Effectiveness of urban wastewater treatment policies in selected countries An EEA pilot study

EEA Report No 2/2005 Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study Cover design: EEA Layout: Brandpunkt A/S Legal notice The contents of this publication do not necessarily reflect the official opinions of the European Commission or other institutions of the European Communities. Neither the European Environment Agency nor any person or company acting on behalf of the Agency is responsible for the use that may be made of the information contained in this report. All rights reserved No part of this publication may be reproduced in any form or by any means electronic or mechanical, including photocopying, recording or by any information storage retrieval system, without the permission in writing from the copyright holder. For rights of translation or reproduction please contact EEA project manager Ove Caspersen (address information below). Information about the European Union is available on the Internet. It can be accessed through the Europa server (http://europa.eu.int). Luxembourg: Office for Official Publications of the European Communities, 2005 ISBN 92-9167-763-9 ISSN 1725-9177 © EEA, Copenhagen 2005 Environmental production This publication is printed according to high environmental standards. Printed by Scanprint a/s — Environment Certificate: ISO 14001 — Quality Certificate: ISO 9001: 2000 — EMAS registered — licence no. DK- S-000015 — Approved for printing with the Nordic Swan environmental label, licence no. 541 055 Paper — Woodfree matt fine paper, TCF — The Nordic Swan label Printed in Denmark European Environment Agency Kongens Nytorv 6 1050 Copenhagen K Denmark Tel.: +45 33 36 71 00 Fax: +45 33 36 71 99 Web: www.eea.eu.int Enquiries: www.eea.eu.int/enquiries 3 Contents Contents Acknowledgements ................................................................................................... 4 Executive summary ................................................................................................... 5 1. Setting the scene: the EEA and policy effectiveness evaluations .......................... 8 1.1 European clean water policies ...........................................................................8 1.2 Meeting information demands ...........................................................................8 1.3 EEA policy effectiveness evaluations ..................................................................9 1.4 The approach of this study ...............................................................................9 2. Methodological considerations ........................................................................... 11 2.1 Introduction ................................................................................................. 11 2.2 Policy in focus .............................................................................................. 11 2.3 Effects: outputs of urban wastewater treatment policy ....................................... 12 2.4 Effectiveness: outcomes of urban wastewater treatment policy ........................... 13 2.5 Explaining differences .................................................................................... 15 2.6 Cost-effectiveness ........................................................................................ 17 Selected EU-15 Member States 3. Denmark ............................................................................................................ 18 3.1 Water quality situation .................................................................................. 18 3.2 Water quality policy objectives ........................................................................ 18 3.3 Institutional context ...................................................................................... 18 3.4 Policy Instruments ........................................................................................ 19 3.5 Observations on effectiveness ........................................................................19 4. France ................................................................................................................ 20 4.1 Water quality situation .................................................................................. 20 4.2 Water quality policy objectives ........................................................................ 20 4.3 Institutional context ...................................................................................... 21 4.4 Policy instruments ........................................................................................ 21 4.5 Observations on effectiveness ........................................................................22 5. The Netherlands ................................................................................................ 23 5.1 Water quality situation .................................................................................. 23 5.2 Water quality policy objectives ........................................................................ 23 5.3 Institutional context ...................................................................................... 24 5.4 Policy instruments ........................................................................................ 24 5.5 Observations on effectiveness ........................................................................25 6. Spain ................................................................................................................. 26 6.1 Water quality situation .................................................................................. 26 6.2 Water quality policy objectives ........................................................................ 26 6.3 Institutional context ...................................................................................... 27 6.4 Policy instruments ........................................................................................ 27 6.5 Observations on effectiveness ........................................................................28 Selected new Member States 7. Estonia ............................................................................................................... 29 7.1 Water quality situation .................................................................................. 29 7.2 Water quality policy objectives ........................................................................ 29 7.3 Institutional context ...................................................................................... 30 7.4 Policy instruments ........................................................................................ 30 7.5 Observations on effectiveness ........................................................................31 8. Poland ............................................................................................................... 32 8.1 Water quality situation .................................................................................. 32 8.2 Water quality policy objectives ........................................................................ 32 8.3 Institutional context ...................................................................................... 33 8.4 Policy instruments ........................................................................................ 33 8.5 Observations on effectiveness ........................................................................34 9. Comparative analysis ......................................................................................... 35 9.1 Introduction ................................................................................................. 35 9.2 Effects ........................................................................................................ 35 9.3 Effectiveness ................................................................................................ 38 9.4 Cost-effectiveness ........................................................................................ 41 10. Conclusions ....................................................................................................... 46 References .............................................................................................................. 48 Annex Some options for further work related to the effectiveness of urban wastewater treatment policies .................................................................. 51 Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study4 This report has been prepared by Prof. Mikael Skou Andersen in cooperation with Dorte Lerche, Peter Kristensen and Carey Smith of the Danish National Environmental Research Institute (NERI) under contract with the European Environment Agency. Lars Fogh Mortensen guided the preparation of the report as the EEA project manager. The report has been edited for language by Peter Saunders (independent consultant). The report benefited from comments and additional information received from the Member States covered: Denmark (from Mogens Kaasgaard, Danish EPA); Estonia (from Karin Pachel, Estonian Environmental Information Centre); France (from Annie Coutellier, IFEN); the Netherlands (from Jos Timmerman, RIZA, and Ton Bresser, RIVM); Poland (from Lucyna Dygas-Cielkowska, National Focal Point to the EEA); and Spain (from Maria Jesus Ibanez and J. Ruza, Ministry of Environment). It also benefited from comments received though the peer review process from: Prof. Bernard Barraqué, Ecole Nationale des Ponts et Chaussées, France; Prof. Hans. Bressers, University of Twente; Andreas Kraemer, Wenke Hansen and Eduard Interwies, Ecologic; Prof. Pieter Leroy, Radboud University Nijmegen; Prof. Juan Martinez-Alier, Autonomous University of Barcelona and member of the EEA Scientific Committee; Prof. Laszlo Somlyody, Budapest University of Technology and Economics and member of the EEA Scientific Committee; and Ms. Kristina Veidemane, Baltic Environmental Forum. The comments and suggestions received have been useful and complex. The best effort has been made to ensure that data are accurate and to integrate information received, but the analysis presented in this report is the responsibility of the EEA. Finally, comments and inputs from EEA staff were beneficial throughout the project, in particular from Ann Dom, Jane Feehan, David Gee, Jock Martin and Niels Thyssen, and in its final phases also from Philippe Crouzet, Andrus Meiner and Louise Rickard. Acknowledgements 5 Executive summary Executive summary Water pollution caused by wastewater persists despite three decades of effort to clean up European surface waters and despite the requirements of the Urban Waste Water Treatment Directive (UWWTD). Several EU Member States have yet to satisfy the requirements of the directive. A European Commission report released in 2004 noted that several countries had failed to designate sensitive areas and were behind schedule in establishing the capacity of sewage treatment as required by the directive deadlines in 1998 and 2000. As the next deadline is approaching at the end of 2005, for extending sewage treatment to urban areas with more than 2000 inhabitants, the EEA has acknowledged the need to improve our understanding of the inherent implementation problem. This pilot study examines the effectiveness of wastewater policies and measures in six Member States in order to identify and understand the reasons for both the successes and the shortfalls in implementation. Two of these countries have almost fully implemented the directive, two have yet to do so, and two have only recently acceded to the EU and are therefore allowed more time to accomplish the environmental acquis. The report seeks to clarify the role of local authorities, policy instruments and financial mechanisms in securing effective implementation, and it also addresses the issue of cost-effectiveness. The report focuses on the extension of sewage plants with appropriate levels of treatment (biological or advanced) and trends in discharges to surface waters. Denmark has fully and the Netherlands has nearly fully implemented the requirements of the directive, but France and Spain remain rather far from the targets. The two new Member States, Poland and Estonia, are making good progress in some respects, particularly Estonia where 70 % of the population is served by wastewater treatment. The effectiveness analysis shows that clear lines of institutional