Environmental Permitting for AI Data Centers: Federal Acceleration, Federal Lands, and State Resistance

By Alex Arensberg, Carolyn L. McIntosh and Phil Sandick on Posted in Air Quality, Climate Change & Sustainability, Energy & Utilities, Mining & Natural Resources, NEPA, Rulemaking & Policy Development, Water Quality
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The environmental permitting landscape for data centers is shifting rapidly, with federal and state regulators often pulling in opposite directions. The Trump Administration has moved to accelerate federal environmental review and to open federal lands for data center siting. States and localities have responded by tightening scrutiny of the energy, water, and land use impacts of these facilities. This post summarizes the relevant permitting framework, the key federal and state developments, and what comes next.

Environmental Permitting Overview:

Large-scale data center projects typically require overlapping federal, state, and local environmental authorizations, with the precise mix turning on site location, project design, and affected resources.

Federal requirements may include National Environmental Policy Act (NEPA) review for projects involving federal action; Endangered Species Act (ESA) Section 7 consultation for projects affecting listed species or critical habitat; National Pollutant Discharge Elimination System (NPDES) coverage for cooling water, stormwater, and process wastewater discharges; Section 404 Clean Water Act (CWA) permits (with Section 401 certification) for discharges of dredged or fill material; Prevention of Significant Deterioration or Nonattainment New Source Review preconstruction permits and Title V operating permits for major air sources; and Section 106 National Historic Preservation Act review where applicable.

State requirements commonly include air, water withdrawal, industrial wastewater, stormwater, and hazardous waste permits, along with review under “little NEPA” statutes such as the California Environmental Quality Act (CEQA).  Local approvals typically include zoning, conditional use, building, noise, traffic, and grading permits.

Executive Order 14318 and Federal Acceleration:

On July 23, 2025, President Trump signed Executive Order 14318, “Accelerating Federal Permitting of Data Center Infrastructure.”  EO 14318 applies to data center projects and associated components that involve at least $500 million in capital expenditures, more than 100 MW of incremental load, that protect national security, or that are otherwise designated by the Secretaries of Defense, Interior, Commerce, or Energy.  Among other things, EO 14318:

  • Directs federal agencies to identify NEPA categorical exclusions for qualifying data center projects, and provides that federal financial assistance under 50% of project costs is presumed not to trigger NEPA review;
  • Authorizes the Federal Permitting Improvement Steering Council to designate qualifying data center projects as “transparency projects” under Title 41 of the Fixing America’s Surface Transportation Act (FAST-41) and to expedite their transition to FAST-41 “covered projects” (thereby streamlining environmental review);
  • Directs EPA to develop or modify regulations under the Clean Air Act, CWA, the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the Toxic Substances Control Act (TSCA), and other applicable laws to expedite data center permitting;
  • Directs EPA to identify Brownfield and Superfund sites suitable for Qualifying Project reuse;
  • Directs the US Army Corps of Engineers to consider activity-specific Section 404 nationwide permits to facilitate data center permitting;
  • Directs programmatic ESA Section 7 consultation for common construction activities expected to occur over the next 10 years on identified data center sites; and
  • Directs the Departments of Energy, Defense, and the Interior to take certain actions to use federal land to facilitate the development of Covered Projects.

Federal agencies have moved quickly to implement EO 14318.  For example, on July 24, 2025, the Department of Energy (DOE) announced the selection of four sites for data center development and subsequently issued solicitations for DOE’s Idaho National Laboratory, Oak Ridge Reservation, and Savannah River Site. In October 2025, the Department of the Air Force issued Requests for Lease Proposals for approximately 3,100 acres across five Air Force bases. In January 2026, EPA issued guidance for redeveloping Superfund and Brownfield Sites as data center sites, and launched a dedicated Clean Air Act resources page for data center developers.  On April 2, 2026, the Federal Permitting Improvement Steering Council designated the first data center to receive FAST-41 covered project status.  On May 11, 2026, EPA issued a pre-publication version of a proposed rule to revise certain definitions within the CAA’s New Source Review Program to authorize start of construction before obtaining air emission permits to facilitate data center development. 

