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Scottish Power General Ltd, Re For Judicial Review [2005] ScotCS CSOH_67 (24 May 2005)

OUTER HOUSE, COURT OF SESSION

[2005] CSOH 67

P1876/03

OPINION (NO.2) OF LORD REED

in petition of

SCOTTISH POWER GENERATION LIMITED

Petitioners;

for

Judicial Review of a decision by SCOTTISH ENVIRONMENT PROTECTION AGENCY

First Respondents:

________________

Petitioners: Dean of Faculty (Martin, Q.C.), Mure; Biggart Baillie

First Respondents: Currie, Q.C., Howlin; Tods Murray, W.S.

Second Respondent: (Scottish Water): A. W. D. McLean; Dundas & Wilson, C.S.

24 May 2005

INTRODUCTION
[1] The factual background to this case, and the relevant legal provisions, are set out fully in my Opinion dated 22 December 2004. Following the issue of that Opinion, and as envisaged in paragraph 144 of the Opinion, Scottish Power sought a further hearing in order to present arguments relating to the interpretation and application of the relevant domestic legislation. That hearing has now taken place. It was conducted on the basis that the waste-derived fuel ("WDF") burned at Longannet Power Station ("Longannet") was "waste" as defined by Article 1(a) of Directive 75/442/EEC (as amended), and that Longannet was a "co-incineration plant" as defined by Article 3(5) of Directive 2000/76/EC, as I held in my earlier Opinion, although Scottish Power reserved their position as to whether to reclaim against my decision after the petition had been determined.

THE SUBMISSIONS

1. THE SUBMISSIONS FOR SCOTTISH POWER
[2] On behalf of Scottish Power, it was submitted that, notwithstanding my decision that the WDF was waste, Longannet was not an existing waste incineration installation as defined in regulation 2 of the Waste Incineration (Scotland) Regulations 2003 (SSI 2003 No. 170). Longannet therefore did not fall within the ambit of regulation 3(2) of the 2003 Regulations. The variation notice at issue, which proceeded on the basis that regulation 3(2) applied to Longannet, was therefore based on an error of law and was ultra vires and should be reduced.

[3] The starting point was the authorisation, under the Environmental Protection Act 1990 and the Environmental Protection (Prescribed Processes and Substances) Regulations 1991 (SI 1991 No. 472), as amended, under which Longannet was operated. That authorisation was for the combustion of fuel, not for the incineration of waste. The variation notice dated 1 February 2001, which amended the description of the authorised process, stated:

"This notice refers to the authorisation granted to the Authorisation Holder under section 6 of the Act in respect of a combustion process (hereinafter called "the authorised process") carried on by the Authorisation Holder at Longannet Power Station ... particulars of which are contained in the Certificate of Authorisation ... dated 30 April 1993".

Schedule 1 to the variation notice described the authorised process. That description began:

"The combustion process at Longannet Power Station, Kincardine on Forth, is used to supply steam for the generation of electricity. It comprises 4 coal fired boilers producing steam at 169 bar. Each boiler has a maximum net rated thermal input of 1600 MW and can generate 600 MW electric in two 300 MW generators. The total station generating capacity is 2400 MW electric with a net thermal input of 6400 MW. The process is therefore a prescribed process as it fits the description in section 1.3, paragraph (a), of the 1991 Regulations. Heavy fuel oil or Natural Gas is used at start up and may be used as a support fuel. Two boilers are provided with facilities to co-burn waste derived fuel (WDF) made from dried sewage sludge with coal at a maximum rate of 15% WDF by weight"

(emphasis added). Section 1.3, paragraph (a), of Schedule 1 to the 1991 Regulations described a combustion process:

"Burning any fuel in a combustion appliance with a net rated thermal input of 50 megawatts or more".

A different Section, namely Section 5.1, was concerned with the incineration of waste.

[4] The description of the authorised process at Longannet was consistent with the permit under which the sludge treatment centre at Daldowie was operated. That permit, issued on 15 January 2003 under the Pollution Prevention and Control Act 1999 and the Pollution Prevention and Control (Scotland) Regulations 2000 (SSI 2000 No. 323), as amended, described the permitted activity carried out at the sludge treatment centre as:

"the manufacture of dried sewage sludge granules for use as a fuel which is described in Part A of Section 5.5 of Schedule 1 of the Regulations as making solid fuel from waste by any process involving the use of heat other than making charcoal".

[5] The 2000 Regulations gave effect to the 1999 Act. Under regulation 6, no person was permitted to operate an installation after "the prescribed date" without a permit. The prescribed date was to be determined in accordance with Schedule 3. In relation to existing Part A installations, such as Longannet, Schedule 3 specified a "relevant period". Under paragraph 2(1), where an application for a permit was made before or during the relevant period, the prescribed date was the date when the application was determined; where no such application was made, the prescribed date was the day after the date on which the relevant period expired. Paragraph 2(2) provided that the relevant period for an existing Part A installation was the period specified for that description of installation in the tables which followed. In relation to Longannet, the relevant table was Table 1, which contained two columns. The left hand column was headed:

"Any installations where an activity falling within the following Sections of Part 1 of Schedule 1 is carried out ..."

The right hand column, headed "Relevant Period", specified the periods applicable to the Sections in Schedule 1 to the 2000 Regulations which were listed in the left hand column. In the case of Section 1.1 Part A, the relevant period ended on 31 March 2006. In the case of Section 5.1 Part A paragraph (e), the relevant period ended on 31 March 2005.

[6] In Schedule 1 to the 2000 Regulations, Section 1.1 Part A included:

"(a) Burning any fuel in a combustion appliance with a net rated thermal

input of 50 megawatts or more".