responsibility were helpful for implementation in Denmark and the Netherlands. Overlaps of responsibilities between authorities at the local, regional and national level in Spain and France, together with large investment needs and bottlenecks in financing, appear to be important reasons for not implementing the directive requirements in time. In particular, the fact that local municipalities in Spain and France are responsible for the provision of sewage treatment, while being largely deprived of their own financial resources, leads to lengthy negotiations on financing that are not supportive of the agreed measures. Denmark complies fully with UWWTD and discharges of organic matter as BOD to surface waters have decreased by more than 90 %. However, the Danish approach to implementation appears to have been somewhat costly. Construction of sewage treatment plant capacity and the associated investment have been notably higher per capita than in the comparable case of the Netherlands. France has not responded fully to the challenge of the UWWTD, as in sensitive areas 58 % and in non-sensitive areas 37 % of wastewater plants do not meet the requirements (EC, 2004a). France does not appear to be reaping the full benefits of its advanced management system with river basin management, full-cost pricing and a water-pollution control levy. French waterpollution levies remain modest by European standards, and the system could be finetuned to address the implementation gap The Netherlands is close to compliance with the UWWTD. It has not installed sufficient advanced treatment for nitrogen in some large cities, but discharges of BOD to surface waters have decreased by more than 90 %. The Netherlands spends a lower share of GDP on water pollution control than the other Member States. Economic instruments have been used to provide incentives to polluters to reduce pollution at source, rather than opting for the more expensive end-of-pipe solution of public sewage treatment. Spain has not achieved compliance with the UWWTD. The continued implementation gap in Spain is notable, as the EU has supported its implementation of the UWWTD with large subsidies. Between 1993 Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study6 and 2002 more than 3.8 billion Euro were provided in support from the Cohesion Fund, covering about half of Spanish investment in sewage control and up to 85 % of individual sewage treatment plant investments. Estonia, as a new Member State, has until 2010 to comply with UWWTD. As a result of waste water investments, and of industrial decline, discharges of BOD to surface waters have been reduced by more than 90 % in just ten years. The Estonian water pollution levy is modest, however, and domestic environmental financing will hardly suffice if UWWTD requirements are to be implemented in time, so there will be substantial reliance on EU support in the future, as there has been on western donors in the past. Poland has also been allowed until 2010 to comply with the UWWTD for industry and large cities. Discharges of BOD to surface waters were reduced by about 24 % during the 1990s. Polish industry has made substantial investment, up to 0.5 % of gross value added annually, on water-pollution control. EU support is now available from the Cohesion and Structural Funds, but new methods of distributing these funds, that promote implementation and costeffectiveness, could be useful. There is a strong case for more emphasis on eco-efficiency in wastewater management. This becomes clear from a careful review of the approach adopted in the Netherlands. The use of economic instruments in the Dutch case, as an incentive to make industry reduce discharges at source, has reduced the need for public sewage-treatment plant capacity — and public investments — to a level well below that in other countries. In contrast, the water pollution taxes are rather low in France, Spain and Estonia, and full-cost pricing of sewage treatment is not in place in Poland, Spain or Estonia. The absence of economic incentives to promote eco-efficiency gives reason for concerns as to whether Member States will be able to meet the requirements of the UWWTD costeffectively. The Dutch approach demonstrates that substantial savings in investment costs can be made if advantage is taken of water pollution control levies and the incentives they provide for controlling the sources of pollution. Wastewater treatment plants are only part of the costs imposed by the UWWTD, which also calls for appropriate sewer networks. There is a need for operational expenditure as well as investment. The efficiency of the incentive approach appears to be reflected in the fact that water pollution control expenditure in the Netherlands, only 0.6 % of GDP, is about 20 % lower than in France (0.8 % of GDP), despite a higher degree of compliance with the UWWTD. The Dutch-Danish comparison suggests that Member States with low or inadequate water pollution levies (Spain, France and Estonia) or no full-cost pricing of sewerage (Spain, Estonia and Poland), may overinvest in excessive capacity if they do not take account of the potential for reducing discharges from industrial sources. Most of these countries are eligible for considerable EU subsidies (75–85 % of investments), so there is a risk of less efficient use of EU funding if wastewater treatment plant capacity is not optimised. There is also a risk that these countries will incur larger operational costs than necessary, which they will have to meet themselves. The main reason for delays in implementing the UWWTD is the costs involved, so eco-efficient approaches that minimise investment deserve more attention. Greater emphasis on ecoefficiency, and economic incentives that promote wastewater reduction at source, are likely to be the keys to more timely and cost-effective implementation of the UWWTD in Member States. It is expected that the cohesion policy, through the Cohesion and Structural Funds, will continue to support sewage treatment plants from its proposed 336 billion Euro budget for 2007–2013 for all 10 new Member States. Support is greatly needed as current investments in Poland and Estonia are at the level of 5–10 Euro per capita (not PPP-adjusted), and will need to be increased to a level of about 40–50 Euro per capita to comply with the agreed deadlines. Nevertheless, the Cohesion and Structural Funds could address the polluter-pays principle more systematically. If there are not economic instruments in place to provide industries with an incentive to promote eco-efficiency and to reduce 7 Executive summary pollution at source, there appears to be a considerable risk that EU subsidies will lead to excess investment in sewagetreatment plant capacity. The right balance between prevention and adequate sewage treatment capacity needs to be found, as sewage treatment is one of the most capitaldemanding environmental measures. Water-pollution control costs account for about 0.8 % of GDP in several Member States and have absorbed more than 50 % of all environmental investment in recent decades, so despite the relative triviality of sewage compared with many other environmental problems, it can crowd out other needs if not managed wisely. Affordability and competitiveness concerns are legitimate, but the good news is that there is evidence that the polluter-pays incentives can smooth implementation by helping to control costs. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study8 1.1 European clean water policies Concerns about the pollution of Europe's waters have historically been at the heart of European environmental policymaking. The Paris Summit in October 1972 is usually viewed as the official starting date for the EU's environmental policy. At that meeting the heads of state agreed that the Commission should draw up the first environmental action programme. The summit took place only a few months after the UN's Stockholm conference, an event that was an occasion for many countries to finalise and present initiatives and plans for their national environmental policies. Yet, had it not been for the concern voiced by the European Parliament since the late 1960s, a European environmental policy might not have emerged so soon. In 1970 the Parliament passed a resolution which called for measures to protect water quality and public health from the dangers of pollution. This early resolution called for special attention to be paid to the pollution of the river Rhine and other surface waters. Early European environmental policies relied mainly on coordination of Member State efforts, but a new impetus resulted from the environment being officially included as an area for harmonisation in the Treaty in 1987. For clean water policies the Treaty amendment led to a series of significant directives, notably the Nitrate Directive and the Urban Waste Water Treatment Directive (UWWTD). These directives established minimum requirements for urban wastewater treatment and placed limits on the surface application of nutrients. The impetus also helped the environment to become a topic for pan-European cooperation in the context of the Environment for Europe process that from 1991 involved central and eastern European countries, and which in the environmental area paved the way for the recent expansion of the EU. Clean-up measures for surface waters was one of the cornerstones of this process, as environmental assistance was made available and measures were taken to implement directive requirements by all EU members. 1. Setting the scene: the EEA and policy effectiveness evaluations The time would now appear ripe for an evaluation of the effectiveness of the European deliberations on the clean-up of surface waters. Three decades have been available to achieve the improvements demanded by European institutions, at least for the EU-15 Member States, although the past decade may have been especially significant, due to the binding requirements issued in 1991. Although some Member States only recently joined the EU, a somewhat parallel effort to comply with similar targets and deadlines became apparent during the 1990s. EU-15 Member States had to comply with the mandatory requirements of European directives, but acceding countries knew that they would have to meet similar requirements to obtain membership, and from the outset they targeted their environmental efforts towards compliance with the EU standards. 1.2 Meeting information demands The sixth environment action programme (6EAP) of the European Community highlights the need to undertake 'ex-post evaluation of the effectiveness of existing measures in meeting their environmental objectives'. Such evaluations require a better understanding of policy measures and an examination of the mechanisms that lead to their observed effects. What measures have been implemented in response to the given directive, what were their effects and what is the national context in which they are supposed to operate? For a number of years, the European Parliament has clearly expressed its wish for the EEA to provide information on the implementation of policies in Member States and to analyse the effectiveness of past policies in the EU. The Parliament is particularly interested in information and analysis on the implementation of EU legislation in the Member States. The European Commission is also in need of analysis and knowledge on the extent to which directives and measures are working in Member States. Reporting by Member States on the implementation of directives seldom covers information on the 9 Setting the scene: the EEA and policy effectiveness evaluations effectiveness of the measures put in place in the countries. The EEA can help to fill this knowledge gap. EEA member countries, including all 25 EU Member States, face increasing demands for information and knowledge about the extent to which the policies they put in place give 'value for money'. They are also very interested in knowing what policies have worked under what conditions in other countries, and which did not work. This is particularly the case for the 10 new Member States who now face a significant challenge to implement EU directives as soon as possible, and without repeating the mistakes and problems that the EU-15 Member States have encountered. 