Substantive Permitting Pressure Points:

Several substantive permitting issues continue to drive scrutiny of data center projects at the federal, state, and local levels.

  • Air Quality and Backup Power. Backup power systems—historically diesel generators classified as “emergency” units—are increasingly subject to Clean Air Act permitting conditions resembling major source analyses, particularly in nonattainment areas. Battery storage, stationary fuel cells, and hydrogen-ready installations are increasingly being considered as alternatives.
  • Water Use, Cooling Systems, and PFAS. Water consumption is an increasingly significant siting consideration. Cooling-related discharges generally require NPDES permit coverage.  In addition, immersion cooling fluids and other data center equipment sometimes contain intentionally added PFAS, which may implicate hazardous substance control laws and PFAS product and reporting laws.
  • Local Land Use and NEPA Review. At the local level, zoning, noise, traffic, and visual impact considerations remain a primary driver of scrutiny. For projects requiring federal action or that utilize federal funding, agency-specific NEPA review obligations remain in place notwithstanding EO 14318. Notably, data center projects may qualify for a categorical exclusion (CE) from NEPA review, consistent with the Council on Environmental Quality’s (CEQ) recent “CE-first” approach.
  • Federal Public Land Use Planning. Siting data center projects on federal public lands requires approval from the federal land manager (e.g., BLM or USFS) and may necessitate amending the governing Resource Management Plan (for BLM lands) or Forest Plan (for USFS lands)—a process that itself triggers time-consuming NEPA review and public participation requirements. 

State and Local Response:

While the Trump Administration has been seeking to accelerate data center development, states and local governments have begun pushing back.  In 2026 alone, over 300 data center legislation bills have been filed across more than 30 states.  Data center legislation has generally focused on three issues:

  • Energy cost allocation and large-load consumer obligations. Over 20 states are considering legislation targeting “large load” customers, and others introduced bills establishing special rate classes for large energy users to avoid residential customers from bearing the cost of data center power.  For example, Oregon’s POWER Act, signed into law in August 2025, creates separate rate class for facilities of 20 MW or more and requires long-term power purchase agreements.
  • Water usage reporting and cooling system requirements. Several states have proposed monthly or annual disclosure obligations on data center energy and water usage, including California (AB 1577), Virginia (HB 496 and SB 553), and New Jersey (S3379), and closed-loop cooling mandates in South Carolina and Kansas.
  • Construction moratoriums. Over ten states have introduced data center moratorium bills to pause construction pending further study on impacts to utilities, the environment, and local communities. Maine’s bill (LD 307) passed last month but was vetoed by Governor Janet Mills.

Community organizations are also pushing back, though data center developers have been able to calm some of this resistance through community benefit “good neighbor” agreements.

Key Considerations Going Forward:

Developers and operators of large-scale data center projects should anticipate and be prepared to navigate continued tension between federal and state regulatory priorities. Project proponents should consider:

  • Developing state-specific permitting strategies that account for emerging state and local requirements, particularly in jurisdictions with active legislative activity;
  • Engaging early with local stakeholders on land use, water, and community-benefit issues to facilitate project development, keeping in mind the creation of a fulsome administrative record that can be used in any potential litigation;   
  • Monitoring agency-specific NEPA implementing procedures and CEQ guidance, including CEQ’s April 2026 categorical exclusion guidance for projects with a federal nexus;
  • Identifying PFAS-related compliance obligations associated with cooling system chemistry and other products used in data center construction, particularly in states with PFAS product or reporting requirements; and
  • Evaluating opportunities to participate in DOE’s ongoing AI data center solicitations and monitoring whether DOI initiates similar processes for BLM-managed lands.

Please get in touch with the authors or your SPB contact if you have questions about data center environmental permitting, federal lands authorizations, or any of the federal or state developments discussed above.

