The Energy Prices Act 2022 (Extension of Time Limit) (No. 2) Regulations 2026

Published: Wed 9th Sept 26

Removed the £250,000 statutory cap on variable monetary penalties for environmental offences in England.

This Order amends the Environmental Civil Sanctions (England) Order 2010 to remove the £250,000 limit on variable monetary penalties that regulators, such as the Environment Agency, can impose for environmental offences.

The changes apply to enforcement actions in England concerning breaches of environmental regulations, including water quality and waste management.

By removing the cap, the legislation authorizes regulators to determine the size of a penalty based on the specific circumstances of the offence without a statutory maximum.

Arguments For

The Explanatory Note states that the order removes the previous £250,000 cap on variable monetary penalties to ensure regulators have appropriate tools to deter non-compliance.
The document indicates the change aligns with the Regulatory Enforcement and Sanctions Act 2008 by allowing penalties to be set at a level that accounts for the severity of the breach and the financial benefit gained from non-compliance.
The order seeks to ensure that the 'polluter pays' principle is upheld by removing statutory limits that may have previously restricted the impact of financial sanctions on well-resourced entities.

Arguments Against

Legal commentators have noted that removing the cap grants significant discretionary power to regulators, which may lead to inconsistency in how fines are calculated across different regions or sectors.
Regulated entities, particularly in the water and waste sectors, have expressed concern regarding the lack of a new upper limit, arguing it creates financial uncertainty and potential over-punishment for accidental breaches.
Some legal experts suggest that very high administrative penalties issued without a court trial could face challenges under Article 6 of the European Convention on Human Rights regarding the right to a fair hearing.

1. Citation, commencement and extent

(1) This Order may be cited as the Environmental Civil Sanctions (England) (Amendment) Order 2023.

(2) This Order comes into force on 1st December 2023.

(3) This Order extends to England and Wales.

This section establishes the official name of the legislation and sets the date it becomes legally active as 1 December 2023.

It specifies that while the law applies to the combined legal jurisdiction of England and Wales, the substantive changes to penalties concern enforcement in England.

2. Amendment of the Environmental Civil Sanctions (England) Order 2010

(1) The Environmental Civil Sanctions (England) Order 2010 is amended as follows.

(2) In Schedule 2 (Variable Monetary Penalties, Restoration Notices and Compliance Notices), in paragraph 1 (Variable monetary penalties)—

(a) omit sub-paragraph (2);

(b) in sub-paragraph (3), omit “(subject to sub-paragraph (2))”.

This section modifies the 2010 Order by deleting the specific paragraph that previously capped variable monetary penalties at £250,000.

It also removes a cross-reference to that cap in the following subsection, effectively granting the regulator the power to issue fines of any amount for the relevant environmental offences.

A variable monetary penalty is a type of civil fine where the regulator decides the amount based on the severity of the incident and the offender's conduct.

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