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    Environmental Effects of the TAP Pipeline

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Summary

Companies in Italy are faced with a highly complex environment with regards to permissions processes and requests for new infrastructure. The Trans Adriatic Pipeline in Italy is currently struggling to move ahead.

by: Davide Tabarelli, NE Nomisma Energia

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Natural Gas & LNG News, News By Country, , Italy, Pipelines, Trans-Adriatic Pipeline (TAP) , Environment, Top Stories

Environmental Effects of the TAP Pipeline

Italy is probably the most difficult place on Earth to build new industrial infrastructures, at least judging from the troubles encountered by any proposed energy project over the last several decades. The Trans Adriatic Pipeline (TAP), the gas pipeline expected to bring gas from the Caspian Sea to Italy, has ended up in the same trap, and is now struggling to find a way out. In Italy almost all new producing plants or infrastructures are likely to face some opposition, and this is even more so for projects involving energy. Things are especially difficult in some areas, notably Southern regions like Apulia, where TAP should come ashore.

In order to get an idea of the highly complex environment faced by companies, it is helpful to begin with a brief summary of the lengthy and tortuous permissions process. Let’s start with the endpoint: on April 17th 2014, the TAP consortium handed the Italian Ministry of Environment (MATTM) and the Italian Ministry of Cultural Heritage (MINBAC) an updated, 1,200 page version of the Environmental and Social Impact Assessment of the Italian section of the TAP project, as required by Italian authorities. After evaluating 12 alternative routes for the pipeline, as requested by MATTM and MINBAC in March, the document confirms that the one coming ashore near San Foca is the best solution in environmental, technical and socio-economic terms. The TAP consortium restated that the pipeline will be ready for operation in 2019.

This was the last step in a very complex path towards attaining the relevant environmental authorisations for the project, as the 5.6 GB of publically available documents produced by the consortium stand to testify. The Environmental Impact Assessment (EIA) is a technical-administrative procedure that, according to Legislative Decree no. 152/2006, is normally carried out by an ad hoc decision making process by competent agencies (Conferenza dei Servizi). The Conferenza dei Servizi review the decisions of all governmental agencies involved in the EIA procedure, including central and local governments. This type of coordination is designed to guarantee that all stakeholder interests are taken into consideration, while enabling the EIA to comply with its schedule, which should not exceed 150 days.

For the TAP pipeline, as for any natural gas pipeline of that relevance, Legislative Decree no. 152/2006 requires an EIA procedure, in order to carefully evaluate potential environmental and cultural heritage risks. According to Article 21 of the same Decree, an EIA procedure may be preceded by a period of consultation (so called “scoping”), in which the proposers of the project agree with relevant Authorities on the documents to be submitted for the following procedural steps. This phase is expected to take up to 60 days; for the TAP project, it took more than 11 months. In fact, the TAP consortium began consultation with the MINBAC in May 2011; the Ministry issued an opinion only 9 months later (February 2012). Meanwhile, the TAP consortium begun to prepare the Environmental Impact Study, which was presented on March 15th 2012.

In the period leading up to this first submission, a total of five alternative route options were investigated: the San Foca route was concluded to represent the optimal solution in environmental, technical, socioeconomic and safety terms. This solution brings the pipeline ashore near San Foca, and places the Pipeline Receiving Terminal (PRT), the facility to connect TAP into the Italian gas network, in Melodugno. This route was presented by the TAP consortium to the Italian authorities as the optimal solution.

Inevitably, the TAP consortium had to revise its study in order to account for Ministry views, issued as part of the scoping phase. In December 2012, MINBAC gave the TAP Consortium 9 months to consult with local authorities and local NGOs on the potential environmental and social impacts of the project. In September 2013, the Consortium came up with a new document, which addressed some of the comments received during the new consultation period. Under the revised plan, the pipeline still comes ashore at San Foca, but the landfall site was shifted slightly to diminish the impact on the seashore, to further prevent any damage to the area’s protected Posidonia sea grass, and to avoid any visual impact. A 1500m micro tunnel 10 meters underground was also proposed. Furthermore, the Consortium decided to reduce the size and to optimize the location of the PRT in Melendugno, in order for it to conform with the typical configuration of local structures such as farm buildings, thereby reducing its visual impact.

The documents prepared by the TAP Consortium were considered by the main national (MATTM, Ministry of Tourism) and local (Apulia Region, Lecce Province, Melendugno Municipality) authorities. In January 2014, Apulia Region issued a negative (non-binding) opinion on the EIA procedure, as it had already done in September 2012. This decision was based on “landscape-issues”, and the regional authorities requested the Consortium to consider another landfall site for the pipeline.

