Environmental Law News Update

In this latest Environmental Law News Update, Gordon WignallChristopher Badger and Natasha Hausdorff consider sentencing remarks in Environment Agency v Southern Water, the removal of climate commitments from the Australia trade deal and House of Lords amendments to the Environment Bill.

Environment Agency v Southern Water

No-one will ever want to read another case about such degrees of pollution as those deliberately and cynically caused by Southern Water, which was sentenced on 9 July 2021: seven years of untreated sewage discharged into coastal waters over a 6 year period. The fine of £90m (reduced by a third for an early plea) was widely publicised.

What can the sentencing remarks tell us about the judicial application of the Environmental Offences Definitive Guideline even where a very large organisation is not the defendant?

EA v Southern Water is best seen in conjunction with Regina v Thames Water Utilities Ltd, Practice Note [2015] EWCA Crim [2015 1 WLR 441, the first definitive guidance case which was heard by the Court of Appeal, and on which Southern Water draws.

The overarching message must be that, save in cases of low culpability where there is very minor harm, judges can be expected to sentence with full regard for punishment and deterrence: companies can expect to be hit hard in order to drive home the message that environmental damage will not be tolerated. The higher up the scale the offending falls, the more rigorously this principle will apply.

To mitigate the sentence, there must be the most extensive cooperation with the regulator, very early and genuine attempts to prevent the same incident from occurring, the earliest and most unhesitating expressions of genuine remorse and the prompt engagement of the most senior members of the board of directors.

In examining culpability, Mr Justice Johnson in Southern Water was prepared rather to stretch the evidence before him to draw inferences against the board of directors and even to establish a counterfactual world which would have existed if the board of directors had set up adequate working systems. The Court of Appeal in Thames Water, adopting the wording of the definitive guidance, was concerned only with the conduct of the “organisation as a whole”.

The cases show that nice distinctions on the facts and elaborate accounts of a company’s finances are of very limited assistance to a defendant.

In Southern Water Johnson J. took one specimen count, applied the culpability / harm matrix under the guidance, adopted a suitable starting point, and considered the aggravating and mitigating factors before deciding on the appropriate totality of the fine. He then established his own methodology for examining the economic benefit of the offence (applying a cross-check by an alternative assessment) and added this to the fine, ensuring that he considered the fine proportionate to the Defendant’s means. He then reduced the fine to reflect the plea, proportioning the total sum out among individual offences.

It is clear from both authorities that a sort of logarithmic sense of judicial exasperation will be applied to the combination of a defendant’s lawlessness and the extent of the environmental harm it causes.

At the same time, anyone needing to make clear their case in mitigation must do so fully, realistically and openly, in accordance with the correct procedures and in good time for the first hearing. There can be few other cases in which it is correctly said that a first hearing is not a dress rehearsal. There must be a correct basis of plea, the agreement of the prosecution must be obtained as necessary and the case must be correctly listed with the full cooperation of the judiciary.

Climate commitments removed from Australia trade deal

Is this evidence that the UK is prepared to prioritise trade over the environment?

It has been reported that the Government removed references to temperature goals from the deal and that the Australian prime minister is supposed to have asked for key Paris agreement climate commitments to be watered down.

Part of the issue may be that the Government needs to be seen to make Brexit a success. As one “government source” told the Telegraph in May: “If we can’t get Australia over the line, then we’re partly accepting our centre of gravity still revolves around Europe.”

The Government has estimated a gorecast benefit of a 0.02% boost to GDP over 15 years as a consequence of the trade deal.

The changes appear to make the Australia deal weaker than the Brexit agreement with the EU. According to European Commission data, Australia is the second-largest exporter of coal in the world and has a high per capita carbon footprint. The country has a notoriously weak record on climate action.

The UK’s Department of International Trade has stated that there will be a substantive article on climate change which reaffirms both parties’ commitments to the Paris Agreement and achieving its goals. However, the Department would not confirm whether “1.5°C” would actually be included in the agreement.

One potential inconsistency between the parties was that while the Australian Prime Minister stated emphatically that this was a trade agreement, not a climate agreement, the UK Government sought to argue that there were already a lot of environmental safeguards in the trade deal and that the text implicitly committed Australia to the Paris Agreement.