1.3 EEA policy effectiveness evaluations In the past, the focus of much of the EEA's work has been to provide information on and analysis of the state of the environment in Europe, including the underlying driving forces and the pressures on the environment from economic activities. As a result, the Response dimension of the DPSIR framework (Driving Force — Pressures — State — Impact — Response) has often received less attention. The EEA report 'Reporting on environmental measures — are we being effective?' (EEA, 2001) concluded that little is known about the extent to which past environmental policies and instruments have had an effect on the environment. In 2003, the EEA initiated two pilot studies on policy effectiveness to gain experience on undertaking such evaluations and their methodologies, and provide the Parliament, the Commission and member countries with analyses of the effectiveness of policy measures in a few areas and countries. It was decided that one pilot study would evaluate the effectiveness of packaging waste management systems in five EU Member States while the other would evaluate the effectiveness of urban wastewater treatment policies in six EU Member States. 1.4 The approach of this study This study builds on and extends previous research findings on the effectiveness of clean water policies in Europe (Andersen, 1994; 1999), in which the efforts in the 1970s and 1980s were analysed in a comprehensive study covering a selection of the EU-15 Member States. This EEA pilot study employs a similar methodology, but Box 1 Policy effectiveness evaluation and the EEA strategy 2004–2008 The EEA strategy, adopted in 2003, sets out the main priorities of the Agency for 2004–2008. It identifies ex-post policy effectiveness analysis as one of its priorities for the future. In his foreword to the strategy, the Chair of the EEA Management Board Mr. Lars-Erik Liljelund states that: 'Increased emphasis will be placed on evaluation of policy effectiveness. Environmental policy is no longer a free ride. In order to be able to convince politicians and the public alike that environmental policies are necessary and good for society as a whole, we must be able to demonstrate that they are delivering real results in an effective way. I welcome the fact that the European Commission also sees a clear role for the EEA in this field. We will work closely with the Commission to deliver real results'. The strategy identifies the following outputs of EEA work on policy effectiveness in 2004–2008: • Pilot studies (e.g. urban wastewater and packaging policies) including economic aspects; • Analyses of effective policy mixes and cross-compliance; • Support for the network of European Protection Agencies, including analyses of specific policy implementation in member countries; • establishment of a network of policy analyst professionals to support the development of a methodological guide and framework for undertaking policy effectiveness evaluations. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study16 Gudenå Denmark France Spain Poland 1980 1985 1990 1995 1998/1999 mg O2/1 0 2 4 6 8 10 12 14 Skjern å Estonia 53 rivers Pärnu Loire Seine Garonne Rhône Guadalquivir Duero Ebro Guadiana Maas-Keizersveer Rijn/Maas Delta Wisla Odra BOD Gudenå Denmark France Spain Poland 1980 1985 1990 1995 1998/1999 mg P/I Skjern å Estonia 53 rivers Pärnu Loire Seine Garonne Rhône Guadalquivir Duero Ebro Guadiana Maas-Keizersveer Rijn/Maas Delta Wisla Odra Ammonium 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 0.0 0.2 0.4 0.6 0.8 1.0 Gudenå Denmark France Spain Poland 1980 1985 1990 1995 1998/1999 mg N/I Skjern å Estonia 53 rivers Pärnu Loire Seine Garonne Rhône Guadalquivir Duero Ebro Guadiana Regional waters Large water bodies Wisla Odra Total phosphorus Netherlands Netherlands Netherlands Source: OECD Environmental Data Compendium 2002 and EEA Note: Estonia 1990 = 1992; The Netherlands 1995 = 1992. Figure 2 Water quality of rivers in six Member States 1980–1999 17 Methodological considerations to support the implementation of the requirements. Financial and economic instruments are of particular interest, since a prerequisite for implementation is the availability of funding. These three elements are considered in the chapters on the separate Member States. In the final comparative analysis, the report returns to these issues to discuss their relative significance. 2.6 Cost-effectiveness Cost-effectiveness analysis seeks to establish whether pollution reductions have been attained at a reasonable cost. This report therefore considers investment in wastewater pollution control by both public authorities and industry. Such figures have been compiled by Eurostat for recent years, but the report also draws on historical time-series from national statistical agencies. Data on investment costs enable benchmarking and an analysis of whether sewage treatment capacity has been established efficiently. We abstain from an analysis of operational costs, as this would require a different level of detail. Pollution reduction in industry is often cheaper if source-related in-house or in-plant measures are used, rather than the passive end-of- pipe process of sewage treatment. The key to considerations of cost-effectiveness is therefore the relationship between public sector involvement and clean-up measures by industry. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study18 3.1 Water quality situation Denmark consists of a peninsula and several hundred islands, the largest of which is relatively urbanised and houses the capital, Copenhagen. There are few rivers, but an extensive network of streams connects with vulnerable fjords along the coastline. The impact pathways from land-based sources to the marine environment are of extraordinary significance for water quality. Sewage treatment is extensive, with advanced treatment in most places, and leaching of nutrients from intensive agricultural livestock industry is now the main water quality problem. Although BOD levels in Danish watercourses have decreased, reflecting a significant environmental improvement, Denmark falls short of its domestic nitrogen goals for surface water quality. The main cause of continuing eutrophication is pollution from agricultural sources. Around 90 % of households and 80 % of industries are connected to municipal sewage treatment plants. At the 1 558 sewage treatment plants, 86 % of the wastewater receives advanced treatment. About 100 industries discharge directly to surface waters, the most significant being food-processing industries. The targets for the UWWTD have been met on time, as acknowledged in the Commission's 2004 implementation report. 3.2 Water quality policy objectives Policies in the 1970s relied heavily on local planning and designation of quality objectives. By the mid-1980s, 75 % of discharges received secondary treatment, and many industrial discharges had been connected to the public sewage systems. The policy approach was nevertheless regarded as too lenient for major polluters and local quality objectives were adjusted to take account of the presence of large dischargers. The Action Plan for the Aquatic Environment (1987) established national reduction targets for discharges: 50 % for nitrogen and 80 % for phosphorous. It also fixed mandatory thresholds for discharge concentrations. These targets overruled local planning provisions and also helped address nutrient runoff. Various international conventions specified similar targets in subsequent years, but these were less demanding than the Danish ones. For instance, the Paris/Oslo conventions and the Helcom convention require a 50 % reduction for both nitrogen and phosphorous. The Danish plan preceded the UWWTD, which had only minor implications for Denmark. When the directive was implemented into Danish law in 1994, tertiary treatment had become the dominant mode of treatment. The reduction targets established in the 1987 plan were not translated into specific quality objectives. They were merely a means to 'do something'. Quality objectives for lakes, rivers and coastal areas are set by the regional authorities, the counties. 3.3 Institutional context Environmental responsibilities are largely decentralised to municipalities and counties, with the Ministry of the Environment and the Environmental Protection Agency both 3. Denmark Sources: OECD and Eurostat. Figure 3 Share of population served with public wastewater treatment in Denmark 1970–2001 Mechanical Biological Advanced % 0 10 20 30 40 50 60 70 80 90 100 200119971990198619771970 19 Denmark being given a mainly supervisory role. The basic legislation is the Environmental Protection Act, which prescribes competencies and establishes a framework for the efforts of local authorities. Originally the 275 municipalities were the main executing institutions, but over the years the 14 regional counties have acquired a greater role and more powers over implementation. While the counties are responsible both for planning and designation of surface water quality, as well as for monitoring and some inspection, the local municipalities are responsible for building and operating sewage treatment plants. Permits for industries for discharges directly to surface waters are issued by the county authorities. An Environmental Board of Appeal can deal with cases involving issues of principle if it receives complaints about decisions taken by local authorities. Responsibility for enforcement lies with the local and regional authorities, and is sometimes influenced by the politicallyelected bodies, but the Environmental Protection Agency can intervene. The municipalities and counties enjoy great financial autonomy, as most of their revenue comes from locally agreed income and property taxes. These local taxes constitute more than 35 % of all tax revenues, reflecting the significance of the local authority level in the Danish institutional set-up. 3.4 Policy instruments The basis for issuing permits and for decisions on wastewater treatment levels was initially the quality standards established by the local or regional authorities. These standards were subsequently overruled by the reduction targets and treatment requirements laid down in the Action Plan for the Aquatic Environment. Full-cost recovery of water pollution control costs was not required in the earlier decades. Sewage treatment plants were partly subsidised by local authorities out of general tax revenue, but this practice was phased out during the 1980s. In 1988 a bill was introduced which made full-cost recovery for discharges to sewage treatment plants mandatory. The bill also set out in detail how large dischargers should be charged according to their environmental burden. In 1995 a national wastewater tax for direct dischargers (industry and sewage treatment plants) was agreed, but it offers reduced rates for the larger industrial polluters. A national water supply tax for households was introduced alongside the wastewater tax. Both taxes apply in addition to user fees. For households, the water supply tax, on top of increased user fees, resulted in steep increases in water prices. 3.5 Observations on effectiveness Studies demonstrate that the most significant impact on discharges and improved water quality was achieved by the command-and-control approach of the 1987 plan. Before that plan, from 1972 to 1987, the local planning approach was not effective and gross discharges remained unchanged (Andersen, 1994). Since 1987, however, discharges have been reduced. A main problem has been the strong focus in the 1970s and 1980s on connecting industries to public sewage treatment, with attention to opportunities for the application of in-house, cleaner technologies within industry arising only in the 1990s. No economic incentives existed to push industries to introduce in-house improvements until much later — when full-cost recovery via user fees was introduced. At that point, industries became highly active in the management of pollution discharges with the result that the financing basis for the municipal sewage treatment plants sometimes was eroded due to the discharge reductions achieved. The 1995 wastewater tax was introduced 'on top' of the existing regulations and, as such, had limited additional effect. However, the effect of the tax has been helpful in bringing about improvements in the rate of compliance by public sewage treatment plants. Before the mid-1990s nearly 30 % of the sewage treatment plants did not comply with the discharge standards; now nearly full compliance has been achieved. