Net Zero Strategy Court Case (UK)

On 18 July 2022, the High Court handed down a judgment in a case against the UK government on its Net Zero Strategy (NZS). The judgment is here. The summary is here.

The judgment states – (extracts and some sentences shortened) –

The UK responded to the 21st COP Paris Agreement (2015) in two ways. First, section 1 of the Climate Change Act 2008 (“CCA 2008”) was amended so that it became the obligation of the Secretary of State for Business, Energy and Industrial Strategy (BEIS) to ensure that “the net UK carbon account” for 2050 is at least 100% lower than the baseline in 1990 for CO2 and other GHGs, in substitution for the 80% reduction originally enacted (see the Climate Change Act 2008 (2050 Target Amendment) Order 2019 (SI 2019 No.1056)). That change came into effect on 27 June 2019.

Second, on 12 December 2020 the UK communicated its NDC (National Determined Contributions) to the UNFCCC (UN Framework Convention on Climate Change) to reduce national GHG emissions by 2030 by at least 68% compared to 1990 levels, replacing an earlier EU based figure of 53% for the same year.

Section 4 of the CCA 2008 imposes a duty on the Secretary of State to set an amount for the net UK carbon account, referred to as a carbon budget, for successive 5 year periods beginning with 2008 to 2012 (“CB1”). Each carbon budget must be set “with a view to meeting” the 2050 target in s.1. The ninth period, CB9, will cover the period 2048-2052 for which 2050 is the middle year. Section 4(1)(b) imposes a duty on the Secretary of State to ensure that the net UK carbon account for a budgetary period does not exceed the relevant carbon budget. Thus, the CCA 2008 had established a framework by which the UK may progress towards meeting its 2050 net zero target.

The Secretary of State has set the first 6 carbon budgets. Each has been the subject of affirmative resolution by Parliament. CB6 came into force on 24 June 2021 (The Carbon Budget Order 2021 – SI 2021 No. 750) and sets a carbon budget of 965 Mt CO2e (million tonnes of carbon dioxide equivalent) for the period 2033 – 2037.

The court case was for judicial review but did not challenge the setting of the net zero target in s.1 of the CCA 2008 nor the setting of any carbon budget (including CB6).

Instead, the court case asked if the UK government had complied with s.13 and/or s.14 of the CCA 2008.

Section 13 imposes a duty on the Secretary of State to “prepare such proposals and policies” as he considers will enable the carbon budgets which have been set under the CCA 2008 to be met. The UK government agrees this is a continuing obligation.

Section 14 provides that “as soon as is reasonably practicable” after setting a carbon budget, the Secretary of State must lay before Parliament a report setting out proposals and policies for meeting the current and future “budgetary periods” up to and including that budget. Following the setting of CB6, the Secretary of State laid the NZS before Parliament on 19 October 2021 as a report under s.14 of the CCA 2008.

Re Section 13 – the court concluded –

(1) s.13(1) of the CCA 2008 does not require the Secretary of State to be satisfied that the quantifiable effects of his proposals and policies will enable the whole of the emissions reductions required by the carbon budgets to be met. The obligation in s.13(1) does not have to be satisfied by quantitative analysis alone.

(2) Information on the numerical contribution made by individual policies in the NZS is legally essential to enable the government to discharge its obligation under s.13(1) by considering the all-important issue of risk to delivery. These are matters for the Secretary of State and not simply his officials.

Re Section 14 – the court concluded –

(3) The NZS should have gone below national and sector levels to look at the contributions to emissions reductions made by individual policies (or by interacting policies) where assessed as being quantifiable in order to comply with the language and statutory purposes of s.14 of the CCA 2008.

(4) It is the responsibility of the Secretary of State, not his officials, to lay a report before Parliament under s.14. The adequacy of such a report is a matter for him, acting on the advice of officials and with legally sufficient briefing.

The Secretary of State must lay before Parliament a fresh report under section 14 before the end of March 2023.

Hydrogen Strategy (UK)

UPDATE (18th August) : the 121 page UK Hydrogen Strategy is here.