The Packaging EPR Lawsuit You’re Not Watching—But Should Be

By Allen Kacenjar, Phil Sandick, Jennifer Tharp and Nicole Bothwell on Posted in Climate Change & Sustainability, Environmental
Are You Ready?

If you follow extended producer responsibility (EPR) litigation, your inbox has been full of updates about Oregon.  For good reason: the National Association of Wholesaler-Distributors (NAW) filed suit in federal court in July 2025 challenging the constitutionality of Oregon’s Plastic Pollution and Recycling Modernization Act, secured a preliminary injunction in February 2026, and has a trial date set for July.  That’s high drama with potential real ramifications (although the court did rule that the injunction only covered entities who were members of NAW when the injunction issued and the court has denied at least one motion by other groups to intervene in the lawsuit as plaintiffs).  The recent release of lists of compliant and non-compliant entities was also quite unexpected.

While everyone is focused on the Pacific Northwest, a second packaging EPR lawsuit quietly landed in Colorado, one of the other states with more advanced EPR programs.  It deserves serious attention from manufacturers and distributors operating anywhere in the country.

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Understanding New Mexico’s New PFAS Product Labeling Requirement

By Danelle Gagliardi and Abigail Dop on Posted in Chemicals & Products
science laboratory glassware

Regulation of per- and polyfluoroalkyl substances (PFAS) in consumer products continues to accelerate across the United States at the state level. In addition to phase-outs and bans on certain consumer products containing PFAS, state regulators are turning to labeling requirements as a tool to drive transparency and liability.

One notable recent development comes from New Mexico. The New Mexico Environment Department (NMED) formally proposed a rule to require consumer-facing labels on products containing intentionally added PFAS. On March 23, the New Mexico Environmental Improvement Board (NMEIB) officially approved the rule, making New Mexico the first state to require such labels on all products containing PFAS, even if those products are currently exempt from reporting/disclosure obligations to the state. The labeling requirements will go into effect January 1, 2027.

Although the precise label is not yet finalized, the required label is expected to consist of an Erlenmeyer flask image containing the word “PFAS.” For products other than complex durable goods, this label will be required to appear on the product and in some cases the packaging as well. For complex durable goods (defined to include products with a useful life of at least five years and composed of at least 100 components) the label need not appear on the product but must be included in a consumer-facing product specification sheet and operation and maintenance manual.

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UK Parliamentary Committee Publishes Report on PFAS Risks

By Francesca Puttock on Posted in Chemicals & Products, Climate Change & Sustainability, Environmental, Environmental Due Diligence, Food Safety, Food-Contact Materials and Articles, Health & Safety, Supply Chain, Water Quality

It has been a couple of months since the UK PFAS Plan was published and made countless headlines. Today (23 April 2026), having gathered evidence as part of a parliamentary inquiry, the House of Commons’ Environmental Audit Committee (“EAC“) published a report titled ‘Addressing the risks from Perfluoroalkyl and Polyfluoroalkyl Substances (PFAS)‘.

The report summarises the conclusions drawn by the EAC in the course of its inquiry and makes recommendations grouped into three areas:

  1. Preventing PFAS at source
  2. Human exposure and risk management
  3. Addressing pollution.

There is a lot to digest in this report, so we have highlighted some notable examples of the conclusions and recommendations reached by the EAC:

  • The EAC finds that the UK PFAS Plan “lacks the specificity needed to inform and deliver action”, and without clear requirements on what to monitor, the methods to use, thresholds for concern, adequate funding, and laboratory capacity, enforcement efforts will be undermined.
  • In the corporate disclosure space, the EAC advocates for a Government consultation on mandatory PFAS disclosures across supply chains within six months.
  • Government should consult by March 2027 on establishing a PFAS Remediation Fund. In addition, the EAC is seeking a commitment that Government will commit to funding the research and development of non-incineration PFAS destruction technologies.
  • UK REACH should be reformed by March 2027 to avoid further delay in restricting PFAS. The Government should “adopt an essential‑use approach to regulating PFAS, prioritising the rapid restriction of PFAS in non‑essential applications.”
  • The EAC calls for clearly defined exemptions for essential uses, with time‑limited derogations where substitutes are still being developed.
  • Some specific consumer goods are singled out by the EAC, with a recommendations that the Government “commission the Health and Safety Executive under UK REACH to bring forward restrictions on PFAS in non‑essential consumer products (e.g. food packaging, cookware and school uniforms) without delay and begin a phased restriction from 2027.”
  • There are also allusions in the report to alignment with other jurisdictions. The EAC recognises that “many lessons relevant to the UK are already emerging from studies and regulatory processes across the European Union and beyond”. It recommends that the Government “draw on international best practice and collaborate with established PFAS research programmes to ensure that the UK is fully aligned with and contributing to this global evidence base.” The EU’s PFAS restriction is currently in a decisive phase for companies across multiple sectors, as the draft opinion of the Committee for Socioeconomic Analysis (SEAC – part of the European Chemical Agency) is subject to public consultation until 25 May.
  • The move to introduce statutory limits for PFAS in drinking water is a “welcome step” but significant gaps remain in managing and limiting human exposure to PFAS through food and agricultural pathways. The food chain in particular is highlighted as an area where producers, retailers, and regulators need limits on the levels and types of PFAS in agricultural processes.

The EAC’s remit is “to consider the extent to which the policies and programmes of government departments and non-departmental public bodies contribute to environmental protection and sustainable development, and to audit their performance against sustainable development and environmental protection targets.” It does not have the power to set law or policy, but these findings are still notable and will require Government response.

The Government undertakes, where possible, to respond to reports of select committees like the EAC within two months.

We have been following this inquiry since it opened in April 2025. Should you wish to discuss possible ramifications on your business, please contact our Environmental, Safety, and Health team.

Emerging State-Level Greenhouse Gas Emissions Reporting Frameworks

By Michael Cox and Phil Sandick on Posted in Air Quality, Climate Change & Sustainability, Rulemaking & Policy Development
Gas turbine electrical power plant

As the US Environmental Protection Agency (EPA) rolls back greenhouse gas (GHG) laws, rules, and regulations consistent with Trump Administration priorities, several states are advancing legislation to create their own GHG emissions reporting frameworks. While some of these initiatives generally mirror California’s climate disclosure requirements, this new state-led regulatory landscape is creating a state-by-state patchwork that businesses must now monitor.

Federal Rollback

Beginning with President Trump’s Executive Order 14154, “Unleashing American Energy” (January 20, 2025), the Trump Administration has made clear that it opposes any laws—federal or state—addressing the causes or impacts of climate change. For example:

  • Executive Order 14154 revoked a suite of existing climate-related presidential executive orders and abolished offices, programs, and funding established pursuant to them.
  • The Securities and Exchange Commission ended its in-court defense of corporate climate disclosure rules, which were adopted on March 6, 2024. Consequently, the climate disclosure rules will not go into effect.
  • On April 8, 2025, President Trump signed Executive Order 14260, “Protecting American Energy From State Overreach,” which aims to stop the enforcement of state laws addressing climate change on the ground that they are unconstitutional, unenforceable, and preempted by federal law.
  • Most recently, the EPA finalized a rule on February 12, 2026, overturning its own “Endangerment Finding”—a finding that allowed EPA to regulate GHGs as pollutants under the Clean Air Act and underpins virtually all federal laws regulating GHGs.

Terminology

Generally speaking, GHG reporting laws focus on Scope 1, 2, and 3 emissions. For the uninitiated, the different “Scopes” are as follows:

  • Scope 1 Emissions: These are direct emissions from sources that a company owns or controls (think, stack emissions from an industrial facility). 
  • Scope 2 Emissions: These are indirect emissions associated with the generation of purchased electricity, steam, heating, and cooling that the company consumes. While the business does not produce these emissions directly, they are a consequence of the energy the company uses. 
  • Scope 3 Emissions: This category encompasses all other indirect emissions that occur upstream and downstream along a business’s supply chain and, in some instances, can contribute far more to a business’ carbon footprint than Scope 1 or 2 emissions combined. Scope 3 emissions can include downstream production, shipping, waste, disposal, employee transportation, and the like.