However, the failure to expressly refer to 1.5°C does imply that Australia is not as committed to the goals of the Paris Agreement as might have been considered when it was ratifed.

House of Lords amendments to the Environment Bill

As the House of Lords continues its scrutiny of the Environment Bill in Report stage, the Government was defeated in several votes. Peers agreed to amendments relating to the independence of the Office for Environmental Protection (OEP), exemptions from environmental legislation, the powers of Courts and the question of whether interim targets should be binding on Ministers.

Lord Krebs (Crossbench) was successful in proposing that the OEP should have “complete discretion in the carrying out of its functions”, including in preparing its enforcement policy, exercising its enforcement functions and preparing its budget, and that the consent must be obtained from the Environment, Food and Rural Affairs and Environmental Audit Committees for any changes to senior OEP appointments.

Baroness Parminter (Liberal Democrat) was successful (by two votes) in her amendment to remove exceptions for the armed forces, defence policy, tax, spending and resources from the requirement to have due regard to the policy statement on environmental principles.

Lord Anderson of Ipswich (Crossbench) won an amendment to allow courts to grant any remedy for non-compliance by an authority with environmental legislation that it could were a judicial review taking place.

Baroness Brown of Cambridge (Crossbench) was successful in advancing a statutory duty on the environment secretary to meet any interim targets set, bringing those targets into line with the suite of legally binding, long-term environmental improvement targets and the interim milestones in the Climate Change Act.

Further amendments, to be considered by the House this week, cover a range of subjects, including:

  • reducing single-use items;
  • reducing the risks to pollinators, such as bees, from pesticide use;
  • lowering speed limits to improve air quality;
  • establishing air quality improvement areas; and
  • monitoring and reducing storm overflows. 

It remains to be seen what impact the Government’s defeats and the further proposed amendments will have once the Bill returns to the House of Commons, given the Government’s majority.

To keep up-to-date follow us on Twitter @6pumpcourt or click here to subscribe to the mailing list. If you have any comments or suggestions please contact Bridget Tough at bridget.tough@6pumpcourt.co.uk

Environmental Law News Update

In this latest Environmental Law News Update, Charles Morgan, James Harrison and Rukan Hazar consider a new regulatory statement on water and sewage effluent discharges, a legal challenge relating to the emission of noxious landfill site fumes and an announcement on the UK’s new ‘Heat Strategy’.

The New Normal?

“Normally, you need a permit under the Environmental Permitting (England and Wales) Regulations 2016 to discharge treated effluent from a waste water treatment works (WwTW) to surface water or groundwater”. So begins the Environment Agency’s latest “Regulatory Position Statement” B2 on the subject of “Water and sewerage company effluent discharges: supply chain failure.” The word “invariably” might be nearer the mark. But now, only “up to a point”, to be determined by an officer of the Agency.

We discoursed very recently on the subject of Regulatory Position Statements (see Environmental Law News Update 167) in the context of spreading of sewage sludge, where it seems that a significant “get out of jail free” card has been delivered to sewerage undertakers to ease the problems arising from lack of storage space. This time the relaxation is, according to Water UK as reported by ENDS, prompted by supply chain difficulties (specifically delivery problems due to a shortage of drivers) leading to a dearth of ferric sulphate which is used in tertiary treatment. The problem is thus not as bad as it might be (ENDS had to correct an earlier version of the story which suggested that the RPS would allow more raw sewage to be discharged into rivers) but the timing of the RPS could scarcely be worse, coming hot on the heels of the record fine imposed on Southern Water and the debate over the provisions in the Environment Bill concerning sewage discharges and on the eve of COP26. It is likely to be seen as a further unacceptable laxity in regulation of the undertakers, who are seemingly let off every hook on which they might conceivably become snagged.

The RPS is hedged with caveats. It is not available at all in the case of “high risk” discharges and available stocks must be prioritised for the most risky of the remaining discharges. Two weeks’ advance notice must be given to the Environment Agency and normal use must resume as soon as possible. The relaxation will end altogether on 31 December 2021 unless extended.

