Drawn to the special attention of the House
Draft Environmental Permitting (England and Wales) (Amendment) (England) Regulations 2023
Date laid: 30 March 2023
Parliamentary procedure: affirmative
These draft Regulations propose changes to the current oversight regime for groundwater, with the aim of improving the regulatory tools available to the Environment Agency for managing and protecting groundwater quality. According to the Department for Environment, Food and Rural Affairs (Defra), there have not been any significant changes since the current regulatory regime was introduced in 2010. We have received a submission from Greener UK which raises questions about a specific aspect of the instrument dealing with the installation of closed-loop ground source heating and cooling systems. We have also obtained additional information from Defra about two other aspects of the draft Regulations which deal with activities that will be exempt from a prohibition on direct discharges to groundwater, including low-volume and low-pressure hydraulic fracturing, and with the defence available to sewerage undertakers that are in breach of permit conditions. As the Explanatory Memorandum (EM) offered limited information on these aspects of the instrument, we have asked the Department to revise the EM, so that a fuller explanation is available to anyone taking an interest in the proposed changes. Groundwater quality is an issue of considerable public interest, and the information provided by Defra may provide useful additional context when the instrument is debated in the House.
The draft Regulations are drawn to the special attention of the House on the ground that they are politically or legally important and give rise to issues of public policy likely to be of interest to the House.
Background
1.These draft Regulations have been laid before Parliament by the Department for Environment, Food and Rural Affairs (Defra) with an Explanatory Memorandum (EM). The draft Regulations propose amendments to the Environmental Permitting (England and Wales) Regulations 2016 (“EPR”). The proposed changes seek to improve the regulatory tools available to the Environment Agency (EA) for managing and protecting groundwater quality.
Policy rationale
2.Under the EPR, the EA regulates discharges into the environment that may impact groundwater quality. Defra explains that this regulatory regime has not been updated in any significant way since it came into force in 2010, and that while the EPR is an effective tool for managing groundwater activities and pollution risks, several deficiencies in the regime have been identified, leading to inconsistencies in approach within the wider EPR regime. The Department says that the regulatory tools also need to be “optimised” in the context of pressures from climate change and population growth.
3.This instrument proposes amendments to the EPR which, according to Defra, are to provide a “more proportionate, risk-based” regulatory approach and align it with the regulation of other activities under the EPR. The aims are: to provide the EA with an “improved hierarchy” of regulatory controls for groundwater activities; increase the range of pollutants that can be controlled; and update and clarify the existing control measures under the EPR for protecting groundwater from site-based activities.
Key changes proposed by the draft Regulations
4.Amongst other changes, the instrument would amend the EPR regime to enable the EA to issue Standard Rules Permits as well as Mobile Plant Permits for groundwater activities where the generic risks are well-understood, assessed and mitigated. At present, such activities can only be permitted through the use of site-specific “bespoke” environmental permits. The draft Regulations also propose exemptions from the requirement for an environmental permit for new cemeteries that pose a low risk of pollution to the groundwater environment.
5.The instrument would further enable the EA to apply, for the first time, regulatory controls and issue permits as necessary for groundwater activities that present a significant risk of introducing microbial pollution; for example, as a result of the discharge of treated sewage effluent to the ground from septic tanks and sewage treatment plants, or that risk introducing heat pollution.
6.The draft Regulations also propose exemptions from the requirement of an environmental permit for most closed-loop ground heat pump activities. We received a submission from Greener UK which questioned the proposed exemption criteria and sought assurance that the proposals would avoid harmful impacts on protected sites and ancient woodland. Defra responded that:
“Currently there is no environmental regulation of closed loop ground source heating and cooling systems at all. The reinstatement of heat as a pollutant for groundwater will mean that such systems would become regulatable activities. Open loop ground source heating and cooling systems are already subject to regulation as they involve abstracting and discharging water and the heat aspect is considered as part of these applications. We appreciate that a closed loop system will have a smaller impact on the surrounding ground as it is not removing and reinjecting heated and cooled water. However, to protect sensitive groundwater receptors such as wetlands we have sought to ensure that only those systems that are proposed in close proximity to such receptors require direct regulatory controls via an environmental permit from the Environment Agency.
Systems that are outside the designated sensitive areas will continue as now, not to need environmental permits. We consider this a proportionate regulatory approach balancing environmental protection against unnecessary regulatory burden and cost on householders and other potential users of closed loop ground source heating and cooling systems.”
7.We have published the submission by Greener UK and Defra’s response in full on our website.1
8.The instrument also proposes to “clarify the defence for sewerage undertakers in breach of permit conditions”. As no further explanation is offered in the EM, we asked for more information; in particular, whether this clarification could enable sewerage undertakers to avoid enforcement action. Defra responded that the changes were solely aimed at “providing certainty for both the regulator and sewerage undertakers as to when a breach of an environmental permit is not an offence when it has occurred as a consequence of circumstances beyond the control of the operator”.
