Weston Aluminium Pty Limited v Environment Protection Authority

Land and Environment Court (NSW)|2021-07-20|Before: Pepper J

Weston Seeks an Exemption from the Requirement to Pay Contributions

The applicant in this matter, Weston Aluminium Pty Limited ("Weston"), is the owner and occupier of a property at 129 Mitchell Ave, Kurri Kurri, identified as Lot 61 in DP 1237125 ("the property"). Weston seeks a declaration that it is exempt from the requirement to pay contributions pursuant to s 88 of the Protection of the Environment Operations Act 1997 ("POEOA") by operation of cll 20(3) and 20(4)(a) of the Protection of the Environment Operations (Waste) Regulation 2014 ("Waste Regulations").
The activities undertaken at the property are regulated by the POEOA, the Waste Regulations and the Environmental Planning and Assessment Act 1979 ("EPAA").
The issues raised by the amended summons and the parties' pleadings are as follows: 1. first, whether Weston is exempt from the requirement to pay contributions which it is liable to pay as occupier of the property by reason of cl 20(3)(a) of the Waste Regulations. More specifically, whether for the purpose of cl 20(3), the property is a "scheduled waste disposal facility" as defined in cl 3(1) of the Waste Regulations; and 2. second, whether Weston is exempt from the requirement to pay contributions which it is liable to pay as occupier of the property by reason of cl 20(4)(a) of the Waste Regulations. In particular: 1. whether for the purpose of cl 20(4)(a), the property is a "scheduled waste facility" that is required to be licensed under the POEOA because it is used for the disposal of waste, and therefore, it is not a "scheduled waste facility" only in respect of the storage, treatment, processing or sorting of clinical and related waste, hazardous waste, liquid waste or restricted solid waste (or any combination of those kinds of waste); and 2. whether the property is a "scheduled waste facility" as defined in cl 3(1) of the Waste Regulations only in respect of the storage, treatment, processing or sorting of clinical and related waste, hazardous waste, liquid waste or restricted solid waste (or any combination of those kinds of waste).

Weston's Activities and Approvals to Carry Out the Activities on the Property

The factual background giving rise to the dispute was largely contained in an agreed statement of facts and several affidavits filed by the parties: 1. two affidavits of Garbis Simonian, the Managing Director of Weston, affirmed on 4 and 5 March 2021 (on behalf of Weston); and 2. an affidavit of James Marshman, a solicitor employed by the EPA, affirmed on 19 March 2020.
Weston is the holder of Environment Protection Licence 6423 ("EPL 6423") which authorises the carrying out of scheduled activities on the property. EPL 6423 was issued on 26 April 2000, pursuant to s 48 of the POEOA. Since then, EPL 6423 has been varied on numerous occasions (as described below).
Within the property there are, amongst other things, two large industrial buildings for scrap remelt dross and spent pot lining processing, an administration building, a truck loading bay, a workshop and other ancillary structures such as baghouses and bulk material storage bunds.
The property also includes a thermal waste processing facility which has the following structures: 1. Bin Tipper and Solid Waste Loader; 2. Primary Combustion Chamber (Rotary kiln); 3. Ash Discharge System; 4. Secondary Combustion Chamber; 5. Pollution Control System; and 6. By-pass Stack.

