Category A mining waste facilities: financial provision
How to calculate and maintain a financial provision for a Category A mining waste facility under the Environmental Permitting Regulations 2016.
Applies to England
This guidance applies to operators of Category A mining waste facilities and mining waste facilities that meet the definition of ‘Hazardous’ in Article 3 (2) of the Mining Waste Directive 2006/21/EC (‘the Directive’).
It does not apply to operators of non-hazardous, non-inert mining waste facilities, unless those are also Category A mining waste facilities.
The guidance explains what you must consider in the design and calculation of your financial provision. This is to satisfy the requirement to provide a ‘financial guarantee’, or equivalent.
The financial provision does not cover the remediation of environmental harm caused by the operations of the permitted mine or quarry, beyond that caused by the mining waste facility.
Legal requirement
The Directive aims to prevent or reduce as far as possible any adverse effects on the environment. This includes water, air, soil, flora, fauna and landscape, as well as risks to human health, caused by the management of waste from the extractive industries. The scope of the Directive includes waste from mineral extraction other than mines.
In England and Wales, the provisions of the Directive are implemented through Schedule 20 of the Environmental Permitting (England and Wales) Regulations 2016 (EPR 2016).
The Department for Environment, Food and Rural Affairs (Defra) has published Environmental permitting guidance: the Mining Waste Directive to help you understand the UK requirements of the Directive on the management of waste from extractive industries.
Under Article 14 of the Directive the Environment Agency must ensure that you provide a financial guarantee, such as a bond, deposit, mutual fund, or equivalent, before starting operation of a Category A mining waste facility. This ensures that funds are available:
- to meet environmental permit obligations
- to rehabilitate land as outlined in your waste management plan
- for site closure and clean up
In 2009 the European Commission published Decision 2009/335/EC. This sets out technical guidelines for calculating financial guarantees aimed at ensuring mining operators cover site rehabilitation and closure costs. It requires national authorities to ensure that provisions take account of environmental impacts, remediation timelines and closure risks.
Scoping and costing of the financial provision
Your financial provision must be sufficient to meet:
- all relevant conditions and monitoring requirements of the environmental permit
- all costs during and after closure as defined within the procedures agreed with the Environment Agency for closure and aftercare
- all costs associated with the maintenance of the Category A facility and associated infrastructure such as emergency spillways, site drainage and monitoring infrastructure
- all costs associated with replacing monitoring infrastructure, for example boreholes or piezometers
Your financial guarantee or equivalent must be secure and available to the Environment Agency when needed, without undue delay.
You must maintain the financial provision throughout the life of the permit.
Requirements
When calculating the amount of the financial provision, you must consider the following.
Environmental and health impact
An assessment of the costs of liabilities associated with the likely impacts of a waste facility on both the surrounding environment and human health, including potential exceedance of applicable environmental standards.
Environmental objectives including physical stability
Measures to guarantee the physical stability of the waste facility to prevent failures or collapses.
Water quality
Provision for maintaining minimum quality standards for water resources in the area.
Contaminant controls
Engineering and associated site infrastructure required to meet the authorised release rates of hazardous and non-hazardous pollutants into the environment.
Land rehabilitation, closure and after-closure care
An assessment of the costs of ensuring appropriate closure and after-closure care, including possible after-closure:
- monitoring or treatment of contaminants
- land rehabilitation
- biodiversity reinstatement
The duration of the aftercare period will be determined according to the specific risks of the mining waste facility.
Duration of care
Estimation of the timescale of impacts and required mitigation measures.
Safety management system (SMS) and major accident prevention plan (MAPP)
Provision to ensure that the MAPP and SMS are maintained and enacted where necessary. For example, in periodic inspections.
Independent assessment
The financial assessment must:
- be performed by an independent and suitably qualified third party
- account for the possibility of unplanned or premature facility closure
Other factors you must consider
You must demonstrate you have considered the following factors in calculation of the amount of the financial provision.
Nature and quantity of waste
The specification of the wastes, including:
- what contaminants they contain
- what physical form they are in (for example, slurry, fine crushed material) and mobility of the material within and beyond the mining waste facility
- what quantity of wastes are held in the mining waste facility
Climate and weather
The impacts of foreseeable:
- prolonged or heavy rainfall
- high winds
- extremes of temperature
Preventative measures
Preventative measures to minimize environmental impact during operation and the after-closure phase, including:
- collection and treatment of contaminated water or leachate
- actions to prevent or significantly reduce erosion by water or wind
- relevant maintenance to ensure physical stability and to prevent pollution or contamination of soil, air, surface water, or groundwater, and short- or long-term damage to the landscape
- regular monitoring, inspection and reporting by competent and qualified individuals and maintenance and retention of records
- actions to implement corrective measures if monitoring results indicate instability, or water or soil contamination
- maintenance of all structures associated with the mining waste facility including bund drainage mechanisms, overflow channels and spillways
Check the Best Available Techniques (BAT) Reference Document for the Management of Waste from Extractive Industries (MWEI BREF), to see what monitoring, inspection, surveys and maintenance are appropriate.
Rehabilitation
When defining rehabilitation this should include consideration for the potential after-use of the waste facility. This may include restoration, such as capping, replacement of topsoil, and revegetation and reworking or disposal of on-site material.
Reviewing the financial provision
You must review the amount of the financial provision as the facility is developed. This is to ensure that it adequately reflects any changes in the size and complexity of the facility. This means that the amount of the provision is likely to increase as the size, nature and complexity of the facility develops.
The review frequency is based on the need to take price inflation into account, as well as other changing circumstances, such as:
- emerging awareness of new hazards
- a deterioration in performance revealed by compliance or monitoring
You must review your financial provision annually, or on variation or transfer of your Category A mining waste permit, whichever is sooner, taking account of the following circumstances:
- a published change to this guidance
- identification by either yourself or the Environment Agency of a new or escalating environmental or human health risk
- inflation and other changes to cost impacts
Your review must be:
- validated by an independent and suitably qualified third party
- submitted in writing using the contact details supplied to you by the Environment Agency
Further support
Contact the Environment Agency if you need help calculating the financial provision for your site. The Environment Agency has templates you can use to calculate the provision and develop your expenditure plan.