Select Committee on Environment, Food and Rural Affairs Written Evidence

Memorandum submitted by the Environment Agency (U22)


  The Environment Agency is responsible both for regulating emissions that cause climate change and for preparing for the consequences.

  Key issues for the new UK Climate Change Programme:

    —  Climate change may well be an even greater threat than was realised at the time of the original 2000 programme.

    —  The new programme needs clearer statistics, which avoid potential for double counting and facilitate accountability.

    —  There are inconsistencies between government policies and indications of a likely shortfall in meeting targets.

    —  Further action is needed to secure the 20% manifesto target for CO2, and to work towards the 60% target for emissions.

    —  The current programme does not take account of the central role that a robust EU Emissions Trading Scheme will play in achieving success.

    —  There needs to be a much greater focus on adaptation.

    —  The programme should take account of the essential role of regional and local action to limit and adapt to climate change.

  The Environment Agency believes that, with sufficient effort from all players, the national targets for CO2 reduction can be achieved. This will show international leadership and help to persuade the rest of the world to act.

1.  Context

  1.1  The Environment Agency plays a major role in respect of climate change and energy. We regulate industries responsible for 40% of UK Greenhouse Gas (GHG) emissions, and are the competent authority for the EU Emissions Trading scheme. We take a lead role for England and Wales in adapting to some of the serious effects of climate change, including flood risk and water resources management.

  1.2  Scientific evidence since 2000 suggests that we may need to tackle climate change more intently. New evidence has emerged on concentrations of greenhouse gas emissions, data from ice cores, rates of glacial melting, emissions from peatlands, and the likely implications on species and habitats. We ourselves have unwelcome, fresh operational experience of extreme events, possibly due to increased climate variability, which remind us starkly of the difficulty in dealing with them.

  1.3  It is important that the forthcoming review builds on the Energy White Paper 2003, and current understanding about climate change science to set out a clear programme of action addressing both emissions reductions and adaptation to anticipated changes in climate. We would urge that any shortfalls arising in the programme to deliver emissions reductions should be addressed now to ensure we are on path to meet the 2050 goal.

  1.4  The public sector has a key role. There must be willingness by Government and Regulators to act quickly to remove any inconsistencies across regulatory regimes and to ensure a consistent message. For example, the Environment Agency is examining its own regulatory practices to see if we impose any unnecessary barriers to increasing renewable energy supplies.

2.  Mitigation of Emissions


  2.1  In terms of emissions projections & trends we are concerned that the UK is not on track to meet its 20% 2010 and 60% 2050 targets. Recent Cambridge Econometrics and DTI forecasts show increases in the projected baseline carbon emissions such that the Government's 2010 carbon reduction target of 20% will be missed. This is due to poorer performance than had been expected in transport, domestic energy consumption, renewables generation, and Combined Heat and Power (CHP) development.

  2.2  We are also concerned about data consistency and credibility. To facilitate understanding, and ensure comparisons are possible, we suggest that thought is given on how best to present data consistently in the revised strategy. Wherever possible, all government strategies and related statistical reports should present data in a comparable manner. Data needs to be presented transparently for each gas, sector and measure to avoid double counting. With a likely shortfall in meeting future targets it becomes even more essential that the strategy is made transparent and that some headroom for slippage is built into the next version of the programme.

  2.3  Energy consumption, as the major contributor to GHG emissions, must be reduced. It needs to be both easier and cheaper to reduce energy use and GHG emissions, and unpopular and expensive to add to them. Increasing energy efficiency remains the single most cost-effective way to reduce emissions.[41]

Energy efficiency

  2.4  The scope for greater energy efficiency in the industrial and commercial sector remains great. Agency research[42] found that industry could cut its energy consumption by a fifth by 2020 if the right policies were put in place. The findings found that without new policy objectives, energy use would only be cut by 10%. Other research[43] explored the potential for energy savings from different industry sectors. It showed that savings could be made in chemicals, refineries, food and drink, and paper production—all from adoption of CHP in the near future.

  2.5  We would like to see businesses given more support from Government and others to achieve resource efficiency savings, and to overcome barriers, such as a lack of information or access to capital. Programmes such as Envirowise, with support from the Environment Agency, have proved very cost effective at working with businesses.