Four consultations are started –

(1) the business model – here,

(2) a NetZero Fund – here,

(3) a UK low carbon hydrogen standard – here,

(4) facilitating a grid conversion hydrogen heating trial – here.

The current intention is that low carbon hydrogen producers seeking government support, through a Net Zero Hydrogen Fund, and/or the Hydrogen Business Model would be required to comply with a UK low carbon hydrogen standard in order to secure support.

The standard could also be developed into a certification scheme.

The design elements of a UK low carbon hydrogen standard are expected to be finalised by early 2022, while work continues on delivery and administration considerations.

The approach in the UK will involve a mix of hydrogen production methods, including large scale gas reforming with carbon capture, utilisation, and storage (CCUS) (blue hydrogen with CCUS) and electrolytic hydrogen from low carbon electricity (green hydrogen).

Note the following are out of scope for the purpose of developing a UK low carbon hydrogen standard (and are addressed by separate BEIS work streams that are not yet reporting) –

* End use safety / quality standards e.g., regulations for use of hydrogen in transport, or regulations on hydrogen boilers,

* Gas Safety (Management) Regulations and entry standards for blending hydrogen into the gas grid,

* Standards for other (non-hydrogen) decarbonised gases,

* Wider environmental standards and regulations (e.g., water consumption, air quality) although later work on these areas is not excluded. Hydrogen producers will, in any event, need to comply with current and future regulations on air pollutants including nitrogen oxides (NOx),

* Gas quality – e.g., the Wobbe Index.

—————————–

The UK government issued this morning a press release – here – signalling its published Hydrogen Strategy which it is consulting on – but (once again as is typical of these press releases) the strategy document itself is not published (even though the press release is written using the past tense that the document is already in the public domain) nor the consultation questions.

I will update this post on the blog itself (that won’t be a second email notification, so check the blog post) when the strategy document is finally available, with a link to that document, and some comments on its content.

Here is the link to government consultations.

Here is the New Scientist take on the strategy – its link to the strategy itself sends to a 404 page not found.

UKCA and UKNI marks (UK)

The European CE mark is being phased out in the UK. Various deadlines apply to the situation where no CE marked good may be imported into the UK market unless it has been re-marked as UKCA.

A special situation exists in Northern Ireland – the Ireland/Northern Ireland Protocol allows European CE marking to continue to be used in Northern Ireland. The alternative UK mark to be used in Northern Ireland is UKNI, not UKCA.

A vast number of CE marked goods are in regular use in the UK. All businesses and individuals operating in the UK must assess their future requirements for CE marked goods and take steps to ensure their timely delivery before deadlines kick in.

Please check with suppliers and BEIS (the government department) on the current availability of already imported CE marked goods, and the deadline for a particular CE marked good.

Not all local assessment processes are set up, and deadlines may change. Further information is likely – please pay close attention to Email Alerts and Blog posts in the autumn.

[Not all European goods use the CE mark, I posted earlier about consultation underway on the timings for the phaseout of European marked Transportable Pressure Equipment – TPE – European sourced TPE has a different European mark]

Framework for Better Regulation (UK)

The government yesterday initiated a consultation on its plans to reform its Framework for Better Regulation. The consultation is here.

Better Regulation is a principles-led process of evaluating legislation before it’s proposed and enacted, and then after it is enacted. Better Regulation also exists at EU level.

In the UK, (per the explanation in the document) –

Better Regulation is designed to ensure that government regulation is proportionate and is only used where alternative non-regulatory approaches would not achieve the desired policy outcomes. The framework enables ministerial decisions to be based on robust analysis of the costs and benefits of different options, including the direct costs on businesses, and means that decision making is clear and transparent. The framework helps ensure that new burdens are only imposed where there is clear evidence they will generate sufficient benefits for society, and that measures are implemented and enforced in a way that is easier for businesses to deal with.

The revisions propose increasing the outcomes orientation of regulation –

(1) delegating more power and discretion to the UK’s regulatory bodies, removing many of the detailed rules in the existing statutory frameworks to make them less prescriptive (replacing them with outcomes to be achieved), and allowing the regulatory regime to be shaped more by case law.

