Consultation on modernising environmental permitting for industry

A proud history of UK industrial pollution control 

Britain is the birthplace of the industrial revolution. Alongside the enormous benefits to economic growth and quality of life, this revolution created challenges in dealing with new sources of pollution.   

In the late 19th century, legislative frameworks to control pollution began to be developed, starting with the 1863 Alkali Act which was the first piece of industrial pollution control legislation in the world. As industry expanded over the 19th and 20th centuries, regulations were developed in parallel to mitigate the worst impacts of industrial pollution. For example, in 1952 widespread coal burning and other industrial emissions led to the Great Smog in London which is estimated to have caused over four thousand deaths. In response, the government passed the Clean Air Act in 1956 which introduced powers for local authorities to control emissions of smoke, grit, dust and fumes from industrial sites and furnaces and set up smoke control areas to reduce the burning of coal near people.  

Throughout the 20th Century, the UK remained a world-leader in pollution control and the 1990 Environmental Protection Act required industries to apply for permits to operate if their activities could result in significant pollution. It also introduced the concept of Integrated Pollution Control (IPC: consideration of emissions to air, water, and land and other environment impacts as a whole rather than in isolation) and the use of BAT to control emissions (the available techniques and technologies which are best for preventing or minimising emissions and impacts on the environment). 

The IPC and BAT concepts were later adopted by the European Union through the Integrated Pollution Prevention and Control (IPPC) Directive (1996). The IPPC Directive was followed by the Industrial Emissions Directive (IED) in 2010, which consolidated the IPPC Directive and other EU directives related to industrial emissions.  

The IED was originally transposed in England and Wales in 2013 through the Environmental Permitting (England and Wales) (Amendment) Regulations 2013 which were replaced by the 2016 EPRs, which have also been amended over time to consolidate all environmental permitting regimes (for example, industry, water, waste). The unified permitting framework provided by the EPRs is broadly welcomed by business as creating a coherent framework to navigate​.  

Following EU Exit, responsibility for industrial pollution control in the UK now rests with the UK and devolved governments, who have agreed arrangements for setting standards for the largest industry through the BAT Common Framework.   

Since 1994, as shown by the UK’s National Atmospheric Emissions Inventory, industrial emissions of key pollutants have fallen dramatically, with sulphur dioxide (SO2) emissions from industry falling by 97% and both fine particulate matter (PM2.5) and nitrogen oxides (NOx) emissions falling by 79%. The reductions of industrial emissions of just 5 key air pollutants (PM2.5, NOx, SO2, ammonia and non-methane volatile organic compounds) have delivered over £52 billion in benefits to human health, ecosystems and labour productivity. 

However, industry remains a significant proportion of UK emissions of these pollutants, accounting for approximately 30% of overall UK emissions of PM2.5, 74% of SO2 and 34% of NOx in 2023. 

Summary of the current framework  

The core of the UK industrial emissions permitting framework is simple – certain industrial and industrial-scale agricultural activities require permits, which set out conditions on pollution emissions and other environmental impacts. Permit conditions are based on the BAT (the available techniques, or other sectoral pollution standards, which are set out in legislation and Defra guidance). Ongoing monitoring must be carried out to assess compliance with permit conditions, and regulators have wide-ranging enforcement powers in cases of non-compliance. 

However, in reality, the gradual development of the framework has left us with a complex and fragmented regulatory landscape underpinned by a patchwork of EU and domestic legislation. Industrial installations covered by the industrial permitting regulatory framework range from steel works to dry cleaners. The size and type of installation determines the kind of permit granted and the standards that operators must comply with in their permit as well as which organisation they are regulated by, with EA generally regulating the largest and most complex sites (with some exceptions). The types of installation are as follows: 

• Part A1 installations – includes refineries, steelworks and large combustion plant – regulated by EA with approximately 3,847 sites in England 

• Part A2 installations – includes glass manufacturing and foundries – regulated by local authorities with approximately 330 sites in England 

• Part B installations – includes animal processing sectors and various mineral processing activities – regulated by local authorities with approximately 10,698 sites in England 

• Medium combustion plant (MCP) and specified generators – regulated by EA with estimates suggesting ~23,400 will fall within regulation in England by 2030 

• Solvent emission activities (SEAs) – generally regulated by local authorities (although some are also listed as Part A or Part B installations) with approximately 2,236 sites in England 

• Small waste incineration plant (SWIPs) – regulated by local authorities with approximately 35 sites in England 

Part A installations, as set out in the IED, are required to apply integrated pollution control, covering BAT for emissions to air, water (including discharges to sewer) and land, plus a range of other environmental effects (for example, waste, heat, noise, vibrations, energy and resource efficiency). 

Regulation of Part B installations is of domestic origin and they are only required to apply BAT on pollution to air. SWIPs and SEAs have emission limits set out in the EPRs via the IED and MCP have emission limits set out in the EPRs via the EU Medium Combustion Plant Directive. 