Development Approvals

Three development consents authorise the carrying out of various activities at the property: 1. first, a development consent granted by this Court in 1995 for the construction and operation of the aluminium dross recycling plant on 30 August 1996 ("the 1995 consent"); 2. a State significant (designated and integrated) development consent (DA 86-04-01) granted by the Minister for Planning ("the Minister") for extensions to the existing aluminium dross recycling plant on 20 September 2001 ("the 2001 consent"); 3. a State significant development consent (SSD 7396) granted by the Minister for the construction and operation of a thermal processing facility on 12 December 2018 ("the 2018 consent"). The 2018 consent authorised the incineration of up to 8,000 tonnes per annum of medical, research, quarantine, pharmaceutical, illicit drug and other wastes in the thermal processing facility. The 2018 consent was required to be carried out "in accordance with the EIS and Response to Submissions" in condition A2(c). The reference to the "EIS" in the condition was to the AECOM Thermal Waste Processing Project Environmental Impact Statement - SSD_15_7396 prepared for Weston and dated 26 August 2016 ("the 2016 EIS").
The 2016 EIS described the "project" as expanding the property to receive from off-site and treat on-site a variety of waste as defined in the POEOA and the construction and operation of a dedicated waste thermal treatment plant. The project was "a response to the increasing need to dispose of certain waste streams" and was to provide a means for "the disposal of various types of general, hazardous and other wastes". Section 5.2 detailed "alternative waste disposal methods" and noted that given the nature of some of the wastes to be treated by the project, "traditional types of waste disposal, including disposal to landfill, are not suitable." Table 6-3 listed the types of waste anticipated to be received. Section 6.4.6 described the thermal processing system and the primary and secondary combustion chambers. The 2016 EIS noted that the project would introduce a new scheduled activity pursuant to cl 40 of Sch 1 to the POEOA, namely, "waste disposal (thermal treatment)". It further noted that: 1. thermal destruction achieves a significant reduction in waste quantity, that is, typically 85-90% of the original weight; 2. illicit drugs and pharmaceutical waste are not generally suitable for disposal to landfill; 3. the thermal treatment facility would provide a disposal option for a variety of wastes that cannot be disposed of by other means and require destruction for environmental and community health reasons; and 4. thermal treatment is the accepted, and often the only, method of disposal of medical and various other wastes in New South Wales.
AECOM also prepared an Environmental Assessment in respect of the proposed modification of the 1995 and 2001 consents dated 10 July 2017 ("the 2017 EA"). It noted that the proposal offered a "local and cost-effective solution for the disposal of pharmaceutical and illicit drug waste, utilising the existing infrastructure". Section 1 of the 2017 EA was replete with references to the "disposal" of the waste to be received. The "small component" of residual ash remaining after disposal of the pharmaceutical and illicit drug waste would form part of Weston's marketable product with the potential to be used as a substitute for raw materials in a number of manufacturing and industrial processes.
On 2 August 2019 the Minister approved the modification of the 1995 consent ("MOD 10") and the 2001 consent ("MOD 12") to allow "the processing" of up to 2,000 tonnes per year of pharmaceutical waste and five tonnes per year of illicit drug waste "in existing furnaces". The existing furnaces are located in the aluminium dross recycling plant.
At the time of the lodgement of the applications in 2017 resulting in MOD 10 and MOD 12, Weston had approval to process up to 35,000 tonnes of scrap aluminium metal per annum, up to a combined total of 40,000 tonnes of aluminium dross and spent pot lining per annum, and the processing of up to 200 tonnes of illicit drug waste and 1,000 tonnes of pharmaceutical waste over a 24 month trial period (which concluded in October 2017).
Pursuant to MOD 10 and MOD 12: 1. Weston could not process on the property more than 2,000 tonnes of pharmaceutical waste and five tonnes of illicit drug waste per year; 2. no more than 5% by mass of pharmaceutical and illicit drug waste was to be co‑processed with aluminium dross and/or spent pot lining in the furnaces; and 3. Weston could not process liquid pharmaceutical or illicit drug waste unless approval was granted by the EPA.
The application resulting in the 2018 consent sought approval to construct and operate a "thermal processing facility to incinerate up to 8,000 tonnes per annum of medical, research, quarantine, pharmaceutical, illicit drug and other wastes".
At the time of the lodgement of the application resulting in the 2018 consent, the activities carried out at the property included the re-melting of aluminium scrap, the processing of aluminium dross and spent pot lining, and the thermal treatment of small quantities of illicit drugs and pharmaceutical waste.
Pursuant to the 2018 consent: 1. Weston must not receive or process on the property more than 8,000 tonnes of waste per year comprising: 1. clinical and related waste; 2. waste pharmaceuticals, drugs and medicines; 3. waste from the production and preparation of pharmaceutical products; 4. quarantine waste; and 5. other wastes as permitted by an environment protection licence; 1. Weston must not process more than 800kg of waste per hour; and 2. Weston must not process more than 10% by mass of other waste at any one time including: 1. pitch sludge residue; 2. solvents and paints; and 3. oily rags, except as permitted by an environment protection licence.
On 11 September 2020 the Minister approved the modification of the 2018 consent ("MOD 1"). The AECOM Weston Aluminium Thermal Processing Facility: Resource Recovery of Residual Ash Modification Report dated 17 July 2020 ("the Modification Report") prepared for Weston in respect of the MOD 1 application, described the application as modifying the 2018 consent to "clarify the recycling process for residual ash and to remove any obligation to dispose of residual ash to landfill". Weston was proposing to "reprocess…and recycle the residual ash" from the thermal processing facility so that no disposal by landfilling of these residual ash wastes would be required. This would result in a beneficial environmental outcome. Otherwise, the project was "substantially the same development as originally approved".
The Modification Report noted that the 2016 EIS had estimated that the thermal processing facility would generate up to 800 tonnes per annum of residual ash (being 10% of the approved original weight of the wastes). The application for MOD 1 did not involve any increase in the approved processing limits, hours of operation, traffic loads, air quality or noise limits or wastes received at the property - these aspects of the operation would remain the same. The residual ash could be blended to produce alternative materials that could be used as a substitute for conventional, virgin raw materials in the manufacture of cement, brick and tile products.

Variations to EPL 6423

On 17 June 2019 Weston lodged an application (no 1581163) with the EPA requesting a variation to EPL 6423 pursuant to s 58 of the POEOA in respect of a proposal for the processing of pharmaceutical (up to 2,000 tonnes per annum) and illicit drug wastes (up to five tonnes per annum) in the existing rotary furnaces on the property (in conformity with MOD 10 and MOD 12).
On 16 August 2019 the EPA varied EPL 6423 by adding the scheduled activity of "waste disposal (thermal treatment)" to the licence.
On 27 September 2019 Weston lodged a further application (no 1586144) with the EPA requesting a variation to EPL 6423 in respect of the 2018 consent.
By letter dated 13 January 2020, the EPA wrote to Weston advising it that it was required to pay the levy on all waste received at the property for disposal by incineration in accordance with s 88 of the POEOA and Pt 2 of the Waste Regulations. The letter noted that Weston was not previously liable to pay the levy but that the variation to EPL 6423 on 16 August 2019, which added the scheduled activity of "waste disposal (thermal treatment)" brought the property into the waste levy system.
On 17 February 2020 the EPA varied EPL 6423 in respect of the proposal by adding further waste materials that would be subject to the scheduled activities of "waste disposal (thermal treatment)" and "waste storage" pursuant to s 58 of the POEOA.