In March 2014, MINBAC and MATTM requested some integration to the Consortium submission of September 2013: the Ministries required the company to submit an in depth evaluation of alternative routes for the pipeline. In particular, some suggested that given that another pipeline (ITGI) is coming ashore near Otranto, around 20 km south of San Foca, and that it has already obtained the relevant authorisations, the TAP pipeline landfall site could be moved near Otranto. However, in its April 2014 delivery, the TAP consortium made it clear that San Foca remained the best option for the pipeline to come ashore; in the same document, the consortium provided a reasoned reply to the criticisms made by the Apulia Region authorities and other stakeholders.

The difficulties faced by the consortium in obtaining the relevant authorisations and in rallying support for the project from local and national authorities are in contrast to the relevance of the infrastructure. In fact, the Italian government and the EU have repeatedly declared the TAP gas line to be of “strategic importance”. The reason is quite simple: it adds a new supply route to Europe, different from the traditional ones, like Russia, North Africa or even the North Sea, where reserves are falling very quickly. There is no need for any expertise in energy strategy or economics to understand that when you are highly dependent on an imported commodity, it makes sense to diversify supply sources in order to lower the risks of a sudden interruption, and also to generate lower prices through competition. It would be also the first time that gas from the former Soviet Union (FSU), from the Azerbaijani part of the Caspian Sea, is delivered to Europe without being absorbed into the Russian system of transport grids and, more importantly, commercial contacts.

It is also important to note that the project is competing with future supply from Russia without posing any real threatening to Moscow. Europe is likely to need, if its economy recovers, some 200 billion cubic meters per year (bcm/y) of additional gas up to 2030. Russia will not be able to cover the full scope of this demand, and there will be plenty of room left for gas supplies through South Stream, the other gigantic gas line that will bring Siberian gas to Europe through the so-called northern corridor.

Thus, we should ask ourselves why this project is facing such a fierce opposition from the South of Italy. The answer is complex, with its roots reaching back centuries into the history of the poorest part of the country, where economic development, imposed from central governments with controversial results, has never been really achieved. Lagging behind the rest of the EU, the South of Italy is one of the weakest parts of the EU, with average levels of unemployment close to 20%, reaching peaks of 40% among the youngest. Emigration from has been a constant feature of the past century and has re-emerged as a major trend with the latest economic crisis forcing thousands of people to look for jobs abroad. Experience teaches us that as a territory develops, its inhabitants become increasingly familiar with industrial infrastructures, and thus it is more likely that the realisation of a new project will succeed. What has often happened in the past is that investors in the Southern Italian regions anticipated a welcome from local authorities and people, since they thought they were bringing new opportunities for local development.

But in the last few years, the opposite has happened. A very strong negative perception of any kind of industry grew in precisely those poor areas where industrial development could have helped most. This is a common problem all over Italy, where the media tends to focus on the negative impacts connected to pollution, deaths, and contamination. Due to this negative campaigning, factories, or any kind of investment, are seen as bringing harmful changes. As a consequence, the positive impacts on employment and economic development are ignored.

Apulia Region has a complex relationship with industrial infrastructures, as illustrated by the Ilva case. Ilva is Europe’s biggest steel factory, located near Taranto, 130 km from San Foca, and owned by the Riva Group, one of world’s largest steelmakers. In July 2012, Ilva was forced to close after a judge ordered an asset freeze in an environmental probe. The court dispute centres on studies suggesting that up to 386 people might have died of cancer over the past 13 years, and that people living downwind of fumes from the plant have suffered negative health effects. The history of the Ilva industrial complex dates back to the beginning of the 20th century. The developments of July 2012 are a single chapter in a very long struggle involving the plant's high pollution levels, environmental risks and employment issues: the factory employed some 12,000 workers, and it was the largest private employer in the Apulia Region. The needs and the feelings of the local population on the subject were expressed on April 14th 2013, when a referendum on the future of Ilva took place. Asked if they wanted the plant to shut down i, the majority of the population (80.4%) did not vote, indirectly supporting the preservation of workplaces.

The big coal plant of Cerano, located 10 km south of Brindisi and 40 km north of Melodugno, also faces heavy criticism. It is a 2,600 MW plant that burns imported coal. Given the low price of coal compared to gas, it is running at full speed. According to environmentalists, it is one of Europe’s most polluting plants. In reality it is an efficient and modern plant emitting a lot of CO2 simply because it produces a lot of electricity using large quantities of fossil fuel.