  2.6  We share concerns that the target for domestic energy efficiency has been downgraded even as its overall share of energy and emissions is expected to grow. The target of 5 MtC in the Energy White Paper has been reduced to 4.2 MtC in the Energy Efficiency Action Plan.

  2.7  The growth in vehicle use has resulted in a 62% increase in greenhouse gas emissions (CO2) from transport, which now accounts for 27% of UK emissions. And aviation emissions (not counted towards Kyoto) may well overwhelm the efforts in other areas unless tackled.[44]


  2.8  To develop renewable fuels for transport we see promotion of biofuels as important.

  The biofuels strategy should:

    —  Set out a long term vision that does not just focus on current technology or short term blends of existing fuels.

    —  Make sure decisions taken on biofuels are driven by climate change policy and are not just a substitute for reducing the causes of traffic pollution and congestion.

    —  Ensure that the interaction between biofuels and biomass for heat and power is fully explored to minimise competition while securing appropriate benefits from both.

    —  Ensure that the overall environmental impacts of biofuels across their whole life cycle are taken into account.

  2.9  The Environment Agency recognises the benefits for the environment of sensitively sited renewable energy technologies. Progress with the Renewables Obligation targets has been steady, but slower than expected. Already a shortfall is likely in the 2010 10% target, which was intended to make 2.5 MtC savings. The UK will need a more rapid adoption of renewables to meet a target of 20% of electricity generation by 2020.

  2.10  To increase the use of renewable energy and other low carbon technologies more effort is needed to encourage diversity of sources. This will include support for technology development and commercialisation, eg for buildings-integrated photovoltaics, for tidal energy, and to develop wave power. We also support an improved approach to planning for renewables, which cascades down from regional targets to community level, with increased public participation.

  2.11  Developers of new technologies need to know there will be long-term consistency and certainty for investment, to assist their financial planning and for making the business case for projects to sell power. Environmental considerations need to be included at an early stage in the development and application of each technology. Energy grid and system upgrades will need to complement this.

Combined heat and power

  2.12  More energy is used in this country in the form of heat, either in space heating, industrial processes or water heating, than any other energy service.[45] At the same time, the current electricity generation and distribution system discards more heat than the entire heat demand for the country. This highlights the need to accelerate the use of CHP.

  2.13  The Climate Change strategy set a target of at least 10 GW of CHP capacity by 2010, but there is every indication of output falling short of the target. The barriers to CHP deployment need to be addressed, and these include:

    —  Further efforts to ensure whole of life costing of options to address the capital cost barrier from new, quality CHP.

    —  More support for feasibility studies across mixed land uses and regeneration schemes and where landlord-tenant issues exist.

    —  Greater attention to the obstacles to promotion of CHP through the planning system and building regulations, where many opportunities are missed.

    —  Issues around electricity trading and embedded generation, which are system-wide problems for smaller and intermittent generators.


  2.14  At present, a quarter of UK CO2 emissions are from coal even though its use fell over a third from 1990-2002. The recent growth—due to gas price rises—raised emissions from electricity generation by 6½% in the year 2002-03. If coal is to have a future in energy supply, it should only be medium-term and based on Integrated Gasification Combined Cycle (IGCC) technology. Any long-term future would require reliable techniques for large scale CO2 capture.

Carbon capture and storage (CCS) technologies

  2.15  The use of carbon capture and storage (CCS) technologies was not envisaged when the UKCCP was written. However, the Energy White Paper recognises the potential that CCS could play a useful role. Our North Sea gas fields could store all of UK CO2 emissions at current levels for up to 15 years. The use of saline aquifers offers capacity that could last hundreds of years. However, CCS activities should be put firmly in the context of an overall vision of a low carbon future. CCS should be regarded as part of an interim approach not as a long-term solution. The development of such technologies should not divert resources from the more sustainable and longer-term solutions.

  2.16  There are potential risks from CCS technologies to the local environment and human health and safety. We consider that the environmental impacts are not yet well enough understood and that a programme of research and demonstration is needed to inform the selection of storage sites to minimise the risk of CO2 leakage with its consequent impacts on surrounding air, land and water quality. A new and robust legal and regulatory framework is also needed that protects the environment and human health, including provisions that address issues of long-term liability and remediation.

