Regulatory Outlook: Environment
Current issues: February 2019
Environment Bill and 25 year environment plan
On 19 December 2018, draft provisions of the Environment Bill were presented to Parliament. The Bill is a key piece of post-Brexit legislation which establishes the Office for Environmental Protection, the body that will oversee the implementation of laws and environmental improvement plans (EIPs) after the UK leaves the EU. The draft provisions are accompanied by a list of statutory principles which set overarching standards and will assist in policy making.
On the same day, the Department for Environment, Food and Rural Affairs published a consultation on its framework and metrics that will measure and track changes in the environmental system to monitor the success and progress of its 25 year environment plan. The draft Environment Bill includes provisions to set the 25 year plan on a statutory footing as the first EIP. The draft Environment Bill requires the Secretary of State to obtain data to monitor the progress of the EIP, which will be achieved using these indicators and metrics.
On 18 December 2018, the government published its Resources and Waste Strategy for England which sets out how the government proposes to ensure less waste in favour of more recycling, repair and reuse. The key updates are as follows:
- A tax will be introduced for plastic packaging with less than 30% recycled plastic.
- Producer responsibility will be increased and producers will be required to pay the full costs of packaging disposal.
- Recycling collections are to become more consistent.
- The waste electrical and electronic waste directive (WEEE) will be reviewed early this year.
- A deposit return scheme for drinks containers is to be introduced by 2023.
- Food businesses will be required to produce annual reports on food waste.
- Mandatory guarantees and extended warranties may be introduced for products.
- Electronic waste tracking is to become compulsory.
Simultaneously, the government published statutory guidance on how food and drink waste fits within the waste hierarchy. This highlights how it can be prevented and redistributed, explains the difference between “best before” and “use by” dates, and generally seeks to ensure that landfill and sewer waste are a last resort.
Environmental taxes and allowances
The 2018 Autumn Budget contained announcements on a number of environmental taxes and allowances that will take effect in 2019/20, including the following:
- The government intends to implement a carbon emissions tax to replace the EU Emissions Trading Scheme post-Brexit.
- Enhanced capital allowances will end for energy and water technology companies on 31 March 2020 but first year allowances will be extended for companies investing in electric vehicle charging points, with corporation tax allowances available until 31 March 2023.
- The aggregates levy rates will be frozen for the 2019/20 period.
Recent Court of Appeal ruling on trade effluent
Owners of premises that connect foul and surface water drainage to the public sewer system should be aware of the recent Court of Appeal ruling on trade effluent.
In Boots UK v Severn Trent Water Ltd, trade effluent had been mixed with surface water before it went to the sewage undertaker. The company was charged for the disposal of the mixed liquid but sought to claim that it should pay only for the trade effluent. The court decided that the entirety of the mixed liquid amounted to trade effluent on the grounds that legislation expressly excludes domestic sewerage but not surface or storm water.
As such, companies should ensure that trade effluent is separately drained to ensure costs are not increased.
The Waste and Resources Action Programme (WRAP) has published its UK Plastics Road Map 2025, which helps businesses to deliver targets set out in its plastics pact – a voluntary industry initiative which includes a target of 30% recycled content across all plastic packaging by 2025. Through the pact, businesses have committed to eliminating problematic or unnecessary single-use packaging, ensuring 100% of plastics packaging is reusable, recyclable or compostable, and ensuring that 70% of plastics packaging is effectively recycled or composted. Whilst this is not mandatory, businesses should consider following the guidance given the recent updates in waste strategy which could see these targets become statutory in the near future.
The Department for Business, Energy and Industrial Strategy has also announced a £60m investment into sustainable packaging. It hopes to work alongside industry to find solutions and bring about the changes.
Finally, the recently published Waste Strategy Report announced that a consultation will take place on increasing the 5p carrier bag charge and on extending the initiative to make it mandatory for all retailers.
Japanese knotweed: impact on the built environment
An inquiry into Japanese knotweed’s impact on the built environment has been launched by the House of Commons Science and Technology Committee. The Committee is looking for scientific evidence as to the impact of Japanese knotweed and how this may affect lending decisions and property evaluations. Following written evidence, the Committee will invite experts to hold an oral session early this year.
Given the difficulty of removing knotweed and the large fines that may be imposed when it spreads to neighbouring properties, businesses should keep on top of governmental updates in this area.
In Focus: No deal Brexit
What would be the impact of a no deal Brexit for UK businesses trading with the EU?
Much environmental law that applies in the UK is derived from the EU and/or from international agreements. Following Brexit, the UK’s obligations under international treaties will continue to apply and the body of EU law will be incorporated into UK law (under the EU (Withdrawal) Act 2018), subject to ‘correcting powers’ to remedy ‘defects’ or ‘deficiencies’ arising from the UK’s exit (such as references to EU bodies or procedures).
As a result, substantive environmental law will remain, but there is still uncertainty around how some of the legislation will apply – for example when it refers to standards or guidance that are set by EU environmental bodies. Where this is the case, we do not yet know whether the UK government is likely to maintain, relax or tighten the rules, and in many cases the government has not yet identified a UK body that is ready to take over functions currently carried out by an EU body.
As such, companies should continue to comply with their obligations as though nothing has changed until the government confirms its position. It has published guidance on what will happen in respect of certain environmental obligations in a no-deal Brexit, such as introducing a carbon tax to replace the EU ETS. Should there be no deal, a holding arrangement would also be put in place for the establishment of the Office of Environmental Protection to ensure any breaches of environmental law are still caught.
Dates for the Diary
|1 March 2019||Environment Agency consultation on revisions to its public participation statement closes.|
|4 March 2019||Consultation on draft climate change adaptation for Wales closes.|
|11 March 2019||EU ETS reporting deadline to report 2018 emissions, with deadline to surrender allowances for 2018 following on 15 March 2019.|
|31 March 2019||Radioactive Waste Management consultation on potential sites for a new geological disposal facility to be published.|
|1 April 2019||Streamlined Energy and Carbon Reporting scheme comes into force, replacing the CRC Energy Efficiency Scheme and introducing new energy consumption and carbon emissions reporting obligations for large businesses.|
|7 April 2019||Environmental Protection (Miscellaneous Amendments) (England and Wales) Regulations 2018 come into force.|
|1 October 2019||Compliance deadline under the Medium Combustion Plant Directive for ‘Tranche A’ generators with a thermal input above 5MW, emission level of NOx over 500mg/m3 and which operate for more than 50 hours per year.|