Brindisi is famous for its international gas industry, particularly for the LNG terminal that BG fought - unsuccessfully - to build for almost a decade. The project, along with ten more all over Italy, was drawn up at the beginning of the 1970s and. Then, having been forgotten for years, it was resurrected in 2000 by the UK gas company. At the beginning, the proposal was welcomed, but immediately delays emerged. In August 2001, the UK Prime Minister Tony Blair sent a letter to the Italian Prime Minister Silvio Berlusconi complaining about the delays in the development of the project. The Berlusconi government then forced Enel, the Italian power utility, to enter into the project, in a bid to speed up the process. However, that did not happen, and later in 2005, Enel, having understood the difficulties facing the LNG terminal, decided to drop out. Despite all the legislative and bureaucratic hurdles, the British company succeeded in obtaining the relevant authorisations from local authorities, but new elections in 2006 brought a new administration that rejected and appealed against it. Then, an investigation into bribes paid to obtain the first authorisation was launched, bringing further problems. The drop in domestic gas consumption, linked to the 2008 economic crisis, made the project much less attractive. Finally, in March 2012, after eleven years and an investment of some 200 million Euros - a significant part of which was spent on legal fees - BG decided to abandon Brindisi.

Even investments in renewable energy sources often face fierce opposition, a problem that has rescinded only because financial incentives to the sector were sharply reduced in 2013. At the end of March 2014, the president of the Regione Apulia, Nichi Vendola, declared that Apulia “has already given a lot in terms of wind and photovoltaic plant; the construction of new plants should be capped. We are leaders in Italy in new renewable production with a share of 40% out of the total electricity output, against a European target of 20% by 2020.” Apulia, where the TAP project should come ashore, has a large amount of new renewables simply because it has been blessed with favourable natural conditions. One of the biggest Italian Regions, its territory runs across vast planes. Its geographical location in the Southern part of Europe and in the middle of the Mediterranean provides very good insolation levels and optimal wind conditions. Moreover, Apulia is sparsely populated with large parts of the Region inhabitated. Over the last decade, its once thriving agricultural sector has suffered from the economic downturn, which has pushed many farmers to welcome wind and photovoltaic plants in exchange for royalties. The statement by the President of Apulia reflects a general resistance to anything complex, modern and with the potential to benefit private companies that often represent industries believed to harm public health. This is the effect of the so-called antagonism applied in the realm of politics and to the decision-making authorisation process of a modern democracy whose economy, however, relies on complex industries.

In this regard, Nichi Vendola is one of the most meaningful cases in Europe, since he is a successful politician who in 2009 founded the SEL party (Sinistra Ecologia Libertà, literally Left, Ecology and Freedom). Throughout his political career, Vendola has received many votes not only from the far left, where his party should be placed, but also from an electorate that usually voted for other political factions, even right-wing parties. His ideas, well explained and clearly articulated given that he is a highly skilled politician, are based mainly on a brand of environmentalism that inevitably takes on anti-modernity positions, envisaging a poorly defined social vision in which people can achieve liberation from dependence on technology.

The influence of local authorities in the permissions process is one of the most debated issues in relation to infrastructural developments, or rather the lack thereof. After more than ten years since the transfer of a major part of these competences from central governments to local authorities, a large political coalition now argues that it is time to re-centralise the full scope of these competences. In early 2001, a weak left wing government managed, few days before resigning, to get parliament to approve changes to the 5th section of the Italian constitution. These changes were later voted in by the Italian people through a referendum and thus signed into law in November 2011. In that period, the constant pressure to improve the efficiency of Italian politics paved the way for federal ideas (so-called “devolution”), as if this alone could solve the problems in national politics. The strongest party in some parts of the richer Northern Italian Regions was the Northern League, a quasi-separatist party. It was believed that increased involvement by Regions, Provinces and Municipalities would help streamline the permissions process, at the same time as improving citizens’ support for democracy. Constitutional Law no. 3 of November 2001 transferred competences from the central government to the regions, and energy was one of the issues involved in that transfer. This Law has been widely recognized as a failure, since the problems raised by local communications cannot be solved in any case. One of the objectives of the new government led by the young Matteo Renzi is to re- centralise some of the competences now managed by the regions and among these is energy. This would not be an easy process, but these are necessary steps if Italy wants to modernise its energy sector, and remain a major European and international economy. 

Davide Tabarelli, NE Nomisma Energia