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study20 4.1 Water quality situation France has five major river systems comprising more than 270 000 km of watercourses, an extensive coastline, and a rich variety of lakes and wetlands of great ecological value. Water resources are, however, unevenly distributed, both geographically and seasonally, which can result in high discharge rates or floods as well as periods of drought. Control of pointsource discharges has improved steadily since the 1960s and has been strengthened as a result of the National Environmental Plan (1990) and the UWWTD. Despite organic discharges having been reduced, concentrations of nutrients have increased in many places, with the result that one third of all rivers and half of all lakes are classified as vulnerable to eutrophication. Droughts affected freshwater quality negatively in the 1990s. The situation in coastal areas has not really improved, and conditions for shellfish are critical in many estuaries. About 77 % of households are connected to public sewage treatment plants (IFEN, 2002: 223) while in rural areas individual treatment (e.g. septic tanks) has been 4. France promoted, and account for 17 % of French households. Of the wastewater passing through the 16 100 (2001) municipal sewage treatment plants, 36 % receives advanced, 60 % biological and 4 % mechanical treatment. Around half of the industries have in-house sewage treatment and discharge directly to surface waters (Barraque, 1997: 298). The extension of sewage and wastewater treatment plants came to France relatively recently compared with its EU neighbours (Jordan, Ward and Buller, 1998: 1399). The UWWTD is a challenge to French policies, and its requirements are far from fully implemented, despite construction and upgrading activities during the 1990s. 4.2 Water quality policy objectives Policies in the 1970s relied mainly on the initiatives of the River Basin Agencies, although formally also on local planning and designation of quality objectives. The River Basin Agencies were guided in turn by the 1964 Loi sur l'Eau, which addressed surface water quality in the context of integrated water management. However, in 1982 the Ministry of Finance imposed a spending limit on the River Basin Agencies, effectively squeezing their capacity. By the late 1980s about 70 % of the population were connected to sewage treatment plants, but treatment remained inadequate for many large cities. Industries were granted permits on the basis of a 1917 Industrial Classification act, with inspection duties delegated to administrations under the Ministries of Industry or Agriculture, thereby causing the policy to be labelled by some as one of tolerance towards polluters. Nevertheless reductions in industrial discharges (56 % for BOD and 80 % for toxic discharges between 1974 and 1998) have been notably more effective than those for domestic wastewater to public sewage treatment plants. The National Environmental Plan (1990) provided a new impetus for French environmental policy. It allowed for an increase in the budgets of River Basin All treatment types % 0 10 20 30 40 50 60 70 80 90 100 199819901985198019751970 Figure 4 Share of population served with public wastewater treatment in France 1970–1998 Sources: OECD, Institut Francais de l'Environnement and Ministére de l'ecologie et du developpement durable. 21 France Agencies by means of a tripling of water levies. The National Environmental Plan also overruled the local planning system and established national targets for water quality improvements. These included a 60 % reduction in wastewater discharges within 10 years and an 80 % reduction of nitrate and phosphorous discharges in vulnerable areas. The plan was followed by the 1992 amendments to the Loi sur l'Eau and a revitalisation of the activities of the River Basin Agencies. The National Environmental Plan helped to promote regional and local implementation, but its impact levelled of as consumers reacted negatively to water price increases. Some local authorities in turn hesitated to implement the requirements of the UWWTD in view of the perceived costs. Of the 486 cities in non-sensitive areas which are required to comply with the UWWTD Directive, 179 were not equipped with the mandatory secondary treatment. Large coastal cities such as Cannes, Marseilles and Perpignan are not in compliance (EC, 2004a: 61). In sensitive areas the situation is not better, as 205 of 348 cities lack the required advanced treatment. In its UWWTD compliance review the Commission has criticised France for having failed to designate a number of sensitive areas, and the European Court of Justice subsequently has ruled that France has failed to fulfil its obligations under the UWWTD (2). 4.3 Institutional context Although France established a Ministry of the Environment as early as 1971, competencies in water management are shared with the River Basin Agencies and with regional and local authorities. The institutional context is complex and marked by a traditional tension between the strong vertical lines of the state and the horizontal ties of society (Buller, 2004). The Loi sur l'Eau, passed in 1964, established the six River Basin Agencies. These are innovative despite the absence of direct management activities. They were set up on a catchment basis. Committees, with equal representation of national and local government and water-consumers, specify water policy guidelines in more detail. The agencies impose levies on dischargers and have recycled the revenue for clean-up programmes. Each river basin agency must present a master plan for integrated water management. Wastewater treatment remains a municipal responsibility, although the architects of the establishment of the river basin agencies would have preferred the task to have been with the agencies. French municipalities are relatively small by European standards, and often group together to share responsibilities and operate in more efficient units. There is a long tradition of using private operators. Full cost recovery with user fees on the dischargers to cover costs was introduced as early as 1959, requiring municipalities to separate the financing of sewage treatment from that of their general operations, although some possibilities for escaping the full cost recovery principle in case of large investment costs persist. An important administrative reform introduced decentralisation in 1982, resulting in the creation of a new regional administrative level on top of the Departements. The regional environmental directorates (DIREN) that were created, however, have no regulatory powers. Competencies for water management and issuing of permits to industrial polluters remain with the specific directorates for industry (DRIRE), responsible for monitoring and inspection. Furthermore, within the Departments the industry directorates also have the upper hand as no environment directorates exist at this level. Discharge permits are granted according to a BATNEEC principle (Best Available Technology Not Entailing Excessive Costs). 4.4 Policy instruments Initially, quality standards established by local authorities guided clean-up programmes and set requirements for industrial discharges. These standards have since been partly overruled by the required reduction targets and treatment prescriptions of the National Environmental Plan and the UWWTD. Full-cost recovery for discharges to sewage treatment plants has represented a financing opportunity from the outset, yet many municipalities hesitated to construct or improve sewage treatment facilities (2) Case C-280/02. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study22 until the late 1980s. This implementation shortfall was due partly to the close vicinity of a number of the larger cities to robust marine recipients, but may also need to be understood against the backdrop of the limited environmental concern among decision-makers in France before 1990. Furthermore, the tax and spending limit imposed on the river basin agencies by the Ministry of Finance around 1980 gave a signal to all parties concerned of the low priority of water quality improvements. As a result of the above, the levies imposed and collected by the river basin agencies for initiating new clean-up programmes remained modest until the end of the 1980s. Increases in the levies simply reflected inflation, as was the original intention (Andersen, 1994: 175). This led to the criticism that the levies merely represented payments for being allowed to pollute. The revenues that were recycled were, however, actually rather significant in targeting investment towards the most polluting industries. In particular, the Industrial Sector contracts of the early 1970s have been acknowledged as a very effective approach, as can be seen from previous evaluations. Under these contracts the revenues from the levies were used to co-finance clean-up with the biggest polluters. This revenue recycling to industries was discontinued after 1978 as required by the European Commission, which regarded it in this case as illegal state aid (Barraque, 1997: 301). 4.5 Observations on effectiveness Despite an early start for clean water policy in France with the 1964 water law, provision of sewage treatment for household discharges proceeded somewhat gradually, so that in 2001 about 77 % of, the population was connected to treatment works. Septic tanks were promoted in rural areas, so that in total 94 % of households are covered. Success in the field of industrial discharges was notable much earlier. The sectors paper and pulp, chemicals and sugar, which were targeted in the Industrial Contract programmes of the river basin agencies and supported by revenue from the water pollution levies, achieved significant reductions in discharges by means of efficient in-plant measures (Andersen, 1994: 179). The municipalities are in most cases too small to possess specialised water staff, but have had sufficient political strength to prevent the River Basin Agencies from assuming full responsibility for wastewater management, as was proposed in the draft Loi sur l'Eau and as is the case with the water boards in the Netherlands. Many municipalities have been reluctant to establish sewage treatment facilities with appropriate treatment levels, despite the possibilities for some financial support from the Agencies. In France the policy directives from the state level are crucial, but also this level, in particular the Ministry of Finance, has tended to support municipal policies. In September 2004 the European Court of Justice ruled that France had violated the UWWTD by not designating a sufficient number of sensitive areas. The lack of compliance with the UWWTD, also prominent in several large cities, is notable in view of the availability of funding and the pioneering 1959 French wastewater legislation, which established the institutional framework for an integrated and river basin oriented management system. 23 The Netherlands 5.1 Water quality situation Water has been regulated meticulously in the Netherlands since the early middle ages; one third of the country lies below sea level, and another third faces possible flooding if canals and dikes are not effectively maintained. The three main Dutch rivers, the Rhine, the Meuse and the Schelde, originate outside the country, and pollution imported by these rivers adds to domestic pollution discharges. During the 1960s, this led to the Netherlands coordinating pollution control with the upstream countries. Control of pointsource discharges was introduced with the Surface Waters Pollution Act in 1970 and by the late 1980s sewage treatment had been extended to 85 % of households and many industries. During the 1990s, connection to households was essentially completed and a programme of improvement of sewage treatment plants to include advanced treatment (phosphorous and nitrogen removal) was introduced. About 98 % of households are connected to municipal sewage treatment (OECD, 2003: 67). About 600 companies undertake sewage treatment independent of the public system, 150 of which discharge directly to surface waters, mainly into the larger rivers and the sea (CBS, 1999: 8). At the 400 public sewage treatment plants (with a combined capacity of about 26 million inhabitant equivalents) 80 % of the wastewater receives advanced, while the remainder receives biological treatment. Nevertheless, improvements in water quality have levelled off in recent years. In many of the nationally managed state waters, pollution concentrations exceed basic quality levels by a factor of two, and in a number of regional waters, managed by regional water boards, by a factor of up to three (OECD, 2003: 70–71). Water quality in the main rivers depends mainly on efforts in upstream countries, and there were improvements during the 1990s, except in the case of the Meuse. The UWWTD target for P-removal was achieved as early as 1998. However, the Netherlands does not yet comply with the target for N-removal. The removal rate of 68 % remains well below the 75 % requirement. Some large cities have yet to introduce N-removal. 