Section 250(1)(e) of the Protection of the Environment Operations Act gives the Land and Environment Court discretion to adopt a "creative" approach to sentencing for environmental crimes. Under this section, the Court can order an offender to pay for the costs of a project to restore or enhance the environment either as an alternative to, or in addition to, a standard monetary fine.
This approach has long been in use in the United States, where the performance of "environmentally beneficial projects" is often accepted as part of a negotiated settlement for an environmental "violation". Although not yet commonplace in NSW, the Court has required such projects in a number of cases, and is likely to do so in appropriate circumstances in future prosecutions.
A recent prosecution by the NSW EPA, Environment Protection Authority v Huntsman Corporation Australia Pty Ltd, (2011) NSWLEC 39 was concluded by the making of this type of innovative order. Huntsman was prosecuted for an incident involving the accidental release to the atmosphere of a toxic air pollutant, ethylene oxide from a chemical manufacturing plant in Matraville. The Court determined that a penalty of $28,000 was warranted for the offence. The company was required to pay this amount to Randwick City Council to partially fund a storm water harvesting and recycling project at a council-owned sports reserve.
The prosecution by the EPA was founded on the allegation that the company had breached a condition of its environment protection licence which required it to carry out its operations "in a competent manner". The proceedings were brought following the malfunction of a device that measured the amount of a catalyst that was being introduced into a chemical reactor. The malfunction initiated a series of events resulting in the emission of about 475 kilograms of ethylene oxide directly to the air through a stack. The emissions occurred over a period of several hours on a single night. It was alleged by the EPA that the pollution incident occurred due to the company's failure to have back up systems to alert plant personnel that insufficient amounts of catalyst were being placed into the reactor vessel.
A noteworthy aspect of this case is the relatively low penalty that the company was required to pay. Although the pollutant that was released into the air from Huntsman's plant has been classified as a carcinogen by the World Health Organisation and is also capable of causing short-term health impacts such as eye and skin irritation as well as headaches and nausea, the penalty of $28,000 represents less than 2.8% of the maximum fine of $1.1 million that could have been imposed under the POEO.
The amount of the fine reflects the Court's conclusion that the incident was only of "low to moderate" seriousness (due to the fact that the emissions were not caused deliberately and that the company did not gain any commercial advantage by committing the offence).
It seems clear that if the incident had lasted for a longer period of time, or if it had actually caused adverse health impacts to residents of the community that is located near the plant, the penalties that would have been assigned by the Court would have been significantly higher.
The Court's judgement can be found at:
http://www.austlii.edu.au/au/cases/nsw/NSWLEC/2011/39.html
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