on industry and the regulator. This option would also include removing the requirement to monitor CO and NOx emissions (see section above).  

Data centres 

Data centres are a rapidly expanding industry in the UK and further growth is predicted to be significant. Data centres come into scope of the EPRs because of the back-up generation that is installed. Depending on the aggregated size of back-up installed they will be regulated under MCP directive, Part B of the EPRs, or the IED. The development of this relatively new sector means the current regulatory framework has not kept pace with industry practices. For example, the rules and requirements currently vary depending on the aggregated size of the back-up generation that is installed and it is not clear that the different scaling-up requirements are appropriate, proportionate or apply equally. This means that if a data centre grows and expands it could be subject to different rules and requirements that may not be appropriate or proportionate and may also not have been considered at the design stage.  

We want to make sure that a coherent, proportionate and business-friendly regulatory framework is in place that will both support the growth of this sector and enable the best environmental outcome overall. Large amounts of aggregated back-up can potentially be a risk to health and the environment if they operate for extended periods. However, this should be rare as back-up generators only operate in emergencies and power outages or for short periods of testing and maintenance. 

We are looking for feedback to inform policy development to ensure regulation of back-up generators is proportionate, whilst maintaining the existing policy objective of controlling the impacts of medium combustion plant, by having the flexibility to tailor requirements to control only those parameters that present a risk to health and air quality. 

Operation of back-up generators under Schedule 25B 

We have identified that some generators below 1MWth, installed as back-up for the purposes of maintaining power for an on-site emergency, could be operated to self-generate power outside of an emergency. 

In this situation they may not adequately fall within the definition of a ‘Specified Generator’, as the operators of these individual generators may not have a capacity or balancing service agreement directly. Instead, they could potentially participate in demand side response indirectly through aggregators.         

We propose exploring amendments to the wording of Schedule 25B to make clear that generators used to self-generate power outside of an emergency, by participating in demand side response, shall be subject to regulation and require a Specified Generator permit. The amendment would close a loophole for any potential increase in pollution.