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.

Ecodesign – External Power Supplies (EU)

A 2009 dated EU Directive 2009/125/EC establishes a framework for the setting of ecodesign requirements for energy-related products. Separate EU Regulations set ecodesign specifies for individual product groups within this framework.

A 2009 dated EU Regulation (EC) No 278/2009 set the ecodesign requirements for external power supplies, and this is now reviewed and updated.

EU Regulation (EU) 2019/1782 now sets the new ecodesign requirements for external power supplies from 1st April 2020 (and Regulation (EC) No 278/2009 is repealed from that date). The new EU Regulation is here. It specifies energy efficiency requirements.

EU Regulation (EU) 2019/1782 applies to all external supplies as defined in Article 2, except a short list set out in Article 1.

The updated European Regulation applies to the EU member states, including the UK (where it will be regarded as Retained EU Law).

Environment Bill (published) Part 3 (England & UK part)

The Bill is here. 130 Clauses in 8 Parts, and 20 Schedules.

The Explanatory Memorandum is here.

The Environment Bill (“the Bill”) is comprised of two thematic halves.

(1) A legal framework for environmental governance once the UK leaves the EU.

This was earlier published in part as the draft Environment (Principles and Governance) Bill on 19 December 2018, fulfilling a legal obligation set out in section 16 of the European Union (Withdrawal) Act 2018. The measures published at that time related only to environmental principles and governance, and placing the government’s 25 Year Environment Plan on a statutory footing.

I posted two Blog posts about this (Brexit) – one on Parts 1&2 and one on the Environment Bill changing UK REACH (Brexit Law).

(2) Provision for specific improvement of the environment, including measures on waste and resource efficiency, air quality and environmental recall, water, nature and biodiversity, and conservation covenants.

SPECIFIC IMPROVEMENT of the ENVIRONMENT

Part 3 – the Waste and Resource Efficiency Part of the Environment Bill – includes –

– requiring producers to pay the full net cost of managing their products at end of life to incentivise more sustainable use of resources;

[some of this aligns with EU policy]

– allowing deposit return schemes to be established, whereby a deposit is included in the price of an in-scope item (such as a drink in a bottle or can) which is redeemed when the item is returned to a designated point;

[some EU member states have deposit return schemes, this aspect has been pre-consulted on by DEFRA]

– enabling producer responsibility obligations to be applied at all levels of the waste hierarchy to, for example, facilitate the prevention of food waste and increase the redistribution of food surplus;

[extended producer responsibility is also an EU objective in changes already made to some EU waste law]

– enabling charges to be applied to specified single-use plastic items;

[this aspect has been pre-consulted on by DEFRA]

– requiring local authorities in England to collect the same range of materials for recycling from households;

– ensuring households have a weekly separate food waste collection;

– ensuring businesses and public bodies present recyclable materials for separate collection and arranging for its separate collection;

[some of this is already provided for in existing Law, with regional variants]

– enabling government to set resource efficient product standards and information and labelling requirements, to drive a shift in the market towards durable, repairable and recyclable products;

[I wrote a recent Blog post about changes in EU eco-design law in this area]

– improving proportionality and fairness of litter enforcement, by issuing statutory guidance on the use of enforcement powers and extending an existing power to set out conditions to be met by all those carrying out enforcement activity;

– improving the management of waste, by enabling the Secretary of State to make regulations in relation to waste tracking digitally;

– improving the regulators’ effectiveness in tackling waste crime, reducing the cost of that criminal activity on the wider economy, environment and society;

– allowing the Environment Agency to be more flexible and responsive in managing exempt waste sites and ensure proportionate controls are in place to avoid environmental harm or illegal activity as waste market practices change;

– filling a gap in existing powers to ensure that waste can be collected and disposed of when normal processes fail;

– enabling the Secretary of State to make regulations to amend the permitted range of penalties for existing Fixed Penalty Notices; and

– enabling the Secretary of State to regulate the import, export or transit of waste and hazardous waste.

