The Scottish Environment Protection Agency is cracking down on toxic pollution from fish farms blamed for wiping out wildlife across widespread areas of the seabed.

The government watchdog has begun a review of the discharge licences of 360 fish farms around the coast to restrict the use of a pesticide called emamectin. The chemical is fed to caged salmon to kill sea lice.

Sepa’s surprise move follows last week’s Sunday Herald revelation that emamectin had contaminated 45 sea lochs in breach of environmental limits since 2006, putting marine wildlife and human health at risk.

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A major scientific study had found “unexpected” links between “very low” levels emamectin and the loss of crabs, lobsters and other crustaceans, Sepa said. The agency is now reviewing its environmental safety limits for the pesticide to check they provide “adequate environmental protection”.

The study, commissioned by Sepa from the Scottish Aquaculture Research Forum, concluded that the use of emamectin at fish farms “was associated with substantial, wide-scale reductions in both the richness and abundance of non-target crustacea”.

It said that “toxic effects occur at levels much lower than those that are currently detectable”, and suggested that there was no threshold below which emamectin would be harmless.

“The evidence suggests that benthic crustacea may not be adequately protected by the current regulation of emamectin use in Scottish salmon farms,” the study warned.

Sepa is now reviewing all fish farm licences and “tightening conditions” for the use of emamectin after discussions with the UK government’s Veterinary Medicines Directorate. “We are beginning the issuing of these new licences this week, and this will be completed by the end of April,” Sepa said.

Sepa’s announcement was “welcome but overdue”, according to Dr Richard Luxmoore, the senior nature conservation adviser with The National Trust for Scotland. “It is worrying to see confirmation that these chemicals are having a seriously detrimental effect on marine wildlife over a far wider area than has previously been acknowledged,” he said.

Guy Linley-Adams, from the wild fish campaign group, Salmon and Trout Conservation Scotland, called on Sepa to cut the amount of salmon that could be kept at fish farms. “Sepa should now also scrap any idea of allowing across-the-board increases in permitted biomass. The fundamental problem here is that Scottish Government policy, to expand fish farming at all costs, is way out of step with what the sea lochs can actually support.” The Scottish Government has backed a fish farming industry plan to double production by 2030.

Don Staniford from the Global Alliance Against Industrial Aquaculture described the findings of the scientific study as “shocking”. Fish farmers had been stopped from using another pesticide to kill sea lice, teflubenzuron, in 2015, he said. “Now Sepa must ban the use of emamectin.”

Sepa’s chief executive, Terry A’Hearn, stressed that it was not banning the use of emamectin. “We have not published a new policy on emamectin, but are tightening Sepa licences.”

A Scottish Government spokesman said: “The Scottish Government has a proportionate approach to balance growing aquaculture sustainably and protecting the environment.”

Revealed: how Sepa bowed to industry pressure on fish farm pollution

The Scottish Government’s green watchdog suppressed a critical report on pollution after pressure from the fish farming industry, according to internal emails seen by the Sunday Herald.

Sepa bowed to private lobbying from the Scottish Salmon Producers’ Organisation (SSPO) not to publish an article in August 2016 highlighting concerns about a fish farm pesticide killing wildlife.

The decision followed SSPO paying for two dinners out for Sepa executives. One at a restaurant in in Perth in November 2015 included four senior Sepa staff and fish farm company directors, and the other in April 2016 involved Sepa chief executive Terry A’Hearn.

On August 5 2016 Sepa emailed SSPO with a draft of an article on the use of pesticides to control sea lice.

SSPO chief executive Scott Landsburgh told Sepa: “Should you publish this statement in its current format, I suspect that it will lead to a good deal of media scrutiny which will seek to undermine the industry’s reputation and will probably damage all of our reputations.”

Landsburgh also emailed Sepa boss A’Hearn saying he was “disappointed” that Sepa was proposing to publish its plans for emamectin. SSPO had been “trying to agree a common media position with all parties in order to minimise the controversy,” he said.

No statement on emamectin was published by Sepa in 2016, though it did post online a statement announcing a “tightening” of the pesticide’s conditions of use last week. This immediately followed Sepa’s release of the emails in response to a freedom of information request by Don Staniford from the Global Alliance Against Industrial Aquaculture.

“It is shameful that Sepa has once again cravenly kowtowed to pressure from the salmon farming industry,” alleged Staniford.

SSPO confirmed that Landsburgh had requested A’Hearn not to publish. This was “because the article to be put into the public domain was going to be out of context,” said an SSPO spokeswoman.

“The idea that SSPO could influence Sepa executives over a couple of dinners is risible. The dinners were arranged to discuss general environmental policies.”

A’Hearn confirmed that four Sepa staff had attended a dinner hosted by SSPO, and that he had attended an SSPO dinner.

“Engagement between Sepa and other organisations, including regulated operators, occasionally includes hospitality, subject to strict rules,” A’Hearn said.

“Sepa considers a wide range of views in its decision-making process, but the final decision is always our own, as it was in this case.”