Environment news update - 6 September
Welcome to the latest edition of our weekly Environment Law news update. As ever, we bring you developments, insights, and analysis in the world of environmental law.
NEWS ROUND UP
Data reporting failures: £25m for Ofgem’s Voluntary Redress Fund
The UK’s largest power station Drax was involved in an investigation relating to environmental impact of wood supply chains which took 16 months. It concluded that there were gaps in the company’s data collection on the sustainability of the wood imported to burn in its biomass units in 2021-22. This led to Drax agreeing to pay £25m into Ofgem’s Voluntary Redress Fund.
In 2022 Drax imported 8.2m tonnes of biomass. To ensure sustainability, imported wood often needs to meet certain certification standards to ensure that the wood is sourced from responsibly managed forests. While biomass is considered renewable, burning wood can produce more carbon dioxide per megawatt of energy than fossil fuels when considering the entire lifecycle, including harvesting, processing and transportation. Data on the sustainability of biomass is collected through various means, including satellite monitoring of forest cover, audits of supply chains, and reporting by certification bodies. This data helps to ensure that the biomass used is not contributing to deforestation or other environmental harms.
The Company CEO argued that their failings were due to the challenging times for Drax’s sustainability and compliance teams, specifically covid restrictions relating to travel and taking critical decisions in person as well as the integration programme of Pinnacle’s assets. Nevertheless, the company accepted the findings and is planning on investing £3m in automated data collection and reporting methods relating to sustainability.
Ofgem found no evidence that Drax failed to meet the sustainability criteria of the Renewables Obligation scheme, that Drax has been issued with Renewables Obligation Certificates incorrectly nor that Drax has deliberately misreported. As such Ofgem cleared the company of any wrongdoing in relation to environmental breaches.
The company’s CEO emphasised the importance of the skill and care of the sustainability and compliance teams as well as their operational colleagues.
Analysts and commentators as well as the company view the conclusion of the investigation as a positive. This may allow the government to extend biomass subsidies that is due to expire in 2027, despite opposition from environmental groups, politicians and climate campaigners, arguing against the use of public funds for wood burning.
In January this year, the government launched a consultation to discuss a “bridging mechanism” for extending biomass subsidies at Drax after the current scheme expires. The consultation supports transitioning from current renewable schemes to bioenergy with carbon capture and storage but the final decision was delayed by the general election and is causing concern for Drax.
New Water Bill to Hold CEOs Accountable for Environmental Failures
In a significant move to address the pollution of rivers lakes and seas across England and Wales the UK government has introduced the Water (Special) Measures Bill. The legislation set to dramatically increase enforcement powers against water companies and their executives forms a central pillar of the government’ wider efforts to overhaul the water industry and curb environmental damage caused by sewage dumping.
New Key Measures
- Tougher Penalties and Criminal Charges for Water. A key provision includes the potential for water company executives to face imprisonment of up to 2 years if they are found guilty of covering up incidents of sewage dumping. Currently CEOs of water companies can face fines failing to comply with investigations by the Environment Agency (EA) and the Drinking Water Inspectorate, but criminal prosecutions have so far been rare. Water companies will also be forced to cover the costs of investigations by the EA and the DWI helping these regulators fund enforcement action;
- Stricter compliance requirements and financial penalties: the bill aims to ensure that water companies quickly hand over critical sewage data imposing severe fines for delays or failures in transparency. New provisions will make it easier for the EA to issue Fixed Monetary Penalties lowering the standard of proof required for enforcement and enabling quicker penalties for pollution offences, failure to report spills or non-compliance with water resource regulations. For the first time water companies will be required to publish real-time data on sewage overflows within an hour of discharge making this information publicly available.
- Banning bonuses for failing Executives: another major change is the introduction of measures that will prevent water company executives from receiving performance bonuses if their companies fail to meet environmental or customer standards. This move comes after high-profile controversies including the case of Severn Trent Water’s CEO Liv Garfield who took a £584,000 bonus despite her company being fined £2million for sewage dumping. Ofwat the water regulator will now have the authority to ban bonuses for CEOs whose companies underperform, fail to meet environmental standards or are not financially resilient.
Whilst the UK government has hailed the new Bill as a transformative step in cleaning up the water sector campaigners argue that more fundamental changes are still needed. Notably Fergal Sharkey, a prominent sewage campaigner has voiced concerns that the measures do not go far enough to protect waterways and ensure that clean rivers across the UK. Sharkey and other campaigners continue to call for deeper reforms and greater investment in the nation’s water infrastructure.
Conclusion
The Water (Special Measures) Bill represents a step in the UK government’s bid to tackle the environmental harm caused by water companies. By increasing penalties, enhancing transparency and holding water company executives accountable the Bill marks a shift in the regulation of the water sector. Given the urgency of the issues surrounding water pollution and sewage dumping the government is pushing for swift legislative action to address public concerns and environmental damage. However, the success of these reforms will depend on the continued enforcement and the UK government’s ability to drive further transformation in the industry.
Developer to pay £300,000 for ignoring tree protection conditions
Gloucester Crown Court has this week provided a useful reminder to developers of the importance compliance with conditions, including those requiring the protection of trees on site, as a developer has been ordered to pay nearly £300,000 in fines and costs and now has a partially built site with extant planning permission.
South Hams District Council have successfully prosecuted Garden Mill Ltd and their director, John Freeland, for breach of a temporary stop notice and enforcement notice. The notices required building works to stop at the Locks Hill site in Kingsbridge, Devon due to non-compliance with a pre-commencement condition.
The condition provided no site clearance, preparatory work or development would take place until a scheme was put in place to protect trees on the site and limit the impact that building work and the development would have on a neighbouring Grade-II listed building. However, the adequate tree protections were not provided prior to commencement of the development.
The matter had already been appealed by the developer to the Planning Inspectorate, after the Council declined to determine applications for the details of the development as they found the outline permission had lapsed. The Council asserted the outline permission had not been lawfully implemented due to non-compliance with the pre-commencement conditions.
The inspector had decided non-compliance with the above condition went to the heart of the permission and thus agreed with the Council the outline permission had not been lawfully implemented.
The developer pleaded guilty to breaching a temporary stop notice and enforcement notice served by the Council and was subsequently ordered to pay £176,000 in fines and £120,000 to the Council, £156,000 of which is to be paid by the director of the company.
The full statement published by South Hams District Council on this matter can be read here.
Plastic Overshoot Day arrives
Thursday 5th September was an extraordinary day, not only did the planning and environment team come within 1 point to winning the Liverpool Women in Property Annual Quiz, but it also represented the day when the amount of plastic produced exceeds the existing capacity of waste management systems – The Plastic Overshoot Day.
Earth Action and the Chartered Institute of Wastes Management reported that 220 million tonnes of plastic will be generated in 2024, this is outpacing recycling rates and waste management capacity globally.
It is rather depressing, but in raising this issue will hopefully go some way to finding a resolution