[Brexit Law makes provision for the international shipment of radioactive waste, shipments of waste to the EU after EU Exit will be subject to EU third country rules, unless new bi-laterals are agreed, or this matter is addressed in the trade deal]

As a Bill, this document would need to pass both Houses of Parliament to enter the statute books. You note, I pegged this as England.

Scotland and Northern Ireland already have Law on food waste. Waste is a devolved matter.

However, some Clauses are intended to have effect outside England – see page 194 of the Explanatory Memorandum which has a table.

If the Bill enters the statute books, the provisions then need to be commenced, some may be commenced immediately, such as those that are needed directly for EU Exit, but there could be a substantive delay in the commencement of other Part, such as Part 3.

I will issue further Blog posts, please look out for them.

EU Eco-Design & Energy Labelling (EU)

UPDATE : these new rules are now agreed – 10 Ecodesign regulations – press release – here.

The European Commission is currently working on eleven draft Ecodesign-regulations which are aimed at ecodesign requirements for various so-called energy-consuming products (the Ecodesign-regulations), and six Energy Labels.

With these Ecodesign-regulations, the Commission focuses, among other things, on the reparability of products in order to exploit a product’s full potential. The Commission aims to do this by introducing a set of repair requirements which should be met by manufacturers and importers by April 2021, in order to be able to keep marketing their products in the European Union (EU).

The current EU Eco-Design Directive is Directive 2009/125/EC of the European Parliament and of the Council of 21 October 2009 establishing a framework for the setting of eco-design requirements for energy-related products.

It establishes a framework for minimum eco-design requirements which goods that consume energy must meet before they can be used or sold in the EU. It does not apply to transport used to carry people or goods.

KEY POINTS

(1) Eco-design requirements cover all stages of a product’s life: from raw materials, manufacturing, packaging and distribution to installation, maintenance, use and end-of life.

(2) For each phase, various environmental aspects are assessed by bodies designated by EU countries. They verify aspects such as the materials and energy consumed, expected emissions and waste and possibilities for reuse, recycling and recovery.

(3) Manufacturers must construct an ecological profile of their products and use this to consider alternative design possibilities.

(4) Products which satisfy the requirements bear the CE marking and may be sold anywhere in the EU.

The Energy Efficiency Directive 2012/27/EU amended the 2009 legislation to further promote energy efficiency. It requires national authorities to do the following –

(1) Establish an indicative national energy efficiency target.

(2) Approve a long-term strategy to renovate residential and commercial buildings.

(3) Renovate, from 1 January 2014, 3 % of the total floor area of government-owned buildings.

(4) Introduce energy efficiency obligation schemes to achieve an annual 1.5 % energy saving by final customers between 1 January 2014 and 31 December 2020.

(5) Submit large enterprises to an independent energy audit from 2016.

(6) Ensure customers are billed on their actual consumption at least once a year.

(7) Inform the Commission, by 31 December 2015, of the potential for efficient co-generation and district heating and cooling.

The energy labelling requirements for individual product groups are created under the EU’s energy labelling framework regulation, in a process coordinated by the European Commission. 16 product groups require an energy label. 

Companies can create their own labels for energy efficiency using a range of labelling tools.

The ecodesign requirements for individual product groups are created under the EU’s ecodesign directive in a process also coordinated by the European Commission.

This is a list of energy efficient products Regulations: by product group – here.

This is the notice to stakeholders re UK Exit – here.

This is a FAQ on the EU Energy Labelling Regulation – here.

This is a FAQ on the EU Eco-Design Directive – here.

This is the Link to the useful CoolProducts summary of new Law proposals (the summary has links to each proposal) – here.

UK Exit Statement – the Exit day is 31st October 2019, unless these NEW EU proposals are enacted by that date, the UK is not bound (the UK is bound by existing EU law, incorporated as EU Retained Law).

Products sold IN the EU must comply.

A BBC summary is here.