Part VIII of the Environment Act 2000 puts a price on using the environment and takes security against the cost of putting it right.
Section 96 — charges for using the environment
The Minister, acting on the recommendation of the Council and after consultation with the Minister responsible for financial matters, may by notice in the National Gazette fix charges for:
(a) the consumptive or non-consumptive use of water; and
(b) the use of water, air and land as a carrier following the release of contaminants — either for that segment of the environment generally, or for a particular use in a specified area.
Using water, air or land as a carrier for contaminants is the environmental service a discharger takes. Section 96(b) allows it to be priced — generally or area by area. That is the object in section 4(g) put into effect: allocating the costs of environmental protection and restoration equitably, in a manner that encourages responsible use and reduced harm.
Note the safeguards on the power: a Council recommendation, consultation with the Treasury Minister, and publication in the National Gazette.
Sections 96A and 100 — fees
The Director may fix fees in relation to any matter or thing required to be done or provided by the Director under this Act — including the provision of any report, document, environmental impact statement, permit or other information.
Section 96A provides that all fees and charges under sections 96, 97 and 100 shall be paid to the Authority — the Conservation and Environment Protection Authority, established by the Conservation and Environment Protection Authority Act 2014, whose Managing Director is the Director of Environment.
Fees also appear throughout the Act: section 63(1)(c) (fees with a permit application), section 70(d) (annual fees for permits), section 75(6)(d) (fees for approving an environmental improvement plan), section 89(1)(b) (the fee with a water investigation permit application), and section 131(3) (fees for searching the Register).
Sections 97 and 98 — the Trust Fund and the Levy
The Regulations may provide for the establishment, operation and management of the Environmental Protection Trust Fund, to fund the office in the event that it becomes a statutory authority or is otherwise corporatised.
Where the Fund is established, all charges and levies under sections 96, 98 and 100 shall be paid into it.
Section 98 then provides that, upon the establishment of the Fund, the Regulations may provide for the imposition, collection, payment into the Fund and application of an Environmental Levy.
Sections 97 and 98 were drafted before the office was corporatised; the corporatisation contemplated by section 97(1) took place under the 2014 Act. Section 96A, inserted later, directs fees and charges to the Authority. Anyone dealing with charges or a levy should check the current Regulation to see which mechanism is operating.
Section 99 — environmental bonds
(a) a person carrying out an existing activity; or
(b) by the conditions of a permit, a person carrying out the permitted activity,
to lodge an environmental bond supported by a bank guarantee, insurance policy or other security approved by the Director, the discharge of which is conditional upon the person:
(c) not committing any contravention of this Act, an Environment Policy or the Regulation of a specified kind during a specified period; or
(d) taking specified action within a specified period to achieve compliance.
First, a bond may be required of a person carrying out an existing activity — not only of a permit holder. Existing activities are otherwise largely outside the permit system under section 44(2).
Second, the security must be approved by the Director. A parent company guarantee or a self-insurance arrangement is not automatically acceptable; a bank guarantee or insurance policy is what the section names first.
Section 99(2) allows the Regulation to provide for when a bond may be imposed, how the amount is calculated, when and how much may be forfeited, and the procedures for forfeiture.
The bond is one of the conditions expressly contemplated by section 66(1)(j), alongside monitoring programmes, management programmes, audits, emergency response plans, baseline studies and rehabilitation of the affected area.
Why the bond matters
| Provision | Exposure | Capped? |
|---|---|---|
| s 105 | The Director does the clean-up and recovers reasonable costs and expenses, with interest after 28 days | No |
| s 129(3) | On conviction — investigation costs, prosecution costs, compensation to any person who suffered loss, a bond, and rehabilitation of the environment | No |
| s 87 | Compensation to owners, occupiers and holders of customary rights | No |
| s 116 | Additional daily penalty for a continuing offence | Per day |
| ss 11, 102, 104 | Fines of up to K250,000 for a corporation | Yes |
The bond exists because most of that list is uncapped, and because an operator that has ceased trading cannot rehabilitate anything. A bond that is properly sized and properly secured is the community’s protection against an abandoned site.
When a project is being assessed, ask about the bond: whether one is required, how the amount was calculated, what security supports it, and what conditions attach to its discharge. Those are proper subjects for a public review submission, and the Register records permit conditions.
Section 58(2)(l) requires the Council to have regard to the suitability of the applicant to hold a permit, and section 65(3)(k) requires the same of the Director. Financial capacity to rehabilitate is squarely within that.
Practical points
- Budget for charges under section 96 — both for taking water and for discharging.
- Diary annual permit fees — under section 70(f) the Regulation may make the validity of a permit depend on lodging the annual return and paying fees.
- Check gazetted charge notices, which may apply generally or to a specified area.
- Arrange the bond security early; it must be in a form the Director approves.
- Read the discharge conditions — no contraventions of a specified kind in a specified period, or specified action within a specified period.
- Keep the compliance record clean; forfeiture procedures are prescribed by the Regulation.
- On a transfer of a project, deal expressly with the bond and any outstanding compensation.
Sources
- Environment Act 2000 — ss 4, 44, 58, 63, 65, 66, 70, 75, 87, 89, 96–100, 105, 116, 129, 131; Part VIII
- Conservation and Environment Protection Authority Act 2014
- Public Finances (Management) Act 1995
Before relying on anything here, read the current text of the Environment Act 2000 and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.