An undertaker is also required to show that the shortage has occurred despite reasonable contingency and response planning. Characteristically of RPSs, there is of course no orderly mechanism for the determination of any argument about whether or not such planning has taken place. It would certainly not be any defence to the strict liability offences whose effect it purports to relax. The “length of the Chancellor’s foot” by which the operation of the 17th century courts of equity was said to vary has re-emerged in the context of 21st century environmental law in the form of the impression of the Environment Agency officer determining the applicability of an RPS. Indeed in the case of the infamous H4 Odour Management Guidance it might not unfairly be suggested to depend upon the flare of the officer’s nostrils.

Local residents kick up a stink about noxious landfill fumes

The Administrative Court recently heard proceedings brought against the Environment Agency with respect of gases that are emanating from Walleys Quarry landfill near Newcastle-under-Lyme. Thousands of residents have complained of sleeplessness and breathing difficulties and claim it has gotten worse since the beginning of this year. However, the effects have been felt most acutely by Mathew Richards, a five-year-old claimant represented by his family, who is said to have a reduced life expectancy as a result of emissions from the site.

The landfill at Walleys Quarry produces hydrogen sulphide, which is a poisonous, corrosive gas with an ‘eggy’ odour, and, at times, the levels of the gas at the site have exceeded the World Health Organisation guidelines. The High Court was told that the local community (of which many members are elderly and 1,773 are children under the age of five) has suffered “with widespread physical and mental health conditions due to the emissions”. For Mathew the production of noxious gases has aggravated his chronic lung disease and underlying health conditions meaning that, in his mother’s words, he regularly has nights where he is “coughing, vomiting, [and] choking” and if the legal proceedings are unsuccessful the family may be forced out of their home.

The judicial review proceedings, of which the Richards family are a part, are brought against the Environment Agency with respect of their enforcement of Walleys Quarry Ltd and are intended to bring an immediate stop to landfill activities at the site. Human rights arguments are being advanced – under Articles 2 and 8 of the ECHR – as well as arguments that the Environment Agency failed to properly inform itself about the safe levels of hydrogen sulphide emissions. In response, the Environment Agency reject the claim that there is a ‘public health emergency’ at Walleys Quarry and argue there is not a real and immediate risk to Mathew’s life.

Mr Justice Fordham is expected to give his ruling at a later date.

Announcement of the UK’s new ‘Heat Strategy’

As readers will know, on 27 June 2019, the UK government set a legally binding target to achieve net zero greenhouse gas emissions from across the UK economy by 2050. A way in which the UK government is aiming to do this is by improving the energy efficiency of new and existing buildings to reduce heat demand.

The Department for Business, Energy & Industrial Strategy announced that it would carry out a consultation on regulatory options to phase out the installation of fossil fuel heating systems in off gas grid buildings. Following the publication of the Future Framework for Heat in Buildings in 2018, it was further announced that the Department for Business, Energy & Industrial Strategy would develop a new long-term policy framework for the future of heat – a ‘Heat and Buildings Strategy’. The strategy will aim to enable homes and businesses transition to low carbon alternatives and bring the UK a step closer to the net zero target.

The highly anticipated ‘Heat and Buildings Strategy’ was expected to be published in March. However, it has been announced that the publication will be further pushed back to September 2021 when the broader net zero strategy will also be published. This will coincide with the 26th UN Climate Change Conference of the Parties (COP26) in Glasgow on 31 October – 12 November 2021.

There have been recent suggestions by Business Secretary Kwasi Kwarteng that the ‘Heat and Buildings Strategy’ may include a plan for phasing out gas boilers. He also added the possibility of introducing incentives aimed at homeowners to make buildings more energy efficient and introducing a carbon tax so as to make polluters pay for their emissions. Although the UK Emissions Trading Scheme replaced the EU Emissions Trading Scheme on 1 January 2021, these comments from the Business Secretary indicate that a conclusive decision has not been reached in government as to whether a carbon tax will be introduced.

To keep up-to-date follow us on Twitter @6pumpcourt or click here to subscribe to the mailing list. If you have any comments or suggestions please contact Bridget Tough at bridget.tough@6pumpcourt.co.uk