State Patchwork

GHG emissions reporting legislation has been enacted and/or introduced in California, Colorado, Illinois, Maryland, Minnesota, New Jersey, New York, and Washington.  (NB: This article does not discuss California. Our firm’s coverage of California’s emissions regulations can be found in this detailed overview and this recent update.)  A brief summary of legislation currently in effect, proposed, and attempted is summarized below:

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UPDATE: CARB Passes Initial Climate Disclosure Regulation under SB 253 and SB 261

By Alex Arensberg, Lianne Mantione, Michael Cox and Phil Sandick on Posted in Air Quality, Climate Change & Sustainability, Rulemaking & Policy Development
flags

At its February 26, 2026 meeting, the California Air Resources Board (“CARB”) approved a key step in implementing California’s landmark climate disclosure laws. CARB adopted the long-awaited California Corporate Greenhouse Gas Reporting and Climate Related Financial Risk Disclosure Initial Regulation (“Initial Regulation”) implementing the Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261). The Initial Regulation establishes the administration and implementation fee structure for SB 253 and SB 261 and sets the first emissions reporting deadline under SB 253: August 10, 2026. Notably, compliance with SB 261 remains voluntary after the U.S. Court of Appeals for the Ninth Circuit enjoined enforcement of that law.

Our previous, in-depth analysis of these two laws can be found here. In general, SB 253 and SB 261 require large companies doing business in California to disclose climate-related information, including Scope 1, 2, and 3 greenhouse gas (“GHG”) emissions and climate-related financial risks. SB 253 applies to companies with more than $1 billion in annual revenue, while SB 261 applies to companies with more than $500 million in annual revenue. As clarified in the Initial Regulation, these revenue thresholds are tied to entities’ gross receipts as reported to the California Franchise Tax Board.

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USFWS Proposes Changes under the Endangered Species Act

By Tabitha Madziwanzira, Jennifer Tharp and Danelle Gagliardi on Posted in Endangered Species Act
Red Wolf at Rest

The Endangered Species Act (“ESA”) has seen a 99% success rate in protecting listed species since its inception in 1973. After celebrating its 52nd anniversary this year, there are diverging views about how to continue to advance this success while developing efficiencies in the decision-making process. Most recently, the US Fish and Wildlife Service (“USFWS”) published four proposed rulemakings in quick succession that generated thousands of comments from the public, zoo and animal foundations, and other interested parties. The four proposed rules specifically relate to listing and delisting decisions, interagency cooperation and consultation, allowance of economic factors in decision-making, threatened species protection, and critical habitat exclusions. The comment deadline for all four proposed rules was December 22, 2025, despite requests from multiple organizations for an extension of the comment period to March 2026. Over 300,000 comments were received on each proposed rule prior to the deadline.

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Defra releases anticipated ‘PFAS Plan’

By Francesca Puttock on Posted in Chemicals & Products, Environmental, Food Safety, Food-Contact Materials and Articles, Health & Safety, Supply Chain

Today we published an update on Defra’s PFAS Plan: “UK Government Releases PFAS Plan Teased in December 2025“. This plan features among the commitments made in the Environmental Improvement Plan made public at the end of last year.

It is generally recognised that the UK needs a plan for PFAS management, but in the hours following the publication of the plan, some commentators expressed that some of the measures identified in the plan lacked clarity (in particular in relation to specific timeframes).

Tackling PFAS is a key policy area in the EU and UK. At the end of January, the European Commission published a report (“The cost of PFAS pollution for our society“) estimating that “if the current levels of PFAS pollution in Europe continue until 2050 without regulatory action, the cost will reach approximately €440 billion during that period. Tackling such PFAS releases at the source by 2040 would save €110 billion, whereas treating polluted water alone would cost more than €1 trillion.”