That was the activity carried out at Longannet, as the authorisation made clear. The expression "fuel" was unqualified, and could in principle include any substance which was burned, including waste. Paragraph (b) of Section 1.1 Part A made it clear that fuels which were waste, or were derived from waste, were fuels within the meaning of that Section. The only other Section which required to be considered was Section 5.1 Part A, which included:

"(e) Unless carried out as part of any other Part A activity, the incineration

of non-hazardous waste in a co-incineration plant".

Even on the hypothesis that Longannet was a co-incineration plant where non-hazardous waste was incinerated, that activity was carried out as part of the activity described in paragraph (a) of Section 1.1 Part A. The proviso to Section 5.1 Part A paragraph (e) was accordingly applicable. It followed that no activities listed in Section 5.1 Part A were carried out at Longannet. The relevant period, determined in accordance with Schedule 3, therefore ended on 31 March 2006.

[7] The variation notice under challenge had been issued on the basis that Longannet fell within the ambit of regulation 3(2) of the 2003 Regulations. That provision applied:

"... where an existing waste incineration installation ... (other than one mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations) is on 31 December 2004 subject to an authorisation".

Where the provision applied, the operator was required on or before 31 March 2005 to apply for a variation of the conditions of the authorisation.

[8] The expression "existing waste incineration installation" was defined by regulation 2(1) of the 2003 Regulations as meaning, in the case of a co-incineration plant, one which was in operation before 28 December 2002 following the grant of a relevant approval. The expression "relevant approval" was defined by regulation 2(1) as meaning, inter alia, an authorisation; and "authorisation" was in turn defined as meaning an authorisation granted under section 6 of the 1990 Act. In the context of the definition of "existing waste incineration installation", the expression "relevant approval" could only be taken to mean "relevant approval as a waste incineration installation". An installation was only approved as a waste incineration installation if it had an authorisation for the incineration of waste under Section 5.1 of Schedule 1 to the 1991 Regulations, or a permit for the incineration or co-incineration of waste under Section 5.1 of Schedule 1 to the 2000 Regulations. Longannet did not have a relevant approval, since it did not have an authorisation as a waste incineration installation: its authorisation was in respect of a combustion process. Since the activities carried out at Longannet fell within Section 1.1 of Part 1 of Schedule 1 to the 2000 Regulations, no application for a permit was required until 31 March 2006, and Longannet could continue to operate until then on the basis of its existing authorisation.

[9] In these circumstances, the court should grant decree of declarator that Longannet was not an existing waste incineration installation, and should reduce the variation notice under challenge.

[10] These submissions were adopted on behalf of Scottish Water.

2. THE SUBMISSIONS FOR SEPA
[11] On behalf of SEPA, counsel submitted that the 2003 Regulations were intended to implement Directive 2000/76/EC on the incineration of waste. That Directive applied to existing co-incineration plants as from 28 December 2005. The purpose of regulation 3 was to ensure that all such installations were compliant with the requirements of the directive by 28 December 2005, by requiring their operators to apply for variations of the conditions of their permit or authorisation on or before 31 March 2005. If applications were made by that date, they could then be processed by SEPA in time for the variation to take effect by 28 December 2005. The court had already found that Longannet was a co-incineration plant within the meaning of the directive. It was therefore consistent with the intention of the 2003 Regulations that the operator of Longannet should be required by regulation 3(2) to apply for a variation of the existing authorisation on or before 31 March 2005.

[12] Regulation 3(2) applied:

"... where an existing waste incineration installation ... (other than one mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations), is on 31 December 2004 subject to an authorisation".

The expression "existing waste incineration installation" was built up by successive accretions, from "installation" to "waste incineration installation" and thence to "existing waste incineration installation".

[13] It was common ground that Longannet was an "installation", as defined by regulation 2(1) of the 2000 Regulations; and the 2003 Regulations provided, by regulation 2(2):

"In these Regulations, any word or expression used which is defined in the 2000 Regulations shall have the same meaning as it has in those Regulations".

In particular, the term "installation" was defined as including:

"a stationary technical unit where one or more activities listed in Part 1 of Schedule 1 are carried out".

Part 1 of Schedule 1 to the 2000 Regulations listed in Section 1.1 Part A, among other activities:

"Burning any fuel in a combustion appliance with a net thermal input of 50 megawatts or more".

That was what happened at Longannet.

[14] The expression "waste incineration installation" was not directly defined in the 2003 Regulations. Instead, regulation 6(a) amended the interpretation provisions of the 2000 Regulations by inserting into regulation 2 of those regulations the following:

"'waste incineration installation' means that part of an installation ... which includes any of the following activities:-

(a) The incineration or co-incineration of waste in an incineration or co-

incineration plant falling within paragraphs (a), (b), (c), (d) or (e) of Part A of Section 5.1 of Part 1 of Schedule 1; or

(b) any activity falling within any Section of that Part of that Schedule

which is carried out in a co-incineration plant as defined in Section 5.1 of that Part of that Schedule."

For present purposes, the operative part of that definition was part (b). The installation at Longannet included an activity falling within Section 1.1 of Part 1 of Schedule 1, namely:

"[b]urning any fuel in a combustion appliance with a net thermal input of 50 megawatts or more".

That activity was carried out in a co-incineration plant as defined in Section 5.1 of Part 1 of Schedule 1. Section 5.1 (as inserted by regulation 9 of the 2003 Regulations) provided:

"'co-incineration plant' means any stationary or mobile plant whose main purpose is the generation of energy or production of material products and -

- which uses wastes as a regular or additional fuel".