5.2 Water quality policy objectives Water policies in the 1970s were guided by special five-year plans, termed IMPs (Indicative Multi-year Planning) for water, the same practice as for other environmental sectors. The first IMP-Water (1975) was remarkable for its clear focus not only on sewage treatment but also on eco-efficiency, i.e. industrial in-plant measures, often proclaimed as the most effective and least expensive way to restrict effluent and residual waste products. The focus was clearly placed on changing or adapting industrial processes to reduce the volume of effluent and the quantity of waste matter (MTPW, 1975: 18). The Dutch National Environmental Policy Plan (1989) was a product of the cycle of five-year IMPs, but represented increased ambitions in addressing pollution problems and achieving sustainability. Figure 5 Share of population served with public wastewater treatment in the Netherlands 1970–1999 5. The Netherlands Sources: OECD and Eurostat. Mechanical Biological Advanced % 0 10 20 30 40 50 60 70 80 90 100 2000199319901985198119751970 Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study24 The short-term (2006) water quality objective is to reduce pollutant concentrations below Maximum Admissible Risk (MAR) levels, broadly equivalent to 'good surface water chemical status', as defined in the EU Framework Directive. In the longer term, the target is to reduce concentrations to below the negligible risk value. The Netherlands has promised to apply the measures for sensitive areas for the whole territory. Although the targets are stricter for sensitive areas, according to article 5(8) of the UWWTD, more freedom is permitted as to methods of attainment. In spite of a requirement for 75 % of P and N to be eliminated for the country as a whole, P and N-removal is not required at each individual sewage treatment plant. 5.3 Institutional context Water quality and water quantity management in the Netherlands are closely related and require coordination between the Ministry of Spatial Planning, Housing and the Environment and the Ministry of Transport, Public Works and Water Management. Although the Surface Waters Pollution Act vested competencies for quality management with the Provinces, as far as responsibility for implementation was concerned these had, in turn, to rely on the traditional water authorities; the local water boards. It is these water boards, and not the municipalities, that have been responsible for building sewage treatment plants. The water boards are important and influential institutions in Dutch society as they are responsible for integrated water management — originally of water quantity and canals, but now also including the provision of sewage treatment services to households and industries. The water boards are governed by the water users and have traditionally relied on a system of user levies for their services. With this background, the country has abstained from government subsidies for sewage treatment, and a system of full-cost pricing for sewage discharges was established as early as 1970. Historically there were hundreds of water boards, but an administrative reform during the 1970s reduced the number to just 37 by means of mergers on the basis of the hydrological principles of catchment areas. The reform secured the transition of the traditional Water Board structure, transforming them into modern entities with the capability and expertise to take charge of integrated water management. The remaining two provinces handed over implementation responsibility to the water boards during the 1990s. There is a distinction between water board management areas and state waters, which comprise coastal waters, the river Rhine and some other rivers and waters of national interest. As the state waters are outside the management system of the local water boards, these have been administrated directly by the Rijkswaterstaat, the influential national agency of the Ministry of Transport, Public Works and Water Management. Many of the larger industrial installations discharge to state waters and a system of levies has also been established for these. The administrative structure in the Netherlands represents a rather complex compromise, but is also tailor-made to address a variety of problems and priorities. 5.4 Policy instruments The main policy instruments foreseen in Dutch legislation were the discharge permits and the system of levies, both placed within the framework of indicative national planning for the water sector. It was as a consequence of the Surface Waters Pollution Act that these two policy instruments were introduced. Although the Dutch commonly refer to the levies as one coherent system, analytically they are both user fees and taxes. The levies paid by households and industries discharging via a sewer system to a sewage plant are a payment for a service and are akin to user fees paid in other countries. The levy paid by those who discharge directly to surface waters is more clearly an environmental tax instrument since no service is provided in direct return for the payment. The state water levy has the character of an environmental tax. It has played a dual role, as revenue from the levy has been recycled for control measures in industry and for building of treatment plants. Under the Rijkswaterstaat, a sewage treatment research centre and advisory service, RIZA, has been established, with responsibility for providing technical advice regarding permits for dischargers. As a national unit, RIZA was in a position to gain an overview of possible in-plant measures to reduce 25 The Netherlands discharges and could communicate this knowledge to water boards and companies as part of permit considerations. At the same time, efforts to identify cost-effective solutions rather than simply build a company sewage treatment plant were common. Often, it was a combination of inplant measures and end-of-pipe treatment that proved most efficient. Certain exemption mechanisms relating to the levy existed in the early years of the scheme. For instance, a company could obtain an exemption under general clauses in tax legislation ('hardheidsclausule') if the burden was substantial. The exemption would require a reduction in discharges from the company and, at the end of the exemption period, the levy would be applied to the reduced level of discharge achieved, including the years when the exemption applied. The exemption clause was applied only in very few instances. 5.5 Observations on effectiveness The Netherlands managed to establish nationwide coverage with regard to sewage treatment before the end of the 1980s, mainly as a result of the water boards. They had been obliged to treat discharges and met few restrictions in doing so. In fact, since the committees of the water boards were dominated by farming interests, with point source dischargers representing a minority, there was little to hinder implementation. The few delays in the extension of sewage treatment resulted from planning regulations and problems relating to decision-making on the location of treatment plants. Additional measures, such as phosphorous removal, were generally not accepted by the water boards, until concerted efforts were agreed at the European level. Success with regard to the control of industrial discharges has been especially evident: in the first years of the 1970s, industrial wastewater discharges were reduced by about 50 % (in terms of BOD). Notably, these effects were achieved even before the first administrative permit guidelines on wastewater were issued in 1975, demonstrating that the levy system, and not the permit procedure, had the greatest impact. Two widely-quoted Dutch studies (Bressers, 1983; 1988; Schuurmann, 1988) showed that pressure from the levies prompted industries to undertake large reductions in effluents. Bressers investigated the response to levies within the water board districts. Although several large dischargers and the reductions they achieved were excluded, the study revealed a clear relationship between increases in levy rates and decreases in pollution discharges. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study32 8.1 Water quality situation Poland is divided into a northern lowland area with two major lake districts and a southern hilly upland area, crossed by flat, long river valleys. It is connected to the Baltic Sea basin and the major drainage goes through the Vistula and Oder rivers. Poland depends on surface waters for its water supply, but high pollution levels and low available water reserves have led to drinking water shortages in a number of areas. The need to improve water quality has been addressed by policy-makers since the early 1970s. Despite significant progress during the 1990s, the overall state of river water quality gives rise to concern, while several beaches continue to be affected by insufficient sewage treatment. The creation of the National Fund, foreign environmental assistance (donors) and the need to comply with the EU's environmental acquis are three main factors which have helped to promote the control of point-source discharges. About 55 % of households are connected to municipal sewage treatment. At the plants 23 % of the wastewater receives advanced treatment, and 28 % biological treatment. Mechanical treatment has been almost phased out. 3 500 large industries discharge directly to surface waters, and about 1 900 of these have no wastewater treatment plant (Jarosinski, 2002). Compliance with the UWWTD is an economic and administrative challenge for Poland, which has been granted a 10-year transitional period. The investment needed for the required wastewater treatment plants has been estimated at 3 billion Euro. An additional requirement of 4.5 billion Euro is foreseen for the associated sewer network extension (OECD, 2003: 66). 8.2 Water quality policy objectives Poland was a signatory of the 1974 Helsinki convention on protection of the Baltic Sea, and agreed to extend its sewage treatment at that time. However, closure of beaches and prohibition of bathing were common during the 1970s and 1980s. The emphasis on industrial expansion resulted in discharges tripling during the 1970s, and in 1981 Poland was responsible for one-third of the total organic discharge to the Baltic Sea, compared with only 11 % of the total water flow into the sea. There was a huge gap between formal policy objectives and the measures provided to meet them. The 1991 National Environmental Policy document, which was agreed shortly after the demise of the planned economy, provided strategic goals and established a new approach for more efficient water management. This approach was clearly market-oriented and envisioned fullcost water pricing, as a function of water quantity and quality, and the costs of pollution abatement. Increased fees for effluent discharges were therefore proposed. Provision of wastewater treatment was to be increased so that, by 2000, 70 % of wastewater would receive biological or more advanced treatment. Untreated discharges were to be reduced by 50 %. The 2000 Second National Environmental Policy document revised and updated the strategy. It emphasised the need to increase 8. Poland Figure 8 Share of population served with public wastewater treatment in Poland 1990–2000 Source: EEA through its European Topic Centre on Water. Mechanical Biological Advanced % 0 10 20 30 40 50 60 70 80 90 100 200119951990 33 Poland effluent charges to a more realistic level so as to meet the targets of the 1991 plan, which had not been achieved. In 2003 a national programme for purification of wastewater was approved by the government. Not being able to meet the objectives of the 1991 National Environmental Policy, before joining the EU Poland negotiated a transition period of about ten years for compliance with the UWWTD. The transition clause differentiates between industry and various urban areas. Effectively this shifts the compliance deadline for industry to 2006, and for large cities to 2010. Poland has declared the whole of its territory as a sensitive area, to which more restrictive requirements apply. Of the 509 cities which are required to comply with the UWWTD in 2005, 182 have so far been equipped with at least secondary treatment. However, considerable fractions of Warsaw's left bank domestic and industrial wastewater continues to be discharged with no treatment at all to the Vistula, from which drinking water is extracted. 