The Environment Agency has thrown down the gauntlet, proposing a new levy on water companies to fully recover the costs of its enforcement activities. This bold move, enabled by the Water (Special Measures) Act 2025, is a significant shift in how the EA funds its regulatory activities. The proposed levy is not just about recouping costs; it’s about reshaping the enforcement landscape to better protect our environment.
The EA’s mandate is clear: “stop illegal activity, put right environmental harm, bring illegal activity under regulatory control, and punish offenders.” The new levy is designed to bolster these efforts, providing the necessary resources to enforce regulations more effectively. But how will this levy work, and what does it mean for the water sector?
The levy will be proportionate to the scale and complexity of each company’s infrastructure, calculated based on the number, type, and volume of permits for sewage discharge activities. This means that larger companies with more complex operations will pay more, a move that could incentivize efficiency and innovation in waste management.
However, the levy will only apply to specific permits, those with references 2.3.81 to 2.3.93, and it will not impact other sectors at this time. This targeted approach raises questions about fairness and equity. Why these permits specifically? And what about other industries that contribute to water pollution? The EA must address these concerns to ensure the levy is seen as fair and just.
The consultation, open from 14 April to 26 May 2025, is a crucial opportunity for stakeholders to shape this policy. Water companies, environmental groups, and the public should engage actively, challenging norms and pushing for a robust, equitable, and effective enforcement regime.
This levy could be a game-changer, driving significant improvements in water quality and environmental protection. But it could also backfire, driving up water bills and stifling innovation if not implemented carefully. The EA must tread carefully, balancing the need for robust enforcement with the realities of the water industry.
Moreover, this levy could set a precedent for other sectors. If successful, we could see similar levies introduced for other industries, reshaping the regulatory landscape across the board. This is a watershed moment, a chance to rethink how we fund and implement environmental regulation.
The water sector must engage with this consultation, not just to shape the levy but to influence the future of environmental regulation. This is our chance to challenge norms, spark debate, and drive meaningful change. The EA has made its move; now it’s our turn to respond.