That definition applied to Longannet. Its main purpose was the generation of energy, and it used waste as an additional fuel.

[15] The expression "existing waste incineration installation" was defined in regulation 2 of the 2003 Regulations as including:

"a co-incineration plant ... which -

(i) is in operation before 28 December 2002 following the grant of a

relevant approval".

The expression "relevant approval" was defined so as to include an authorisation granted under section 6 of the 1990 Act. Longannet was in operation as a co-incineration plant before 28 December 2002 following the grant of such an authorisation. The fact that the authorised process was described as a combustion process was not inconsistent with Longannet being a co-incineration plant and a waste incineration installation, having regard to the rules as to the interpretation of Schedule 1 to the 1991 Regulations contained in Schedule 2 to those regulations, notably the rules set out in paragraphs 4 and 8. Paragraph 8, in particular, implied that the authorisation of a combustion process also authorised the use of waste in the course of the process of combustion.

[16] Returning to regulation 3(2) of the 2003 Regulations, Longannet was, for the foregoing reasons, an existing waste incineration installation. It was not one which was mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations. It plainly fell outside the scope of paragraphs (a), (b), (c), (d), (f) and (g) of Section 5.1. Paragraph (e) was also excluded, since Longannet fell within the opening proviso:

"Unless carried out as part of any other Part A activity, the incineration of non-hazardous waste in a co-incineration plant".

Such incineration was carried out at Longannet as part of an activity falling within Section 1.1. Part A, namely burning any fuel in a combustion appliance with a net rated thermal input of 50 megawatts or more. Longannet was subject to an authorisation on 31 December 2004. Regulation 3(2) therefore applied to Longannet.

[17] In these circumstances, the court was invited to refuse the petition.

DISCUSSION
[18] It may be helpful to begin by recalling the principal features of the legislative framework under domestic law, which was discussed more fully in my previous Opinion. The 1990 Act introduced a regime under which the carrying on of certain processes required an authorisation. The processes in question were to be prescribed by subordinate legislation. That subordinate legislation would therefore require to list a series of descriptions of processes for which authorisation was required. The foregoing elements of the regime established by the 1990 Act were reflected in the terms of section 2(1):

"2. - (1) The Secretary of State may, by regulations, prescribe any description of process as a process for the carrying on of which after a prescribed date an authorisation is required under section 6 below."

[19] Section 6(1) provides:

"6. - (1) No person shall carry on a prescribed process after the date prescribed as determined for that description of process by or under regulations under section 2(1) above ... except under an authorisation granted by the enforcing authority and in accordance with the conditions to which it is subject."

The 1991 Regulations were made under section 2 of the 1990 Act, and reflect the terms of that section. In particular, regulation 3 provides:

"3. - (1) Subject to the following provisions of these Regulations, the descriptions of processes set out in Schedule 1 hereto are hereby prescribed pursuant to section 2(1) of the [1990] Act as processes for the carrying on of which after the prescribed date an authorisation is required under section 6.

(2) Schedule 2 has effect for the interpretation of Schedule 1."

[20] Schedule 1 is divided into chapters. Chapter 1 is headed "Fuel Production Processes, Combustion Processes (including Power Generation)". The descriptions of processes in Chapter 1 include the following:

"Section 1.3 Combustion Processes

PART A

(a) Burning any fuel in a combustion appliance with a net rated thermal

input of 50 megawatts or more".

The words "any fuel" are unqualified, and prima facie are completely general in scope. It is also to be noted that paragraph (c) of Section 1.3 Part A describes the burning in less powerful appliances of "any fuel manufactured from, or comprising, any ... waste", implying that a fuel, within the meaning of the regulations, may comprise waste. At first sight, therefore, the burning of waste, as a fuel, in appliances such as those at Longannet would appear to fall within the description set out in Section 1.3 Part A. Schedule 1 however also includes Chapter 5, which is headed "Waste Disposal and Recycling". Chapter 5 includes the following:

"Section 5.1 Incineration

PART A

...

there is plant designed to incinerate such waste at a rate of one tonne or more per hour".

It is at first sight arguable that, in so far as Longannet co-burns WDF, it is used to destroy waste by burning it, and might therefore be regarded as premises where the process described in Section 5.1 Part A is carried on.

[21] The 1991 Regulations themselves recognise that the descriptions contained in Schedule 1 are not watertight compartments into one, and only one, of which the activity carried on at any particular location may readily be placed. Schedule 2 addresses that issue by providing a number of rules for the interpretation of Schedule 1. In particular, paragraph 2(1) provides:

"2.- (1) Any description of a process includes any other process carried on at the same location by the same person as part of that process; but this rule does not apply in relation to any two or more processes described in different Sections of Schedule 1 which, accordingly, require distinct authorisation."

Paragraph 4 provides:

"4. Where a process falls within two or more descriptions in Schedule 1, that process shall be regarded as falling only within that description which fits it most aptly ..."

Paragraph 8 provides:

"8. Where in the course of, or as a process ancillary to, any prescribed process the person carrying on that process uses, treats or disposes of waste at the same location (whether as fuel or otherwise), the use, treatment or disposal of that waste shall, notwithstanding the rule set out in paragraph 2, be regarded as falling within the description of that process, whether the waste was produced by the person carrying on the process or acquired by him for such use, treatment or disposal."

