Nitrogen emissions must be drastically reduced

A ruling from the Dutch Council of State on 29 May 2019 should further limit nitrogen emissions. This has major consequences for planned projects in the field of business parks and infrastructure. Over the next five years, 14 billion euros worth of construction projects will be put at risk, according to projections from ABN AMRO.

Biggest challenges for road projects

The largest infrastructure projects affected are the road projects financed by the national government. Based on the list that the Council of State has made available, it concerns at least two projects. Firstly, the A27 / A12 around Utrecht, of which the Council of State has now annulled the route decision. Second, the A12 / A15 at Resen-Oudbroeken near Arnhem. The value of these two projects amounts to 2 billion euros.

But it doesn't stop there. There is still an old list of projects from an appendix to the Nature Conservation Regulation that regulates the implementation of the Nature Conservation Act. This is a list from 2017 and is therefore no longer up to date. A number of projects have now become irrevocable, which means that they may continue after the Council's decision. The list does, however, provide some guidance. The projects on the list that are still in the plan elaboration are expected to be affected. In those cases, the route decision is not final, which means that the decision on the entire project is not yet final. This concerns ten infrastructure projects with a total value of 4.5 billion euros. The Zuidasdok has not been included in this, but given the current state of affairs, it is not unlikely that the ruling of the Council of State will also affect the Zuidasdok.

It also affects projects that are still in the planning phase or exploration phase and that are part of the Multi-year Program Infrastructure, Space and Transport (MIRT) of the Ministry of Infrastructure and Water Management. These are new projects that were therefore not yet on the 2017 list. This concerns 228 million euros in projects in the planning phase and 1.6 billion euros in projects in the exploration phase

In total, it concerns road projects worth 9 billion euros, which are affected by the ruling of the Council of State. The total road budget of the national government amounts to 21 billion euros for the period 2019-2023. The decision of the Council of State therefore has major consequences for the sector.

In addition to the rural road projects, the ruling affects other infrastructure projects, such as rail projects, projects on main waterways and airports. So the consequences of the judgment are also felt at a local level. Municipal and provincial projects and projects of the water boards are affected. This is expected to involve hundreds of millions of euros.

Effects are visible later

The infrastructure builders are not yet directly affected by the nitrogen ruling, because the projects that are delayed or are canceled as a result are not yet in the builders’ books. Their order books are even at a record high. For the coming years, however, it is certain that fewer projects can go ahead and this will affect the builders. The smaller infrastructure builders are expected to be the first to be affected. They are mainly active in regional projects with a shorter lead time. Large builders usually work on large infrastructure projects with long lead times and only experience problems later. The current growth engine of the construction sector, earth, road and hydraulic engineering (gww) will falter as a result.

Solutions for road projects

Fortunately, there are various solutions that can increase the likelihood of road projects passing. First of all, so-called internal recovery measures can be used to build in such a way that nitrogen emissions do not increase. This concerns, for example, the use of electrical construction vehicles. However, the market for such construction equipment is currently too small to build emission-free on all construction sites in the Netherlands. The question is also whether heavy equipment can be electric, although the use of gas as fuel can serve as an alternative.

Apart from this practical limitation, the ruling of the Council of State unintentionally provides an incentive to accelerate the sustainability of the industry. Emissions can also decrease due to external remedial measures. An example of this is that a client buys up emission rights from a livestock farm.

However, it is not construction, but the use of roads that is responsible for the most nitrogen emissions. Even when zero-emission buildings are built, our estimate is that nitrogen emissions from road projects will therefore still increase. The ADC test is then the last resort.

The ADC test has now been successfully applied to the Blankenburg connection between the A20 and A15 near Rotterdam and the widening and connection to the A67 of the Kempenbaan in Veldhoven. So there are certainly opportunities for road projects to pass the test. These projects have in common that these are new roads for which there are no alternatives. For the Blankenburg connection, the minister has even examined eight alternatives. There are, however, compelling reasons of public interest for constructing the roads. For the Blankenburg connection, this includes the accessibility of the port of Rotterdam and in Veldhoven the accessibility of an industrial site where ASML is located, among other things. The road in Veldhoven also significantly reduces traffic nuisance in a number of villages. At the same time, the increase in nitrogen emissions is sufficiently compensated.