Nuclear power

  2.17  The Environment Agency believes that an assessment of the role, if any, to be played by nuclear power must take full account of the financial and economic costs of the management and storage of radioactive waste and the regulatory framework. The Agency would, in any case, question the commissioning of new nuclear generating capacity in the absence of a sustainable long-term strategy for radioactive waste management. Until this issue is resolved, and public concern properly addressed, then any major changes of policy to encourage the construction of new nuclear generating capacity would appear to us premature.

EU Emissions Trading Scheme (EU ETS)

  2.18  The current UKCCP was written before the introduction of the EU ETS. The 2003 Energy White Paper cites the scheme as a "central plank" of future emissions reduction policies, helping deliver additional savings of 2-4MtC by 2020. It is imperative that the scheme delivers. The Environment Agency is committed to the implementation of a robust trading scheme to help protect the environment. It called for a more stringent cap on emissions from installations covered by the EU ETS during the first phase of the scheme 2005-07. The cap is only consistent with a 15.3% reduction on 1990 levels by 2010, substantially short of the 20% domestic target. Although the Government has made a commitment to raise the cap in the second phase (2008-12) in line with the 20% target, we are concerned that the postponement will necessitate tougher measures to make the 20% target achievable.

  2.19  The weakness of some of the caps set by Member States for the first phase undermines the effectiveness of the EU ETS, representing as it does a "business as usual" emissions path. The Dti's Updated Energy Projections show that, without any action, the power sector will achieve a 30% reduction in emissions between 1990 and 2010. The first phase cap thus represents a significant windfall for the sector as it will be allocated allowances in excess of those it needs to meet its target.

  2.20  We note that a recent Carbon Trust report The European Emissions Trading Scheme: Implications for Industrial Competitiveness[46] finds that the EU ETS does not threaten the competitiveness of most industry sectors in Europe, providing the EU Member States take a broadly consistent approach. The electricity, cement and paper sectors are shown to profit under all economic scenarios used in the study. Only the aluminium industry is expected to lose—despite, or indeed partly because of, the fact that it is not within the EUETS system.

  2.21  The UK government will need to set a tougher cap in the second phase, taking account the need to achieve the 20% target and the potential shortfall of other measures in the current UK Climate Change Programme. In parallel, the UK should put pressure on other EU Members States to tighten up their National Allocation Plans. A recent study by the environmental consultancy, Ecofys, concludes that only the NAPs of the UK, Germany, Latvia and Lithuania imposed caps consistent with even their national Kyoto targets.

  2.22  We are also concerned that the interaction between existing mechanisms, such as the Climate Change Levy and Climate Change Agreements, and the EU ETS is not well understood. All aim to reduce emissions from the energy and industrial sectors. The Government should review the need for the continued use of the many different policy instruments to tackle emissions of carbon. The second phase of the EU ETS could be the main policy instrument to control carbon emissions provided more parts of the economy are brought under the scheme. At the very least, the Government should ensure that the interactions between the different policy initiatives are understood and accounted for in its review of the UKCCP and that a revised set of projections makes transparent the relative contributions of each instrument to meeting the national targets.

Sustainable Communities Programme

  2.23  The Sustainable Communities programme offers an opportunity to implement aspects of the climate change strategy. The standards Government sets for the siting, design, and construction of new homes and associated infrastructure, and their ensuing resource requirements, will set important benchmarks for the future. We would like to see:

    —  A tightening up of building regulations in order to improve the energy and water efficiency of buildings by 25%, as recommended by the Sustainable Buildings Task Group.[47]

    —  The proposed Code for Sustainable Buildings to provide a single, coherent and consistent framework for constructing buildings with higher levels of environmental performance than those stipulated by regulation. Such a Code should be used for all public procurement of buildings to drive its adoption by the industry, as well as account taken of the consequences of development in flood plains (see Adaptation).

Changing behaviour

  2.24  Changes in public and organisational behaviour are essential. Government should take the lead with a package of regulatory and fiscal measures to drive changes in behaviour, accompanied, where appropriate, by education and awareness initiatives. The over-riding message to the public should be that energy use, as the major contributor to GHG emissions, must be reduced. The focus should be on direct energy use in the home (electricity, oil, and gas) and for transport (car and air travel). Unless energy efficiency is addressed, any gains from switching to low carbon options could be lost through increased energy use overall.