[22] On the facts of the present case, it appears to me that Scottish Power carry on at Longannet a combustion process, for the purpose of power generation, falling within the description in Section 1.3 Part A, and use waste in the course of that process. As explained in my previous Opinion, the WDF is produced to a specification designed to ensure that it is technically and economically viable as a co-fuel to be burned with coal in order to generate electricity. At Longannet, it is mixed with coal. The mixture is then ground to produce a composite fuel which is burned to generate electricity. The relative proportions of coal and WDF in the mixture are regulated so as to achieve the optimum mixture having regard to the requirements of the station and the output of electricity required from time to time. In these circumstances, it appears to me that the activity carried on at Longannet is most aptly regarded as a single process, falling within the description in Section 1.3 Part A, in the course of which waste is used. The rule set out in paragraph 8 is therefore applicable. It follows that, notwithstanding the rule set out in paragraph 2, the use of the waste is to be regarded as falling within the description in Section 1.3 Part A. Indeed, even in the absence of paragraph 8, I would reach the same conclusion on the basis of paragraph 4: if the process carried out at Longannet were to be regarded as falling within the description in Section 5.1 Part A as well as that in Section 1.3 Part A, the latter description would appear to me to fit the process more aptly, given the factual circumstances which I have already summarised, and bearing in mind also the limited amount of WDF burned (normally around 10 per cent of the fuel burned in one of the four boilers). The same conclusion might well follow even if, contrary to my view, the use of the waste at Longannet were regarded as a distinct process, rather than as something carried out in the course of the process described in Section 1.3 Part A. On that view (which, for the reasons which I have explained, does not appear to me to be apt), the use of the waste could only be regarded as subordinate or subservient to the process described in Section 1.3 Part A, and therefore, in that sense, as ancillary to the latter process. On that basis, the rule set out in paragraph 8 would again apply, requiring the use of the waste to be regarded as falling within the description in Section 1.3 Part A.

[23] It follows from the foregoing that the authorisation of a process described in Section 1.3 Part A does not exclude the possibility that waste is used - and, in particular, is used as a fuel, by incinerating it - in the course of that process (or in a process which is ancillary to the former process). In particular, the terms of the authorisation issued in respect of Longannet do not exclude that possibility. On the contrary, the terms of the authorisation, as varied by the notice issued on 11 December 1998, and as subsequently varied by the notice issued on 1 February 2001, appear to me to have been apt: the description of the process referred (impliedly, in the case of the former notice, and expressly, in the case of the latter notice) to Section 1.3 Part A, but also made it clear that there were facilities to co-burn WDF with coal; and conditions were inserted to protect the environment from the potential consequences of such co-burning.

[24] The 1999 Act, and the 2000 Regulations made under that Act, introduced a regime of permits which is intended, over time, to replace the previous regime of authorisations under the 1990 Act. The 2000 Regulations apply to "installations" and to mobile plant: in the present context, it is only the former which are relevant. The expression "installation" is defined by regulation 2 as including:

"a stationary technical unit where one or more of the activities listed in Part 1 of Schedule 1 are carried out".

Chapter 1 of Schedule 1 is headed "Energy Industries". The activities listed in Chapter 1 include the following:

"Section 1.1: Combustion

PART A

(a) Burning any fuel in a combustion appliance with a net rated thermal

input of 50 megawatts or more".

That activity is carried out at Longannet. The words "any fuel" are again unqualified. It is implicit from paragraph (b), which concerns the burning of specified types of fuel in less powerful appliances, that the term "fuel" includes waste, since "waste oil" is one of the specified types of fuel (another being "any fuel manufactured from any other waste"). Chapter 5 of Schedule 1 is headed "Waste Management". Section 5.1, as inserted by regulation 9 of the 2003 Regulations in substitution for the original Section 5.1, lists a number of activities, including the following:

"Section 5.1: Incineration and co-incineration of waste

PART A

...

(e) Unless carried out as part of any other Part A activity, the incineration of non-hazardous waste in a co-incineration plant".

It is common ground that none of the other activities listed in Section 5.1 is relevant. It is also common ground that, on the hypothesis that the use of WDF at Longannet can properly be described as the incineration of non -hazardous waste in a co-incineration plant, that activity does not fall within paragraph (e) of Section 5.1, since it is carried out as part of another Part A activity, namely the activity listed in paragraph (a) of Section 1.1.

[25] Regulation 6 of the 2000 Regulations (as amended) provides:

"(1) No person shall operate an installation or mobile plant after the

prescribed date for that installation or mobile plant, except under and

to the extent authorised by a permit granted by SEPA.

(2) In paragraph (1) the 'prescribed date' means in respect of any

installation or mobile plant -

(a) referred to in Table 1 in paragraph 2 of Part 1 of Schedule 3, the date set out or determined in accordance with paragraphs 1 and 2 of Part 1 of Schedule 3".

Longannet is an installation referred to in Table 1, since that table refers to

"[a]ny installation where an activity falling within the following Sections of Part 1 of Schedule 1 is carried out",

and one of the Sections listed in the table is Section 1.1 Part A. The prescribed date is therefore to be determined in accordance with paragraphs 1 and 2 of Part 1 of Schedule 3. Paragraph 1 applies to new Part A installations, and paragraph 2 to existing Part A installations. It is common ground that it is paragraph 2 that is relevant: Longannet is a Part A installation, as defined in paragraph 15 of Schedule 1 to the 2000 Regulations, and it is an "existing" Part A installation, as defined in paragraph 6 of Schedule 3. The effect of paragraph 2 is that a "relevant period" is specified. Where an application for a permit is made (under regulation 7 of the 2000 Regulations) before or during the relevant period, the prescribed date is the date when the application is determined. Where no such application is made, the prescribed date is the day after the date on which the relevant period expires. In relation to an installation where an activity falling within Section 1.1 Part A is carried out, the relevant period is from 1 January to 31 March 2006. It was not suggested by any party to the present proceedings that any other relevant period might be relevant to Longannet, and I therefore proceed on the basis that the prescribed date for Longannet will be 1 April 2006, unless an application for a permit is made prior to that date. As from the prescribed date, Longannet cannot lawfully be operated without a permit under the 2000 Regulations, and it will no longer fall within the scope of the 1991 Regulations (by reason of an amendment to those regulations effected by paragraph 8 of Schedule 10 to the 2000 Regulations).

