Regulatory Outlook | Environment | July 2021

Current issues

Climate and Energy (Revocation) (EU Exit) Regulations 2021

The Climate and Energy (Revocation) (EU Exit) Regulations 2021 were made on 28 April 2021 and came into force on 20 May 2021. The regulations follow on from the UK's departure from the European Union, and revoke EU law relating to greenhouse gas emission reduction commitments and associated obligations to report under the Paris Agreement and Kyoto Protocol.

Businesses should watch this space for any new regulations and laws pertaining to greenhouse gases in future.

Environment Bill

The Environment Bill (EB) is expected to receive Royal Assent in autumn 2021.

On 18 May 2021, the government announced that the EB will be amended to require a legally binding target on species abundance for 2030. At the same time the government announced an England Peat Action Plan to protect and restore peatland, an England Trees Action Plan which aims for woodland coverage to be expanded to 12% by 2050, and species reintroduction measures.

As reported previously, the EB contains provisions which will affect regulated businesses.

Office for Environmental Protection

As outlined in our January 2021 report, the EB will introduce the Office for Environmental Protection (OEP). The OEP will oversee environmental governance in the UK as an independent body, and its powers will include taking action against public authorities for environmental law breaches.

An Interim Office for Environmental Protection will be set up in a non-statutory form from July 2021 onwards. The Interim Office for Environmental Protection will have powers including developing the OEP's strategy (including enforcement policy) and publishing an independent assessment of progress in relation to the government's implementation of the 25 Year Environment Plan. The Interim Office for Environmental Protection will be replaced by the OEP once the EB has received Royal Assent.

The Interim Office for Environmental Protection and the OEP will be able to introduce policies and strategies that impact regulated businesses.

Emissions Trading

As of 1 May 2021, the UK is no longer a participant of the EU Emissions Trading System (EU ETS). This has been replaced by the UK Emissions Trading Scheme (UK ETS), which was launched on 1 January 2021.

The UK ETS applies to energy intensive industries, the aviation industry, and the power generation sector. Various guidance is available on the gov.uk website about the UK ETS, which operates in a very similar way to the EU ETS.

Operators who had obligations under the EU ETS must still comply with those obligations for the 2020 scheme year, which ended on 30 April 2021. Other businesses in the affected sectors should be aware of future changes.

Draft Ecodesign and Energy Labelling Regulations 2021

The government has published its response to its consultation on the draft Ecodesign and Energy Labelling Regulations 2021, as reported in our January regulatory update.

The government's response stated that, following a positive reception, it planned on laying regulations to bring the new measures into force in summer 2021. On 28 April 2021, the draft Ecodesign for Energy-Related Products and Energy Information Regulations 2021 were put to Parliament along with a draft explanatory memorandum.

Government consultations

The government has launched consultations on the Extended Producer Responsibility (EPR) for packaging; measures to improve recycling collection; and a deposit return scheme for drinks containers.

The government launched a second consultation on the introduction of EPR for packaging. This would ensure that producers pay the full costs of dealing with packaging waste that they have produced. This aims to reduce waste by encouraging recyclable products, and transfers costs of disposing of unrecyclable packaging onto producers. The government hopes to introduce the scheme using a phased approach from 2023 onwards. Powers imposing sanctions are likely to be in the EB.

On 7 May 2021, the Department for Environment, Food and Rural Affairs (Defra) launched a consultation into recycling collection. They aim to improve recycling by making collections more frequent and clarifying what materials can be collected. There would be more stringent requirements on councils to provide recycling services for plastic, glass, metal, food waste, and paper and card. The goal for the government is to increase recycling and cut down on landfill waste. This would assist with achieving the goal in 2035 of at least 65% municipal waste recycled and no more than 10% of waste sent to landfills, and the 2050 goal of eliminating all "avoidable" waste.

The government launched a consultation on 24 March 2021 on a deposit return scheme for drinks containers. This scheme would encourage drinks containers to be recycled and seeks to change consumer behaviour.

Businesses should ensure that they are compliant with packaging and recycling requirements, and should be aware of the government's recycling and waste initiatives.

Dates for the diary

Summer 2021: The government intends to bring in the Ecodesign and Energy Labelling Regulations.

Autumn 2021: The Environment Bill 2020 is expected to receive Royal Assent.