The Central Pollution Control Board (CPCB), a statutory organization under India’s Union Ministry of Environment, Forest, and Climate Change, has imposed a heavy penalty in the form of Environmental Compensation (EC) on violators of the Plastic Waste Management (PWM) Rules, including civic bodies and business units. The penalty varies depending on the severity of the violation, based on the frequency and volume of the incident.
According to the revised guidelines, a penalty of Rs 5,000 to Rs 20,000 a tonne of banned items has been imposed, which will be levied based on the types of violations and the nature of the business units involved. Proposed to be collected as Environment Compensation, the penalty is also determined by the cost of plastic waste management incurred by local bodies, including the collection and transportation of plastic waste, the establishment of material recovery facilities, and their operational efficiency and management.
| Environmental Compensation (EC) for plastic packaging waste |
| Category of plastic packaging | Generation factor ratio (A) | Availability factor ratio at disposal point (B) | Collection factor ratio (C=A/B) | EC factor ratio (D=1/C) | EC (towards collection & transportation deterrent cost | EC (total PWM cost + deterrent cost) Rs/tonne of plastic waste |
| Category I | 5 | 1 | 5 | 0.2 | 400 | 2900 |
| Category II | 8 | 10 | 0.8 | 1.25 | 2500 | 5000 |
| Category III | 2 | 5.5 | 0.37 | 2.7 | 5400 | 7900 |
| Category IV | - | - | - | - | - | 7900 |
Sources: Central Pollution Control Board, Government of India; and Polymerupdate Research
Note: Category I: Rigid plastic packaging, Category II: Flexible plastic packaging, such as single or multi-layer plastic sheets and covers, Category III: Multi-layered plastic packaging, and Category IV: Plastic sheets and similar materials used for packaging, as well as carry bags made of compostable plastics
PWM= Plastic Waste Management Rule
Assessment of costThe revised guidelines direct assessment of cost incurred in plastic waste management based on the inputs provided by various local bodies. The cost incurred on management of plastic waste management shall essentially be divided into four basic components. The first component explains collection and transportation of plastic waste which concludes the average cost incurred for collection and transportation of solid waste is Rs 2,000 a tonne of waste. The second component is setting up of Material Recovery Facility (MRF) which entails an average cost of setting up of Material Recovery of 100 tonnes per day (TPD) plastic at Rs. 7 crore. Accordingly, the corresponding cost for setting up of 1 TPD plant is Rs. 7 lakhs. Considering 15 years of the plant life, the cost incurred for setting up of MRF works out to Rs.150 a tonne of plastic waste.
Similarly, the third component is setting up of RDF facility for which average cost of Refused Derived Fuel of 100 TPD capacity stands at Rs. 12.5 crore. Accordingly, the corresponding cost for setting up of 1 TPD plant is Rs. 12.5 lakh. Considering 15 years of life of the plant, the cost incurred for setting up of RDF for is Rs. 270 a tonne of plastic waste. And, the fourth component is operations & maintenance (O&M) Cost of RDF facility. Under this, the operational cost of RDF stands at Rs. 1200 a tonne and transportation cost Rs. 300 a tonne of plastic waste. Based on the above assessment cost incurred on management of one tonne of plastic waste is approximately Rs. 4,000.
PWM Rules entrust the responsibility of development and setting up of infrastructure for segregation, collection, storage, transportation, processing and disposal of the plastic waste on the local bodies as well as the producers or brand owners. Accordingly, the cost to be incurred on PWM shall be distributed equally (i.e., Rs. 2,000 a tonne of plastic waste on local bodies and Rs. 2000 a tonne of plastic waste on producers) for the purpose of assessment of Environmental Compensation. To ensure that EC levied acts as deterrent for violation of PWM Rules, deterrent factor of 2.5 is applied and EC of 2.5 times the cost calculated as per the revised guidelines i.e. Rs. 5,000 a tonne of plastic waste shall be levied on the local bodies and the Producers / Importers and Brand owners (PIBOs), respectively.