8.3 Institutional context The Ministry of Environment is the main government body responsible for environmental management, including management of water quality. However, it shares its competencies on water quality with the Ministry of Infrastructure (Baltic Sea environmental issues). Implementation of national legislation takes place through the 49 Voivodships, which are regional state authorities. Each Voivodship has an environmental department, which is responsible for issuing permits and setting maximum allowable emission and discharge levels. In relation to wastewater the Voivodship collects environmental levies imposed according to the national rates. This makes the Voivodships Environmental Protection Department the key institution in implementation (Zylicz, 2003). Inspection is undertaken by units at Voivodship level, which refer directly to the state authorities. The State Inspectorate for Environmental Protection is the national body responsible for enforcement of environmental regulations. Seven regional water management boards, which were created in 1991, and reorganised from 2001, are responsible for developing programmes for water use, mainly in relation to supply and quantity. The National Fund for Environmental Protection and Water Management, established in 1989, plays the key role in the financing of wastewater treatment. It provides financial assistance in terms of grants and soft loans on the basis of revenues from pollution charges and fines for non-compliance. There are also regional funds at Voivodship level. The municipalities are responsible for the provision of wastewater treatment capacity, which is funded by subsidies from the various environmental funds and support from foreign donors. In 1991, western European governments agreed a 'debt-for-environment-swap' and Poland established a separate Ecofund on that basis. Six countries allocated previous debt to the Ecofund, while others decided to offer bilateral environmental assistance. From 2001 and through May 2004 funding was available from the EU through the ISPA programme. Since accession in May 2004 funds have been available from the Cohesion and Structural Funds. However, bilateral financial assistance from foreign donors has remained well below the level of domestic financing through the National Fund, Voivodship funds and others. 8.4 Policy instruments The 2001 Water Act replaced the former 1974 Water Act and is the framework for a number of decrees that address surface water quality, sewage discharges and emissions guidelines. Following the 2001 Water Act the Environmental Protection Act was amended with a reform of the previous system of wastewater charges that was initiated during the time of the planned economy and significantly improved and strengthened following the 1989 revolution. The charges are based on BOD/COD, suspended solids, heavy metals and chlorate/sulphate content. The wastewater charging system was rather complex up to 2001, with different rates for different dischargers. The system favoured municipal sewage plants, which paid a much lower rate than industry. The reform in 2001 introduced a uniform rate, lower than the former standard rate, to Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study34 which many exemptions applied. However, revenues declined significantly following the 2001 reform. This is a step backwards compared with the 1990s. The wastewater charge is collected by the Marshalls of Voivodships, and the revenues are distributed among the National Fund, Voivodship funds, Poviat funds and municipal funds. They provide a basis for financing wastewater control, particularly for the municipalities. An undesired transfer of revenues from industries to municipalities via the funds appears to have been one of the reasons for introducing a uniform rate. Full-cost water pricing has been partly introduced in many municipalities, but is not implemented in the larger urban areas for reasons of affordability (OECD, 2003: 136). Investments in wastewater treatment plants are covered mainly by the environmental funds and are not included in the pricing structure. Prices of wastewater collection and treatment are estimated at between 0.2 and 1.5 Euro per m3 for households, averaging 0.8 Euro per m3. In 1998 households spent 1.4 % of their budget on sewerage and water supply. 8.5 Observations on effectiveness The total discharge to surface waters of BOD and nutrients from point sources was reduced by about 24 % between the late 1980s and the mid-1990s (Jarosinski, 2002: 157). With only 55 % of the population connected to public sewage treatment there remains a considerable backlog, despite three decades of policy declarations and high levels of investment in the mid-1990s. As Poland started its transition to a market economy in 1990 it faced a massive deficit in its water pollution control infrastructure. For this and other environmental reasons the National Environmental Fund was created to establish an independent financial basis for clean-up measures, and water pollution taxes were raised to western levels. However, the municipalities, which were made responsible for provision of sewage treatment, faced very serious financial shortages and in some cases bankruptcy. Although funds were also available from western donors, providing the necessary treatment plant presented a significant administrative and financial challenge. Companies from various donor countries competed for construction contracts, and much assistance was absorbed by consultancy services rather than direct investment. Due to shortage of funds, upgrade of old sewage plants was often given a higher priority than the provision of new infrastructure, e.g. in Warsaw. 35 Comparative analysis 9.1 Introduction This section compares the effects, effectiveness and cost-effectiveness (as defined in Chapter 2) of the urban wastewater treatment policies in the six countries. 9.2 Effects a) Wastewater treatment plants Since 1972 clean water policies have resulted in a gradual increase in the share of the population connected to sewage treatment plants in every one of the six countries studied. The 1991 UWWTD coincided with the national environmental policy plans of the early 1990s and thereby helped to intensify the efforts being made. Figure 9 provides a comparative overview, and shows that full connection has almost been achieved in Denmark, the Netherlands and France, with Spain and Poland lagging rather far behind and Estonia in between. The figures refer to total coverage with public sewage treatment plants and are not specified according to the detailed UWWTD requirements. Simple mechanical treatment has been phased out in most areas, but advanced treatment, has not been sufficiently extended in France, Netherlands, Poland or Estonia, and remains almost absent in Spain. b) Discharges to surface waters Figure 10 shows how total discharges to surface waters have changed in those Member States where the statistics include both direct and indirect discharges of BOD. The net load concept has been developed by the Dutch Central Bureau of Statistics, which publishes such a figure annually for the Netherlands. For Denmark and France net loads can be calculated on the basis of the statistical sources available. Changes in net loads for Poland from the late 1980s to the mid-1990s have been calculated in the context of Helcom work. Discharges have been reduced by about 24 % during this period. In Estonia the significant reduction of about 95 % since the early 1990's (also calculated in the context of Helcom) resulted from clean water policies as well as economic restructuring. Reductions in Estonia are impressive and in fact per capita BOD discharge from industry and households combined is currently similar to the level in the Netherlands and Denmark. The net load on surface waters is a general pressure indicator, which does not contain a spatial dimension. Despite the general decrease, regional differences and undesired local effects can arise. However, the dramatic decline in the net load on surface waters clearly indicates the effect of the improved capacity of sewage treatment and of industrial pre-treatment as regards organic discharges. In terms of effectiveness, the net load indicator reveals the first-order outcome of the policy; organic discharges have been reduced. Whether there have been improvements in water quality and if so the extent to which they can be attributed to sewage treatment 9. Comparative analysis Sources: EEA, OECD, Eurostat. Figure 9 Share of population served with public sewage treatment, and type of treatment offered. Latest year available Mechanical Biological Advanced % 0 10 20 30 40 50 60 70 80 90 100 Denmark France Spain Poland Estonia Netherlands Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study36 is more difficult to assess. As discussed in the methodology chapter it would be necessary to use a model at catchment level to disentangle the precise impacts of changes in total discharges on water quality. However, such a modelling exercise is beyond the scope of this report. c) Effects on expenditures Whether changes in net load on surface waters have been attained in an economically effective way will be analysed in Section 9.4. Here we simply summarise the effects of clean water policies on expenditures. Data for public investment in wastewater management, compiled by national census bureaux according to the common Eurostat SERIEE-methodology, are available for most of the period 1990–2002. Figure 11 provides an overview of investment in water pollution control (incl. both treatment and sewage networks) undertaken in the six Member States. The investments in Spain, Poland and Estonia include subsidies from the EU and foreign donors. To allow comparison between countries, the investments are converted into Euros and corrected for purchasing power parities (PPP). The relative costs of labour and capital differ between countries, so PPP- corrected investments are necessary, as one Euro may buy more sewage treatment in some countries than in others. Higher levels of investment are apparent in Denmark, the only country which has met the requirements and deadlines of the UWWTD. Investments were already considerable after 1991, as efforts to extend sewage treatment resulting from the Danish 1987 Action Plan for the Aquatic Environment partly preceded the passing of the directive. In France and the Netherlands public investment has increased, resulting in convergence at around 35–40 Euro per capita per year. Public investment in Spain decreased in the first half of the 1990s and increased only after the 1995 agreement between the government and the regions on the financing of wastewater treatment. Investment is now converging to the level of Denmark, France and the Netherlands. This may indicate an effort to implement the UWWTD, not yet reflected in the statistics on operational sewage treatment plants. Public investment in Poland was remarkably high before EU membership, investment in Figure 10 Net load on surface waters — organic discharges (BOD) from sewage treatment plants, industry and other direct outlets. 