The Finance Act 2025 includes a range of financial policy relevant to the environment.
This summary concerns confirmed rates for the climate change levy from 1 April 2026.
These changes apply across the UK.
What has changed?
Amendments to the Finance Act 2000 set the main rates of climate change levy from 1 April 2026.
Taxable commodity supplied
Rate at which levy payable if supply is not a reduced-rate supply
Electricity
£0.00801 per kilowatt hour
Gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility
Any petroleum gas, or other gaseous hydrocarbon, supplied in a liquid state
£0.02175 per kilogram
Any other taxable commodity
£0.06264 per kilogram
New publications this month:
HM REVENUE AND CUSTOMS (HMRC)
Carbon Border Adjustment Mechanism (CBAM)
The Finance Act 2025 enables HMRC to prepare for the introduction of a UK CBAM. This will apply with respect to embodied emissions on certain types of imported goods and is due to be introduced by 2027. The Act does not apply any compliance obligations on businesses at this stage.
Government guidance states that the UK CBAM will apply to the aluminium, cement, ceramics, fertiliser, glass, hydrogen, iron and steel sectors.
DEPARTMENT FOR ENVIRONMENT, FOOD AND RURAL AFFAIRS (DEFRA)
Simpler recycling: household recycling in England
This new document provides guidance to waste collectors on separate collections of household waste from 31 March 2026. Food and garden waste, paper and card, other dry mixed recyclables and residual waste will need to be collected separately from all households in England from this date.
How to operate or service electrical switchgear containing SF6
Updates provide further information on the management of waste SF6 and labelling requirements.
Circular Economy: Delivery Roadmap
Defra’s circular economy roadmap has been updated to reflect policy implemented through to March 2025.
Extended Producer Responsibility for Packaging (pEPR): Aggregated Packaging Data
Aggregated packaging data are now available through to H1 2024.
DEPARTMENT FOR ENERGY SECURITY AND NET ZERO
Guidance supporting the Clean Heat Market Mechanism
The Clean Heat Market Mechanism (CHMM) sets low-carbon heat pump installation targets on manufacturers of fossil fuel boilers that exceed the sale thresholds set. The scheme operates from 1 April 2025. The following guidance on the scheme was issued in March 2025:
DEFRA AND ENVIRONMENT AGENCY
Packaging data: what to collect for extended producer responsibility
This guidance now provides further information for small producers, includes a link to the recyclability assessment methodology and provides further information on reporting requirements.
From 1 January 2025, producers supplying household packaging must assess and report recyclability of packaging, which will determine the fees applicable.
Extended producer responsibility for packaging: fit and proper person status
This new guidance sets out how regulators will determine whether applicants meet the ‘fit and proper person’ status for approval as a compliance scheme or accreditation as a reprocessor or exporter.
Legal operator and competence requirements: environmental permits
This guidance sets legal, financial and professional requirements for operators and managers of facilities requiring an environmental permit. The guidance has been updated to provide further details of what a ‘legal entity’ is.
How you'll be regulated: environmental permits
This guidance confirms the Environment Agency’s plan to phase in the publications of Compliance Assessment Reports (CARs) on the public register.
Flood risk activities: environmental permits
A minor update reflects RPS 333 (small-scale monitoring instruments and associated equipment alongside in main river watercourses), which does not require permission from the Environment Agency as long as the conditions are met.
UK ETS: Register your installation as an ultra-small emitter
Eligibility criteria for ultra-small emitter scheme in the 2026 to 2030 allocation period have been updated in this guidance. Between 1 April and 30 June 2025, all installation operators must submit data to ahead of the 2026 to 2030 allocation period and apply for the ultra-small emitter scheme, where applicable.
The guidance includes data collection and verification templates for ultra-small emitters, plus guidance on the application process.
ENVIRONMENT AGENCY
Monitoring stack emissions: carbon capture plants with solvent-based abatement
A standardised approach is set out for the monitoring of stack emissions from post combustion carbon capture plant regulated under the Industrial Emissions Directive 2010/75/EU.
Monitoring stack emissions: quality assurance of continuous monitoring
Requirements on continuous monitoring of stack emissions have been updated to reflect revised requirements on Quality Assurance Level QAL1, QAL2 and QAL3 checks alongside update reporting templates, including for Annual Stack Test (AST) failures.
Preparing a flood risk assessment: standing advice
This guidance reflects updated flood and coastal erosion risk data, alongside sustainable drainage system policies included in the December 2024 version of the National Planning Policy Framework (NPPF).
Dispose of waste to landfill
This updated guidance now reflects the prohibition on landfilling paper and card, plastic, metal, glass or food and garden waste that has been separately collected for recycling or composting under the simpler recycling obligation in England, which applies from 31 March 2025.
Regulatory Position Statements (RPSs)
The following RPSs were published or updated during March 2025:
DEPARTMENT FOR TRANSPORT
Climate change risk assessment: transport sector
New guidance is available to help transport sector organisations to undertake climate change risk assessments.
PLANNING INSPECTORATE
Nationally Significant Infrastructure Project (NSIP) Guidance on Working with Public Bodies
The following guidance was published for the first time in March 2025. This provides advice on working with the respective public bodies in relation to NSIP developments.
SCOTTISH ENVIRONMENT PROTECTION AGENCY (SEPA)
Flood maps
SEPA has launched new surface water flood maps. These maps are considered more detailed, as they now include small watercourses.
SCOTTISH GOVERNMENT
Environment Strategy for Scotland - Transformative Changes for Sustainability
This independent report is intended to inform the Scottish Government’s forthcoming environment strategy.
