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      Your environmental obligations

       

      Current state of play

      • European regulatory initiatives dominate UK environmental legislation. Mostly, these take the form of EU directives, which the UK has implemented into domestic law. A Brexit would not automatically undo such domestic rules – depending on the nature of the post-Brexit UK/EU relationship, the UK may be free to change them. That said, many EU environmental and nature conservation directives are drawn from international conventions and standards. The UK would therefore either have to reformulate its own rules within the requirements of these regimes, or it would need to withdraw from its international commitments.
      • However, some EU legislation – such as the regime governing chemicals – takes the form of directly applicable regulations, for which implementing domestic laws are not required. If the UK left the EU, it would need to deal with this regulatory gap immediately. Whichever way the UK addressed this, UK exporters of chemicals to the EU would still have to comply with the existing EU regime.

      New commercial, industrial or infrastructure projects

      • The development of large or environmentally significant facilities requires a comprehensive Environmental Impact Assessment (EIA), which is an EU requirement transposed into domestic law. 
      • Rules relating to contaminated land and groundwater comprise requirements originating in both European law and domestic law. 
      • Similarly, a lot of important legislation protecting biodiversity, habitats and wildlife is European in origin. 
        • UK regulations and guidance regarding energy efficiency flow from EU directives. 
        • EU rules dictate how the UK is required to meet the 'access to environmental justice' requirements of the Aarhus Convention, and allow objectors to challenge UK project consents in EU courts. 
        • Some large projects are directly driven by a need to meet EU standards under threat of massive fines for infraction, such as the £4.2bn Thames Tideway Tunnel, developed principally to comply with the Urban Waste Water Treatment Directive.  
         

      Operating industrial or commercial facilities

      • Operators are required to obtain comprehensive environmental permits that regulate discharges to the environment and waste disposal. This regime is very closely based on requirements in the EU Industrial Emissions Directive.
      • Best Available Techniques Reference Documents (BREFs), produced in an EU-facilitated process, have to inform the operating permissions given by national authorities. 
      • Environmental permitting requirements significantly impact on UK industry. For example, sulphur and nitrate emission limits taking effect in 2016 and 2023 directly determine the asset life of the entire UK fleet of coal-fired power plants, and many of the older gas plants.

      Chemicals

      • The EU Regulation on Registration, Evaluation, Authorisation and restriction of Chemicals ('REACH') places obligations on manufacturers, importers to the European market, and European downstream users.

      Energy and power supplies 

      • The EU Emissions Trading System (EU ETS) requires energy-intensive facilities to hold EU emission allowances permitting them to emit certain quantities of carbon dioxide. These allowances are tradable and tracked in a central EU registry. 
      • EU competition law limits the extent to which the UK may subsidise or incentivise investment in low carbon energy infrastructure.
      • The UK participates in EURATOM, Europe’s civil nuclear energy community, which is governed by EU institutions.

       

      What should I be thinking about now?

      Project development

      • Post-Brexit, what would be the status in the UK planning and environmental permitting process of guidance, best practice and BREFs published by EU institutions?
      • If I am planning a complex consenting strategy for a large, long-term project, how could I design a robust EIA and permitting process that met the requirements of current and future regimes? 
      • If EU biodiversity and conservation designations affect my land or project, might a change to the domestic regulatory regime change development opportunities?
      • How would an EIA in another European country treat cross-border effects on the UK and vice versa?
      • What would be the future of projects specifically developed to meet EU standards? 
      • Would the UK reform its project consenting rules post-Brexit to streamline public consultation processes or reduce the scope for third party challenges?
      • Is it likely that the UK would lower the environmental and consultation requirements of project development to an extent that would be significant for consenting timelines?

      Chemicals

      • If REACH ceased to apply in the UK, would the UK substitute a different regulatory approach, resulting in fractured compliance obligations for companies manufacturing, importing or using chemicals in both the UK and the EU? 
      • Would compliance with EU standards ensure compliance with any reformulated UK requirements? 

      Energy

      • Would the UK leave the EU ETS and, if so, would additional domestic measures be brought in to ensure UK compliance with international and domestic climate change commitments? 
      • In absence of EU competition laws, would the UK’s support for its low-carbon electricity sector change? 
      • Would the UK change EU (non-carbon) emissions limits for fossil fuel power plants, prolonging their life-spans?
      • Would a Brexit also entail a withdrawal from EURATOM, changing UK operators’ participation in the nuclear fuel market?

      General

      • Would the UK government cull a lot of environmental regulation following a Brexit and, if so, make the UK a more attractive place to do business? Would UK institutions seamlessly replace EU implementation and oversight roles and, if so, perform those functions more efficiently?
      • Would an overhaul of UK environmental law entail a long period of uncertainty and ultimately lead to inconsistency with the harmonised rules in the EU? As environmental law is a devolved matter within the UK, would Westminster and the devolved administrations create different legal regimes? If so, companies that operate across the UK and the EU may well face a greater compliance burden.

       

      What could the position be following a Brexit?

      The answers to many of the above questions would depend on the nature of a post-Brexit UK/EU relationship.

      To give an idea of the range of possible outcomes, we have considered what the position would be under the ‘Norwegian option’ and the ‘World Trade Organisation (WTO) option’ – on the basis that these are at opposite ends of the spectrum of existing models for an alternative relationship with the EU.

      What if the UK left the EU, joined the European Free Trade Association and remained a member of the EEA? (the Norwegian option)

      • Under the EEA Agreement, a lot of EU environmental law applies throughout the EEA. So the Norwegian option means the UK would have little power to change its environmental, consumer protection, and health and safety rules.
      • The EU regulatory regimes for water, air, chemicals, waste, noise, climate change, energy efficiency, and technical regulations and standards (including REACH) would continue to apply. The EEA countries also participate in the EU Emissions Trading System, and UK domestic legislation binds the country to emissions reductions similar to those imposed by the EU.
      • Areas of environmental regulation excluded from the EEA Agreement include the conservation of wild birds and natural habitats. It’s questionable whether Westminster or the devolved administrations would want to deregulate in these areas, particularly as the UK would have to withdraw from various international conventions.

      What if the UK left the EU without any form of free trade agreement? (the WTO option)

      • The UK would no longer be directly bound by EU rules on environmental regulation.
      • However, UK exporters would still have to comply with EU product safety and labelling standards in order to place their products on the European single market.
      • The UK would also remain bound by the various international conventions to which it is a party (unless it decided to withdraw from those as well). These cover matters such as climate change (the Framework Convention and Kyoto Protocol), access to justice in environmental matters (Aarhus Convention), habitat protection (eg Ramsar) and the protection of endangered species (eg CITES).