DR. Ravi D.

R
M. Tech, PhD
Environmental Officer
Karnataka State Pollution Control Board
 Natural ecosystem provides number of goods and services.

 Ecosystem services ensure long-term sustainable development.

 Natural resources are exploited to meet the unlimited economic needs.

 Unsustainable development has affected the health of environment,

beyond its carrying capacity.
 Non-excludable - Prevented from using a public good.
 Non-rivalous - One person’s use does not reduce another person’s use .
 Allows for simultaneous consumption. Imparts Free Rider Problem.
 All the Natural Resources are considered as public goods.
Externality is when the well-being of one directly affected by the actions of
another.

Environmental Pollution and Resource depletion is Negative Externality-

hampering the well being.

Need to create Market policy by well defined property rights or

establishing a complete system that uses externalities.
 ’Polluter Pay Principle’ - An effective tool for controlling pollution &
resource conservation.

 Relies on those who produce pollution should bear the cost of managing
it, to prevent damage.

 First introduced in 1974

 The polluter should bear the expenses of carrying out measures, to

ensure environment in an acceptable state.

 The cost of Pollution Control measures should be reflected in the cost of

goods and services, which cause pollution.
A Pigovian Tax is a tax placed on any good which creates Negative Externalities. The aim of
Pigovian tax is to make the price of the good equal to the social marginal cost and create a more
socially efficient allocation of resources.

In a free market, the equilibrium will be at

Q1 – where D=S. At this output, there is
social inefficiency.

At Q1, the social marginal cost (SMC) is

greater than the social marginal benefit
(SMB) – there is overconsumption.

If the government place a tax equal to the

external marginal cost, then consumers pay
full social marginal cost. (SMC)

This will reduce the demand from Q1 to Q2

and this will be socially efficient because at
Q2 - SMC=SMB.
▪An approach to Decision-Making under conditions of great uncertainty
and potential harm.

▪Where there are threats of irreversible damage, lack of full scientific

certainty shall not be used as a reason for postponing cost-effective
measures to prevent environmental degradation.

▪When an activity increases threats to human health or the environment,

precautionary measures should be taken even if some cause and effect
relationships are not fully established scientifically.

▪Key Elements are

▪Recognition of potential (serious, irreversible) harm
▪Recognition of uncertainty (and complexity)
▪Recognition that action is warranted
The principle of environmental compensation is to Prevent, Minimize,
Restore or Compensate the damage to environment caused by
Anthropogenic activities.

Conservation action required to counter-balance ecological values, lost in

the context of development.

Conservation actions intended to compensate for residual adverse effects of

Development.
 In the Vellore citizens' forum case, Hon’ble Supreme Court has elaborated
the Concept of Polluter Pays Principle.

 The Hon’ble National Green Tribunal has given a thrust for :

- Imposing a fine/tax for the polluters.

- Empower CPCB to lay down the methodology to assess & recover

compensation for damage caused to the environment.

- Utilize such compensation for preparation of action plan to protect the

environment.
 The Hon’ble National Green Tribunal (NGT), in the matter of OA No.
593 /2017 (WP (CIVIL) No. 375/2012, has directed the CPCB to assess
and recover compensation for damage to the environment .

 CPCB has constituted a committee and developed a formula based on

“Polluter Pay Principle” for imposing environmental compensation, for
violation of directions.
Category-I (Formula based)
a. Discharges in violation of consent conditions - Prescribed Standards .
b. Not complying with the directions issued, such as direction for closure,
non-adherence to the action plans submitted etc.
c. Intentional avoidance of data submission or data manipulation by
tampering the Online Continuous Emission / Effluent Monitoring systems.
Category-II (Specific Study Based)
d. Accidental discharges lasting for short durations resulting damage to the
environment.
e. Intentional discharges to the environment -- land, water and air resulting
acute damage to the environment.
f. Injection of treated/partially treated/ untreated effluents to ground water.
  EC (in Rs) = PI x N x R x S x LF.........................................................(1)
 PI = Pollution Index of industrial sector: (R-80, O-50, G-30)
 N = Number of days for which violation took place
 R = A factor in Rs for EC: 250 (minimum 100 and maximum-500)
 S = Factor for scale of operation: micro or SSI units-0.5, medium-1 and large-1.5)
 LF = Location factor

For industrial units located within municipal boundary or upto10 km distance from the
municipal boundary of the city/town, following factors (LF) may be used:
SL. Population (million) Location Factor (LF)
No.
1 1 to <5 1.25
2 5 to <10 1.5
3 10 and above 2.0

 For notified Ecologically Sensitive areas, LF may be taken as 2.0.

