One year on, what impact has the Environment Act 2021 had?
The 2021 Environment Act came into force on 9 November 2021, following protracted and delayed progress through Parliament. The Act has now been in force for a year, and whilst a number of individual provisions within it are yet to come into effect, it has already started to have a material impact on businesses and has emphasised the need for sustainability to be a priority for retailers.
The Act is incredibly wide-ranging in its scope and includes provisions relating to environmental protection, waste efficiency, air and water quality, and even the regulation of chemicals. Retailers will have to be far more proactive than they currently are in order to comply with the Act.
Extended producer responsibility
On a practical level, one way in which the Act is likely to have a real impact on retailers is through its sustainability provisions. In summary, the Act represents the Government’s attempt to move away from a ‘take-make-use-dispose’ mentality towards an increase in reuse and recycling.
The ‘polluter pays’ principle is the generally accepted contention that those who produce pollution should bear the costs of its safe disposal and any environmental damage caused by it. The Environment Act extends this principle and additional regulations on this issue are due to come into force at the start of 2023, which will have the effect of imposing a ‘waste management cost obligation’ on all organisations for the packaging they handle.
In the spirit of the Environment Act, these regulations are expected to encourage and incentivise durability, repairability and recycling, and move away from disposal as the default option at a product’s end of life.
These provisions follow-on from the plastic packaging tax, which was introduced earlier this year, and serve to impose additional costs on those who produce plastic packaging which does not contain a minimum level of recycled material.
Deposit return schemes
The UK has never had a wide-ranging deposit return scheme. However DEFRA consulted on the possible introduction of such a scheme in 2021, and, although the results were expected in early 2022, these have yet to be published.
There are clear environmental benefits to the environment in deposit return initiatives, and Scotland is due to introduce its own scheme in August 2023 which will include a 20 pence premium on all single-use drinks bottles, which is refunded to the consumer on return of the item.
However laudable the aims, the logistics of a deposit return scheme are likely to be immense. For example, arrangements need to be made for returned items to be transported to facilities which enable their reuse, with questions about storage space whilst they await return, and the implications of such schemes for online retailers. In addition, schemes across all four nations need to be consistent with one another and would be self-defeating if they imposed inoperable burdens on businesses.
Sustainability litigation
Although not specifically mentioned within the Environment Act, sustainability and climate change litigation is a growing risk for retailers.
Historically such claims have proceeded against governments and businesses in the fossil fuel sector, but in light of the potentially universal nature of future measures contained within the 2021 Act, all businesses, particularly retailers, need to be aware of their own environmental impact and should take steps to mitigate potential actions which may be initiated against them.
For example, there have already been reports in the media of claims being brought against some fashion retailers, alleging in terms that they have not abided by their publicly stated sustainability goals. Allegations of ‘greenwashing,’ being the alleged over-statement of environmental performance, is also likely to be a growth area.
Recycling of clothing
The Act contains multiple provisions (yet to come into effect), which promote an increase in sustainability, together with measures intended to avoid products becoming waste. Although there is not yet a definitive timetable for when these provisions may come into force, or what materials may be caught by them, there is already evidence of retailers moving towards this mentality. For example, several high-street retailers have already announced plans for ‘dress for hire’ schemes which enable consumers to rent garments for a period before returning them, as opposed to purchasing them outright.
We anticipate that there is going to be increasing pressure on retailers and wholesalers to adopt a similar approach over the coming months and years. We recommend that businesses review their procedures and operations now to assess whether there are any aspects which may be able to benefit from sustainability drives. This will ensure that they are best positioned when further regulations are introduced, as well as enabling them to actively contribute to environmental protection.
Conclusion
Although many of the details as to the future landscape of environmental protection remain to be confirmed, the direction of travel is clear. The 2021 Environment Act provides the framework for an increased environmental protection regime – and an active role for all stages of the supply chain. Retailers will have to be far more proactive than they currently are, and although initial measures have started to be introduced, it is likely that far more will be required over the coming years.
If you’d like to discuss any of these issues or have questions about the article, please contact Bill Dunkerley in the Regulatory team.
Bill Dunkerley
Associate Partner, Regulatory
T: +44 (0) 161 393 9087 M: +44 (0) 7920 237681
Bill represents both corporate and individual defendants in respect of a wide range of regulatory interventions and prosecutions including corporate and individual gross negligence manslaughter and health and safety offences arising under Trading Standards legislation and the Health and Safety at Work etc Act, including in the context of associated inquest proceedings. Bill is very experienced in designing and delivery training courses on risk management and compliance.
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