Current EPL 6423

Currently, EPL 6423 permits Weston to carry out the following scheduled activities at the property (subject to conditions): 1. metallurgical activities (identified in cl 26 of Sch 1 to the POEOA), namely: 1. aluminium production (scrap metal); and 2. scrap metal processing; 1. resource recovery (identified in cl 34 of Sch 1 to the POEOA), namely, the recovery of hazardous and other waste; 2. waste disposal (thermal treatment) (listed in cl 40 of Sch 1 to the POEOA), namely, of hazardous and other waste; and 3. waste storage (listed in cl 42 of Sch 1 to the POEOA), namely, of hazardous, restricted solid, liquid and clinical and related waste.
Condition L4.1 of EPL 6423 authorises the following waste to be stored (waste storage activity) and processed (waste disposal (thermal treatment) activity) in the thermal treatment facility on the property: 1. clinical and related waste; 2. waste pharmaceuticals, drugs and medicines; 3. glass, plastic, paper or cardboard - paper documents only; 4. waste mineral oils unfit for their original intended use - oily rags only; 5. waste tarry residues - pitch sludge residues only; 6. waste oil/hydrocarbons mixtures/emulsions in water - pitch sludge residues only; 7. waste from the production, formulation and use of organic solvents - solvents and paints only; 8. halogenated organic solvents - solvents and paints only; 9. organic solvents excluding halogenated solvents - solvents and paints only; 10. waste resin, latex, plasticiser, glue and adhesive - solvents and paints only; 11. waste ink, dye, pigment, paint, lacquer and varnish - solvents and paints only; 12. waste chemical substances arising from research and development or teaching activities, including those that are not identified and/or are new and whose effects on human health and/or the environment are not known; 13. quarantine waste; 14. waste from the production and preparation of pharmaceutical products; and 15. cytotoxics.
Condition L4.1 authorises the storing (waste storage activity) and processing (waste disposal (thermal treatment) activity) of pharmaceutical, drug and medicine waste in the aluminium dross recycling plant to the following limits: 1. the combined total quantity of aluminium dross, spent pot lining, illicit drug and pharmaceutical waste must not exceed 5,000 tonnes stored on the property at any time; and 2. no more than a combined total of 40,000 tonnes of aluminium dross, spent pot lining, illicit drug and pharmaceutical waste in any combination is to be processed per year.
Condition L4.2 of EPL 6423 specifies that the processing limit for the above wastes is 8,000 tonnes per year. Condition O5.7 provides that the thermal treatment facility must, at a minimum, use primary and secondary (that is, two stage) combustion. Condition O5.8 provides that the maximum amount of waste that can be processed in the facility at any one time is 800kg per hour.
Condition L7.2 of EPL 6423 provides that no more than 5% by mass of pharmaceutical and illicit drug waste is to be co-processed with aluminium dross and/or spent pot lining in the rotary furnaces in the aluminium dross recycling plant.
Condition L7.3 of EPL 6423 provides that Weston must not process liquid pharmaceutical and illicit drug waste at the property, except for the purpose of Proof of Performance testing provided for under the licence.
Condition L7.4 of EPL 6423 provides that the quantity of pharmaceutical and illicit drug waste processed in the rotary furnaces in the aluminium dross recycling plant must not exceed 250kg per batch.
EPL 6423 expressly provides for the discharge of emissions from the thermal processing facility into the air (see, for example, conditions, L3.1, L3.2, O5.11, O5.12 and O5.14). That is, the licence contemplates the emissions of gases that will be released into the atmosphere as a result of the thermal processing occurring on the property.