 In order to include deterrent effect for repeated violations, EC may be increased on
exponential basis, i.e. by 2, 4, 8, 16…. times on each similar violation.
 EC ranges from: 10,000-60,000 for Red, 6,250-37,500 for Orange, 5,000-22,500 for
Green.
Two large industries (one bulk drug and other Milk processing ) located at 5
KM from the City. The analysis report of samples collected on 1.1.2019 are not
meeting Board Standards and the samples collected on 31.3.2019 met board
Standards. Calculate EC
Factors Bulk Drug Unit Milk Processing CPCB Calculation
( both units)
PI 95 68.75 80
N 100 100 100
R 250 250 250
S 1.5 1.5 1.5
LF 2 2 2
EC ( Rs ) 71,25,000 51,56,250 60,00,000
 4 Milk Processing units found to be discharge effluents in violation of consent
conditions out side the premises fro m1.1.2019 to 31,3.2019

Factor /location Large Red Large Red Medium Red Small Red
and type located in City located in City located in City located in City
A B C D

PI 68.75 68.75 68.75 68.75

N 100 100 100 100
R 250 250 250 250
S 1.5 1.5 1 0.5
LF 2 1 2 1
EC ( Rs ) 51,56,250 25,78,125 34,37,500 8,58,375
 1.Cost saved by the concerned authority by not having proper waste/sewage
management system.

- 10% interest on capital cost of the Waste / sewage management facility.

- Daily O&M cost; and

2. Cost to the environmental externality due to untreated/ partially treated waste

/sewage because of insufficient capacity of waste/ sewage management/
treatment facility.

EC = Capital Cost Factor x Marginal Average Capital Cost for Establishment of

Waste or Sewage Management or Treatment Facility x (Waste or Sewage
Management or Treatment Capacity Gap) O&M Cost Factor x Marginal Average
O&M Cost x (Waste or Sewage Management or Treatment Capacity Gap) x No. of
Days for which facility was not available + Environmental Externality..............(2)
 Assumptions:
Water Demand : 150-200 LPCD (BIS IS-1172:1993 )
Return Rate : 85% (CPHEEO)
Marginal Capital Cost of STP (i.e. 1 MLD) : Rs 1.75 Cr, (CPCB)
Marginal Capital cost of conveyance : Rs 5.55 Cr. (CPCB & others)
system (i.e. for 1 MLD)
Marginal O&M Cost (STP and Conveyance) : 10% of total capital cost
Population : As per latest Census of India.
EC (Lacs Rs.) =17.5(Total Sewage Generation – Installed Treatment Capacity)
+ 55.5(Total Sewage Generation-Operational Capacity) + 0.2 (Sewage
Generation-Operational Capacity) x N + Marginal Cost of Environmental
Externality x (Total Sewage Generation-Operational Capacity) x N..............(3)
N= Number of days from the date of direction of CPCB/SPCB/PCC till the required
capacity systems are provided by the concerned authority.
Deterrent effect for repeated violations, component of O&M may be increased on
exponential basis by 2, 4, 8, 16…. times on every six-months, beyond the time
prescribed by authority for ensuring complete treatment of sewage/waste of the
city/town.
Environmental Externality for Untreated/Partially Treated
Sewage

Sewage Environmental Minimum and Maximum value of

Treatment Externality (Rs. Per Environmental Externality
Capacity MLD/day) recommended by the
(MLD) Committee (Lacs Rs. Per Day)
Up to 200 75 Min. 0.05
Max. 0.10
201-500 85 Min. 0.25
Max. 0.35
501 and above 90 Min. 0.60
Max. 0.80
 Minimum and Maximum EC to be levied for
untreated/partially treated sewage discharge