[26] Until the prescribed date, Longannet can continue to operate lawfully on the basis of an authorisation under the 1990 Act and the 1991 Regulations. It is however important to note that that does not entail that Longannet can continue to operate on the basis of the conditions currently contained in its authorisation. Section 7 of the 1990 Act provides:

"7. - (1) There shall be included in an authorisation -

(a) subject to paragraph (b) below, such specific conditions as the enforcing authority considers appropriate ... for achieving the objectives specified in subsection (2) below;

(b) such conditions as are specified in directions given by the Secretary of State under subsection (3) below; and

(2) Those objectives are -

...

(b) compliance with any directions by the Secretary of State given for the implementation of any obligations of the United Kingdom under the Community Treaties or international law relating to environmental protection;

(3) ... the Secretary of State may give directions to the enforcing authorities as to the conditions which are, or are not, to be included in all authorisations, in authorisations of any specified description or in any particular authorisation."

Section 10 provides:

"10. - (1) The enforcing authority may at any time, subject to the requirements of section 7 above ... vary an authorisation and shall do so if it appears to the authority at that time that that section requires conditions to be included which are different from the subsisting conditions.

(2) Where the enforcing authority has decided to vary an authorisation under subsection (1) above the authority shall notify the holder of the authorisation and serve a variation notice on him."

[27] The Waste Incineration Directive (Scotland) Direction 2003 was given to SEPA by the Scottish Ministers in exercise of the powers conferred on them by, inter alia, section 7(1) and (2)(b) of the 1990 Act. The Direction provides:

"SEPA shall, on or before 31^st December 2004, include as a condition in the authorisation (other than an authorisation of an activity mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations) or, as the case may be, the permit of any existing waste incineration installation or mobile plant a requirement that the operator of such an installation or mobile plant make an application in respect of that installation or plant under regulation 3 of the 2003 Regulations."

It was in implementation of that direction that SEPA issued the variation notice under challenge in the present proceedings, as was explained in the covering letter. The notice stated that it had been issued under section 10(2) of the 1990 Act. It added the following condition to the authorisation:

"10.7 By 31 March 2005, the Authorisation Holder shall make an application under Regulation 3(2) of the Waste Incineration (Scotland) Regulations 2003."

The date specified in the notice is also the date specified in regulation 3(2) of the 2003 Regulations. The fact that that date (31 March 2005) is earlier than the latest date at which Longannet can continue to operate on the basis of an authorisation under the 1991 Regulations, without applying for a permit under the 2000 Regulations (i.e. 31 March 2006), does not give rise to any anomaly: on the contrary, as explained below, it is only to be expected.

[28] The important issue, therefore, is whether Longannet is an installation to which regulation 3(2) of the 2003 Regulations applies. Regulation 3, so far as material, provides:

"3.- (1) ... where an existing waste incineration installation or mobile plant is on 31^st December 2004 subject to a permit, the operator shall during the period beginning with 1^st January 2005 and ending with 31^st March 2005 make an application under regulation 13 of the 2000 Regulations for a variation of the conditions of that permit.

(2) ... where an existing waste incineration installation or mobile plant (other than one mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations), is on 31^st December 2004 subject to an authorisation, the operator shall during the period beginning with 1^st January 2005 and ending with 31^st March 2005 make an application in one of the following forms:-

(a) an application for variation of the conditions of an authorisation under section 11 of the 1990 Act; or

(b) an application for a permit under regulation 7 of the 2000 Regulations."

Both paragraphs of the regulation are thus concerned with "existing waste incineration installations": paragraph 1 applies to those which were on 31 December 2004 subject to a permit (under the 2000 Regulations), and paragraph 2 applies (subject to the proviso in parentheses) to those which were on 31 December 2004 subject to an authorisation (under the 1990 Act).

[29] The purpose of regulation 3 of the 2003 Regulations is to ensure that existing installations which fall within the scope of Directive 2000/76 comply with the requirements of that directive by 28 December 2005, in accordance with Article 20 of the directive:

"Article 20

Transitional Provisions

1. Without prejudice to the specific transitional provisions provided for in the Annexes to this Directive, the provisions of this Directive shall apply to existing plants as from 28 December 2005.

2. For new plants, i.e. plants not falling under the definition of 'existing incineration or co-incineration plant' in Article 3(6) or paragraph 3 of this Article, this Directive, instead of the Directives mentioned in Article 19, shall apply from 28 December 2002.

3. Stationary or mobile plants whose purpose is the generation of energy or production of material products and which are in operation and have a permit in accordance with existing Community legislation where required and which start co-incinerating waste not later than 28 December 2004 are to be regarded as existing co-incineration plants."

Article 3(6) (as corrected, OJ L332 of 28 December 2000) provides:

"'existing incineration or co-incineration plant' means an incineration or co-incineration plant:

(a) which is in operation and has a permit in accordance with existing

Community legislation before 28 December 2002, or,

(b) which is authorised or registered for incineration or co-incineration and has a permit issued before 28 December 2002 in accordance with existing Community legislation, provided that the plant is put into operation not later than 28 December 2003, or

(c) which, in the view of the competent authority, is the subject of a full request for a permit, before 28 December 2002, provided that the plant is put into operation not later than 28 December 2004".

