Environmental Law News Update

December 4, 2017

In this latest Environmental Law News Update Christopher Badger and Charles Morgan consider the Environment Agency’s consultation on a new Enforcement and Sanctions Policy, an inquiry into Green Finance by the Environmental Audit Committee and new farming rules for water.


Environment Agency Consults on New Enforcement and Sanctions Policy

The Environment Agency currently acts according to the principles contained in three documents: Enforcement and Sanctions – Statement (v.3, 2014, 9 pages) – a high level statement of principle; Enforcement and Sanctions – Guidance (v.4, 2015, 75 pages) – a working document providing a methodology for determining the appropriate method of response (criminal sanctions/civil sanctions); Enforcement and Sanctions – Offence Response Options (v.11, 2016, 175 pages) – a comprehensive list, sector by sector, of available responses to specific offences and applicable civil sanctions.

Each document tells the reader that it must be read together with the others. Only then will the full mystery be revealed.

In order to render this process of revelation easier, the Environment Agency proposes to combine the first two of these documents into one, to be called “the Enforcement and Sanctions Policy” (referred to as “the revised ESP”). A draft of 68 pages has been prepared together with a consultation document. Two major drivers for the proposed changes have been the 2014 Definitive Guideline for the Sentencing of Environmental Offences (on the practical operation of which there is now a considerable mass of experience) and the introduction of a power to accept enforcement undertakings (“EUs”) for breaches of the Environmental Permitting Regulations. It is proposed that the Sentencing Guideline should form the basis for the calculation of variable monetary penalties under the RESA régime. The new policy will also include revised guidance on climate change penalties and numerous other changes.

Perhaps the most novel proposal is a methodology for “natural capital assessment” as a means of quantification of an EU offer in the context of water pollution. This is set out in a further document “Water Pollution Natural Capital Calculator Guidance” and an accompanying Excel workbook file “Water Pollution Natural Capital Calculator”. The latter’s purpose is to estimate “the value the public holds for improvements to rivers, lakes and other water bodies such as reservoirs, canals”. The range of figures produced by the calculator will “provide a starting point to open discussion with the Environment Agency”. The devil here is definitely in the (invisible) detail; parameters (such as decline in water quality) are selected from a series of drop-down menus to which values are ascribed in a manner not transparent on the face of the spreadsheet, though doubtless to be found embedded within it. “Results” appear at the foot of the table in the form of the “Central” and “High” points of the range of suggested offers. Outcomes from four to eight figures in £s can readily be generated by casual experimentation. Behind this apparent simplicity must lie a sophisticated process of cost-benefit analysis, the most likely source being “Principals of Natural Capital Accounting” developed by the Office for National Statistics and Defra. Nothing about cost-benefit analysis, the assumptions upon which it is based and the values which it produces is set in stone (see Charles Morgan’s recent article published in the Journal of Water Law) and there is bound to be scope for respectable argument over both the methodology used and its application within the calculator, open to be raised by anyone prepared to decipher both and to respond during the consultation period (absent which, the calculator’s workings will in effect “solidify”).

The Environment Agency is now seeking views on its proposals. As it says: “this is your opportunity to ensure that the revised ESP can be understood by you and is clear and fair about the action we may take if a legal obligation is breached.” The consultation has now begun and will run until 15 January 2018. You can respond online.


Environmental Audit Committee looks into Green Finance

On 24 November 2017 the Environmental Audit Committee launched a Green Finance inquiry to scrutinise the Government’s strategy to develop ‘world leading Green Finance capabilities’.

The inquiry will examine:

• The measures set out in the Clean Growth Strategy;
• Whether the Green Investment Group is fulfilling commitments made by its new owners Macquarie;
• The UK’s future relationship with the European Investment Bank;
• How company reporting on climate liabilities and risks could be encouraged;
• Whether the Government’s policies are likely to deliver the levels of investment needed to meet the UK’s national and international environmental commitments.

The Committee’s starting point is to invite written submissions by 3 January 2018. Interesting topics include how can investment promote long-term sustainable development, what the effect of leaving the EU will be on investment in environmentally friendly projects and where the newly created ‘Green Finance Taskforce’ should concentrate its efforts.

Private sector investment in low carbon technology and infrastructure is considered key to whether or not the UK will meet its carbon budgets. In contrast, there is a question mark about the level of support from the Government for renewables projects. The key issue is whether current proposals are going to encourage innovation by and investment in UK business.

The Committee’s terms of reference can be found here.

New Farming Rules for Water

DEFRA has published a policy paper setting out ‘Farming Rules for Water’, due to take effect from April 2018 and intended to fulfil obligations under the Water Framework Directive. The paper follows a consultation that took place back in 2015.

The scope of the rules includes the storage and application of organic manures and manufactured fertilisers and protection of soil erosion. It is intended that the Environment Agency will carry out any checks against the rules as part of its existing risk-based, targeted farm inspections. The Agency will focus on catchments where agriculture is known to be having an environmental impact, as well as associated higher risk farming activities and non-compliant farmers.

Diffuse rules for farmers already include topics such as nitrates, slurry and pesticides. Further, the Government published River Basin Management Plans in February 2016 and intends to publish a 25-year environment plan at some point in 2018. Yet future environmental policy requires a coherent approach. It is estimated that 70% of the UK’s land is managed by farmers and the challenge for farming policy is whether it is possible to develop a supportive approach that engages with both food production and environmental measures, promoting productivity rather than stifling it.

The policy paper can be found here


Christopher Badger wins Legal 500 UK Junior of the year:  Real Estate, Environment and Planning

We are delighted to announce that Environmental Law News blog author Christopher Badger has won the Real Estate, Environment and Planning Junior of the Year in the Legal 500 2018 UK Bar Awards announced earlier today.