UK Coal response

UK Coal PLC
27 November 2003


                        Large Combustion Plant Directive

As noted in the interim results of 10 September, UK COAL has been lobbying the
UK Government to adopt prescribed emission limit values (ELVs) at power
stations, rather than the National Plan, to ensure indigenous UK coal is not
displaced by low sulphur imported coal for no economic or environmental benefit.

The EC Large Combustion Plant Directive (LCPD) states that UK sulphur dioxide
emissions must fall by 50% to below 585 thousand tonnes by 2010 to meet the EC
National Emission Ceilings Directive. The bulk of this reduction will be made at
existing coal-fired power stations where sulphur emissions are expected to fall
by over 500 thousand tonnes from 2008 when these power stations must comply with
the LCPD.

The Government has chosen to extend its consideration of the NERP or ELVs
implementation options, pending further analysis of the impact on industry,
until spring 2004. UK COAL will continue to communicate with Government
throughout this time.

The response from the Government announced today is as follows:

'The Government published a consultation paper on 30 June 2003 setting out the
options for implementing the Large Combustion Plants Directive (2001/80/EC) in
the UK for plants licenced before July 1987. For these plants, there is a choice
between either setting emissions limit values individually for each plant, or
establishing a 'national plan' under which a 'bubble' for each of the pollutants
covered by the Directive (sulphur dioxide, nitrogen oxides and dust) could be
shared between plants in the scheme.

'Consultations closed on 30 September. We received a number of detailed
submissions on the consultation paper which we have been considering. No
consensus has emerged from the responses to the consultation and there are
strongly held views in favour of both implementation options. The choice between
the options is also sensitive to other policies on which decisions will be taken
in the next few months.

'The Directive requires that any national plan is submitted to the European
Commission by 27 November 2003. However, we consider that further analysis is
required before we can be sure which implementation approach it is in the UK
interest to adopt. We are therefore submitting a national plan to the Commission
at the same time as undertaking this further analysis. This will in effect keep
either option open, we would withdraw the plan if this further analysis
suggested that the emissions limit approach was to be preferred. A decision on
whether to withdraw the national plan would be taken before Spring 2004.'

UK COAL will continue to lobby for ELVs whilst the Government is undertaking its
further analysis of the best implementation policy.


MEDIA CONTACTS:

UK COAL PLC
Gordon McPhie, Chief Executive            Tel: [phone]

Gavin Anderson & Company
Financial:
Liz Morley / Ken Cronin                   Tel: [phone]

Operational:
Stuart Oliver                             Tel: [phone]





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