The Activities Carried Out by Weston on the Property

Pursuant to its approvals, on the property Weston carries out thermal treatment of hazardous waste, liquid waste, special waste, and other general solid waste, being those waste types described in condition L4.1 of EPL 6423 ("the waste").
The waste arrives at the property by truck or vehicle only and is weighed on the weighbridge. It is individually inspected and screened to confirm the type and quantity of waste and to ensure that no prohibited material enters the property.
After an initial inspection, the waste, which has been baled or packaged according to the relevant codes and guidelines (namely, the EPA's Australian Code for the Transport of Dangerous Goods by Road and Rail or the relevant Australian Standard), is then unloaded by either forklifts for large deliveries or hand wheeled waste bins of up to 660L or receptacles for smaller deliveries.
Any waste material that is not scheduled for immediate processing is stored on the property, including at the following locations: 1. the fully-bunded waste storage location within the building; or 2. the fully enclosed refrigerator storage area especially reserved for medical organic waste such as anatomy parts and tissues.
The waste material ready to be processed is loaded into a hydraulic powered bin tipper (usually tipping a single 660L or two 240L bins) and a hopper which then controls and allows the waste material to travel into the primary combustion chamber (or rotary kiln).
Weston treats the waste by combustion/incineration (at temperatures of 1,100oC and over) in the thermal processing system as follows: 1. the waste is loaded into the primary combustion chamber, being the rotary kiln, using a bin tipper and solid waste loading hopper; 2. natural gas is then used to initiate the combustion/incineration of the waste and maintain the required kiln temperatures; 3. following combustion/incineration, the resultant ash is discharged from the rotary kiln using an ash discharge system. The ash is then sorted in order to recover metal and oxides for reuse; 4. the secondary combustion chamber is used to complete the combustion of gases generated from the primary combustion chamber; 5. exhaust gases are then discharged from the secondary combustion chamber and directed through a heat exchanger, before being reduced in temperature and moved to the baghouse where they are injected with activated carbon to absorb pollutants and lime to neutralise acids; and 6. the exhaust gases then pass through the baghouse and are discharged into atmosphere from the baghouse stack.
Thus, activities carried out at the property relevantly include the receipt of certain types of waste, including pharmaceutical waste and illicit drug waste, that are tipped into the thermal processing facilities and then incinerated at a very high temperature. The incineration destroys 85-90% of the waste, resulting in the generation of a small proportion of residual ash. The incineration also results in the conversion of waste into gaseous form and the discharge of gaseous substances into the atmosphere.

The Statutory Requirement to Pay Contributions and the Exemptions

Section 88 of the POEOA applies to "waste facilities" that are required to be licensed under Ch 3 of that Act. The provision requires an occupier of a premises to pay the EPA in respect of all waste received at the facility such contribution as is prescribed by regulation: 88 Contributions by licensee of waste facility (1) This section applies to waste facilities that are required to be licensed under this Chapter. (2) The occupier of a waste facility to which this section applies is required to pay to the EPA in respect of all waste received at the facility such contribution as is prescribed by the regulations.
Pursuant to s 88(5), the regulations may provide for the exemption of specified occupiers, or classes of occupiers, from the requirement to pay contributions: (5) The regulations may - (a) provide for contributions to be calculated on such basis (including such estimates), and in accordance with such factors, as may be specified or described in the regulations, and (b) provide for the exemption of specified occupiers, or specified classes of occupiers, from the requirement to pay contributions, and (c) provide for the exemption of specified wastes from the calculation of contributions (including for example wastes that are recycled, re-used, recovered or processed), and (d) provide for the payment of rebates to specified occupiers or specified classes of occupiers.
It was uncontroversial that s 88 applied to Weston as the occupier of the property, a waste facility that is required to be licensed under Ch 3 of the POEOA.
The exemptions from the liability to pay contributions are contained in Div 5 of Pt 2 of the Waste Regulations. Clause 20(3) of the Waste Regulations states: 20 Exemption of certain other occupiers from requirement to pay contributions … (3) The occupier of a scheduled waste facility is exempt from the requirement to pay contributions to the EPA under section 88 of the Act if - (a) the facility is not a scheduled waste disposal facility, and (b) the facility is a scheduled waste facility because an activity listed in clause 26 (Metallurgical activities) of Schedule 1 to the Act is carried on at the facility.
Clause 20(4)(a) provides: 20 Exemption of certain other occupiers from requirement to pay contributions … (4) The occupier of a scheduled waste facility is exempt from the requirement to pay contributions to the EPA under section 88 of the Act if - (a) the facility is a scheduled waste facility only in respect of the storage, treatment, processing or sorting of clinical and related waste, hazardous waste, liquid waste or restricted solid waste (or any combination of those kinds of waste), or…
The term "scheduled waste disposal facility" is defined in cl 3(1) of the Waste Regulations to mean, "a waste facility that is required to be licensed under the Act because it is used for the disposal of waste."
A "scheduled waste facility" is defined in cl 3(1) to mean, "a waste facility that is required to be licensed under the Act because it is used for the storage, treatment, processing, sorting or disposal of waste".
And the expression "waste facility" is defined in the Dictionary to the POEOA to mean "any premises used for the storage, treatment, processing, sorting or disposal of waste (except as provided by the regulations)". "Premises" is relevantly defined in the Dictionary to include a "building, or structure, or land or a place".
Finally, the term "waste" is defined in the Dictionary to the POEOA relevantly as including: waste includes - (a) any substance (whether solid, liquid or gaseous) that is discharged, emitted or deposited in the environment in such volume, constituency or manner as to cause an alteration in the environment, or (b) any discarded, rejected, unwanted, surplus or abandoned substance, or … A substance is not precluded from being waste for the purposes of this Act merely because it is or may be processed, recycled, re-used or recovered.
"Substance" is defined in the same Dictionary to include a "matter or thing".

