Environmental issues for real estate in 2012

Environmental issues for real estate in 2012


Author: Sophie Wilkinson

Environmental issues continue to move up the political agenda and there is no let up expected in 2012, with several key environmental developments anticipated

Here, we summarise those developments expected to affect the real estate sector.


Draft legislative proposals on changes to the second phase of CRC are expected for formal consultation in early 2012.

It is anticipated that the Government's response to the consultation will be issued in September 2012, with guidance on the revised CRC being published in December 2012. Amended legislation will follow in April 2013.

The next milestone under the introductory phase of CRC is the first sale of allowances, which draft regulations propose will take place between 1 June and 31 July 2012 at a price of £12 per tonne CO2, and will relate to emissions during the 2011/2012 compliance year. Allowances need to be surrendered by 31 July 2012 in order to avoid a civil penalty.

In addition, the qualification period for the second phase of the scheme is 1 April 2012 to 31 March 2013. The deadline for registering as a participant in phase 2 is 30 September 2013.

Contaminated land

Last year, DEFRA reviewed the contaminated land regime in England for the first time since its introduction in 2000.

The review found the primary legislation (Part 2A of the Environmental Protection Act 1990) remained fit for purpose, and that there was a strong need to keep it.

However, there were flaws in the accompanying Statutory Guidance, which had undermined the effectiveness of the regime and created considerable regulatory uncertainty.

Following this review, DEFRA and the Welsh Assembly consulted on proposals for changes to the Statutory Guidance. Their response to the consultation was expected at the end of last year, but has been delayed.


  • From 6 April 2012 an energy performance certificate (EPC) will be required at the point of marketing for all properties. In addition, written property particulars will need to include a copy of the first page of the EPC. It will no longer be possible to include only the asset rating.
  • Legislation to implement the Green Deal is expected in spring, with the first green deals appearing in autumn 2012. For more detail on the Green Deal see The Green Deal.
  • Phase 2 of the Renewable Heat Incentive (RHI) is expected to be open from October 2012. Phase 1 opened in November 2011, providing a financial incentive to install renewable heating systems in non-domestic premises (for more detail see Renewable Heat Incentive. Phase 2 will extend the RHI to domestic premises and will introduce support for additional technologies and fuels.
  • The Government is to consult on introducing a new green areas designation, giving local people the opportunity to protect green spaces that have significant importance to their local communities. The consultation was expected at the end of 2011, but has been delayed.
  • Voluntary biodiversity offsetting is to be established and tested by local authorities in pilot areas for two years starting in spring 2012. The approach will allow developers to impair the habitat value of a site, provided that it pays to restore another habitat site that has the potential to become at least the same quality as the habitat that will be lost.