IS THIS ANOTHER CONFLICT OF INTEREST? THE LINK BETWEEN PEAK CLUSTER AND THE ENVIRONMENT AGENCY
ANOTHER CONFLICT OF INTEREST? THE LINK BETWEEN THE CHAIR OF THE ENVIRONMENT AGENCY & PEAK CLUSTER
Alan Lovell has chaired the Environment Agency since July 2022. The Environment Agency is the government body responsible for regulating Carbon Capture, and Storage (CCS) activities in England through environmental permits, risk assessments, scientific research and guidance on industrial decarbonisation.
https://www.gov.uk/government/collections/environmental-capacity-for-industrial-clusters
Alan Lovell was also Chair of Progressive Energy from 2009 until he resigned in 2022 to become Chair of the Environment Agency. Progressive Energy is the lead partner for both the Peak Cluster and HyNet projects.
During the selection process for the Environment Agency Chair, Alan Lovell declared that he was Chair of Progressive Energy and acknowledged that “this represents a potential conflict of interest”. He said the issue could be managed because he would step down from Progressive Energy and “recuse myself from EA discussions/decisions that create, or could be perceived to create, a conflict of interest”.
https://committees.parliament.uk/publications/23000/documents/168538/default/
However, when he became Chair of the Environment Agency, Lovell did not give up his shares in Progressive Energy. According to the Guardian, when the Environment, Food and Rural Affairs Committee asked whether he would divest himself of any financial interests in the company, Lovell replied: “I don’t feel that I need to do that.”
The Guardian described Lovell as an accountant and businessman known for stepping in to rescue struggling companies, including an unsuccessful attempt to support Carillion. It was reported that he told MPs they should welcome his investment in important sectors.
Lovell said he regarded the CCS and hydrogen sector as “extremely important” and had invested in it since 2009. He added that Progressive Energy had been selected to coordinate HyNet, one of two government-backed clusters.
Lovell defended retaining his shares, telling MPs that HyNet was “going to go ahead” and had sufficient government backing. He said he did not believe this created any issue.
The MPs on the EFRA Committee who appointed Lovell as Chair of the Environment Agency said they “were surprised that he had not come to more fully researched and formed views on some of the key environmental issues and challenges facing the Environment Agency.” Although the pre-appointment report also identified “significant gaps in his knowledge” of the agency’s enforcement work, the committee was “satisfied that Alan Lovell has the professional competence and personal independence required of the Chair of the Environment Agency”.
His remuneration as Chair of the Environment Agency was initially £100,000 for 3.5 days per week. Alongside this role, he held several other positions:
· Chairman of the Interserve Group (July 2019 – Jan2024) which he wound up in 2024
· Senior Independent Director of SIG plc (Aug 2018 – present) (currently facing “significant financial pressure”)
· Chair of the Hampshire Cultural Trust (Nov 2014 – present)
· Chairman of Safestyle UK (Jul 2018 – Jan 2024) (collapsed in 2023 owing £30 million to its customers)
· Chairman of the Mary Rose Trust.(Aug 2015 – Jan 2024)
Before becoming Chair of the Environment Agency, Lovell’s corporate experience also included:
· Chief Executive of Jarvis (2004-2006) faced a”long slow decline” before finally going into administration in 2010.
· NED and Chair, Restructuring Committee, Carillion plc (2017-2018) “nearly succeeding with a rescue package”
· Chairman of Flowgroup plc (2017-18) - sold the energy subsidiary and wound down the plc
· Sepura plc (2016 – 2017) “successfully sold” to a Chinese Competitor
· Finance Director and CEO Conder group plc (1989 – 92) “achievements” included “sale of subsidiaries” and “properties” and “drastic cost-cutting” and then the company collapsed in Sept 1992.
· Chair of Consumer Council for Water (April 2015 – March 2019) “the independent voice for water and sewerage consumers in England and Wales, providing advice, advocacy, and complaint resolution”.
While Chair of the Environment Agency, Lovell was criticised for attending three private dinners at an exclusive dining club in London with the Chairs of Ofwat and a number or water companies. The Guardian newspaper reported Freedom of Information requests “showed that the Ofwat and Environment Agency chiefs discussed topics including “navigating the coming months, particularly to manage perceptions” and “Given the debate on bills/affordability how do we carefully message the increases?””
“Water quality campaigner and former Undertones frontman Feargal Sharkey described the private dinner as “outrageous”. He argued that industry and regulators, both under intense public scrutiny, appeared to be acting together to avoid transparency and accountability, and he called for the chairs to resign.”
“James Wallace, the CEO of River Action UK, added: “It is outrageous that the government is holding private meetings – using taxpayers’ money – with water industry bosses on how to greenwash their dreadful performance on river and coastal pollution””
In the past week, it was announced that Lovell will step down as Chair of the Environment Agency to become Chair of British Steel. British Steel has been involved in several carbon capture projects and trials. Business Secretary Jonathan Reynolds said Lovell “understands what it takes to lead companies through major change”.
Although Lovell’s pattern of corporate work appears to include winding down or restructuring many companies, often only staying around for a few years, he seems keen to retain his financial interest in Progressive Energy which he has been involved with since 2009. According to the Global Database website, Lovell remains one of the three main shareholders with significant control of the company progressing Peak Cluster.