Environment Strategy for Scotland - Global Environmental Impacts of Consumption and Production in Scotland
This independent report examines environmental impacts from consumption and production in Scotland.
Waste (Materials Facilities) (Scotland) Direction 2025: ministerial direction
This direction requires SEPA to ensure existing and new waste management licences and PPC permits contain a condition requiring compliance with the Materials Facilities Code.
WELSH GOVERNMENT
Placing a value on carbon: technical advice note
Guidance is provided on determining the economic value of carbon emissions.
Hydrogen for road transport: technical advice note
This note provides an overview of hydrogen vehicles.
Providing electric vehicle charging for staff at the workplace: technical advice note
This document provides guidance on considerations when installing electric vehicle charging.
Staff Scope 3 emissions: technical advice note
Technical guidance is provided on changes to business travel to cut carbon emissions.
Managing standalone renewable generation: guidance
This document concerns the monitoring and management of standalone renewable generating stations. This includes measures to generate more electricity.
Monitoring and maximising the performance of roof-top solar arrays: guidance and tools
This guidance is targeted towards public sector organisations. It concerns the monitoring and management of roof-top solar arrays in order to generate more electricity.
Approved Document R: physical infrastructure for high-speed electronic communications network (in-building physical infrastructure)
This approved document supporting the building control regime in Wales now reflects changes as a result of the Building etc. (Amendment) (Wales) Regulations 2025 from 1 July 2025.
Environment Agency publishes 2024 storm overflow spill data for England
The Environment Agency has published annual water company Event Duration Monitoring (EDM) return data for 2024. This data show the frequency and duration of spills from sewage treatment plants as a result of storm overflows in England.
The data for 2024 show a 2.9% decrease in the number of sewage spills compared to 2023. However, spill durations increased by 0.2%. The 2024 data show that storm overflow spill counts and durations remain unacceptably high.
The data also shows that in 2024:
In January 2025, the Environment Agency secured a major commitment of actions and investment from water companies to clean up waterways. The Water Industry National Environment Programme (WINEP) sets out over 24,000 actions water companies must take over the next five years to meet their legal requirements for the environment. It is understood this represents a £22.1bn investment, including around £10.2bn to improve storm overflows in England, including nature-based solutions which reduce the amount of rainfall reaching overflows.
Water companies have committed to upgrading over 2,500 storm overflows, which the Environment Agency expects to reduce annual sewage spills by 85,000. Water companies are also due to install 3,500 monitors at emergency overflows sites, protecting and enhancing 13,500 km of river.
Lincolnshire waste offender required to pay a large additional penalty due to undeclared assets
A convicted waste offender must now significantly increased proceeds of crime after the Environment Agency re-opened an inquiry into his finances and discovered he had undeclared assets.
The man’s case was re-opened after the Environment Agency learned of changes in his financial position. It was discovered that he owned a property that he had not declared at the time of his sentencing, when only £8,317 was recovered from him because it was believed he had limited means.
The man was originally prosecuted in the summer of 2021 for waste crime offences. He was given a suspended prison sentence for storing and burning waste illegally at a site in Holbeach, Lincolnshire, despite repeated warnings from the Environment Agency.
At court on 27 February 2025, it was re-calculated that the man benefited from his illegal waste activities by £286,809.94.
During the initial investigation, Environment Agency officers visited the Holbeach site on six occasions and told the man verbally and in writing to stop bringing waste to the site and burning it. However, on returning to the site, Environment Agency officers found more waste had been brought to the site and burned.
Waste observed at the site during the multiple visits included household waste, furniture, mattresses, clothing, paint cans, toilets, televisions and numerous fridges. Some of the rubbish had been burned, prompting neighbours to complain about the smoke generated. Fridges are classed as hazardous waste and require specialist disposal.
Additional penalty
The man was ordered to pay an additional £278,492.92. He was given three months to pay the remainder or to serve five years imprisonment, and was ordered to make a £1,500 contribution towards the Environment Agency’s costs.
This is on top of the £8,317.02 he paid after being sentenced in 2021.
Waste company prosecuted for failing to comply with a demand for information about accepted materials
A business and a designated member of the partnership have been fined after failing to comply with a formal information notice served on by the Environment Agency.
Tetron Welbeck Limited Liability Partnership has had an environmental permit since 2013 to operate a site at Welbeck Colliery near Mansfield, Nottinghamshire. It was stated that the business changed hands around 2020.
The Partnership failed to comply with a formal information notice served on it after it failed to provide information requested by the Environment Agency. The information was required to allow the Environment Agency to audit the site in order to ensure waste within the correct category was being accepted. The deadline in the notice for the receipt of the information was 15 June 2023. No information was received.
A work plan was provided on 15 June 2023, but this did not include the required information. Despite engaging with the Environment Agency, the man, who was a designated member of the partnership, did not provide the information required.
Further attempts by the Environment Agency to obtain the relevant information failed.
Breach
Tetron Welbeck Limited Liability Partnership pleaded guilty to breaching Section 71(3) of the Environmental Protection Act 1990:
The offence was found to have been committed with the consent or connivance of, or was attributable to, neglect on the part of the partner of the firm, contrary to
The partner in the firm was deemed to have committed the offence of breaching Section 157(1) to the Environmental Protection Act 1990.
Penalty
Tetron Welbeck Limited Liability Partnership was fined £44,800 with costs of £5,605.05.
The partner in the firm was ordered to pay costs of £5,605.05 and the victim surcharge of £683.
