"One of the best sectors on operational performance is fuel and power," she added. At the launch of its business environmental performance report for 2001, the government body said big cuts in emissions from businesses regulated by the Agency had contributed to a continuing trend of improving air and water quality in England and Wales.

The largest fine in 2001 was 100,000 pounds ($156,600) for Magnox Electric plc, after it pleaded guilty to six discharges of radioactive waste from its Bradwell, Essex and Hinkley Point A nuclear power stations.

"The high fine reflected Magnox's failure to give environmental protection a high priority, especially important for the nuclear industry," Young said, adding that the company had since improved its performance.

Oil was the major contaminant found at pollution sites, accounting for 12 percent of the most serious incidents, the report said.

Oil major TotalFinaElf UK was fined 54,000 pounds and made to pay 90,000 pounds costs after petrol leaked into groundwater from a service station in Hampshire, southern England.

"This represents a continuing threat to groundwater, which we will have to monitor," Young said, as only 50 percent of the petrol could be extracted.

BP was also fined 10,000 pounds after 2,500 litres of kerosene oil leaked into a river from the loading of an oil tanker at a plant in Essex in southern England.

Eight-five percent of companies in the fuel and power sector were given a 'B' or 'C' rating out of an A-E scale for operational performance. Only EPR (Ely) Ltd, which generates power from waste straw, was categorised as 'E' or poorly managed.

A quarter of all incidents of serious UK pollution were from the waste industry, with the water sector criticised and high street chains such as supermarkets also responsible for serious environmental offences, the report said.

IMPROVED PERFORMANCE

The fuel and power sector accounted for 69 percent of total UK sulphur dioxide emissions in 2000, though its emissions fell by 196,000 tonnes or 25 percent in 2001, the report said.

The Agency requires the total amount of sulphur dioxide emissions from the sector to be reduced by over 60 percent on 1996/1997 rates by September 2005.

The good performers included Innogy plc, which reduced sulphur dioxide from its Tilbury Power Station in Essex by 34 percent using low sulphur coal, as well as Petroplus and Phillips Petroleum refineries in Teeside, north-east England.

"It is a high risk sector but because of regulation they have got their act together," Young told Reuters.

BP's Coryton refinery in Essex reduced sulphur dioxide by 51 percent using more gas firing instead of oil, though production also declined.

The sector was also one of highest contributors to carbon dioxide emissions, a greenhouse gas considered responsible for global warming. Analysts say Britain's power stations are puffing out more pollution as some switch to coal generation after a steep rise in natural gas prices.

A report by an environmental think tank this week said shareholder value at some top oil and gas companies could fall by six percent because of environmental costs and risks in the coming decade.

Young called for a more systematic approach to company environmental reporting. She said average fines had gone down, though she hoped companies would be encouraged to take action before being forced to by the Agency.