[30] Regulation 3 ensures compliance with the directive by requiring operators of existing waste incineration installations to make an application to SEPA which will then enable SEPA to impose conditions on the installation in accordance with the requirements of the directive. If the installation in question is already subject to a permit issued under the 2000 Regulations, then the appropriate application is for a variation of the conditions of that permit, as required by regulation 3(1). If, on the other hand, the installation in question is currently subject to an authorisation issued under the 1991 Regulations, then the appropriate application can be either for a variation of the conditions of that authorisation, under regulation 3(2)(a), or alternatively for a new permit to be issued under the 2000 Regulations, as provided for in regulation 3(2)(b). Whether the application is made under regulation 3(1), regulation 3(2)(a) or regulation 3(2)(b), the requirement that it be made no later than 31 March 2005 allows SEPA sufficient time to have the necessary conditions in place (by issuing a variation notice or a new permit, as appropriate) by 28 December 2005, when the directive becomes applicable to such installations.

[31] The reason for the exclusion from regulation 3(2) of the 2003 Regulations of existing waste incineration installations which are mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations, and which are subject to an authorisation under the 1990 Act, was not explored in the parties' submissions, but may be that such installations are required in any event to apply for a permit under regulation 7 of the 2000 Regulations several months prior to 28 December 2005, by reason of the "relevant period" prescribed in Schedule 3, as amended by regulation 11 of the 2003 Regulations. In the case of paragraphs (a) to (e) of Section 5.1, the relevant period expires on 31 March 2005, and in the case of paragraphs (f) and (g), it expires on 31 August 2005. Existing waste incineration installations whose "relevant period" expires on a later date, on the other hand, have to be compelled to make an application, enabling SEPA to impose the conditions necessary to comply with the directive, by a requirement taking effect earlier than that already arising from the 2000 Regulations: hence, it appears, the need for regulation 3(2) of the 2003 Regulations.

[32] In order for regulation 3(2) of the 2003 Regulations to apply to Longannet the following conditions therefore have to be met:

(1) it must be an existing waste incineration installation;

(2) it must not be one mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations; and

(3) it must have been subject to an authorisation on 31 December 2004.

[33] The expression "existing waste incineration installation" is defined by regulation 2(1) of the 2003 Regulations:

"'existing waste incineration installation' means a waste incineration installation or mobile plant which -

(a) in the case of such an installation or mobile plant which is a co-incineration plant, is one which -

(i) is in operation before 28^th December 2002 following the grant of a relevant approval; or

(ii) is put into operation by 28^th December 2004 following the grant of a relevant approval before 28^th December 2002 or the grant of a relevant approval, where the application for such an approval was duly made before 28^th December 2002 ...

and where an installation or mobile plant becomes authorised as a waste incineration installation or mobile plant for the first time as a result of a variation or modification granted for the purposes of sections 10, 11 or 37 of the 1990 Act or regulation 13 of the 2000 Regulations, references in this definition to a relevant approval shall be construed as references to that variation or modification and not to the original relevant approval, and references to the grant of a relevant approval shall be construed as references to the service of a notice giving effect to that variation or modification".

[34] In order to be an "existing waste incineration installation", therefore, the installation in question must be a "waste incineration installation". That expression is defined in regulation 2(1) of the 2000 Regulations, and has the same meaning in the 2003 Regulations (by virtue of regulation 2(2) of the latter regulations):

"'waste incineration installation' means that part of an installation or mobile plant which includes any of the following activities:-

(a) the incineration or co-incineration of waste in an incineration or co-

incineration plant falling within paragraphs (a), (b), (c), (d) or (e) of Part A of Section 5.1 of Part 1 of Schedule 1; or

(b) any activity falling within any Section of that Part of that Schedule

which is carried out in a co-incineration plant as defined in Section 5.1 of that Part of that Schedule".

[35] The expression "co-incineration plant" is defined in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations (as amended) as follows:

"'co-incineration plant' means any stationary or mobile plant whose main purpose is the generation of energy or production of material products and -

- which uses wastes as a regular or additional fuel; or

- in which waste is thermally treated for the purpose of disposal".

[36] On the facts of the present case, it appears to me that the main purpose of the plant at Longannet is the generation of energy. Longannet uses waste as a regular or additional fuel. It is therefore a co-incineration plant as defined. An activity falling within Section 1.1 of Part 1 of Schedule 1 to the 2000 Regulations - namely, burning any fuel in a combustion appliance with a net rated thermal input of 50 megawatts or more - is carried out in that co-incineration plant. Longannet is therefore a waste incineration installation as defined.

[37] Whether Longannet is an "existing waste incineration installation" therefore depends on whether it was in operation before 28 December 2002 following the grant of a relevant approval. The expression "relevant approval" is defined in regulation 2(1) of the 2003 Regulations as meaning inter alia "an authorisation", which expression is itself defined as meaning an authorisation granted under section 6 of the 1990 Act. Longannet was, as a matter of fact, operating as a co-incineration plant before 28 December 2002; and it had undoubtedly been granted an authorisation under section 6 of the 1990 Act. The principal submission advanced on behalf of Scottish Power, however, was that a "relevant approval" must be an authorisation as a waste incineration installation, and that Longannet did not, and does not, possess such an authorisation.