The Exemption Contained in cl 20(3) of the Waste Regulations Does Not Apply

In order for cl 20(3) of the Waste Regulations to apply both of the criteria in paragraphs (a) and (b) of that clause must be satisfied. The EPA accepted that paragraph (b) of the clause was satisfied, but submitted that this was not the case with respect to paragraph (a) because the property was a "scheduled waste disposal facility", as defined, by reason of its use for the disposal of various types of waste which was required to be licensed as such under the POEOA.
Given the definition of "scheduled waste disposal facility" in cl 3(1) of the Waste Regulations, the basal issue was whether, having regard to the reference to "facility" in cl 20(3)(a) (which is a reference to "scheduled waste facility" having regard to the chapeau to the sub-clause), the property was being used for the disposal of waste.
It was uncontentious that the property is a "waste facility" as defined by the POEOA. So much so is apparent from the description of the property and the activities carried out upon it described above. The description afforded to the property in the 2016 EIS stated that: The existing WA Site primarily remelts aluminium scrap for the production of deoxidant products for the steelmaking sector, and processes aluminium dross and spent pot lining (SPL) that is generated by the aluminium smelting industry as a by-product of the smelting process. WA also currently thermally treats quantities of illicit drugs and pharmaceutical wastes.
The conclusion that the entirety of the property is used as a "waste facility" is, moreover, consistent with the evidence of Simonian in his first affidavit.
It is also consistent with EPL 6423, which is a premises-based licence (see s 48 of the POEOA) that, pursuant to condition A2, applies to the whole of the property. As the EPA correctly noted, the licence is neither limited to some part of the property or a specific structure, nor does it apply to the carrying out of scheduled activities not related to the premises (see s 43(c) of the POEOA).
Therefore, because Weston is the occupier of the "waste facility" that comprises the property, Weston is prima facie liable to pay the contribution under s 88 of the POEOA (see s 88(2)).
The next question is whether the property was being used for the scheduled activity of the disposal of waste, or put another way, whether the property was being used as a "scheduled waste disposal facility" for the purposes of the Waste Regulations.
Weston initially submitted that it was not because there are two facilities on the property, namely, a metallurgical facility and a thermal processing facility, neither of which were licensed as a "scheduled waste disposal facility" under EPL 6423.
While the evidence discloses that there are two facilities on the property, this is not the end of the matter. In my opinion, the distinction Weston seeks to draw is misconceived. What is relevant is the activity carried out at the property by reason of the operation of the two facilities. These activities include the use of the existing furnaces and the thermal treatment plant to deal with waste. If these activities have the effect of disposing of the waste received (discussed further below), the property is operating as, amongst other things, a "scheduled waste disposal facility" which is required to be licensed under the POEOA and the exemption in cl 20(3) of the Waste Regulations does not apply.
Weston argued that the scheduled activity of "waste disposal (thermal treatment)" regulated by EPL 6423 was limited only to the receiving and processing of waste, and not its disposal off-site (for example, at a landfill site). This was because when regard was had to the proper meaning of the words 'dispose' or 'disposal' in the context of the regulatory regime, it was plain that the activities carried out at the thermal treatment plant amounted only to processing. Therefore, by its terms, the licence did not allow for the disposal of waste on the property, and therefore, did not permit activity constituting a "scheduled waste disposal facility". It followed, according to Weston, that there was no "scheduled waste disposal facility" on the property because none was permitted by EPL 6423.
By contrast, the EPA contended that when regard was had to the ordinary meaning of the term 'dispose' and the proper construction of the words "waste" and "substance" in the POEOA, the activities carried out on the property unequivocally involved the disposal of waste and fell within the ambit of EPL 6423.
The principles of statutory construction are well known and are relied upon without repetition (SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 262 CLR 362 at [14]; SAS Trustee Corporation v Miles [2018] HCA 55; (2018) 265 CLR 137 at [20] and following; Keybridge Capital Ltd v WAM Active Ltd [2021] NSWCA 203 at [76]; and Bushfire Survivors for Climate Action Inc v Environment Protection Authority [2021] NSWLEC 92 at [20]). These principles apply to other statutory instruments, such as EPL 6423 (Environment Protection Authority v Grafil Pty Ltd; Environment Protection Authority v Mackenzie [2019] NSWCCA 174; (2019) 238 LGERA 147 at [257]-[261]; and J.K. Williams Staff Pty Limited v Sydney Water Corporation [2021] NSWLEC 23 at [61] and [273]).
The expression 'dispose' or 'disposal' is not defined in the POEOA or the Waste Regulations. The ordinary and natural meaning of the word "dispose" in the Macquarie Dictionary (on-line ed) is "to deal with definitely" and "to get rid of; dump". The definition contained in the Oxford Dictionary (on-line ed) is not dissimilar: "to put into the proper or suitable place; to put away, stow away, deposit" and "to deal with (a thing) definitively; to get rid of; to get done with, settle, finish". For the sake of completeness, it is observed that the definition of "disposal of waste" in s 115(3) of the POEOA only applies to that provision and, in any event, is harmonious with its natural and ordinary meaning.
In other words, to dispose of a substance means to definitively get rid of a matter or thing. While care must be taken not to transport meanings ascribed to words in different contexts, there is some authority supporting the ordinary meaning of the word "dispose" as including to "get rid of" (Roache v Australian Mercantile Land & Finance Company Ltd (No 2) (1966) 67 SR (NSW) 54 at 59).
Nothing in the POEOA or the Waste Regulations displaces the ordinary meaning of the words 'disposal' or 'dispose'.
In my opinion, as a matter of construction, the combustion and incineration of the various forms of waste received at the property by thermal treatment involves the disposal of that waste. As the evidence discloses, the incineration of the waste received at the furnaces on the property amounts to the destruction of the waste material, which, as a matter of common sense and understanding, is equivalent to the disposal of that waste. As Simonian deposed in his first affidavit, up to 2,000 tonnes of "pharmaceutical waste" and five tonnes of "illicit drug waste" per annum is currently incinerated in the furnaces. Under the 2018 consent Weston has approval to incinerate up to 8,000 tonnes per annum of medical, research, quarantine, pharmaceutical, illicit drug and other waste at the property.
