[SME Regulation Site③] Asphalt Industry Hampered by 'Sticky Regulations'

Factory Location 'Specific Air Pollutant' Emission Standards... "Cannot Meet with Current Technology"
Ascon Industry: "Not Refusing, Just Asking for More Time"
Ministry of Environment: "Already Stated Will Not Accept," Unyielding

On the 8th, an asphalt company was conducting road repair work in Dongtan New Town, Hwaseong-si, Gyeonggi-do. [Photo provided by Seoul Gyeongin Asphalt Industrial Cooperative]

[Asia Economy Reporter Kim Jong-hwa] In winter, when temperatures are low, workers must arrive at the construction site within 30 minutes. This is because the asphalt concrete (Ascon) must be maintained at 140 degrees Celsius to allow work before it hardens. Due to severe traffic congestion in downtown Seoul, night work is inevitable. Typically, work starts at 10 p.m. and must be completed by 4 a.m. the next day. The most important role of nationwide cooperatives, such as the Seoul-Gyeongin Ascon Industrial Cooperative, is to select the Ascon plant closest to the construction site, making distance and time critical factors. While it is acceptable to arrive within an hour during the warmer summer months, in winter, even a 10-minute delay often results in the material being discarded as waste.

Therefore, Ascon plants must be located within a 30 to 40 km radius of the construction site. However, because they are classified as facilities emitting specific air pollutants, they must be situated in planned management areas or natural green zones outside urban centers. According to the Korea Ascon Industrial Cooperative Federation (Federation), among the 512 Ascon companies nationwide, 369 companies (72%) are located in planned management or natural green zones, while the remaining companies are situated in industrial complexes.

Planned management areas are regions expected to be incorporated into urban areas or designated for limited use and development considering the natural environment. Natural green zones are designated to protect the natural environment, farmland, and forests and to prevent disorderly urban sprawl.

Legally Built Factories Now Considered Unauthorized Illegal Facilities

This is where the problem begins. Although the factories were legally established at the time, the Ministry of Environment strengthened emission standards for specific air pollutants, causing 72% of Ascon plants located in planned management and natural green zones to be classified as unauthorized illegal facilities.

The Ministry of Environment amended the Air Quality Preservation Act twice, in 2006 and 2020, adding polycyclic aromatic hydrocarbons (PAHs) and benzene among specific air pollutants subject to regulation and tightening emission standards. Only companies that install prevention facilities and do not exceed the allowable emission limits can be reauthorized. In particular, the allowable emission limit for PAHs is 10 ng/㎥, a level that companies claim is impossible to achieve with current technology. In contrast, the allowable PAHs emission limit in industrial complexes is 50,000 ng/㎥, which is 5,000 times higher than that in planned management areas.

Fifty Ascon companies in the Seoul-Gyeongin area invested between 300 million and 500 million KRW each, totaling 17.5 billion KRW by the end of last year to install harmful substance reduction facilities, but they failed to meet the standards required by the Ministry of Environment. This means that current prevention technologies cannot satisfy the standards.

Seo Sang-yeon, director of the Seoul-Gyeongin Ascon Industrial Cooperative, explained, "The Federation, along with the Ministry of Environment, the National Institute of Environmental Research, and the Korean Society for Atmospheric Environment, held three competitions for optimal prevention facilities, but no equipment meeting the standards was developed. No country in the world, including Korea, currently has the technology to meet these standards."

Ascon's main raw material is asphalt (AP), the residue left from the final stage of crude oil refining. Since the AP supplied by refineries already contains benzene exceeding the standard (3.11 ppm versus the standard of 0.1 ppm), the industry argues that responsibility should first be placed on the refineries. There is dissatisfaction that the Ministry of Environment is shifting responsibility to small Ascon companies while ignoring the refineries.

"Not Refusing, Just Asking for Time"

Even if there is no possibility of overcoming the Ministry of Environment's high hurdles, regulations remain strict even if the hurdles are cleared. According to the National Land Planning and Utilization Act, factories requiring air emission facility installation permits cannot be located in planned management areas. This means that even if reauthorized by the Ministry of Environment, Ascon plants cannot continue operating at their current locations and must either close or relocate to industrial complexes with more lenient emission standards.

According to the Federation's data on last year's nationwide Ascon production and delivery, the Seoul-Gyeongin region produced 5.9 million tons, Busan-Ulsan-Gyeongnam 2.72 million tons, Daegu-Gyeongbuk 2.6 million tons, and Chungbuk 1.4 million tons. The Seoul-Gyeongin region produces more than twice as much as other regions. However, even the seemingly better Seoul-Gyeongin region is just a case of "all that glitters is not gold."

According to estimates by the Seoul-Gyeongin Cooperative, the average sales of Ascon companies in the Seoul-Gyeongin region range from 10 billion to 15 billion KRW, with profits around 10%. Due to rain, snow, or extremely cold weather, the average annual factory operation days are about 200 days, and in poorer regions, only about 100 days. With annual profits of 1 to 1.5 billion KRW, companies spend 200 to 300 million KRW in winter on machinery and equipment maintenance, with the remainder covering raw material and fuel costs, labor, and other expenses. Some regions have many companies with annual sales as low as 1.5 to 2 billion KRW, making investment in reduction facilities unthinkable.

Director Seo appealed, "We are not refusing but asking for a grace period to delay the investigation and crackdown on specific air pollutants at existing Ascon plants until reduction technology is developed and commercialized, and to ease location restrictions in planned management areas. Although it is a difficult problem with no clear solution, please appreciate the efforts of companies doing their best to resolve it."

While negotiations between the Ascon industry and Gyeonggi Province are progressing toward somewhat easing location restrictions in planned management areas, the Ministry of Environment remains firm. A Ministry of Environment official emphasized, "We have already stated that we will not accept this," and added, "There will be no significant changes to the Air Quality Preservation Act at present."