9.Defra specified that these circumstances would apply when: another person caused or knowingly permitted a discharge to be made into the sewer; the undertaker either was not bound to receive the discharge into the sewer or was bound to receive it subject to conditions which were not observed; or “the undertaker could not reasonably have been expected to prevent the discharge into the sewer”.
10.Defra told us that the wording “the undertaker could not reasonably have been expected to prevent the discharge into the sewer or works” was tried and tested as it has been transferred from predecessor legislation.2 The Department said that while the wording does require judgement and interpretation, that would ultimately be for the Courts, as this is a statutory defence in relation to water pollution offences.
11.The instrument further proposes to update the current list of exemptions from the prohibition on direct discharges to groundwater, with the aim of bringing the provisions “in line with current operational practices and facilitate energy recovery and the latest green technology”. As the EM does not offer further explanation, we asked about the types of activities that would be permitted by these new exemptions, and whether the exemptions could lead to more direct discharge into groundwater. Defra explained:
“There are two new exemptions that will allow the use of techniques and activities that would otherwise be prohibited, bringing the total number of activities allowed to be permitted […] to eleven. The first new exemption will allow for the remediation of groundwater and associated land from the effects of pollution. For example, where polluted groundwater has been pumped from the ground, treated to remove pollutants, and is to be returned to the ground. The second will allow techniques to be used that will improve the recovery and extraction of fluids and gas from rocks that also contain groundwater, for the purposes of energy production. An example would be to increase the flow of hot water to extraction points for geothermal heat or energy use.
Whilst this could lead to a greater number of direct discharges, such activities would still require an environmental permit, which the Environment Agency would only grant where it was satisfied that the activity does not pose an unacceptable risk to the environment and does not compromise the objectives of The Water Environment (Water Framework Directive) (England and Wales) Regulations 2017. Without the controls that a permitting approach would allow for these specific new direct discharge activities, many remediation schemes would not proceed, leaving contaminated groundwater untreated. Similarly, our ambitions to promote certain green energy geothermal schemes would be significantly restricted.”
12.The Department confirmed that the exemption would allow several technologies to be permitted that could be used to enhance the flow of gas and fluid, including hydraulic fracturing. Defra explained, however, that the EA already controls, through the permitting process, low-volume, low-pressure hydraulic fracturing practice in formations that do not have associated groundwater, and that high-pressure fracturing is subject to a Government moratorium.3 Under the proposed exemption “low volume low pressure fracturing in the onshore oil and gas industry in deep formations containing groundwater could now be permitted, but only where the risk to the environment was demonstrated to be acceptable”, while high-volume high-pressure hydraulic fracturing for shale gas exploration would remain subject to the Government moratorium. The Department added that it was “not currently aware” of any proposals for low-volume and low-pressure fracturing in deep formations containing groundwater in the onshore oil and gas industry.
13.Defra further explained that:
“Low volume, and low pressure, hydraulic fracturing had been historically used in the oil and gas industry for many years to enhance production and ensure the efficient recovery of as much hydrocarbon as possible per well. This practise was not controlled through permitting prior to the commencement of on-shore shale gas exploration as it was considered to be of low environmental risk. Following a detailed review of the regulations, it was recognised that such practice, despite being low risk, was a ‘groundwater activity’ and that the regulations would prohibit this activity in formations where groundwater was present. The practice has therefore effectively been banned since around 2014. That ban, however, also captures many techniques that new and emerging ‘green technologies’ such as Geothermal may also use for efficient energy recovery. The amendment would therefore allow effective regulatory scrutiny, and control, via the EPR where it was appropriate for the recovery or use of energy, and only where the risk to the environment was demonstrated to be acceptable.”
14.The Department concluded that the draft Regulations would “enable innovation on a wider range of sub-surface energy proposals, such as Geothermal energy by requiring effective and proportionate environmental scrutiny and permitting controls”, adding that “geothermal projects may also wish to enhance flow through hydraulic fracturing practice”, but that currently this “green technology would be prohibited without the amended regulation if there was groundwater present in the formation, as occurs in the Cornish and Weardale granites.”
15.We note the additional information provided by the Department. Given the public interest in groundwater quality, we have asked Defra to revise the EM, so that a fuller explanation of the issues is available to anyone taking an interest in the changes proposed by this instrument.
1 Secondary Legislation Scrutiny Committee’s ‘Scrutiny evidence’ webpage: https://committees.parliament.uk/committee/255/secondary-legislation-scrutinycommittee/publications/8/scrutiny-evidence/.
2 Section 87 (2) of the Water Resources Act 1991 which was subsequently used in the Environmental Permitting Regulations 2010 and later in the Environmental Permitting Regulations 2016.
3 Department for Business, Energy and Industrial Strategy, Statement HLWS339 (27 October 2022): https://questions-statements.parliament.uk/written-statements/detail/2022–10-27/hlws339 [accessed 25 April 2023].