1970–2002 Sources: OECD, UNECE, Danish National Environnmental Research Institute and national statistical services. Note: Absent or incomplete data on industrial discharges in Spain precludes calculation of the development in discharges. Index (policy start year = 100) Denmark France Netherlands Poland Estonia 0 20 40 60 80 100 120 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 37 Comparative analysis Sources: Eurostat, OECD and national statistical services. Figure 11 Public investments for sewers and wastewater treatment in Euro per capita 1990–2002. Deflated to constant 1995-prices and corrected for purchasing power parities Denmark France Netherlands Poland Spain Estonia 1995 PPP-euros per capita 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 0 5 10 15 20 25 30 35 40 45 50 Figure 12 Industrial investments for wastewater treatment 1992–2002. % of industry's gross value added (GVA) Sources: Eurostat, OECD and national statistical services. Notes: The high level of investments in Estonia reflects measures in the oil shale industry. For Denmark, data is only available for 1992 and 1993. Denmark France Netherlands Poland Spain Estonia 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 % of GVA Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study38 the early 1990s being higher than in Spain. In Poland and Estonia, however, there has been a notable decline since investment peaked in the early and mid-1990s. This may reflect the fact that environmental investment had to give way to other concerns during the transition process. Data for industrial investment in water management, compiled by national census bureaux according to the common Eurostat SERIEE-methodology, is also available for most of the period 1992–2002. These investments are illustrated in Figure 12 as a percentage of gross value added (GVA) by industry. Unfortunately there is a lack of detailed investment data for Denmark; the figure shows OECD estimates (1999: 60). For the other countries, Poland and Estonia have the highest levels of investment as a share of industry GVA. Industrial investment in water management in the second half of the 1990s as a percentage of industry GVA in both countries was higher than the 0.4 % seen in the Netherlands. Despite foreign assistance and loans, approximately 75–85 % of Polish industry's investments was funded domestically. In Estonia industrial investment in water management peaked in 1997 at a record high of 3.5 % of industry GVA. For France and Spain investment was relatively modest, generally below 0.15 % of industry GVA. Finally, Figure 13 illustrates total expenditure by the public and private sectors in the field of water pollution control for both investment and operational purposes. This ranges from 0.55 to 0.85 % of GDP, except for Denmark, which is lower as expenditure by industry is not taken into account.. EU subsidies are included in the Spanish figure. It is notable that the Netherlands generally spends a lower share of GDP for water pollution control than the other countries, despite being close to compliance with the UWWTD. The more detailed analysis below further supports the view that that the Dutch approach has been superior in terms of economic cost-effectiveness. 9.3 Effectiveness The analysis of effectiveness involves comparisons between the policy measures and the desired objectives, as well as analysis and judgement on the causal mechanisms of implementation. The analysis in this report shows that, despite three decades of European efforts to introduce and set minimum standard requirements for wastewater treatment, disparities between Member States persist. Implementation shortfalls are found in three of the four longer-established Member States reviewed. Figure 13 Total expenditures on water pollution control (point sources) since 1992 as a share of gross domestic product. Data covers available years in the 1990s Sources: Eurostat and national statistical services. Share of GDP, % 0.0 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 Poland (1996–2001) Netherlands 39 Comparative analysis Denmark and the Netherlands essentially comply with the UWWTD, although there is still a small deficit for nitrogen removal in the Netherlands. While authorities in Poland and Estonia have until 2010 to meet the standards of the directive, Spain and France have not met the agreed deadlines. In both countries about two thirds of the wastewater treatment plants that discharge in sensitive areas did not provide the required advanced treatment, while one-third in non-sensitive areas did not provide secondary treatment (Commission, 2004). The designation of sensitive areas is a separate issue, and the European Court of Justice recently ruled that France had not fulfilled its obligations under UWWTD in this respect. In order to understand why expectations for implementation have not been met, even in EU-15 Member States such as Spain and France, it is necessary to consider the influence of institutional responsibilities for water pollution control. It appears that sharing responsibilities between municipalities and water basin authorities, combined with the availability of subsidies, tends to distort implementation. Objectives for urban wastewater treatment are necessarily implemented by subnational authorities. While construction of sewage treatment plants is generally the responsibility of municipalities, river catchment authorities are also involved in the planning and financing activities in most countries. The Agence de l'Eau in France and River Basin Authorities (Confederación Hidrografica) in Spain participate in planning and allocate funds from the proceeds of economic instruments (water pollution levies) to the municipalities. The succesful extension of the coverage of wastewater treatment in Denmark and the Netherlands occurred in a setting where only one authority (either the municipalities or water boards) was made fully responsible. The significance of shared responsibilities can be observed in the Spanish case, where implementation was dependent on finalisation of agreements between the regions and the state. The history underlying the continued shortfall in wastewater treatment in many European urban areas relates to the number of authorities involved in combination with the large investment requirements. Bottlenecks associated with financial support often cause lengthy negotations and provide perverse incentives. As regards Poland and Estonia, there is some doubt whether it will be possible to meet the UWWTD requirements in the time agreed. Investment needs remain large (Table 1). Current investment is around 5–10 Euro/capita/year cf. fig. 10 (without PPP-adjustment), whereas it appears that implementation by 2010 would require 40–50 euro/capita/year over the next six years. Sources: CEC, 1999; Helcom for Poland and Estonia. Note: The last column on UWWTD expenditure as % of annual GDP is based on a 13 year implementation period for EU-15 Member States, and a 6 year implementation period for new Member States (2004–2010). The previous column provides the share of GDP if all UWWTD investments theoretically were focused in just one year. The costs have been reported by Member States to the Commission, but the methodology is not entirely consistent across Member States. Table 1 Expenditure and affordability of the UWWT Directive Country Population (million) GDP/capita (Euro) 2002 UWWTD investment expenditure Billion Euro UWWTD expenditure Euro per capita UWWTD expenditure as % of a 1-year GDP UWWTD expenditure as % of annual GDP (3) Denmark France The Netherlands Spain Estonia Poland 5.1 61.2 16.2 40.2 1.4 38.6 36 026 24 850 27 447 17 319 4 931 5 213 4.1 12.0 2.9 10.9 0.3 11.2 804 197 181 270 236 292 2.23 0.79 0.66 1.56 4.78 5.59 0.17 0.06 0.05 0.12 0.80 0.93 (3) From 1993–2005, but 2005–2010 for Poland and Estonia. Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study40 A proper appreciation of the implementation costs of the UWWTD is the key to understanding the implementation difficulties. Whereas in the EU-15 Member States analysed, the total investment expenditure required for implementation is less than 2 % of one year's GDP, the requirement in the new Member States analysed is around 5 %. Since water pollution control costs as a fraction of GDP are already similar in the new and EU-15 Member States (see Figure 13) it is questionable whether the two new Member States can afford to fully implement the UWWTD without more attention to costeffectiveness. Subsidies have been introduced by the EU to soften implementation costs in the less-developed Member States. The role of subsidies is greatest in Spain, where up to 85 % of the costs of construction of sewage treatment plants are supported by EU funds, notably through the Cohesion Fund. Support is also offered to the new Member States, Poland and Estonia, in this case up to 75 % of the costs of the projects under the ISPA fund from 2001 to 2004. Since May 2004 Poland and Estonia have been benefitting from both the Cohesion and Structural Funds. While subsidies may appear to be a logical solution to the threatening implementation deficit, there is ample reason for caution. Subsidies may cause distortions, such as over-investments. A further important drawback of the subsidy approach is that cities in non-compliance may profit from delaying action until an opportunity for EU financial support materialises. Since 1975 the OECD has recommended application of the polluter-pays principle, which basically is a no-subsidy principle. This principle was also adopted in the European Treaty of Rome in 1987. It is in acordance with this principle that the Water Framework Directive recommends the introduction of full-cost pricing for water services in all Member States. Two economic instruments should therefore be in place in the area of wastewater treatment: — user fees for wastewater discharges for households and industries connected to public sewage treatment plants; these should reflect the full costs of sewerage services (capital and operational); — wastewater levies for entities that discharge directly to surface waters (industries and municipalities); these should vary with the types of pollutants according to the damage caused (external effects). All six countries in this study have introduced both types of economic instrument, but only three have full-cost user fees for wastewater treatment. There is a legal requirement for full-cost pricing only in the most-established of the Member States: France (since 1959), the Netherlands (since 1971) and Denmark (since 1992). Subsidies, mainly from the EU, continue to play a substantial role in Poland, Spain and Estonia. EU Structural and Cohesion Funds required the integration of the environmental dimension, including environmental appraisal for large projects, but have not systematically required the polluterpays principle to be implemented when calculating the investments eligible for EU support. The focus has been on identifying large projects eligible for support. Social concerns are given as a reason for providing support, yet no distinction is made between support to households and to industry. Distributional issues are best mitigated by providing a direct support to those individuals who suffer from inequity, rather than by across-the-board subsidies. There are distributional concerns which seem to preclude full-cost water pricing in certain Member States. The EU offers subsidies for exactly this reason. However, the subsidies are provided to local authorities and not directly to the most needy citizens (Zylicz, 2003). Barcelona, for example, has obtained an 85 % EU grant for its newly-opened sewage treatment plant, so that all citizens and industries in this area will benefit not only from cleaner waters in the future, but also from greatly reduced user fees for wastewater discharges. EU support will continue and increase for less developed Member States if the Commission's proposal for the Cohesion policy activities in the period 2007–2013 is adopted, but Spain has now become too relatively prosperous to benefit to the same extent. 