The agency has 9,500 staff and a budget of pounds 563m, and was formed last year by the merger of Her Majesty's Inspectorate of Pollution (which monitored air pollution), waste regulators from 83 local authorities (responsible for preventing land pollution), and the National Rivers Authority (which monitored river pollution). Mr Gallagher had been chief executive of the NRA before the three regulators were combined.
Bringing together those responsibilities has led the Environment Agency to take a broader view of the environment than its predecessor bodies, and focus more on solving problems, rather than transferring pollution from one element onto another.
"We have to come up with a solution, saying this is what we must do with these toxic materials," Mr Gallagher explains. "We are always going to have stakeholders who have diametrically opposed views of what they want. We can't fudge the issue as I could in the NRA, over, say, BSE carcasses, and say don't bury them near a watercourse. Now I have to say, `What are we going to do with them?' "
That provides greater strategic coherence to environmental management. The price has been merging fiercely independent organisations. "To form a common cultural identity is very, very difficult," Mr Gallagher admits. "Our people are very loyal to their basic disciplines. Now they find themselves merged into this great, integrated agency." There has been concern that managers are now more likely to be generalist scientists, and less likely to be specialists.
One of the Environment Agency's roles is to act as an "honest broker", pulling together a range of voluntary groups, companies, local authorities and public bodies, to form new partnerships. The agency is party to 35 co-operative agreements for site improvements.
But that spirit of co-operation has not worked with the water companies. "We have been very critical of the water industry," Mr Gallagher says. "We give them the credit for improvements in water quality: our rivers are about a third cleaner now than pre- privatisation, and a lot of that is due to the water companies' investment.
"But the lack of work done on sewer overflows, their lack of interest in conservation demand and the fact that when we ask for pounds 10m for English Nature to be spent on projects to take phosphates out of some of our threatened sites of special scientific interest, they say they can't afford it but within a year they have spent six times that amount on special dividends to shareholders, and pounds 1bn on buying back their own share - I don't think that is the basis for trust and understanding. A lot of cultural change is still needed."
The agency wants the companies to invest more of their profits in computer management systems and bio-technology for sewage treatment. Mr Gallagher believes extraction of water supplies from rivers will be eliminated across most of the country once pipe leaks have been brought under control. In the South-east there is no easy solution to the problem of excessive demand. In the end, he suggests, the planning process will have to recognise that this region cannot sustain more homes.
His immediate priorities now, apart from sorting out the water companies, are to work more closely with local authorities, the education sector, national and local voluntary groups and with industry.
The Stock Exchange is another target, to promote the greater use of environmental auditing, and spread the message that companies that take waste reduction seriously are more efficient and more profitable. Mr Gallagher wants to encourage businesses to export environmental control systems.
As a public servant, Ed Gallagher has to avoid political comments. But it is clear he welcomes the strong environmental messages coming from the new government: "It is a change away from the consumer society, it is about valuing materials. My generation has ruined the environment." The tide, he feels, is beginning to turn