(2) Parliament should set out only what is prohibited or the outcomes to be achieved, in plain English, and set out any parameters within which regulators would need to operate to meet these outcomes, but then giving regulators appropriate powers and discretion over how to do so, rather than legislation setting out all of the rules that businesses have to comply with in detail.

(3) regulators would still set out some detail in rules and guidance but would have flexibility to change these without having to petition the Government to introduce further legislation. This would give regulators the freedom to regulate based on whether the outcomes set by Parliament are being achieved rather than whether a particular rule has been followed. Where regulators provide for detailed rules or processes, they would also be able to provide for exemptions and waivers to reach the outcomes set out by Parliament in the most sensible way.

The Government wants to identify areas where the envisaged benefits of a move to a less codified, more common law focused approach are likely to be the greatest, and areas where the Government should be more cautious about adopting such an approach.

The government is also seeking responses on its proposals to replace the Precautionary Principle with a Principle of Proportionality. Pages 21 and 22 in the consultation document set this out. This would be a major departure.

Please read the other sections of the document for further questions.

Consultation ends 1st October 2021.

[if the focus changes to a more outcomes-led Regulation in the UK (Britain) in this manner, then we would, in Cardinal Environment, need to start analysing and reporting on case law (i.e. the common law as this document puts it) in this jurisdiction]

Changes to Energy Labels and Ecodesign (UK)

UK guidance changed to confirm that (effective 1st March) EU type re-scaled energy labels would apply throughout the UK, not only in Northern Ireland (via the IRL/NI Protocol). This was in yesterday’s monthly email alert.

The law has still to catch up, but today the BBC confirms (1 March) EU repairability and spare parts obligations will be applied in Britain. They anyway applied in Northern Ireland (Protocol).

The specific product EU Law in this area is in the form of EU Regulations directly applicable in member states (and Northern Ireland via the Protocol).

The BBC link is here.

A consultation was held (closing date November 2020) – here.

Energy labels apply to a list of mainly white household goods, but also computer screens. Ecodesign stipulations apply to a wider list of electric and electronic products.

Energy White Paper (UK)

I Blog posted this morning re the UK ETS. Publication of the UK ETS (which was already provided for in Law) is contained in the Energy White Paper (published today).

The Energy White Paper (CP 337) “Powering our Net Zero Future” is here.

It is a long document (170 pages) with many promises for consultations and targets.

A few I have singled out –

(1) significant strengthening of the Energy Performance Certificates system with an EPC target of C for domestic buildings by 2035 (and B for rented non-domestic buildings by 2030). Since most domestic properties are D or below, this is huge and will necessitate new law. Involvement of mortgage lenders is also being consulted on.

(2) re the UK ETS no further detail is given (other than is set out in my blog post this morning)

(3) an Industrial Decarbonisation Strategy to be published in Spring 2021

(4) targeting 40GW offshore wind by 2030, including 1GW floating wind, plus growing the installation of electric heat pumps from 30,000 per year to 600,000 per year by 2028

(5) commitment to make the UK continental shelf a net zero basin by 2050. This will necessitate a new legal approach

(6) commitment to join the UK to the World Bank’s ‘Zero Routine Flaring by 2030’

(7) a new strategy for the Oil & Gas Authority by end of 2020

(8) review of the Offshore Petroleum Regulator for Environment and Decommissioning

Manufactured Goods (UK from 1st Jan 2021)

On 1st Sept 2020, the UK issued instructions for persons placing manufactured goods on the UK market after 1 Jan 2021. These instructions are here.

The instructions detail the situation for the GB market, separate links access instructions for GB companies placing goods on the EU market, and for Northern Ireland. Please follow those links and read the information set out there.

Separate rules apply to chemicals, medicines, vehicles and aerospace. Follow the links for the latest information. Medicines is well elaborated.

There are also rules for goods that are not covered by EU rules. Follow those links for the latest information there.