41 Comparative analysis 9.4 Cost-effectiveness Assessing the effectiveness of the implementation of wastewater pollution control policies requires examination of the appropriateness of the investments made. In the absence of a clearcut economic valuation of clean water improvements, a cost-effectiveness analysis is carried out at a more general level as a benchmarking of costs and policy outputs. The question is basically whether the improved sewage treatment capacity has been established in the most cost-effective way. Improving the quality and reducing the quantity of wastewater discharge at source is normally preferable to constructing sewage treatment plants. Most engineering textbooks mention this, but often fail to go beyond wastewater treatment plant design. A sewage plant is an end-of-pipe solution, and more tailor-made and ecoefficient solutions within the domain of manufacturing can often help to improve both environmental and economic performance. A significant implication of this is that successful eco-efficient approaches in industry will also help to reduce capacity requirements at wastewater treatment plants which, in turn, will reduce the investments required. Levies and user fees for wastewater discharges therefore have both a financing and an incentive function. The price signal from user fees will encourage dischargers to look for more cost-effective solutions. Where more efficient reductions can be identified, the need for end-of-pipe treatment will be reduced. From the point of view of the competent authorities, the challenge is to predict the need for capacity accurately, in the light of the possibilities for in-plant measures in industry. Appropriate use and introduction of economic incentives at an early stage can be helpful in this respect. According to economic theory, environmental taxes on emissions will provide incentives to reduce emissions and install cleaner technologies. Figure 14 provides an overview of wastewater taxes for the final discharges to surface waters, either from industry or from sewage treatment plants. These are not the user fee charges for sewage, but the actual externality payment — the price for direct emissions to surface waters. The tax is important for providing an economic incentive to control discharges and hence to comply with regulations such as UWWTD, but taxes differ considerably in design and rates among the six Member States. The data in Figure 14 relates to BOD only, but except Spain all Member States have tax rates also for N- and P-discharges (simple organic pollution). Comparisons are difficult because there are many exemptions and special conditions. The highest rate of taxes are found in Poland, the Netherlands and Denmark. Rates are significantly lower in France, Estonia and Spain. The rates of the taxes depend on historical circumstances and developments, as indicated in the country chapters of this report. In the case of Spain the rate of the water pollution control tax is well below that in the other western European countries, as becomes clear when the tax-base of Spanish pollution units is converted into inhabitant equivalents for BOD (Figure 14). Most countries apply the tax revenues to measures to control water pollution. The exception is Denmark, where the revenue from the wastewater tax has been used to lower income taxes as part of an environmental tax reform. An understanding of the significance of appropriate economic incentives can be gained by comparing experience in Denmark, France and the Netherlands. The following cost-effectiveness analysis is limited to these three Member States, as the data for Spain, Poland and Estonia do not allow the same level of detail. Figure 15 provides time-series for gross industrial wastewater discharges comprising both direct discharges and discharges to public sewers. Gross industrial discharges are considered here, because their decline would reflect the extent to which pre-treatment or ecoefficiency measures have been introduced in industry as an alternative to passive end- of-pipe treatment. The decrease in gross industrial BOD- discharges has been most marked in the Netherlands and compares favourably with developments in France and Denmark. The relatively late Danish reduction af industrial discharges is related to the role of comprehensive planning requirements and the absence of economic incentives until the late 1980s (see Andersen, 1994). Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study48 Andersen, M.S., 1994, Governance by green taxes: making pollution prevention pay, Manchester University Press. Andersen, M.S., 1999, Governance by green taxes: implementing clean water policies in Europe 1970–1990, Environmental Economics and Policy Studies, 2: 39–63, Tokyo. Andrews, K., 2001, Study on the impact of community environment–water policies on economic and social cohesion, Bucks: WRc. 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Danmarks Statistik, 2004, Udgifter på vandforsynings, spildevands- og affaldsområdet 2003, Miljø og Energi 2004:12, København. References Miljøstyrelsen, 1999, Punktkilder 1998, København. OECD, 1999, Environmental performance reviews: Denmark, Paris. France: Barraqué, B., Berland, J-M., Cambon, S., 1997, Frankreich, in F.N. Correia and R.A. Kraemer, eds., Eurowater: Institutionen der Wasserwirtschaft in Europa: Länderberichte, Berlin. Springer. Buller, H., 2004, France, in A. Jordan and D. Liefferink, Environment Policy in Europe, Routledge. IFEN (Institut Francais de l'Environnement), 1999, 2002. L'environnement en France, Orleans. IFEN (Institut Francais de l'Environnement), 2002, Les évolutions récentes de lássainissement, Les données de l'environnement numéro 76, Orleans. INSEE (L'Institut National de la Statistique et des Études Économiques), 1974–2003, Annuaire Statistique de la France, Paris. Jordan, A., N. Ward and H. Buller, 1998, Surf, sea, sand... and sewage: implementing European bathing water policy in the UK and France, Environment and Planning A, 30:1389–1408. OECD, 1996, Environmental performance reviews: France, Paris. SESSI (Service des ëtudes et des statistiques industrielles), 1992–2001, Les investissement pour protéger l'environnement, Paris. The Netherlands: Bressers, H., 1983, Beleidseffektiviteit en waterkwaliteitsbeleid; Een bestuurskundig onderzoek, Enschede: T.H. Twente. Bressers, H, 1988, A comparison of the effectiveness of incentives and directives: The case of the Dutch Water Quality Policy, Policy Studies Review, 7:3, 500–518. 49 References Bressers, H. and K. Lulofs, C., 2005, Fees in Dutch Water Quality Management: How Effective Are They in Reducing Pollution?, in: W.Harrington and D. Morgenstern, RFF- press, Wash.: Resources for the Future. CBS (Central Bureau of Statistics), 1996 and 1999, Waterkwaliteitsbeheer deel A, Lozing van afvalwater 1993; 1995–96, Hague. CBS (Central Bureau of Statistics), 1998 and 2000, Waterkwaliteitsbeheer deel B, Zuivering van afvalwater 1996; 1997 Hague. CBS (Central Bureau of Statistics), Statistical Yearbook of the Netherlands. Directoraat-Generaal Rijkswaterstaat, 1995, Wastewater charge schemes in the European Union, part 1 and 2, Lelystad: RIZA. MTPW (Ministry of Transport and Public Works), 1975, The combat against surface water pollution in the Netherlands: Prospective multi-annual programme 1975–79, The Hague: SDU. OECD, 2003, Environmental performance reviews: Netherlands, Paris. Schuurman, J., 1988, De Prijs van Water, Arnhem: Gouda Quint BV. Spain: INE (Instituto Nacional de Estadistica), 2004, Encuesta del gasto de las empresas en proteccion ambiental, Notas de prensa, 9.8.2004. Luaces, P., 2002, Circumventing adaptation pressure? Implementing EU environmental policies in Spain. The cases of Habitat and Urban Waste Water Directives, South European Society and Politics, Vol 7, no 3. Maestu, J., 1996, Comparing water prices in Spain, final report, Madrid: ECOTEC. Ministerio de Medio Ambiente (2005) Website: http://www.mma.es OECD, 1996, Environmental performance reviews: Spain, Paris. OECD, 2004, Environmental performance reviews: Spain, Paris. Pedersen, Sif, 2000, Det forståelige Miljøunderskud: Spansk miljøregulering set i et økonomisk, politisk og kulturelt perspektiv, Hovedfagsspeciale, Aarhus Universitet: Romansk Institut. Estonia: Estonian Ministry of the Environment, 1997, Estonian Environmental Protection System, Talinn. Estonian Environment Information Centre, 1997, Estonian National Environmental Strategy, Talinn. Kaasik, T., et. al., 1992, National report of Estonia to UNCED 1992, Talinn. Kallaste, T., 1994, Taxation and Environment in Estonia, pp. 57–70 in OECD, Taxation and the Environment in European economies in transition, Centre for cooperation with economies in transition, GD(94)42, Paris. National Board of Waters and the Environment, 1991, Estonian Environment 1991, Helsinki. UNECE, 1996, Environmental performance reviews: Estonia, Geneva. UNECE, 2001, Second environmental performance review of Estonia, Geneva. Pachel, K., 2002, Estonian National Report on nutrient loads pp. 90–102 in Lääne, A., et. al., Evaluation of the implementation of the 1988 Ministerial Declaration regarding nutrient load reductions in the Baltic Sea catchment area, The Finnish Environment 524, Helsinki: Finnish Environment Institute. Udenrigsministeriet, 1997, Miljøsektoren i Estland, Kbh: Sekretariatet for Udenrigshandel. Poland: Jarosinski, W., 2002, Polish National Report on nutrient loads pp. 153–168 in Lääne, A., et. al., Evaluation of the implementation of the 1988 Ministerial Declaration regarding nutrient load reductions in the Baltic Sea catchment area, The Finnish Environment 524, Helsinki: Finnish Environment Institute. Milaszewski, R., 1994, Water protection policy in Poland, pp. 46–74 in Marianne Löwgren and Ronnie Hjorth, eds., Environmental policies in Poland, Sweden and the Netherlands, Tema V Effectiveness of urban wastewater treatment policies in selected countries: an EEA pilot study50 Report 19, Linköping: Dept. of Water and Environmental Studies. Ministry of Environmental Protection, Natural Resouces and Forestry, 1995, National Environmental Action Programme, Warsaw. Nowicki, M., 1997, Poland, pp. xx in J. Klarer and B. Moldan, The environmental challenge for central and eastern Europe, John Wiley. OECD, 1995, Environmental performance reviews: Poland, Paris. OECD, 2003, Environmental performance reviews: Poland, Paris. Sleszynski, J., Economic instruments in Polish environmental policy, pp. 30–68 in John Clark and Daniel H. Cole, eds., Environmental Protection in Transition: Economic, legal and socio-political perspectives on Poland, Aldershot: Ashgate. Sleszynski, J., 1998, Environmental protection and capacity building in Poland, 25–44 in Andersen M.S. and Dyhr, V., Environmental policy and the role of foreign assistance in Central and Eastern Europe, Copenhagen: KPMG. Sleszynski, J., 1998, Environmental expenditure in Poland, case study report, COWI, Copenhagen: EAP Task Force. Zylicz, T., 1994, Taxation and environment in Poland, pp. 36–56 in OECD, Taxation and the environment in European economies in transition, centre for cooperation with economies in transition, GD(94)42, Paris. Zylicz, T., 2003, interview. 51 Annex During the review and consultation process for this report, a number of suggestions for further work related to the effectiveness of urban waste water treatment policies were made by experts in the field. Although undertaking such analysis was not possible within the scope of this project with a fixed budget, the EEA found that the suggestions provided potentially useful projects that researchers and organisations may wish to consider if they seek to contribute to the insights on effectiveness of urban waste water treatment policies. Suggestions include the following: • Undertake detailed analyses of emissions related to urban waste water and of changes in water quality in rivers, lakes, groundwater, inland waters etc. using a large number of water pressure and water quality indicators. • Mapping changes in the driving forces (agriculture, urban settlements etc) in a certain area (stratum) with where the pollution is impacting (measured at monitoring places) by using the classical stratification statistical technique. This technique can categorise a country or a region (for example Europe) into certain strata such as very urban (high population density, without significant agricultural activities), urban (dominated by urban population, without significant agricultural activities), mixed (urban and agricultural) and rural (mainly with agricultural activities) and link to where Annex Some options for further work related to the effectiveness of urban wastewater treatment policies the water pollution occurs. This has already been done for France in a pilot study. • Looking at large scale sea water desalination and brine from desalination and how this can affect water ecosystems. • Analyse the effects of shared or perhaps unclear division of responsibilities for urban waste water treatment policies between the various levels of public authorities at national, regional and local level. • Analyse possible counterproductive economic, social and environmental effects of EU subsidies and to which extent such subsidies possibly hinders national investments. • Analyse competitiveness effects of waste water prevention measures. For example, a factory may reduce pollution by reducing its level of activity and employment. On the other hand, shifting part of the tax burden from labour to for example water pollution would be good for both the environment and for employment (the double dividend). • Analyse distributional and equity effects of waste water measures. For example water pricing is often difficult to implement because it affects the poorer parts of the population relatively more, unless compensation is made.