But PFAS are a wide group of substances, integrated into countless product supply chains, and across most industries, in many cases with no clear alternatives. Another notable piece of research focusing on six fluoropolymers and F Gas and examining the potential impact of a full or partial EU REACH restriction recently called for a “balanced approach that protects the environment while preserving industrial and technological capability” (“The [PFAS] and their role as enablers in the competitiveness of European industry“). This document will be of particular interest to businesses in the aerospace, defence, green energy, and semiconductor sectors.

‘A New Vision for Water’ – Defra’s White Paper and Other January 2026 Developments

By Caroline Almond, Francesca Puttock, Cristina Vela Gonzalez and Jody Li on Posted in Environmental, Uncategorized, Water Quality, Water Rights & Resource Management

It has been a busy start to the new year for water law and policy with various developments published in the last couple of weeks. Following the release in December 2025 of the Environmental Improvement Plan (EIP), which lists a number of commitments on water, Defra published a long awaited Water White Paper this week setting out the government’s action plan for water regulation. Earlier this month, we also saw Defra release details of the mandatory annual pollution-cutting plans that water companies will be obligated to produce under the Water (Special Measures) Act 2025 (the ‘2025 Act’). On the same day, the Office for Environmental Protection (OEP) issue information notices to Defra and the Environment Agency (EA) for ‘possible failures’ under the Water Framework Directive (WFD) Regulations.

We consider these developments below.

  1. Defra’s Water White Paper revealed – ‘A New Vision For Water’

The Water White Paper marks Defra’s intention to break with the ‘piecemeal’ and ‘disjointed’ approach of past water reforms and to focus on its ‘most critical outcomes’, i.e., delivering a safe and secure water supply, a protected and enhanced environment, and a ‘fair deal’ to customers and investors.

A large portion of the Water White Paper is dedicated, as anticipated, to the establishment of a new integrated water regulator. This new body will consolidate certain water-related roles historically played by the EA, Natural England, Ofwat and the Drinking Water Inspectorate into an integrated water regulator. There is an emphasis in the Water White Paper of the new regulator taking a ‘supervisory approach’ to regulation that will ‘shift regulation towards being more proactive and targeted to the specific needs of each water company to improve performance – while also increasing grip over water company delivery’. A Chief Engineer will sit inside the new water regulator to oversee what is described as a fundamental shift in the culture of the regulator and to provide the appropriate technical capability and engineering expertise.

Other developments noted in the Water White Paper include:

  • Appointment of a chair-designate of the new water regulator.
  • Establishment of a Regional Water Planning Steering Group to test new elements of the regional water planning function.
  • Introduction of a Water Reform Bill to Parliament (though little is said on this beyond ‘reset’ of the legislative framework including “elements of the Urban Wastewater Treatment Regulations and exploring updates to the Water Framework Directive Regulations, where needed”).
  • Introduction of a new Performance Improvement Regime (PIR) for poorly performing water companies. This will include an ‘MOT approach’ for water company infrastructure, requiring health checks on pipes, pumps and more.
  • Defra’s publication of a ‘Transitional Plan’ in 2026 with an accompanying interim Strategic Policy Statement to set out how changes will happen and who is responsible throughout the development of the new integrated regulator.

This document signals Defra’s desire to bring long term stability to this critical policy area. However, there have been mixed reactions from the industry. Environmental campaigners have said of the Water White Paper that ‘without significant new government funding it will not be the radical, transformational change that we hoped for or that communities, our environment and the economy need’. Others welcomed the document as an important step towards a joined-up and outcomes focussed framework.

2. Mandatory Pollution Incident Reduction Plans for Water Companies

Implementing Pollution Incident Reduction Plans (PIRP) is a key part of the 2025 Act, which aims to strengthen the enforcement powers of the water industry regulators to tackle offences by water companies and their chief executives.

