White smoke after nitrogen deal reached... And dark storm clouds for the agriculture sector

One year after the infamous ‘nitrogen ruling’ by the Council for Permit Disputes on 25 February 2021, the Flemish government has reached an agreement in the nitrogen dossier.

NOMA is happy to explain to you the agreement reached -and its implications for the agricultural sector.

First, back to early 2021: A ruling by the Council for Permit Disputes, which overturned the environmental permit of a Limburg farm, put the entire nitrogen policy of the Flemish Government (PAS) in question at the time.

Indeed, in its ruling, the Council ruled that a permit-granting authority may only permit a certain activity if it is certain that the implementation of this activity will not result in meaningful impairment. The mere use of a 5% nitrogen emission threshold (as had been done until then), without specifying on the basis of which objective data any significant impairment could be excluded, was deemed insufficient by the Council.

Since then, it was unclear to the entrepreneur what the applicable nitrogen framework still looked like. Licensing authorities also had no guidance on how to specifically examine an application. To the frustration of a lot of (agricultural) entrepreneurs, a general nitrogen freeze arose. Suddenly, the legality of permits already obtained, granted on the basis of the provisions of the PAS (and certainly on the basis of the threshold values) was also called into question. Doom was looming for the agricultural sector....

We are now a year on and there has (finally) been white smoke from the Flemish Government. On the night of 22 February, the parties of the Flemish Government reached a ‘nitrogen agreement’, which was cast in a Concept Note PAS on 23 February.

Both the first statements in the media on behalf of the Minister for the Environment and a first reading of the concept note show that the new agreement could effectively have especially large consequences for agriculture. While the currently used 1% threshold for nitrogen oxides (NOx, mainly from industry) is confirmed, a very low threshold of 0.025% is proposed for ammonia emissions (NH₃, mainly from agriculture). Above this threshold, therefore, an ‘appropriate assessment’ remains necessary.

The consequences in practice seem considerable: for almost all new agricultural permits, an appropriate assessment would have to be made, estimating the ‘significant effects’ on Natura 2000 areas, which threatens to severely restrict the new development space.

Furthermore, companies should subscribe to the generic emission reductions in relicensing dossiers. Very concretely, this means for livestock farmers: either invest in technology and low-emission stables (provided they would already obtain their permit for this), or drastically reduce their livestock. The Flemish government realises that this will be a particularly bitter pill for - mainly young - farmers, and has already announced that an extra 150 million will be provided to support these investments.

For the so-called ‘red farms’ (farms with an impact score of more than 50% on depositions in nearby nature areas), the story is already threatening to end irrevocably: they must all be closed by 2025 at the latest.

The so-called ‘dark orange farms’ (farms with an impact score of more than 20% on depositions in nearby nature reserves) can enter a voluntary buy-out scheme, whereby they will receive a shutdown offer by 2026.

In addition, the pig sector must achieve a 30% reduction in livestock numbers by 2030, which the government intends to achieve through a buy-out scheme of the pig farms with the highest impact score.

Although bold and far-reaching measures seem to be necessary to solve the nitrogen problem, the intentions of the Flemish Government are once again hitting Flemish farmers hard, who in some cases risk losing their life's work.

Moreover, the legal validity of some measures can be questioned. After all, farms with valid permits are suddenly being told to stop much sooner than their permits allow. Even if they have a valid permit and have recently made heavy investments to produce in a more environmentally friendly way, the (near) future of these companies seems to be at risk. Unfortunately, a socio-economic impact analysis, which was promised, seems to be lacking.

The lack of understanding with agriculture is also great, since they do not understand why NH₃ (emitted by agriculture) is so heavily targeted, while NOx (emitted by industry) is rather ignored. This even seems to lean towards unjustified and unfounded discrimination.

However, the Flemish government proudly sells its agreement as a note that brings clarity and legal certainty. Of course, this concept note only serves as a basis for the actual PAS and its accompanying plan-MER, which still has to go into public scrutiny.

Without pre-empting the facts, it should already be noted that certain (agricultural) entrepreneurs -who obtained legal permits and made heavy investments, but would now have to close down anyway- interpret the concept of ‘legal certainty’ somewhat differently.

A cartload of objections during the public enquiry can by no means be ruled out. Curious whether all the Flemish Government's intentions will pass this (legal) test.