Finally, some other categories have particular rules, follow those links.

Please read my separate Blog post on UKCA marking. Note, UKCA marking will not be recognised in the EU or Northern Ireland markets. Products currently requiring a CE marking for sale in the EU will continue to need a CE mark.

Note, distributors of EU goods in the UK will become importers from 1 Jan 2021.

Queries should be sent to BEIS.

UKCA Mark (UK from 1st Jan 2021)

On 1st September, the UK issued instructions for manufactured goods (and some other classes of goods), together with instructions on the UKCA mark applicable from 1st Jan 2021.

The UKCA mark instructions are here.

The instructions for manufactured goods are here.

The instructions for medical devices are here (note CE marked goods can circulate in GB until 30 June 2023).

The instructions for construction products are here.

The instructions for explosives are here. (HSE)

The instructions for rail interoperability are here. (dating from 1st July 2020)

UKCA (UK Conformity Assessed) marking is a new UK product marking that will be used for goods being placed on the market in Great Britain (England, Wales and Scotland). It covers most goods which previously required the CE marking, and aerosol products. I Blog posted some time ago about UKCA marking coming in.

UKCA marking alone cannot be used for goods placed on the Northern Ireland market, which will continue to require CE marking or UK(NI) marking.

The technical requirements (‘essential requirements’) and the conformity assessment processes and standards that can be used to demonstrate conformity – will be largely the same from 1st Jan 2021 as they are now.

UKCA marking can be used from 1 January 2021. However, CE marking will be permitted until 1 January 2022 in most cases.

CE marking will only be valid in Great Britain for areas where GB and EU rules remain the same. If the EU changes its rules and the product carries the CE mark on the basis of those new rules, CE marking will not be permitted for sales in Great Britain even before 31 December 2021. Please look out for Blog posts.

UKCA marking will not be recognised on the EU market. Products currently requiring a CE marking will need a CE marking for sale in the EU from 1 January 2021. [note from 1 Jan 2021, CE marks must be issued by legal entities based in the EU]

UKCA marking does not apply to existing stock, for example if the good was fully manufactured and ready to place on the market before 1 Jan 2021. In these cases the good can be sold in Great Britain with a CE marking even if covered by a certificate of conformity issued by a UK body.

On 1 Jan 2021 UK standards will be the same in substance and with the same reference as the standards used in the EU. However, they will use the prefix ‘BS’ to indicate that they are standards adopted by the British Standards Institution as the UK’s national standards body.

From 1 Jan 2022, CE marks will not be recognised in Great Britain for areas covered by the UKCA mark instructions and the UKCA marking. However, a product bearing the CE marking would still be valid for sale in the UK so long as it was also UKCA marked and complied with the relevant UK rules. Separate rules apply to medical devices (see the link above).

Product areas covered by the UKCA marking

• Toy safety

• Recreational craft and personal watercraft

• Simple pressure vessels

• Electromagnetic compatibility

• Non-automatic weighing instruments

• Measuring instruments

• Lifts

• ATEX

• Radio equipment

• Pressure equipment

• Personal protective equipment

• Gas appliances

• Machinery

• Outdoor noise

• Ecodesign

• Aerosols

• Low voltage electrical equipment

• Restriction of hazardous substances

All enquiries should be to BEIS.

This is a summary, please follow the links and read the instructions in full.

Meeting Climate Change Requirements (UK from 1 Jan 2021)

On 7 July, the EU revised and updated its 1 Jan 2021 Readiness Notice on the EUETS (EU carbon trading) (previously dated 19 Dec 2018). This updated Notice is here.

Amongst the list of instructions are :

(1) Operators of stationary installations in the UK and aircraft operators where the UK is the administering EU member state – to continue holding emission allowances after 30 April 2021 – must open a trading account in the Union Registry administered by an EU Member State and move their assets to this account.

(2) They must also – ensure that their annual emission reports are verified by verifiers established in the EU and accredited by the national accreditation body of an EU Member State.

Please note the Notice also sets out specific restrictions that will apply in Northern Ireland from 1 Jan 2021.