| Minimum and maximum environmental compensation for violation for the Plastic Waste Management Rules |
| Violator | Minimum Population | Maximum population | Minimum environmental compensation (Rs per annum) | Maximum environmental compensation (Rs per annum) |
| Village Panchayat | 1,000 (average) | - | 5,000 | 50,000 |
| Cities & Towns | 5,000 | 99,999 | 50,000 | 2 crore |
| Cities & Towns | 100,000 | 999,999 | 5 lakhs | 10 crore |
| Cities & Towns | >10,00,000 | - | 50 lakhs | 1,000 crore |
| Violator | Minimum Capacity (TPA) | Maximum Capacity (TPA) | Minimum Environmental Compensation value (Rs per annum, at 1st violation) | Maximum Environmental Compensation value Rs per annum, at 3rd violation) |
| Producer, Brand Owner, Importer & Plastic Waste Processors | 50 | 100,000 | 0.05 | 200 |
| Manufacturer | 60,000 | 45,00,000 | 2 crore | 500 crore |
Sources: Central Pollution Control Board, Government of India; and Polymerupdate.com
Repeat violatorsThe EC factor shall be inversely proportional to collection of each category of plastic packaging waste i.e., higher compensation for low collection and vice versa. The EC for Category I (Rigid plastic packaging), Category II (Flexible plastic packaging, such as single or multi-layer plastic sheets and covers), and Category III (Multi-layered plastic packaging), waste shall accordingly be Rs. 2,900, Rs. 5,000, and Rs. 7,900, respectively. Owing to difficulty faced in identification and segregation of compostable plastics. Similarly, EC for Category IV (Plastic sheets and similar materials used for packaging, as well as carry bags made of compostable materials) plastic packaging is considered the same as Category III plastic packaging i.e. Rs. 7,900 a tonne of plastics waste.
However, the penalty goes to the extent of seizure of manufactured products and closure of unit in case of violation for carry bags made of virgin or recycled plastic, not be less than 75 microns in thickness with effect from the September 30, 2021, and 120 microns in thickness with effect from the December 31, 2022. EC is set to be levied at Rs. 5,000 a tonne of plastic bags manufactured from the date of inception of the unit or date of notification of PWM Rules (March 18, 2016) whichever is later (EC to be levied at Rs. 10,000 a tonne for the second violation, and Rs. 20,000 a tonne for the third violation.
According to the revised guidelines, the manufacturers or sellers of compostable plastic and biodegradable plastics carry bags or commodities or both shall obtain a certificate from the Central Pollution Control Board before marketing or selling. For violating this law, EC will be levied at Rs. 7,900 a tonne of compostable and biodegradable plastic produced for the period of violation or from the date of issue of certificate. An EC is proposed to be levied Rs. 15,800 a tonne for the second violation, and at Rs. 23,700 a tonne for the third violation.
| Environmental Compensation charges and financial penalty non-timely submission |
| Amount deposition time period | Environmental Compensation and Financial Penalty Amount |
| Within one month from the stipulated time period | Original amount with interest @12% per annum for number of days delayed after the stipulated date of amount deposition |
| After one month but within three months after the stipulated tie period | Original amount with interest @24% per annum for number of days delayed after one month of the stipulated date of amount deposition |
| After three months | 1. Closure of unit/facility 2. Seizure of trade documents 3. Further action |
Sources: Central Pollution Control Board, Government of India; and Polymerupdate.com
Single use plastic (SUP)The CPCB has also specified a penalty for single use plastic players. Under the guidelines, manufacturer, import, stocking, distribution, sale and use of following single use plastic, including polystyrene and expanded polystyrene, commodities shall be prohibited. The SUP items include: earbuds with plastic sticks, plastic sticks for balloons, plastic flags, candy sticks, ice-cream sticks, polystyrene (thermocol) for decoration, plates, cups, glasses, cutlery such as forks, spoons, knives, straw, trays, wrapping or packaging films around sweet boxes, invitation cards, and cigarette packets, plastic or polyvinyl chloride (PVC) banners less than 100 microns, and stirrers.
For producers, an EC has been levied at Rs. 5,000 a tonne of plastic SUP items produced from the date of inception of the unit or July 01, 2022 whichever is later. An EC will be levied at Rs. 10,000 a tonne for the second violation, and at Rs. 20,000 a tonne for the third violation. The penalty goes on to cancellation of the license and closure of units. In case local bodies find a violator then an EC will be levied on the Municipal Commissioner or Village Panchayat, whichever the case may be, to the tune of Rs. 5,000 a tonne of plastic waste. The penalty amount will double (i.e. Rs 10,000) for the second time violator, and quadruple (i.e. Rs 20,000) for the third time violator.
By Dr. Sajjid Mitha (Founder and CEO)
POLYMERUPDATE / POLYMERUPDATE ACADEMY / RACE CONFERENCES
sajjid.mitha@polymerupdate.com
