Environment Agency: ESP updates to include CHMM

Overview

This consultation describes the proposed changes to the enforcement and sanctions policy (ESP) to incorporate the Clean Heat Market Mechanism (CHMM).

This consultation does not introduce new penalties.

Small changes will be made to the main body of the ESP to include mention of the CHMM, and a new section, section I, is proposed to be added to Annex 2 to detail our intended approach for applying civil penalties under the CHMM.

Under the CHMM Statutory Instrument, civil penalties may be applied for the following breaches of the scheme: 

• failure to comply with the registration obligation 
• failure to notify information (quarterly and annual fossil fuel boiler sales) 
• notification of inaccurate information (annual notification of fossil fuel boiler sales) 
• failure to maintain and make available records 
• failure to make a notification (change of corporate structure) 
• failure to make a payment 
• failure to comply with an information notice 

In each case, the Statutory Instrument details the maximum penalties that can apply to each breach. In some cases, these will include a daily penalty which accrues from the day following the breach until the breach is rectified or the maximum amount payable is reached, whichever occurs sooner. 

The Statutory Instrument provides no discretion to the Environment Agency on 2 of the penalties: for failure to notify us of fossil fuel boiler sales, and failure to make a payment. In all other cases we have discretion to waive or modify the penalty. 

The proposed additions to Annex 2, should be read in conjunction with the rest of the enforcement and sanctions policy, and are intended to make it clear how and when we will apply discretion, and if so, the reasons why.