As a result, the UK has updated (19th August) its pre-existing instructions on meeting climate change requirements (covering emissions trading, ecodesign and energy labelling) previously issued on 12 October 2018. Note: the EU does not have 1 Jan 2021 Readiness Notices on ecodesign or energy labelling (only on EMAS and the EU Ecolabel).

The UK instructions are here. I Blog posted about these instructions at the time in 2018.

Key points : (taking account of the EU Readiness Notice)

(1) UK stationary installation operators and aircraft operators will continue to have access to Operator Holding Accounts and Aircraft Operator Holding Accounts administered by the UK for 2020 compliance obligations, up to and including 30 April 2021. Access to accounts after this date may no longer be possible.

Where applicable, operators should confirm with their traders that delivery of allowances will be possible from 1 January 2021 to ensure sufficient allowances are available to enable compliance with surrender obligations for 2020 emissions.

(2) Holders of Trading Accounts, Person Holding Accounts, Person Accounts in National Kyoto Protocol Registry and Former Operator Holding Accounts in the UK section of the Union Registry should plan for a loss of registry access from 1 January 2021.

(3) Free allowances will need to be allocated by the National Administrator on or before 31 December 2020 (the end of the transition period) subject to any changes being agreed by the European Commission in a Commission decision meeting.

(4) The deadlines for UK operators participating in the EU ETS during the transition period are:

• 31 March 2021 – submit Verified Annual Emissions Report for 2020 emissions

• 30 April 2021 – surrender equivalent allowances to 2020 verified emissions

NOTE : The temporary suspension by the European Commission on the processes relating to the UK registry was lifted on 3 February 2020 and the UK commenced the process of issuing 2019 and 2020 free allocation, as well as resuming auctions. The lifting of the suspension also allowed UK stationary installation operators and aircraft operators to regain the ability to use their entitlement in the Union Registry to exchange international credits for EU ETS allowances.

(5) Account holders who use their accounts to hold and trade Certified Emission Reductions and Emission Reduction Units will continue to be able to access their accounts within the UK’s Kyoto Protocol National Registry until 1 January 2021. As of 1 January 2021 (the day following the end of the transition period), account holders will no longer have access to these accounts.

The UK government is procuring a new system to enable account holders to hold and trade Certified Emission Reductions and Emission Reduction Units, which we expect to be operational in Spring 2021. Businesses with accounts in the Kyoto Protocol National Registry should consider taking action to manage the risks created by a short gap in service before the new system is implemented. For example, affected business could consider opening an account in another country’s registry to hold and trade Certified Emission Reductions and Emission Reduction Units during this period.

EU PRODUCT DATABASE (this is not an EU Readiness Notice, so this UK information derives directly)

(1) In terms of the EU product database:

• all consumers will still have access to the ‘open’ section of the database

• however, the UK’s Market Surveillance Authorities will no longer have access to the ‘closed’ compliance section of the database.

There will be changes for UK and EU suppliers regarding the EU product database. UK and EU suppliers placing relevant energy-using products:

• on the EU market will have to enter relevant information into the database

• on the UK market will not be required, under domestic law, to enter relevant information into the database, including for those products placed on the market between 1 August 2017 and 1 January 2019 after 1 January 2021.

UK and EU suppliers must ensure that relevant energy-using products:

• placed on the UK market comply with minimum UK Ecodesign and Energy Labelling standards

• placed on the EU market comply with minimum EU Ecodesign and Energy Labelling standards

UK and EU retailers must ensure that relevant energy-using products:

• placed on the UK market comply with minimum UK Energy Labelling standards

• placed on the EU market comply with minimum EU Energy Labelling standards

RE standards – All EU ecodesign and energy labelling requirements which enter into force and apply before 31 December 2020 will have effect in the UK. Further legislation is being prepared to ensure that all of these requirements continue to function in the UK from 1 January 2021.

Please clarify any gaps e.g. verification of annual emission reports, and the specifics applying in Northern Ireland, with the UK government department BEIS.