[38] In relation to the first part of that submission, I note that the final part of the definition of "existing waste incineration installation" addresses the situation where an installation is "authorised as a waste incineration installation" for the first time as a result of a variation granted for the purposes of sections 10 or 11 of the 1990 Act. In such a situation, the "relevant approval", for the purposes of the definition of an existing waste incineration installation, is that variation, rather than the original relevant approval; and the "grant of a relevant approval", within the meaning of that definition, is the service of the notice giving effect to the variation. It follows that an authorisation under the 1990 Act is not necessarily to be regarded as a relevant approval for the purposes of that definition: in particular, where an installation is not authorised as a waste incineration installation by its original authorisation, but that authorisation is subsequently varied so as to authorise the installation as a waste incineration installation, then it is the variation, and not the original authorisation, which is to be regarded as the relevant approval. It appears therefore that the intention of the legislation is that an authorisation is not to be regarded as a relevant approval, for the purposes of the definition of an existing waste incineration installation, unless it authorised the installation as a waste incineration installation. To that extent, I accept the submission made on behalf of Scottish Power.

[39] The next question is whether Longannet was granted a relevant approval - i.e. was authorised as a waste incineration installation - before 28 December 2002. The answer to that question depends on the meaning of the expression, "authorised as a waste incineration installation". The submission for Scottish Power proceeded on the basis that an installation was only authorised as a waste incineration installation if it had an authorisation under Section 5.1 of Schedule 1 to the 1991 Regulations, or a permit under Section 5.1 of Schedule 1 to the 2000 Regulations. Longannet, being authorised in respect of a combustion process under Section 1.3 of Schedule 1 to the 1991 Regulations, was therefore not authorised as a waste incineration installation. It appears to me, however, that the two categories are not mutually exclusive, and that it is necessary to consider more precisely what was authorised at Longannet.

[40] As explained in my previous Opinion, the authorisation of Longannet was originally issued on 30 April 1993, at a time when the use of WDF was not envisaged. The description of the authorised process referred only to the burning of coal, and to the use of oil at start up and, potentially, as a support fuel. When the use of WDF as a co-fuel was proposed, Scottish Power applied to SEPA for a variation of the authorisation, under Section 11(4)(b) of the 1990 Act. Section 11(1) enables a person carrying on a prescribed process under an authorisation, who wishes to make a relevant change in the process, to notify the enforcing authority and to request them to make a determination under subsection (2). For the purposes of the section, a relevant change is defined by subsection (11) as meaning a change in the manner of carrying on the process which is capable of altering the substances released from the process or of affecting the amount or any other characteristic of any substance so released. On receiving a request under subsection (1), the enforcing authority has to determine inter alia whether the change would involve a substantial change in the manner in which the process is being carried on, and whether the authority would be likely to vary the conditions of the authorisation as a result of the change. For the purposes of the section, a substantial change is defined by section 10(7) as meaning a substantial change in the substances released from the process or in the amount or any other characteristic of any substance so released. Section 11 continues:

"(4) Where the enforcing authority has determined that a proposed change would involve a substantial change that would lead to or require the variation of the conditions of the authorisation, then -

...

(b) the holder of the authorisation shall, if he wishes to proceed with the change, apply in the prescribed form to the enforcing authority for the variation of the conditions of the authorisation.

...

(8) On an application for the variation of the conditions of an authorisation under any provision of this section -

(a) the enforcing authority may ... vary the conditions ...

(b) if the enforcing authority decides to vary the conditions, it shall serve a

variation notice on the holder of the authorisation."

[41] As explained earlier, Scottish Power applied for a variation of the authorisation under section 11(4)(b) when they wished to begin using WDF as a co-fuel. A variation notice was thereafter issued by SEPA, under section 11(8)(b), on 11 December 1998. The notice varied the authorisation, with effect from 15 December 1998, by amending the description of the authorised process and the conditions of the authorisation. In particular, the description was amended so as to state:

"1.1 ... Two boilers are provided with facilities to co-burn waste-derived fuel (WDF) made from dried sewage sludge with coal at a maximum rate of 15 per cent WDF by weight."

The description of the authorised process also set out the arrangements for the delivery and storage of the WDF, and referred to Scottish Power's application as containing a more detailed description of the process. Ten new conditions were inserted in the authorisation, relating to the burning of WDF. They included conditions requiring the periodic analysis of samples of WDF for heavy metals, and the periodic measurement of concentrations of heavy metals in the flue gases and fly ash from the boilers into which WDF was fed, both with and without the feeding of WDF. There were also conditions limiting the amount of WDF burned annually to a maximum of 100,000 tonnes, and limiting the proportion of WDF in the fuel fed into any boiler at any time to a maximum of 15 per cent.

[42] As explained in my previous Opinion, further notices of variation of the Longannet authorisation were issued by SEPA to Scottish Power from time to time. In particular, the variation notice dated 1 February 2001, issued under section 10(2) of the 1990 Act, amended schedule 1 (the description of the authorised process) and replaced all the conditions. In schedule 1, the amended paragraph 1.1 stated that the process was a prescribed process "as it fits the description in section 1.3, paragraph (a), of the 1991 Regulations". As before, the description of the authorised process referred to the co-burning of WDF made from dried sewage sludge with coal, and included a description of the arrangements for delivery and storage of the WDF. The conditions included eleven conditions relating to the burning of WDF. As before, the conditions required the periodic analysis of the WDF for heavy metals, and the periodic measurement of heavy metals in the flue gases and fly ash from the boilers into which WDF was fed, both with and without the feeding of WDF. The conditions also limited, as before, the annual tonnage of WDF burned, and the proportion of WDF burned by any boiler at any time. A further variation notice, dated 9 April 2002, added further conditions relating to the burning of WDF, including a requirement that olfactory assessments be made around the boundary of the coal plant whenever there was WDF present on the bing.

