Environmental Impact Assessment (“EIA”) Notification was promulgated by the Ministry of Environment, Forest and Climate Change (“MoEFCC”) in 2006 to scrutinize all relevant information about a project or activity in order to assess (and accordingly mitigate) its potential adverse impacts on the ecology of a region. As it seeks to uphold the ‘precautionary principle’ of environmental governance, it strictly mandates that following activities: construction of new projects or activities listed in its Schedule; the expansion or modernisation of existing projects or activities listed in its Schedule with increase in production capacity through the change in process and/or technology; or change in the product mix in existing manufacturing units beyond the specified range, shall be undertaken in any part of India only after obtaining prior environmental clearance (“EC”) from the appropriate authorities.
However, over time, it was observed that EIA Notification should provide for resultant change in EC based on factual information or data without having to go through the entire process again, provided the proposed change does not result in any adverse impact on environment. In light of this, the criteria of ‘no increase in pollution load’ along with the ‘production capacity’ has assumed significance for exemption from the requirement of prior EC for existing projects or activities. In light of recent amendments in EIA Notification pertaining to this aspect, we analyse this concept in detail below.
Regulation 7(ii) of the EIA Notification prescribes prior EC for expansion, modernisation or change in product mix in existing projects. Due to wide scope of the provision, it became practically cumbersome for industries to seek prior EC on every occasion before adjusting their product, production capacity, or modernising their process (with existing prior EC) as per market requirements even when such change does not result in pollution load beyond the limit specified in the EC.
Accordingly, in 2016, MoEFCC amended the Regulation 7(ii) of the EIA Notification stating that there will be no requirement to obtain fresh EC for any change in the configuration of the plant (as per the EC earlier granted for the project) after detailed engineering during the execution of the project, provided there is no change in the production and pollution load of the project. The proponent was only required to inform the relevant authorities about such change.
Besides, it also provided that any change in product-mix, change in quantities within products or number of products in the same category would not require fresh EC provided that there is no change in the total capacity sanctioned and no increase in the pollution load as per the existing EC.
Subsequently, in 2020, this provision was further amended to exempt any change in raw material-mix or product-mix, change in quantities within products or number of products in the same category from the requirement of fresh EC provided there is no increase in pollution load and the resultant increase in production is not more than 50 percent of the production capacity permitted in the earlier EC.
However, the project proponent was still required to obtain ‘No Increase in Pollution Load‘ certificate from the relevant State Pollution Control Board (“SPCB”) as per the provisions of EIA Notification.
On bare perusal of the amendment notification, it seems that the MoEFCC observed the need to limit the exemption from obtaining fresh EC for any change in raw material-mix or product-mix, or change in quantities within products or number of products in the same category to not more than 50% increase in production due to representations filed by sugar distilleries on account of incidental increases in their actual production due to certain government policies promoting the ethanol production. However, as the language of this amendment was not restricted to such industries, it applied to all projects/activities listed in the Schedule to EIA Notification.
Recently, MoEFCC again amended the EIA Notification in light of the principle of ‘no increase in pollution load’, based on representations filed by processing, production and manufacturing sector for permitting to increase production capacity of their existing projects without having to go through entire EIA process again as long as there is no increase in pollution load. For instance, Indian Drug Manufacturers Association approached the MoEFCC seeking this amendment.
|Provisions of the EIA Notification||Position before the amendment dated 02.03.2021||Position after amendment dated 02.03.2021|
|Regulation 2(ii)||Requirement of obtaining fresh EC for existing projects or activities covered:
(a) expansion or modernisation with capacity addition beyond the limits specified in the EC; (b) any change in the product mix of existing manufacturing unit beyond the specified range.
|Requirement of obtaining fresh EC for existing projects or activities now covers:
Expansion, modernisation or any change in the product mix or raw material mix in existing projects or activities, listed in the Schedule to this notification, resulting in capacity beyond the threshold limits specified, subject to conditions and procedure provided in the sub-paragraph (ii) of paragraph 7.
Note: The amendment makes the criteria of the increase in the production capacity applicable to expansion or modernisation as well as change in product mix or raw material mix.
|Regulation 7(ii)||Nature of exemption:
||Nature of exemption:
Note: The amendment allows the project proponent to increase the production capacity of projects relating to specific sectors, provided there is no increase in the pollution load. Earlier, increase in production capacity without prior EC was not allowed and sectors were not specified.
Besides, it also extends the application of these exemptions to cases of expansion or modernisation with no increase in pollution load.
|Conditions for application of exemptions:
For Exemption I, proponents had to inform the MoEFCC or State Environment Impact Assessment Authority (as the case may be) as well as relevant SPCB or UTPCC.
|Conditions for application of exemptions:
Note: Exemption B will not apply if on verification of the certificate, SPCB or UTPCC finds that such change results in increase in the pollution load. In such case, proponents would be deemed liable for obtaining prior EC and subject to action under provisions of Environment Protection Act, 1986 (“EPA”). This provision may result in indictment of those proponents under EPA who genuinely or in good faith had considered that pollution load will not increase due to such changes, or also on account of the negligence of the technical experts engaged by them for assessing the increase in pollution load. Given that these technical experts would be those empanelled by authorities, proponents may have no reason to doubt their expertise.
Besides, amendment does not specify whether the ‘pollution load’ certificate obtained by proponents will hold valid until its verification by authorities, and the period within which such verification process should be completed.
Determination of ‘pollution load’:
“Pollution load” shall be determined on the basis of multiplication of quantity and concentration of different components and parameters (as provided or referred in the prior EC or the EIA Report and Environment Management Plan based on which such prior EC has been granted), in respect of emissions, effluents or discharge, solid, industrial hazardous waste and such other parameters notified under the Environment (Protection) Rules, 1986.
|Appendix XIII||The detailed process for application by proponents for obtaining the ‘no increase in pollution load’ certificate from the SPCB/UTPCC had been provided.||The process of verification of ‘no increase in pollution load’ certificate obtained by proponents from Environmental Auditor or reputed institutions empanelled by the SPCB, UTPCC, Central Pollution Control Board or MoEFCC has been provided.|
 Regulation 2, EIA Notification, S.O.1533 (E), dated 14th September, 2006.
 S.O. 3518(E), dated 23rd November, 2016.
 S.O. 236(E), dated 16th January, 2020.
 S.O. 980(E), dated 2nd March, 2021.
 Laxmi Yadav, IDMA urges environment ministry to remove the clause of obtaining ‘no increase in pollution load’ certificate from state PCBs, (20th January, 2020), available at http://www.pharmabiz.com/PrintArticle.aspx?aid=120594&sid=1 (last accessed on 9th March 2021).
This article was originally published in Mondaq on 16 March 2021 Co-written by: Nawneet Vibhaw, Partner; Himanshu Pabreja, Associate. Click here for original article
Contributed by: Nawneet Vibhaw, Partner; Himanshu Pabreja, Associate
This is intended for general information purposes only. The views and opinions expressed in this article are those of the author/authors and does not necessarily reflect the views of the firm.
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