After EU Exit, for Part A1 and A2 installations the UK and devolved governments established a joint system for setting standards for pollution to air, water and land, called the UK BAT system. The UK BAT system provides a transparent and predictable process for governments, regulators, industry and environmental and civil society non-governmental organisations (NGOs) to work together to identify the most effective technologies and processes used by the best operators, which are then implemented through sector-specific pollution standards. There are currently two ‘tranches’ of UK BAT sector reviews underway, which would not be impacted by the proposals set out in this consultation.  

The BAT approach is an engine for investment into clean technology, as periodic tightening of pollution standards leads to investment in modern, more productive and more efficient technologies. BAT is tailored to each sector and gives operators flexibility by requiring compliance with emission limits rather than mandating the use of specific technologies. The evidence-based co-creation of standards, as well as long lead times for implementation of new BAT, supports industry innovation and investment. Each round of new BAT (over a 10+ year cycle) has helped reduce emissions by an estimated 25-60%, depending on the industry and pollutant.  

For the smallest ‘Part B’ industries which fall outside the UK BAT system, BAT for pollution to air, but not other forms of pollution, are set out in Process Guidance Notes (PGNs) issued by Defra. Part B standards have lagged considerably behind BAT for large industries. There are in the region of 70 sectors covered by separate PGNs, with the majority last updated between 2011 to 2013, many not updated since the early 2000s or mid-1990s and some containing references to standards from the 1960s.  

On the whole, the industrial emissions permitting framework provides a coherent and predictable approach to controlling industrial pollution which has led to significant reductions. The post implementation review of the EPRs carried out in 2023 found the regulations to be broadly functioning effectively.  

However, the framework can and should work better in delivering the Plan for Change, net zero and environmental and health improvements. The Corry Review and ‘Regulation for Growth’ action plan have set out how environmental regulation can be too complex and duplicative, stifling progress and innovation; how businesses endure slow processes and a lack of predictability from regulators and regulation; and how our regulatory approach can be too risk averse.  

The Corry Review also specifically recommended reviewing the EPRs. This consultation fulfils that commitment for the industrial emissions aspects of the EPRs. This review is urgently needed as the current framework is more than a decade old, and the speed of the industrial transformation currently taking place with the shift from fossil fuel-based energy systems to low-carbon alternatives and the ongoing transition to a circular economy means that new approaches are required to enable this transformation.  

Now is the perfect time for a review as, once the two current tranches of UK BAT sector reviews have completed, there will have been a full cycle of BAT reviews covering all existing Part A sectors since the IED was introduced in 2010. Any reforms can therefore be implemented ahead of a new cycle of BAT reviews. 

Reviewing the framework  

We have assessed the regulatory framework for industrial permitting against the government’s missions and priorities and key principles which underpin policy and better regulation. These include:  

• Kickstarting Economic Growth mission   

• the mission to Make Britain a Clean Energy Superpower and delivery of net zero 

• the mission to Build an NHS Fit for the Future 

• Environmental Principles 

• Better Regulation principles of Proportionality, Accountability, Consistency, Transparency and Targeting  

• Defra’s circular economy ambition  

• the overall aim of the permitting regime to prevent significant pollution and protect public health and the environment 

We have also considered Dan Corry’s review on Defra’s regulatory landscape, the HM Treasury’s ‘New approach to ensure regulators and regulation support growth’ action plan, the Department for Business and Trade’s ‘The UK’s Modern Industrial Strategy’ and the Department for Energy Security and Net Zero’s Clean Power Action Plan. 

In assessing the permitting framework, including through a programme of engagement with industry, devolved governments, regulators, NGOs and international counterparts, we have identified priority areas where the framework could work better and translated these into reform goals for a modernised framework. These are not intended to be an exhaustive set of the goals for the environmental permitting framework, but rather the key areas we have identified where the framework could work better. Each chapter in this consultation covers one of these goals, discussing how well the existing framework achieves the goal and sets out initial proposals on how to better achieve each goal for feedback. 

Our reform goals for a modernised framework are:  

• Goal 1: Enabling innovation and encouraging new technologies and techniques – developing new approaches to R&D trials and regulation of emerging technologies to accelerate the commercialisation of innovation by industry 

• Goal 2: Agile standards - rapid, predictable and integrated standard setting –standards are rapidly and transparently updated, delivering clear, simple and adaptable requirements that minimise pollution to protect public health and the environment and support industry investment, productivity and growth 

• Goal 3: Proportionate regulation and coherence in the framework – delivering proportionate coverage of emerging clean technologies through a logical and coherent permitting framework, providing clarity on the regulatory position for these technologies and supporting industry planning and investment 

• Goal 4: Regulator effectiveness and efficiency – regulators collaborate with industry to set standards and deliver permits, monitoring and enforcement efficiently, costs are recovered in line with the polluter pays principle and interactions with other regimes are understood and improved where needed 

• Goal 5: A transparent framework – a transparent and trusted framework that meets international obligations and sets clear requirements on regulators and industry and enables local people to understand the pollution in their area, including through an accurate and comprehensive UK Pollutant Release and Transfer Register (PRTR) 

There are questions on specific measures, but also a call for new ideas to achieve the goals. Some measures will sit across multiple areas but are listed with the most relevant goal for the purposes of the consultation paper.