Environmental Law News Update

In this latest Environmental Law News Update, Charles Morgan, Brendon Moorhouse and Natasha Hausdorff consider DEFRA’s plan for storm overflows, water discharge permits in the Hinkley C Appeal, and how companies can improve their ESG data for effective decision-making.

Defra has a Plan

Baldrick: “I have a plan, sir.”
Blackadder: “Really, Baldrick? A cunning and subtle one?”
Baldrick: “Yes, sir.”
Blackadder: “As cunning as a fox who’s just been appointed Professor of Cunning at Oxford University?”

Section 141A of the Environment Act 2021 required Defra to produce a storm overflow discharge reduction plan by 1 September 2022. It did so five days early, on 26 August 2022 (solicitor readers will doubtless be thinking, “Wish barristers did that”). Here it is, in its revised form with missing footnotes restored. It includes as Annex 5 the “Report on feasibility of elimination of discharges from storm overflows” which section 84 required to be produced by the same deadline. Whilst the annex is 18 pages long, it can be précised by the single word “none”. By way of example, of the option of creating sufficient additional storage to eliminate all overflows, it says:

“A scenario that is cost beneficial would have a cost benefit ratio of at least 1. The Storm Overflows Evidence Project calculated an upper estimate of 0.05 (using an upper estimate for benefits and lower estimate for cost) for achieving complete elimination by increasing network storage only. It follows that for this scenario, the costs of elimination far outweigh the benefits.”

Not gonna happen. Similar outcomes for all other methods of elimination. We have commented in the past on the process of cost-benefit assessment, see here.

As for reduction, the body of the Plan sets a number of targets: by 2025, reduction of discharges by 25%; by 2035, improvements of all overflows at or near bathing waters and 75% of overflows to high priority sites; by 2050, “no storm overflows will be permitted to operate outside of unusually heavy rainfall or to cause any adverse ecological harm.” The targets will be reviewed in 2027.

Whether this timetable will overstretch public patience remains to be seen. Activists will at least be pleased to read the proposition that in the meantime, “Water companies must comply with all their existing regulatory obligations and duties, including permits issued by the Environment Agency” and that, if they don’t, the EA can take “robust action”, which may result in “Potential prison sentences following successful prosecution for Chief Executives and Board members whose companies are responsible for the most serious incidents.”

Adopting the approach that prevention is better than cure, the Plan also proposes the rolling-out of Sustainable Drainage Systems, including the implementation of Schedule 3 to the Flood and Water Management Act 2010 and the removal of the automatic right to connect to the sewerage system.

A further interesting aspect of the Plan is its urging that “Rainwater should be treated as a resource to be valued for the benefit of people and the environment, not mixed with sewage or other contaminants.” However, that feeds into the perhaps more controversial proposition that “Analysis has shown that changing public water consumption habits alone can potentially improve storm overflow spill performance by up to 69% in terms of volume and cause a 39% reduction in duration.” So that would be without the sewerage undertakers having to lift a finger or spend a penny, then? Come to think of it, if we all didn’t spend a penny, the problem would completely disappear…

Hinkley C Appeal – water discharge activity permit

On 2nd September, the Secretary of State published the long-awaited decision in relation to the appeal against the Environment Agency’s non-determination of an application to remove the acoustic fish deterrent (AFD) conditions from a water discharge activity permit for Hinkley C nuclear power station in Somerset.

The decision, to dismiss the Appeal, followed a Public Inquiry held in June 2021.

The Inquiry considered the predicted impacts on the Severn Estuary Special Protection Area (SPA), Severn Estuary Special Area of Conservation (SAC), Severn Estuary Ramsar site, the River Usk SAC and the River Wye SAC of the removal of acoustic deterrent equipment aimed at preventing the impingement and entrainment of fish, including endangered Annex II species – the Twait and Allis Shad.

The Inquiry pit conflicting methodologies advanced by CEFAS’s consultancy services on behalf of the Appellant against scientists of the Environment Agency and others including scientists formerly involved in the design of the cooling-water abstraction system.

While ultimately the outcome was based upon an appropriate assessment carried out by the Secretary of State as the competent authority to ascertain whether the AFD would adversely affect the integrity of the designated sites and Ramsar site, the Inquiry considered the approach to be taken towards interpreting terms such as ‘site integrity’ and ‘fish assemblages.’

It remains to be seen whether the outcome will affect the design of Sizewell C that is proposed to be built with similar technology.

FRC Report: Better ESG data drives more impactful decision-making by companies

At the end of August the FRC published a report on Improving ESG data production. The report follows the FRC’s Statement of Intent on Environmental, Social and Governance challenges, published in July 2021, and looks at how companies are developing their systems to generate reliable data. It provides guidance on how companies can organise themselves to process data for public reporting, including navigating to the specific areas, which are most material to them and generating information that company boards need in order to make strategic decisions on sustainability.

The report focuses on how companies can improve their ESG data for effective decision-making and identifies that the systems producing, distributing and using ESG data are significantly less mature than those for financial information. The writers acknowledge that the current data landscape is a complex one with challenges for Boards and executives on how to identify and use the most relevant information. They set out the three key elements of ESG data production: (i) what motivates the company to collect data and therefore what ESG data is required; (ii) the method by which to organise and coordinate teams across companies to collect the data; and (iii) interpreting the meaning of the data for effective decision making.

The tips contained therein aim to assist company boards to respond to challenges and meet targets, to engage in strategic, effective decision making, and also meet regulatory requirements or requests from investors and other stakeholders, recognising the increasing demands on companies to produce public data.

This report is the first part of a three-part project, with the following analysis due to focus on the distribution of data, through data aggregators, and its consumption by the wider public. Josephine Jackson, Chair of the FRC ESG and Climate Group, said:

“High-quality data is critical to high-quality decision-making. Improving the systems and processes for the production of ESG data, as well as embedding a joined-up approach to data collection will result in better decision-useful information. In turn this will lead to more relevant and reliable disclosures for all users who rely on companies for clear reporting of ongoing performance and future prospects.”

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If you have any comments or suggestions please contact Bridget Tough at bridget.tough@6pumpcourt.co.uk