  2.25  Further regulation may be necessary, though this will generally act on the public through regulation of business, for example product policy to progressively remove energy inefficient appliances from the market. Economic instruments should be used to reward behaviour that helps achieve reductions targets, and penalise behaviour that hinders them. The Climate Change Levy is a useful instrument, but its is now cheaper in real terms than when it was introduced, so the incentive to act has fallen. The prices of energy flowing through the economy will need to increase overall and taxation is one of the most cost effective means to deliver such changes. Such fiscal measures must be applied in parallel with social instruments to avoid negative impacts on disadvantaged groups.

3.  Adaptation

  3.1  Whilst we strive to exert global leadership to ensure the world does not have to face dangerous climate change, we shall still need to adapt to some unavoidable impacts already in systems. The Environment Agency has been closely involved in national and regional initiatives to understand climate impacts and to prepare for adaptation. We expect this role to grow as the Government establishes its Adaptation Policy Framework. Our role is central for an effective delivery of measures, which will ensure we are able to cope with unavoidable climate change. Issues concerning the water cycle are related to most of the critical impacts and we have lead responsibilities for both droughts and floods. While flooding has damaging effects on people and property, we must not lose sight of the public health issues associated with more frequent droughts. The environment we regulate in respect to air and water will itself be affected more broadly in relation to temperature change and fluxes and flows, so this is a major issue for our environmental protection responsibilities. Waste management, for example, is likely to have to change significantly.

  3.2  We have recently made a full submission to the Committee about water and climate change issues, so will not cover the same ground here but touch on some new developments.[48]

  3.3  We will be responding in detail to the new government consultation paper "Making Space for Water" and its new thinking in the means to tackle flood risk and its consequences. The forthcoming Government flood strategy must face up to the scale of the challenge that this facet of climate change adaptation poses, as highlighted in the recent Foresight report. The key messages for us are:

    —  A far wider range of responses can be applied to tackle this, and an increase in resources is needed or flood risk could grow to unacceptable levels in future, particularly in south-east England.

    —  Tackling flood risks needs to be undertaken using a broad range of measures, including engineering and other large-scale interventions.

    —  Policies and measures need to be flexible combining funding, incentives and regulation in order to adapt to accommodate the uncertainties of the future.

    —  Inappropriate development in the flood plain must be prevented. We need to clarify and update PPG25 and strengthen it. The Environment Agency should become a statutory consultee on flood risk and we advocate its replacement with the proposed PPS25 on Development and Flood Risk, with Technical Annexes, to reflect Defra's strategy on flood risk management.


  3.4  Water resources are threatened by both climate change and growing demand. The new strategy should take an integrated approach to managing demand and dealing with projected threats to future resources. A long term view is needed on infrastructure decisions. It is vital that decisions we take now are future-proofed against future changes in climate. It is clear that making better use of existing resources will be essential if we are to have more hot, dry summers. More attention must be paid to leakage control and to demand management, ensuring that we are investing for future generations. The next periodic review must be informed by significantly better analyses of the impact of climate change, and vulnerable water companies must start work on these immediately.

  3.5  Potentially, the Water Framework Directive (WFD) could be a way to integrate the management of climate change within the water cycle within catchments. We recognise climate change will require integrated solutions, for example adopting land management measures that can mitigate drought and flood impacts. The WFD will require the integrated management of pressures on the water environment and will provide the opportunity to "join up". There will also be a need to ensure that CAP reforms help deliver complementary land management practices.

  3.6  Somewhat surprisingly, the WFD text does not deal with climate change. However, climate change has the potential to affect reference sites and thus the whole concept of "good ecological quality". We have already recognised that failure to factor in allowances for climate change in the implementation stage could lead to failure in meeting the environmental objectives set out in River Basin Management Plans (RBMPs). Also, freshwater species are potentially vulnerable to direct and indirect climate change effects arising from changes in discharge, water temperature, habitat, and physio-chemistry of rivers, still-waters and wetlands. Therefore, we are undertaking research to characterise ecological status in the face of natural variability and changing climate conditions for different emissions and models.