The incineration of waste by thermal treatment therefore deals definitively with that waste and ultimately results in the conversion of waste from a solid state into a gaseous form with occasional ash residue. The purpose of the treatment is to "get rid of" that waste. To the extent that residual ash or gases are produced as a result of this treatment does not, in my view, derogate from the conclusion that disposal of the waste received on the property occurs. The intention of the receipt of the waste is not, as the evidence of Simonian in my view makes plain, to merely process the waste and transport it into another product; it is to get rid of it. Any resultant product (the ash) is incidental and, in any event, amounts to only 10-15% of the original weight of the waste received.
The definition of "waste" in the Dictionary of the POEOA includes the discharge or emission of gas into the environment in such volume, constituency or manner as to cause an alteration in the environment. The gases that are produced as a consequence of the incineration of material received at the property are therefore discharged into the atmosphere as "waste" and are regulated by EPL 6423. The gases are disposed of insofar as Weston gets rid of them. In short, the gases also constitute waste that is disposed of by Weston at the property.
Weston relied upon the decision in Gray v Macquarie Generation [2010] NSWLEC 34; (2010) 3 ARLR 454 (at [53]-[55]) in support of its contention that the emission of gases from the property does not constitute waste because EPL 6423 permits these emissions (see, for example, conditions P1.1 and L3).
The authority is, however, distinguishable, in my opinion. In Gray the Court considered whether a licence allowing power generation activities also permitted a power station to emit CO2. The Court found that the licence holder could not have committed the offence that it was charged with under the POEOA because the emission of CO2 was a necessary process for the principal activity the subject of the licence (at [54]-[55]). In the present case, merely because EPL 6423 permits the emission of gases from the treatment of waste does not mean that those gases are not "waste" as defined under the POEOA. The gases remain waste but waste that is allowed to be discharged from the property pursuant to the licence.
The venting of gases into the atmosphere therefore provides another basis for concluding that the property is used for the disposal of waste.
Weston sought to make what I consider to be an artificial distinction between the processing of waste and its disposal in seeking to argue that only the former activity was being carried out on the property. It is not clear to me why one activity cannot be encompassed in the other. That is, the act of processing the waste also, on the present facts, results in its disposal. Apart from the minimal amount of residual ash produced by the thermal treatment, the waste is not processed and reused or recycled into another product.
But in any event, the evidence in this case (both that of Simonian and Weston's own planning documents) indicates that the intention of receiving the waste at the property was to dispose of it and that this is precisely what occurs.
Weston observed that the POEOA and the EPAA contain a number of provisions to provide consistency between development consents and environmental protection licences (such as ss 4.42, 4.46, 4.47 and 4.50 of the EPAA and s 50 of the POEOA). It therefore submitted that, in the context of s 88 of the POEOA and cll 20(3) and (4) of the Waste Regulations (confusingly in its written submissions the argument was directed only to cl 20(4), whereas in its oral submissions the argument appeared to be directed to both sub-clauses: T18:12-33 and T19:43-20:4) and the provisions of the EPAA referred to above, "which seek consistency between development consents and environment protection licences", EPL 6423 should not be construed as allowing for the disposal of waste, intentional or otherwise. This was especially so in circumstances where the licence only deals with and permits the storage, treatment and, critically, the processing of waste.
This, it said, was reinforced by the fact that EPL 6423 did not expressly refer to, or permit, the "disposal" of waste other than in condition O1.1, a generic condition that must be contrasted with the specific conditions dealing with the operations of a thermal processing facility (conditions O5.11, O5.12 and O5.14).
Further, properly construed, the permitted activity of "waste disposal (thermal treatment)" in EPL 6423 does not include the disposal of waste but is limited to the receipt of waste and its processing only.
The scheduled activity of "waste disposal (thermal treatment)" encompasses two forms of activity: the thermal treatment of general waste; and the thermal treatment of hazardous and other waste. It is the latter that is presently relevant and which is defined in cl 40 of Sch 1 to the POEOA to mean: thermal treatment of hazardous and other waste, meaning the receiving of hazardous waste, restricted solid waste, liquid waste or special waste from off site and its processing by thermal treatment.
The term "thermal treatment" is defined in cl 50(1) of Sch 1 to the POEOA to mean "the processing of wastes by burning, incineration, thermal oxidation, gasification, pyrolysis, plasma or other thermal treatment processes".
According to Weston, the reference to "processing", and not the word "disposal", in the definitions of "thermal treatment of hazardous and other waste" and "thermal treatment" in the POEOA means that the activity of "waste disposal (thermal treatment)" in EPL 6423 does not include the disposal of waste but is limited to its processing.
Thus, because compliance with the 2018 consent as modified by MOD 1 precluded the disposal of residual ash waste from the thermal processing facility and because EPL 6423 deals only with the storage, treatment and processing of waste, Weston was not disposing of any waste because it had no approval to do so.
According to Weston, this analysis is in conformity with MOD 1, the effect of which was to require all ash from the thermal processing facility to be reprocessed and recycled rather than being disposed of in landfill as contemplated by the unmodified 2018 consent. Weston relied on the fact that the Modification Report noted that "the residual ash material would be disposed of at an off-site landfill licensed to accept such waste", and moreover, that the 2018 consent was to be modified "to clarify the recycling process for residual ash and to remove any obligation to dispose of residual ash to landfill" (rather than allowing for on-site reprocessing and recycling of residual ash). The stated aim of the proposed modification was to reduce the disposal of waste to landfill.