On 8 January 2026, Defra released guidance on the mandatory requirement, under the 2025 Act, for water and sewerage companies to publish PIRP by April 2026 and annually thereafter. The PIRP is required to be published on water and sewerage companies’ website and published annually, with criminal sanctions for failure to meet this duty.

The guidance contains:

  1. An overview of the legal requirements and regulatory actions.
  2. Principles for preparing and publishing both the PIPR and ‘implementation reports’ that must be published before April 2027, and annually thereafter, to show their progress in reducing water pollution incidents. Both PIRP and Implementation Reports must include a statement by the company’s chief executive that they have personally approved the plan.
  3. Details on the required structure and content for the PIRP and implementation reports. It is notable that, in addition to reporting the frequency and seriousness of pollution incidents, water and sewerage companies are required to detail the steps taken to maintain any structure or apparatus that has been the cause of any pollution incidents, the measures taken to reduce the occurrence, and the impact that the measures will have.

In addition to PIRP and implementation reports, the 2025 Act has a number of other notable features, including:

  • The modification of the standard of proof of civil penalties from ‘beyond a reasonable doubt’ to ‘on the balance of probabilities’.
  • Restricting remuneration of directors and chief executives if specific standards are not met.
  • The introduction of automatic penalties for certain offences.

3. OEP Information Notices to Defra and the EA

The OEP was created in November 2021 and is responsible for holding Defra and other public authorities accountable for their obligations under environmental law.

In amongst these publications from Defra, on 8 January 2026, the OEP confirmed that it had issued information notices setting out the details of suspected failures by Defra and the EA to comply with the WFD Regulations. These possible failures relate to:

  • The public authorities’ duties to exercise functions aimed at achievingthe WFD’s environmental objectives, including setting objectives for each river basin district and establishing programmes of measures.
  • Not meeting requirements for setting less stringent environmental objectives and ensuring public participation in the development of River Basin Management Plans. The OEP found that existing plans for water companies were “too generic” and were implemented despite low government confidence that key improvement targets for water companies by 2027 would be achieved.

Defra and EA have two months to respond to the OEP at which point the OEP will consider ‘next steps’.

4. Defra’s EIP

The above developments follow the publication last month of Defra’s EIP. The EIP is the UK cross-governmental roadmap for improving the natural environment in England. It builds on the Environment Act 2021, setting out 10 overarching goals for environmental improvement. Each goal is accompanied by specific commitments and actions linked to measurable outcomes. The delivery of these outcomes is shared across various stakeholders including government, local authorities, businesses (including water companies), landowners, and communities and progress will be tracked through statutory targets, interim milestones, and annual reports.

The EIP includes a number of commitments and actions associated with ‘Goal 3: Ensure English Waters are clean, resilient, and plentiful’. For example:

  • Commitment 25: Reduce phosphorus loadings from treated wastewater by 55% by December 2030 against a 2020 baseline. As an action under this commitment, water companies will be required to upgrade 440 wastewater treatment works by 2030.
  • Commitment 29: Drive further investment to improve the water environment. As an action under this commitment, water companies, must support delivery of £24 billion of water company expenditure to improve the environment.
  • Commitment 34: Ensure water companies deliver their water resources management plans, eliminating the water supply demand gap that grows to 5 billion litres a day by 2050. As an action under this commitment, water companies are responsible for rapidly developing a ‘Regulators’ Alliance for Progressing Infrastructure Development and the National Framework for Water Resources.
  • Commitment 35: Modernise the abstraction licensing system, including moving it into the Environmental Permitting Regulations (EPR). Water companies (along with the EA and water users) are tasked with working with abstractors to find voluntary local solutions to reduce unsustainable abstraction or, if required, using powers to modify these abstraction licences.

If you wish to discuss these developments or water law more generally, please get in touch with a member of our Environmental, Safety, and Health team.

The authors would like to thank Jody Li (trainee) for her contribution to this piece.

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