  3.7  To cope with unavoidable climate change more effectively, we need more information. Defra and its predecessors have led the world with an innovative programme of research which has led to the establishment of the Hadley Centre and many cutting edge projects. Recently the research councils have established the Tyndall Centre, which has already a crucial role. We would like to see the Climate Change Programme Review provide an improved framework for climate change research within the UK. We are already working with other partners on our research programme and are keen to do more as we develop next stage work. With so many of the Environment Agency's functions affected by climate change this has become a priority in our new science strategy. We have already begun the process of assessing how and where such impacts will fall and the ways our operations and infrastructure will be affected. Our current research programme starts to deliver technical methods and information that can be used for strategic and operational assessments of existing standards, regulated activities and the protection of environments that are potentially affected by climate change.

4.  Local and Regional Action

  4.1  Regional initiatives are well underway which contribute to energy policy and integrate these issues into other strategies and plans: the Environment Agency is a committed player in these throughout England and Wales. In fact we have a unique, integrating perspective by being active on both energy policy actions and adaptation at regional level. Many of the impacts of climate change will be manifest and need to be handled at a regional and local level. Delivery on renewable energy policy needs active participation throughout the country. We are working with the Local Government Association on a protocol that will help frame complementary actions on climate change.

  4.2  Better integration across regional plans and strategies is needed. To help make this happen, national planning policy and guidance should require regions to factor climate change into regional documents. This includes making regional contributions to national carbon reduction targets and the need to adapt to climate change impacts. Regional documents should provide a policy framework for climate change mitigation and adaptation in the region. For example, Regional Spatial Strategies should form the basis of regional adaptation (eg flood resilience and sustainable development) and mitigation (eg better buildings and transport policies).

  4.3  The Water Framework Directive (WFD) will establish a catchment-based approach to the management of the water environment. The Agency expects that many of the actions that stakeholders will need to take to meet ecological objectives in the WFD will involve land management and land use planning. In seeking to manage the impacts of climate change, an integrated catchment approach where environmental planning and prioritisation are taken forward in conjunction with investment regimes (CAP funding and AMP) will be required.

  4.4  We would like to see local planning policies strengthened in a number of areas relevant to climate change, particularly PPS 1 and PPG25 (Flood Risk—see paragraph 3.3). The Strategic Environmental Assessment Directive is a means whereby relevant public plans and programmes give full consideration to their climate change and other environmental implications.

  4.5  In planning and project assessment the full environmental costs of all energy technologies need to be internalised to enable decision-making on a level playing field. The whole life of a development should be used as the basis for decision making. Commitments need to be made about decommissioning facilities after use, whether major power developments or small scale sites and equipment for local generation at the same time as development is approved.

  4.6  We suggest that regional bodies concerned with economic development, infrastructure and other functions should be required to "climate proof" their activities. RDAs, in particular, have an influential role to play with the business community and through the services they sponsor. Specific guidance should be prepared for their operations and strategies. This should emphasise that moving to a low carbon economy offers investment, economic and employment opportunities.

1 October 2004

41   "The cheapest, cleanest and safest way of addressing all our goals is to use less energy. We have to improve energy efficiency far more in the next 20 years that in the last 20" Energy White Paper: Our energy future-creating a low carbon economy DTI, 2003. Back

42   Potential for Energy Efficiency in Industry, Environment Agency, 2002. Back

43   The Environment Agency Contribution Towards Achievement of Greenhouse Gas Reduction Targets. R&D Technical Report P4-089/TR, Environment Agency 2001. Back

44   Government airport plans have a long way to go if the environment is to be protected. Environment Agency press release, date published: 16 December 2003. Back

45   Space heating and hot water accounted for 82% of domestic use of energy and 64% of commercial use of energy in 2000, Energy Consumption in the UK, DTI, 2002. Back

46   The European Emissions Trading Scheme: Implications for Industrial Competitiveness-Carbon Trust, July 2004. Back

47   Better Buildings, Better Lives. Sustainable Buildings Task Group Report. DTI. May 2004. Back

48   Climate Change, Water Security, and Flooding-report of the EFRA Committee inquiry, September 2004. Back

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