[43] Returning to the definition of an existing waste incineration installation in regulation 2 of the 2003 Regulations, it appears to me that, in the circumstances which I have described, Longannet was "authorised as a waste incineration installation" from the time when the variation notice was issued in December 1998. As explained earlier, a waste incineration installation is that part of an installation which includes, inter alia, any activity falling within any Section of Part 1 of Schedule 1 to the 2000 Regulations which is carried out in a co-incineration plant as defined in Section 5.1. An activity falling within Section 1.1 of Part 1 of Schedule 1 to the 2000 Regulations -burning any fuel in a combustion appliance with a net rated thermal input of 50 megawatts or more - was undoubtedly authorised. It was authorised to be carried out in a co-incineration plant, since such a plant is defined as meaning, inter alia, a plant whose main purpose is the production of energy and which uses waste as a regular or additional fuel; and all those aspects of Longannet were authorised.

[44] The fact that the authorisation categorised the process carried on at Longannet as a combustion process, under Section 1.3 Part A of Schedule 1 to the 1991 Regulations, rather than as a process of incineration, under Section 5.1 Part A, does not in my opinion affect that conclusion. In that regard, I refer to my earlier observations about Schedule 2 to the 1991 Regulations. For the reasons explained earlier, the description of the authorised process as a combustion process is consistent with the use of waste as a fuel in the course of that process; and it is apparent from the terms of the authorisation issued to Longannet (as varied from December 1998) that such use of waste was indeed authorised, subject to the conditions contained in the authorisation. I should add that the definition of a waste incineration installation in regulation 2(1) of the 2000 Regulations makes it plain that such an installation need not have, or be eligible for, a permit under Section 5.1 of Schedule 1: part (a) of the definition covers the incineration or co-incineration of waste in an incineration or co-incineration plant falling within paragraph (a) to (e) of Section 5.1, and part (b) covers "any activity falling within any Section" of Part 1 of Schedule 1.

[45] I should also observe that, since the 2003 Regulations were intended to implement Directive 2000/76, they should be interpreted so as to achieve that objective. As explained in my previous Opinion, one of the aims of the directive was to close a potential loophole, whereby the controls over pollution applicable to the burning of waste at dedicated incineration plants might be avoided if the waste were co-incinerated at installations which had another primary purpose. In accordance with that aim, the directive covers both incineration and co-incineration plants, the latter being defined as meaning

"any statutory or mobile plant whose main purpose is the generation of energy or production of material products and:

- which uses waste as a regular or addition fuel; or

- in which waste is thermally treated for the purpose of disposal".

As I observed in my previous Opinion, a power station which uses waste (such as WDF) as a co-fuel is a co-incineration plant as so defined and therefore falls within the ambit of the directive. In the United Kingdom, however, any such power station, if operating under an authorisation issued under the 1991 Regulations, is likely to be categorised, for the purposes of those regulations, as carrying on a combustion process rather than a waste incineration process, as a consequence of the rules of interpretation set out in Schedule 2 to the Regulations. If that categorisation were to be treated as having the effect that such a power station was not "authorised as a waste incineration installation", within the meaning of regulation 2 of the 2003 Regulations, the consequence would be a failure to implement the directive. For that reason also, therefore, it appears to me that the description of the prescribed process for the purposes of the 1991 Regulations cannot be taken to be determinative.

[46] For these reasons, I conclude that Longannet satisfies the definition of an "existing waste incineration installation" in regulation 2 of the 2003 Regulations. Since it was subject to an authorisation on 31 December 2004, it is an installation to which regulation 3(2) applies, unless it falls within the excluded category:

"other than one mentioned in Section 5.1 of Part 1 of Schedule 1 to the 2000 Regulations".

In my opinion, Longannet does not fall within that category. The only activity mentioned in Section 5.1 which requires to be considered is the following:

"(e) Unless carried out as part of any other Part A activity, the incineration

of non-hazardous waste in a co-incineration plant."

It is a matter of agreement that WDF is not hazardous waste. If, as I have held, it is waste, it is therefore non-hazardous waste. It is subjected to incineration, that term being defined for the purposes of Section 5.1 as meaning "the thermal treatment of waste with or without recovery of the combustion heat generated". I have held that Longannet is a co-incineration plant. The incineration of the WDF is however carried out as part of another Part A activity, namely the activity mentioned in Section 1.1 Part A:

"(a) Burning any fuel in a combustion appliance with a net rated thermal

input of 50 megawatts or more".

Longannet therefore falls within the scope of the exception in paragraph (e) of Section 5.1. Whether that entails that Longannet is not an installation "mentioned" in Section 5.1 depends on what is meant by the term "mentioned", bearing in mind that Section 5.1 does not expressly mention installations, but rather lists activities. The reason for excluding from the scope of regulation 3(2) - and, hence, from the requirement under that paragraph to make an application by 31 March 2005 - installations mentioned in Section 5.1, appears to be that installations where an activity falling within Section 5.1 is carried out are, as explained earlier, the subject of a requirement to make an application for a permit under the 2000 Regulations by 31 March or 31 August 2005 (depending on which paragraph of Section 5.1 is relevant), under Schedule 3 to the 2000 Regulations (as amended by regulation 11 of the 2003 Regulations). There is accordingly no need for such installations to be covered by regulation 3(2) of the 2003 Regulations. The intention appears therefore to be that an installation is to be regarded as "mentioned" in Section 5.1 if an activity is carried out there which falls within Section 5.1. For the reasons explained, it appears to me that no such activity is carried out at Longannet, that Longannet is therefore not mentioned in Section 5.1, and that regulation 3(2) of the 2003 Regulations therefore applies to Longannet.

[47] It follows that I must refuse to grant the orders sought by Scottish Power. Since it was accepted that the arguments presented to me exhausted the subject-matter of this application for judicial review, I shall refuse the petition.