Class of the City/Town Mega-City Million- Class-I

plus City City/Town
and others
Minimum and Maximum Min. 2000 Min. 1000 Min. 100
values of EC (Total Capital Max. 20000 Max. 10000 Max. 1000
Cost Component)
recommended by the
Committee (Lacs Rs.)
Minimum and Maximum Min. 2 Min. 1 Min. 0.5
values of EC (O&M Max. 20 Max. 10 Max. 5
Cost Component)
recommended by the
Committee (Lacs Rs./day)
 Environment Compensation for Discharge of Untreated/Partially Treated
Sewage by Concerned Individual/Authority

 EC (Lacs Rs.) = [17.5(Total Sewage Generation – Installed Treatment

Capacity) + 55.5(Total Sewage Generation-Operational Capacity)] +
0.2(Sewage Generation-Operational Capacity) x N + Marginal Cost of
Environmental Externality x (Total Sewage Generation-Operational
Capacity) x N
◦Total sewage generated -1400MLD
◦Installed capacity -1070 MLD
◦Total Treated -770 MLD
◦Environment externality =0.8 ( more than 501 MLD and above)

EC={17.5(1400-1070)+55.5(1400-770)}+0.2(1400-770) X 365 +0.8 X(1400-

770) X365= 27. 10 Lakhs
  Assumptions:
Capital and O&M Cost:
Capital cost for 50 TPD MSW Plant (for 1 Lakh Population) : 12 Crore
O&M Cost : 3.5 Crores per annum
Waste Generation : 0.6 kg/day/person - mega-cities
0.4 kg/day/person - million-plus UAs/towns
0.3 kg/day/person - Class-I UA/Towns
EC (Lacs Rs.) = 2.4 (Waste Generation - Waste Disposed as per the Rules) +0.02 (Waste
Generation - Waste Disposed as per the Rules) x N + Marginal Cost of Environmental
Externality x (Waste Generation -Waste Disposed as per the Rules) x N..........(4)
N= Number of days from the date of direction of CPCB/SPCB/PCC till the required
capacity systems are provided by the concerned authority
 If mixing of Bio-medical Waste and Hazardous Waste is found in Municipal Solid Waste
than capital cost component of EC may be increased by a multiplication factor of 1.1 in
case of Bio-medical Waste and by a multiplication factor of 1.25 in case of Hazardous
Waste.
 Deterrent Effect for repeated violations, component of O&M may be increased on
exponential basis by 2, 4, 8, 16…. times on every six-months, beyond the time
prescribed by authority for ensuring complete treatment of waste of the city/town.
 Environmental Externality for improper MSWMF

Municipal Environmental Minimum and Maximum value of

Solid Waste Externality (Rs. per Environmental
Management ton Externality recommended by the
Capacity (TPD) per day) Committee (Lacs
Rs. Per Day)
Up to 200 15 Min. 0.01
Max. 0.05
201-500 30 Min. 0.10
Max. 0.15
501-1000 35 Min. 0.25
Max. 0.35
1001-2000 40 Min. 0.50
Max. 0.60
Above 2000 Max. 0.80
Minimum and Maximum EC to be levied for improper
MSWM

Class of the City/Town Mega-City Million- Class-I

plus City City/Town
and others
Minimum and Maximum Min. 1000 Min. 500 Min. 100
values of EC (Capital Max. 10000 Max. 5000 Max. 1000
Cost Component)
recommended by the
Committee (Lacs Rs.)
Minimum and Maximum Min. 1.0 Min. 0.5 Min. 0.1
values of EC (O&M Max. 10.0 Max. 5.0 Max. 1.0
Cost Component)
recommended by the
Committee (Lacs Rs./day)
EC (Lacs Rs.) = 2.4(Waste Generation - Waste Disposed as per the Rules) +0.02
(Waste Generation - Waste Disposed as per the Rules) x N + Marginal Cost of
Environmental Externality x (Waste Generation - Waste Disposed as per the
Rules) x N

Where;
 Waste Quantity in tons per day (TPD)
 N= Number of days from the date of direction of CPCB/SPCB/PCC till the required
capacity systems are provided by the concerned authority

Generated -5700 TPD

Processed -2050 TPD
Environmental Externality -0.8

EC=2.4 (5700-2050) +0.02(5700-2050) X365 +0.8(5700-2050) x365 =

11.02 Lakhs
Category-I ((Formula Based)

 Industrial Inspections for compliance verification.

