UK Deepwater Drilling - Implications of the Gulf of Mexico Oil Spill - Energy and Climate Change Contents

6  EU Regulatory Role

Environmental Legislation

118. The EU legislation on oil rigs currently includes rules on environmental assessment and safety. The Environmental Liability Directive (ELD) aims to prevent oil pollution incidents associated with oil rigs and respond to the consequences. However, at the EU level, there are no harmonised rules on major accidents and emergency planning in relation to oil rigs, and there are no instruments setting up funds or other rules regarding financial guarantees. Furthermore, the scope of the ELD with respect to biodiversity damage caused by oil spills is limited to certain protected habitats. ClientEarth, an organisation of activist environmental lawyers, describes the ELD in its current state as:

[...] a general system of environmental liability in the EU but it is badly under-equipped to respond to the kind of damage which could result from an offshore pollution incident [...] the gap should be filled by a framework employing a broad definition of environmental damage, and capable of imposing strict liability on all potentially responsible parties.[178]

119. The House of Commons Environment, Food and Rural Affairs Committee, in its report on the implementation of the Environmental Liability Directive, noted that:

Certain types of environmental damage are excluded from the scope of the Directive. These include damage arising from diffuse pollution which cannot be attributed to one or more specific operators, and damage falling within the scope of international Conventions relating to oil pollution [...] where those Conventions are in force in the Member State where the damage occurs. The Directive also provides for 'defences' against liability such that operators would not bear the cost of remediation in certain circumstances, such as where a third party was responsible, or where environmental damage occurred despite the operator complying with the conditions of a permit.[179]

120. Ms Wilks, of ClientEarth, explained that the ELD is "supposed to provide [...] some kind of ecologically sound compensation [...] not just a monetary payment".[180] KIMO UK (the Local Authorities International Environmental Organisation) told us "that the polluter [...] [should] pay for any pollution from oil rigs and the associated clean up operations".[181]

121. ClientEarth argues that "a comprehensive new regulatory package is now needed that not only amends existing EU legislation [...] [but] also introduces legislation to fill the dangerous voids in the current regime".[182] It argues that these "dangerous voids" could be filled by extending existing legislation frameworks to include "operational drilling projects, exploratory drilling, and the period after wells have been decommissioned".[183] ClientEarth also calls for a new EU level agency to coordinate functions in connection with major accident prevention, emergency response plans, inspections and exchange of best practice, with the European Maritime Safety Agency as a candidate for this role.

122. We conclude that—as it stands—the EU Environmental Liability Directive is unlikely to bring to account those responsible for environmental damage caused by an offshore incident such as happened in the Gulf of Mexico. We recommend that the Government works with the EU to ensure a new directive is drawn up that follows the polluter-pays principle and unambiguously identifies who is responsible for the remediation of any environmental damage.

European Commission Calls for a Moratorium

123. In his statement on 7 July 2010 calling for an EU moratorium on deepwater drilling, European Commissioner Oettinger also called for European oversight of regulators, suggesting he would "not hesitate to propose a European framework for 'controlling the controllers' if need be".[184] DECC acknowledged Commissioner Oettinger's call for a moratorium on deepwater drilling, as well as his calls for a broader review of EU regulation of such activities. DECC and the HSE wrote that they, "will be a key contributor to Commission workshops to discuss these issues", including a review of how to improve the capacity for cooperation in terms of response and clean up, and considerations of the need to strengthen regional and international standards.[185] However, Lord Marland, the Parliamentary Under-Secretary of State for DECC, responded to the question of a European moratorium from Lord Stoddart of Swindon by saying:

We are not aware of any current provision within EU law which would enable any EU body to require a moratorium, or on deep water drilling [...] But HMG remain of the firm view that these are matters which are properly left to individual member states.[186]

124. Oil and Gas UK dispute the necessity of EU oversight, citing a lack of EU competence in offshore exploration and production, and also highlight the risk that moving to a set of EU standards could lead to the lowering of UK national standards.[187] Mr Webb told us that while there "is clearly scope to extend [...] [oil spill regulations at the EU level] to drilling",[188] he was still concerned that with increased EU oversight "we might see a dumbing down as opposed to a raising up of standards".[189] The Minister told us that "we want to encourage others to come up to [...] [our] level rather than see any watering down,"[190] and went on to tell us that he regarded the UK safety regulations as the best in the world.[191] He did not want their effectiveness to be unnecessarily diluted by the unnecessary involvement of EU Member States who did not possess a coastline. [192]

125. ClientEarth argued for an EU level agency that could undertake functions in connection with: major accident prevention polices; safety reports; emergency response plans; inspection; and information exchange.[193] They believed that:

The European Maritime Safety Agency [EMSA] is a clear candidate for this role, and its capacity should be extended, with appropriate resources, to cover offshore installations in addition to its current tasks in relation to shipping.[194]

126. EMSA's main objective as it currently stands is to provide assistance to the European Commission and Member States in the "proper development and implementation of EU legislation on maritime safety, pollution by ships and security on board ships".[195]

127. We utterly reject calls for increased regulatory oversight from the European Commission. We recommend that EU countries without a North Sea coastline should not be involved with discussions on regulation of the offshore industry on the UK Continental Shelf.

178   Ev 595 Back

179   Environment, Food and Rural Affairs Committee, Sixth Report of Session 2006-07, Implementation of the Environmental Liability Directive, HC 694, para 9 Back

180   Q 220 Back

181   Ev 590 Back

182   Ev 595 Back

183   Ev 595 Back

184   Speech by Commissioner Oettinger, 7 July 2010, Back

185   Ev 596 Back

186   HL Deb, 20 July 2010, col 1262 Back

187   Ev 63 Back

188   Q 23 Back

189   Q 26 Back

190   Q 323 Back

191   Q 326 Back

192   Q 327 Back

193   Ev 595 Back

194   Ev 595 Back

195   EMSA, Back

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