A £23 billion asset

Economic growth in Scotland owes a lot to the environment.

Many of the country’s most successful industries – whisky, farming, aquaculture, are underpinned by a clean and healthy environment, yet the tangible benefits are often harder to pin down when they are not confined to pounds and pence.

The Scottish Environment Protection Agency (SEPA) exists not only to help protect and improve the environment through regulation and licensing, but is also responsible for promoting good environmental practice among individuals, communities and businesses.

But its chairman, David Sigsworth, said ensuring everyone contributes towards a better environment should not be a “burden on society” and instead should be helping people understand how to get the best out of it and in a way that supports a growing economy.

He said: “When I first came into this role at SEPA, I thought it was important at the time that instead of focusing predominantly on enforcement of law, we actually saw our role as helping people comply.
“In doing that you start from a different place, because we are not looking over operators’ shoulder waiting for them to step out of line. It ought to be a continuous process that is education and developing the idea of what good environmental practice is.”

Last year, in Edinburgh, the first ever World Forum on Natural Capital was held, looking at the idea that natural assets should be considered by the business world and beyond just as financial ones are.
In 2002, SEPA attempted to give a monetary value to how much the environment and its ecosystem services were worth to Scotland.

Building on work from leading ecological economist Robert Constanza, the agency estimated Scotland’s ecosystems were worth £17bn, a conservative valuation that has since been upgraded to £23bn in line with 2010 prices.

The valuation includes the benefit of the environment for provision of clean water and minerals, natural purification of water, dispersal of nutrients in water courses and the “cultural ecosystem” – physical and mental benefits that can be gained from the environment.

But this benefit is not a given; without protection, it is under threat. Sigsworth cites a recent example of a school in Beijing where Chinese school pupils played under a dome because of the severity of air pollution.

“The children were existing in a clean environment, but it was artificial,” he said.
“I think that in Scotland we rely on and we’re so proud of our environment and a lot of our industry relies on it.”

With legislation coming into force on 1 January, the move towards a zero-waste society has been a shining example of how something that has started with an environmental drive – to stop rubbish being buried in landfill and create a more sustainable society – has been intertwined with the economic arguments.

SEPA is the principal regulator for waste management and was a central part of developing the Scottish Government’s new regulations, which include ensuring businesses are required to remove all food and recyclable material from waste bins.

The environmental benefits are well known. In 2011, Scotland’s waste had a carbon impact of 14 million tonnes of carbon dioxide equivalent, but the new regulations will help cut this by 22 per cent by 2025.

But the economic argument has seen ‘zero waste’ as a concept that businesses can get behind. The UK recycling industry was worth £23.3bn in 2011, 15 per cent up on the year before.

Sigsworth says: “It is not just a societal thing, it is a huge economic driver to stop landfilling and move the money having to be invested in landfill charges.

“A huge amount of what we try to put in our bins at the moment can be reused and actually remanufactured, the principle of the circular economy.

“I think at the moment they are only just coming to light in the public’s eyes, but I see this as our job and the wider job of the Government to get people to understand just how important it is. It isn’t just a burden of having another bin for another part of our recycling; it’s helping to drive a better way of living and a more economic way of doing it.”

Many businesses are starting to see where the benefits are. SEPA, along with other organisations like the Scottish Government, Scottish Water and the country’s two enterprise agencies, runs the annual Vision in Business for the Environment of Scotland (VIBES) Awards, which recognise firms who are putting sustainability at the top of the agenda and seeing it as a way to economic success.

Winners last year included Edinburgh-based Vegware, which make compostable packaging and Forres-based Biomatrix Water which specialises in ecologically-sound methods of water treatment.
SEPA has a role in helping companies make their actions more sustainable. It helped the Scottish Whisky Association, the industry body which represents a sector which directly employs 10,000 people and where exports alone are worth £4.3bn.

“We developed an environmental plan that they’ve been living out in a very public way, they made commitments about the improvements they were going to make and they have largely delivered that,” says Sigsworth.

“They are doing it because they realise that for them the environmental component of their craft industry is using wholesome barley, malt, water – all of those natural things from Scotland is what delivers Scotch whisky.”

He adds: “They have seen this as a huge platform that has tremendous value for them and more and more industries will come to manage their macro operations in the same way.”

The Regulatory Reform Bill (formerly known as Better Regulation) currently going through parliament, will help improve the way SEPA works with landowners, businesses and others to improve the environment.

Sigsworth says it will be phenomenally important; there are currently more than 300 different pieces of environmental legislation for businesses to deal with and he believes that this could be simplified – maybe with firms having a single licence for a particular site or even a group of sites.

New regulations would include not just penalties for people who are not managing their environment sufficiently but also benefits for those who are working hard to follow the rules.

He adds: “The lower the risk you are environmentally and the better you are at showing you meet your licensing conditions and maybe go beyond it – we’re hoping the future charging regimes will reflect the benefit of doing that.

“But we also want to be able to have penalties that are meaningful for people who continually fail to do that.”

This approach mirrors the approach taken to manage the impact of diffuse pollution from agriculture – the largest source of water pollution.

The European Water Framework Directive demands that steps are taken to improve the condition of water bodies and Sigsworth says one option that could have been taken was licensing farmers and landowners for water abstraction and run off.

Instead, though, they set out General Binding Rules, simple actions farmers should take to avoid diffuse pollution – such as not ploughing a furrow down into a water course or fencing off areas to prevent animals getting into the water.

“Instead of trying to legislate,” he says. “We get our boots on.

“Last year, we did something like 6,000km of walking along the sites of water courses and noted where the General Binding Rules were not being adhered to. Then we sat down with the people who own the land and discussed what ought to be done.

“About 80 per cent of the people we deal with have actually heeded that advice and taken on the rules. Those who haven’t, we’ll have to start thinking about a higher level of pressure.”

With more companies being involved in the efforts to mitigate climate change and reduce carbon emissions, the agency also has a role to play in the emerging field of environmental and clean technology. SEPA is responsible for ensuring this new technology, just like any other, does not exceed emissions and meets Best Available Techniques specifications.

SEPA is a member of the EU Commission’s Environment Technology Verification Pilot Programme, including Defra, its English counterpart, the Environment Agency, and other bodies such as the Water Research Centre.

Under the new Industrial Emissions Directive which came in last year, there is a wider responsibility for environmental regulators across Europe to be involved in developing environmental technology.
Sigsworth says: “This gives us the basis of being able to work with wider parts of government in the European, UK, and Scottish context to ensure that we’re doing our bit to encourage and provide resources for those new processes to emerge.”

He added: “I am clear about the benefits of SEPA’s partnership approach – for the environment, for the economy, and for Scotland. But I am also sure that there remains untapped potential for us to work together to support and facilitate a vibrant and sustainable economy in a successful and flourishing Scotland.”