 Installation of Continuous WQMS/Continuous AQMS for strengthening of existing
monitoring network.
 Preparation of Comprehensive Industry Documents on Industrial Sectors/ clean
technology.
 Investigations of environmental damages, preparation of DPRs.
 Remediation of contaminated sites.
 Infrastructure augmentation of ULBs /capacity building of SPCBs/PCCs.

Category-II (Specific Study based)

 The amount of Environmental Compensation will be utilized exclusively for the

purpose at specific site.
 Comprehensive plan for remediation of environmental pollution may be prepared
and executed under the supervision of a committee with representatives of SPCB,
CPCB and expert institutions/ organizations.
Recommendation of Monitoring Committee Constituted by Hon’ble
NGT in O.A No. 804/2017 & M.A. No.1302/2018 (i.e. WP (C) No.
657/1995).

 CPCB directions.
 Guidelines on implementing liabilities for environmental damages due to
handling and disposal of hazardous waste and penalty.
 Determination of Environmental Compensation to be recovered for
vacillation of Hazardous and Other Waste (Management and Tran boundary
movement ) Rules, 2016.
 Methodology for assessing environmental Compensation (Water and Air
pollution Violation)
 Guidelines for imposition of Environmental Compensation against Health
Care Establishment and CBMWDF.
 “Actual User” means an occupier who procures and processes
hazardous and other waste for reuse, recycling, recovery, pre-
processing, utilisation including co-processing.
 “Disposal” means any operation which does not lead to reuse,
recycling, recovery, utilisation including co-processing and includes
physico-chemical treatment, biological treatment, incineration and
disposal in secured landfill.
 “Other Wastes” means wastes specified in Part B and Part D of
Schedule III for import or export and includes all such waste
generated indigenously within the country.
 The hazardous and other wastes generated by the occupier shall be
sent or sold to an authorised actual user or shall be disposed of in an
authorised disposal facility.
 The authorised actual user of hazardous and other wastes shall
maintain records of hazardous and other wastes purchased in a
passbook issued by the State Pollution Control Board along with the
authorisation.
 Handing over of the hazardous and other wastes to authorised actual
user shall be only after making the entry into the passbook of the
actual user.
 Particulars Hazardous Other
Authorization Yes Yes
Handing over to actual user Yes Yes
Transportation in authorized vehicle Yes Yes

➢ Handing over of hazardous and other wastes to authorised actual user shall
be only after making the entry into the passbook of the actual user (Rule
6(8)).

➢ Generator shall ensure that the quantities disposed off are entered in the
passbook of the actual user.
The occupiers of facilities

Storage Period:- may store hazardous and other wastes for a period not exceeding 90 days :

Provided that the State Pollution Control Board may extend the said period of 90 days in
following cases:-
(i) Small generators (up to 10 TPA) up to 180 days of their annual capacity.
(ii) Actual users and disposal facility operators up to 180 days of their annual capacity,
(iii) Occupiers who do not have access to any treatment, storage, disposal facility in the
concerned State or
(iv) The waste which needs to be stored for development of process for its recycling,
recovery, pre-processing, co-processing or utilisation;
Records:
Occupier shall maintain a record of sale, transfer, storage, recycling, recovery, pre-
processing, co-processing and utilisation of such wastes and make these records available
for inspection.
 Categorization of Violations

Category A Category B
(Only procedural violations of (Violations causing to environmental
HOWM Rules, 2016, which has not damage including procedural
caused to environmental damage) violations)

Category B1
(Where damages caused to the Category B2
environment can be assessed and (Where damages caused to the
liabilities can be fixed environment are difficult to assess)
 ENVIRONMENTAL COMPENSATION

For B1 violation (where damage

& Liability can be assessed) For B2 violation (where damage &
Processed as per CPCB Liability cannot be assessed)
Guidelines given at Annexure I

Damages not directly

Damages directly related to
related to quantum
quantum (Q) of wastes
(Q) of wastes