But the fact that the property is intended to be used by Weston for the disposal of waste is, as the EPA noted, reflected in Weston's own planning documents, which frequently describe the activities being carried out on the property as involving the disposal of waste. For example, the 2017 EA prepared for MOD 10 and MOD 12 referred to Weston's objective to "offer a sustainable solution to the disposal of pharmaceutical and illicit drug wastes, enabling a local option for the cost-effective destruction of these wastes. As part of this approach WA [Weston] seeks to achieve a minimal ash solution for the disposal of these wastes." The document went on to refer to the POEOA and related regulations and guidelines, under which, "the disposal of certain pharmaceutical wastes by thermal destruction is required by law" and noted that consultation with the pharmaceutical and healthcare industry had indicated that thermal destruction of pharmaceutical wastes in NSW was limited and that a large proportion of the wastes were exported to Victoria and Queensland for thermal disposal. Further references to the disposal of waste in that document are quoted earlier in the judgment.
As referred to above, the 2016 EIS described the overall objective of the project to obtain development approval for the construction and operation of a thermal waste treatment plant to be operated as part of Weston's existing operation "to provide a disposal option for a variety of wastes that cannot be disposed of via other means and required destruction for environmental and community health reasons." The "need" for the project was described as the necessity for a variety of general hazardous and other types of wastes to be disposed of appropriately. It described thermal treatment as "the accepted, and often the only, method for the disposal of medical and various other wastes within NSW."
Both the 2016 EIS and the 2017 EA were replete with references to "the disposal of", "thermally dispose", "processing and disposal", "waste disposal" and "thermal destruction". Likewise, the Modification Report (see above).
To the extent that Weston contended that consistency between the operation of the POEOA and the EPAA was required, in my view, the environmental planning regime served to reinforce the conclusion that what is occurring on the property in terms of the pharmaceutical and illicit drug waste being received for incineration in the existing furnaces and at the thermal treatment plant is its destruction and disposal. This is what the Minister was told would occur in the planning documents that accompanied the application for the modification of the 1995 and 2001 consents (MODs 10 and 12). It is reflected in the variations to EPL 6423, which added waste disposal by thermal treatment as a category of permissible activity. It is also in conformity with the approval sought by Weston for the construction and operation of the thermal waste treatment facility to deal with quarantine waste, medical waste and other types of hazardous waste resulting in the 2018 consent. As stated above, condition A2 of that consent relevantly states that the development (as described) must be carried out in accordance with the 2016 EIS, which in turn describes the proposed project as one involving the disposal of waste. Weston's own environment and planning documentation plainly envisaged the disposal of waste at the property.
Although Weston placed reliance upon MOD 1, as described in the Modification Report, that modification sought to do no more than permit the reuse of the residual ash that was a product of the thermal treatment - that is, destruction - of the received waste. All other activity to be carried out by the thermal treatment facility remained relevantly the same.
The small amount of residual ash to be recycled and reprocessed on-site pursuant to MOD 1 does not change the fact that overwhelmingly waste was to be disposed of by incineration at the property. At its highest, the reprocessing and recycling of residual ash from the incineration process is a neutral factor in determining whether or not Weston is disposing of waste given that, to reiterate, only 10-15% of the mass of waste received is converted to residual ash whereas the remaining 85-90% is emitted into the atmosphere in gaseous form.
And while there is no explicit reference to waste disposal in the body of the conditions of EPL 6423 other than in condition O1.1, the table referred to in condition L4.1 refers extensively to the "activity" of "waste disposal (thermal treatment)". Moreover, condition O1.1, "generic" or otherwise, is of central importance to the operation of EPL 6423, mandating that, among other things, "the disposal of waste generated by the activity" permitted by the licence be carried out in a competent manner. This condition therefore contemplates that the disposal of waste will occur. The condition performs more substantive work than the mere administrative function ascribed to it by Weston.
In addition, as the definitions of "thermal treatment of hazardous and other waste" and "thermal treatment" in the POEOA make plain, the permitted scheduled activity of "waste disposal (thermal treatment)" in EPL 6423 includes processing by "burning" and "incineration", which, on any view, involves destroying the substance being thermally treated. To 'process' by way of destruction of waste at the receiving site through these methods is to dispose of it for the reasons discussed earlier. That is, the activity of "waste disposal (thermal treatment)" in EPL 6423 encompasses, as its description makes explicit, the disposal by way of destruction of the waste. Its meaning ought not be artificially confined in scope in the manner contended for by Weston.
Therefore, when regard is had to the actual activities being carried out on the property, the thermal treatment facility being operated by Weston is being used for waste disposal. There is nothing in the statutory context that precludes a finding that the processing of waste includes its disposal. As explained above, they are not mutually exclusive categories of activity.
On the contrary, the statutory context reinforces the conclusion above. For example, the definition of "waste disposal by application to land" in cl 39 of Sch 1 to the POEOA does not refer to 'disposal' but to the application to land by a range of methods that includes spraying, spreading, depositing, injecting and filling.
To summarise, the combined operation of the 1995 and 2001 consents, as modified, together with the 2018 consent, again as modified, compels the conclusion that, as a matter of substance (in addition to the re-melting of aluminium and associated metallurgical activities) pharmaceutical and illicit drug waste is being received at the property for the purpose of disposal through incineration in the existing furnaces. Other waste, such as quarantine waste, clinical waste, oil rags, paper documents and hazardous waste the subject of the 2018 consent is also received at the property and, employing the language of the relevant planning documents, incinerated and disposed of at the thermal treatment facility. Either way, waste is disposed of at the property when regard is had to the ordinary meaning of that word. Furthermore, the processing activities that were carried out on the property involved the disposal of waste which was required to be licensed under the POEOA. It is for this reason that EPL 6423 permits "waste disposal (thermal treatment)" of hazardous and other waste received at the property.
It follows that the property is a "scheduled waste disposal facility" as statutorily defined, the corollary of which is that cl 20(3) of the Waste Regulations is not engaged and Weston cannot avail itself of this exemption from the requirement to pay contributions.

