Can a waste incineration plant be a manufacturing facility? | In Principle

Construction of a waste incineration plant is a complex undertaking. The investor must meet a number of regulatory requirements and obtain the relevant administrative decisions, including the building permit and the environmental decision preceding it. These can be obtained only if the project complies with the local zoning plan. In this context, it is often questioned whether an incineration plant can be built on land zoned for manufacturing.

What are incinerator plants?

Incinerator plants are industrial plants where waste is thermally transformed. This may consist of:

• Waste incineration by oxidation
• Carrying out other processes, including pyrolysis, gasification or the plasma process, as long as the substances generated during them are subsequently burned.

Several types of incineration plants function in Poland. They primarily serve to manage wastes that are not being recycled. Often, the construction of such facilities arouses public resistance. The opponents of incinerator plants point out that they are harmful to the environment and contradict the principles of a circular economy. Others claim that waste incinerator plants are needed, and in some cases they are the only way to prevent waste from being deposited in landfills. Sometimes incinerator plants also add value, as the effect of thermal conversion can be the recovery of energy. But their main purpose is still waste disposal. This is how an incineration plant differs from a co-incineration plant, whose main activity is the generation of energy or products.

In such disputes, the issue of compliance with the local zoning plan is often raised. Since the verification of compliance with planning documents takes place at the stage of issuing a decision on environmental conditions, arguments on the unacceptability of such projects in a given location are most often raised during these proceedings. The environmental impact assessment procedure involves extensive participation of the public and environmental organisations, and they can be vociferous in alleging violation of local zoning plans.

Waste management in the zoning plan

Some time ago we wrote about the possibility of implementing waste management projects in areas other than those expressly designated for this purpose. The case law of the administrative courts does not clearly resolve this issue. Some courts recognise that waste management can only take place in areas marked “O,” but is banned in other areas. Other courts take the position that implementation of this type of activity does not need to be reflected in specific provisions of the local plan. In such cases, the authority must assess whether the planned project falls within the limits of the specified designations.

Currently, the second view is increasingly being adopted by the courts. A result is the necessity to determine whether the project actually qualifies under the land use designation. Most often, in the case of waste incineration plants, such an assessment involves verifying whether the incineration plant can be classified as an energy-generating production facility, and consequently, whether it can be located in areas designated as “P” in the local plan. In this regard, two main views stand out.

Incinerator plants and production activity

To answer the question whether a waste incineration plant can be a production facility, it is necessary to consider what a production activity is. This concept is not defined in environmental law. Therefore, in a judgment of 5 November 2019 (case no. II SA/Kr 498/19), the Province Administrative Court in Kraków referred to two linguistic definitions: “According to some authors, production is the basic part of the company’s activity, meaning human activity adapting natural resources to its needs…. According to others, it is an economic and technical activity aimed at producing products….” On this basis, the court held: “Activity consisting in processing waste through a recovery process, where the result of the process is that waste serves a useful purpose by replacing other materials, definitely meets the criteria of a production activity.” The Supreme Administrative Court took a similar position, recognising a plastic waste recovery plant as a production facility (judgment of 27 October 2017, case no. II OSK 336/16).

Following the above, in a judgment of 8 October 2020 (case no. II SA/Sz 579/20) concerning construction of a plastics recovery plant and a plant for recovery of thermal energy and generation of electricity from it, applying the process of thermal waste conversion in a renewable energy source installation, the Province Administrative Court in Szczecin held, “The designation of the land for production and service building development does not preclude the construction of a waste collection and processing point,” and thus set aside the decision denying a permit for implementation of the project and the decision of the second-instance authority upholding it. Similarly, in the judgment of 14 July 2022 (case no. II SA/Kr 627/22), the Province Administrative Court in Kraków held that an undertaking not designed as a waste disposal site, but as construction of a facility for the energy use of combustible fractions obtained from waste processing, certainly fulfils a production purpose.

And in the judgment of 29 November 2022 (case no. II SA/Kr 578/22, not yet legally final), the same court pointed out that “a production facility would be not only a facility where tangible goods such as cars or white goods are produced, but also a facility where a final product of a slightly different nature is produced, such as heat or electricity, which in the broader sense are goods and are traded on the market.” However, at the same time, the court noted that in order to find that there is a production facility, the production activity carried out there must be predominant and not merely incidental.

Thus, in principle, in accordance with the view presented above, a waste incineration plant can qualify as a production plant. But sometimes the administrative courts express a different view, mainly when the production purpose is marginal, but not only. For example, in the judgment of 2 June 2022 (case no. II SA/Bk 185/22, not yet legally final), the Province Administrative Court in Białystok stated that the primary purpose of a thermal waste conversion installation is to reduce the mass of waste sent to landfills or for recycling, and not to produce energy. Therefore, a waste incinerator plant is rather an industrial than a production facility. In turn, in the judgment of 9 October 2018 (case no. II OSK 2396/16), sharing the views of the Province Administrative Court in Opole earlier in the case, the Supreme Administrative Court held that energy recovery cannot be considered production because, among other reasons, energy is not a material good and thus does not meet the definition of a product at all.

Similarly, on 24 January 2023, the Province Administrative Court in Bydgoszcz issued a judgment (case no. II SA/Bd 546/22) involving the refusal to issue a decision on environmental conditions for an undertaking consisting in construction of a line for thermal conversion of hazardous waste. One of the reasons for the refusal to issue the decision was that the area where the project was to be carried out was designated as “areas of production facilities, warehouses and storage facilities.” The second-instance authority set aside the decision in its entirety and remanded the case for reconsideration. In its complaint to the administrative court, an environmental organisation claimed that “the planned undertaking is not a production activity, but strictly dedicated for waste disposal, not leading to the production of any product other than waste and air pollution.” Also, in the case of energy, the organisation argued it is necessary to refer to “generation” as defined in Art. 3(45) of the Energy Law of 10 April 1997, and not “production” within the meaning of the local plan. Additionally, according to the organisation, energy is not a product at all, but only an intangible effect of chemical processes. Moreover, the investor did not provide any data regarding the amount of energy it would transfer to the power and heat grid, but only presented projections unsupported by evidence. The environmental organisation acknowledged that under the leading case law, waste management can be carried out in areas other than those expressly designated for it, especially since almost every business deals with waste to some extent. At the same time, however, it pointed out that a waste incinerator plant constitutes an exception and is only allowed to be located in areas designated “O.” The administrative court upheld the appeal and shared the view that a waste incineration plant is a special form of activity, especially when it involves the incineration of hazardous waste. Thus, in this regard, the provisions of the local plan should be interpreted narrowly, and incinerator plants cannot be sited in production areas.

Summary

The case law of the administrative courts does not unequivocally resolve whether waste incineration plants can be classified as production facilities, and consequently sited in areas designated “P” in the local plan. It seems that if there is energy production (generation) in such plants, the answer should be positive. On the other hand, the production aspect is often marginal and only a side effect of waste disposal. In this context, the question arises of how important the production purpose must be in order to justify the siting of a project in an area specifically designated for production activities. In each case, the answer requires an analysis of all the circumstances of the case.

Agata Matysiak, Environment practice, Wardyński & Partners