Are emission performance standards effective in pollution control? : evidence from the EU's large combustion plant directive

This paper explores the extent to which the Large Combustion Plant (LCP) Directive succeeded in mitigating local air pollutants from thermal electricity generating plants in the European Union. Using yearly data on plant-level operations from the EEA, we investigate whether emissions limits on stack concentrations were effective in cleaning emissions from existing combustion plants and a catalyst for improved environmental performance of new installations. We take advantage of the discontinuities in regulation status to show that the emission performance standards led to sizeable declines in SO2, NOx, and particle dust concentrations at the stack level from older combustion plants. We also find suggestive evidence of anticipation effects from newer plants in response to tighter emission standards.