The Exemption Contained in cl 20(4)(a) of the Waste Regulations Does Not Apply

The issues that arise with respect to the exemption contained in cl 20(4)(a) of the Waste Regulations are: 1. first, whether the property is a "scheduled waste facility" that is used for the disposal of waste; and/or 2. second, whether the property is used for the storage, treatment, processing or sorting of general solid waste (with the consequence that it is not a "scheduled waste facility" only in respect of the storage, treatment, processing or sorting of clinical and related waste, hazardous waste, liquid waste, restricted solid waste (or a combination thereof)).
Turning to the first issue, given that I have found that the property is used for the disposal of waste for the purposes of cl 20(3) of the Waste Regulations, and there being no reason to come to a different finding for the purpose of cl 20(4)(a) of those Regulations, the findings made above are sufficient to wholly dispense with Weston's reliance upon cl 20(4)(a) of the Waste Regulations.
The EPA further submitted that the property is used for the storage, treatment, processing or sorting of general solid waste, and therefore, is not a "scheduled waste facility" only in respect of the storage, treatment, processing or sorting of the wastes (or a combination thereof) referred to above. Rather, it is also a "scheduled waste facility" in relation to the storage and processing of "general solid waste (non-putrescible)", and hence, cl 20(4)(a) of the Waste Regulations does not apply.
The contentions made by the EPA in relation to the second issue should be accepted. The composite term "general solid waste (non-putrescible)" is not waste that falls within cl 20(4)(a). The expression is relevantly defined in cl 49(1) of Sch 1 to the POEOA to mean: 49 Definitions of waste classifications (1) In this Schedule - general solid waste (non-putrescible) means waste (other than special waste, hazardous waste, restricted solid waste, general solid waste (putrescible) or liquid waste) that includes any of the following - (a) glass, plastic, rubber, plasterboard, ceramics, bricks, concrete or metal, (b) paper or cardboard, … (k) drained oil filters (mechanically crushed), rags and oil absorbent materials that only contain non-volatile petroleum hydrocarbons and do not contain free liquids, … (q) building and demolition waste,
The term "building and demolition waste" in (q) is relevantly defined in cl 50 of Sch 1 to the POEOA to mean "unsegregated material (other than material containing asbestos waste or liquid waste) that results from…and includes materials such as…(c) bricks, concrete, paper, plastics, glass and metal".
It is not in dispute that conditions L4.1 and L4.2 of EPL 6423 permit Weston to store and process (by thermal treatment) paper documents and oily rags and to store and process (by metallurgical activities) scrap aluminium.
Therefore, as a matter of fact and authorisation, the property is a scheduled waste facility in respect of other wastes, which include paper documents and oily rags. It stores and processes this material, together with scrap aluminium. For this reason, the property is therefore a "scheduled waste facility" in relation to the storage and processing of general solid waste (non-putrescible) and not a scheduled waste facility only in respect of the storage, treatment, processing or sorting of the various types of waste identified in cl 20(4)(a) of the Waste Regulations.

Conclusion and Orders

Weston is liable to the pay the contributions for all waste received at the property as asserted by the EPA in its letter dated 13 January 2020. No exemptions from this obligation to pay the levy apply.
The formal orders of the Court are therefore that the amended summons is dismissed. Weston is to pay the EPA's costs of the proceedings. The exhibits are to be returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 17 November 2021

(2019) 238 LGERA 147

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