Where Q is known, Follow Equation

Where Q is not known,
Follow Equation 1

If granted authorization, take Q as per Where authorization never obtained

authorization; (Follow Equation 2) (Follow Equation 3)
COMPENSTION FOR VIOLATIONS
UNDER THE BIOMEDICAL WASTE
MANAGEMNET RULES
➢ Environmental Compensation for HCFs = HR x T x S x R x N
➢ Where;
➢ HR – Health Risk factor
➢ T- Type of Healthcare Facility
➢ S – Size of Health Care Facility
➢ R – Environmental Compensation factor
➢ N – Number of days of Violation HR Health Risk
➢ (HR) is a number from 0 to 100 and increasing HR value denotes the
increasing degree of health risk due to improper handling of BMW in
healthcare facility.
➢ Further, in any case minimum Environmental Compensation in respect
to Healthcare Facility shall not be less than Rs.1200/- per day
 SCENARIO APPLICABLE EC
Up to 15 days from target date Original EC
Between 15 to 30 days beyond target date Two times
Fails to comply in 2 nd inspections including new Two times
violations if any

Between 30 to 45 days beyond target date Four times

Fails to comply in 3rd inspections including new Four times
violations if any

Beyond 60 days from target date Closure of HCEs

Fails to comply in 4th consecutive inspection Closure of HCEs
 No Not Impro No pre- On-site No ETP Score for
arrange Applied per Treat storage Despite each of
ment for for Segregati ment not requirem Other
disposal Authoriz on of (4) provided ent Violation
of BMW ation (2) BMW (3) or not (6) s of
with adequate BMW
CBWTF (5) Rules,
(1) 2016
(7)
Heath
Risk
30 10 20 10 10 15 5
Score
(HR)
 Type of Healthcare Facility T Factor

Bedded Hospitals 1.0

Bedded Ayush Hospitals 0.5

Non-bedded (veterinary hospital,

1.0
pathological laboratory, blood bank)

Non-bedded (clinic, dispensary, and clinical

0.5
establishment)

Animal Test Houses 1.0

 Size of Healthcare Facility (HCFs) S factor
Non-bedded (clinic, dispensary, and clinical
0.15
establishment)
Non-bedded (veterinary institution, pathological
0.2
laboratory, blood bank)
1 to 10 bedded HCFs 0.20
10 to 50 bedded HCFs 0.30
50 to 100 bedded HCFs 0.50
100 to 500 bedded HCFs 1.00
500 and more bedded HCFs 1.50
Animal Test House 1.00
N- Number of days for which violation took place is the period between the day of
violation observed/due date of implementation as per BMWM Rules, 2016/due date
of compliance of directions and the day of compliance verified by
CPCB/SPCB/PCC.

R- is a factor in Rupees, taken as 250

Environmental Compensation for HCFs = HR x T x S x R x N

Where;

HR – Health Risk factor =10+10= 20

T- Type of Healthcare Facility =1 ( bedded)
S – Size of Health Care Facility =1.5 ( more than 500 beds)
R – Environmental Compensation factor =250
N – Number of days of Violation =300

EC=20 x 1x1.5x250x300=22.5 lakhs

Environmental Compensation for HCFs = HR x T x S x R x N

Where;
HR – Health Risk factor =30
T- Type of Healthcare Facility =1 ( bedded)
S – Size of Health Care Facility =1.0 ( between 100 to 500 beds)
R – Environmental Compensation factor =250
N – Number of days of Violation =365
Environmental Compensation=27,37,500
Beds HR T- Type of S – Size of EC factor N-Number EC
Healthcar Health of days for
e Facility Care which
Facility violation
took place
600 5 1 1.5 250 216 81,000
278 5 1 1.0 250 216 54,000
45 5 1 0.5 250 216 27,000
Clinic 5 0.5 0.3* 250 216 8100
Following cases will be considered for taking cognizance of non-compliance and
fit for levying Environmental Compensation:

a. Incinerator emissions not complying with standards notified under BMWM

Rules, 2016;
b. Treated wastewater not complying with standards prescribed under BMWM
Rules, 2016;
c. Not complying with standards of autoclave/microwave prescribed under
BMWM Rules, 2016
d. Not collecting the biomedical waste from all the member HCFs timely; and
e. Other violations to the conditions stipulated under BMWM Rules, 2016 / CPCB
guidelines
 Environmental Compensation for CBWTFs = PI x S x R x N

Where;

PI– Pollution Index

S – Size of Operation
R – Environmental Compensation factor
N – Number of days of Violation