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Baseline analysis of existing incentive mechanisms forindustrial wastewater management to effectively combatenvironmental pollution
Gap Assessment
Presentation structure
●Assignment objectives
● Incentive mechanisms
●Preliminary evaluation
●Way forward on the assignment
Assignment Objective
National Level State Level (Uttarakhand)
Expected outcome
Indicator 1
Indicator 2
Two additional incentive mechanisms to pro-mote key elements ofsustainable industrial production, in particular wastewatermanagement have been included in the strategic planning of publicagencies of the Indian government on the national level (viz. MoEFCCand CPCB)
Five additional incentive mechanisms to pro-mote key elements ofsustainable industrial production, in particular wastewatermanagement have been included in the strategic planning of publicagencies of the Indian government on the national level (viz. SIIDCULand SIDA)
An inventory and gap analysis of the existing incentive mechanismsfor sustainable industrial production, in particular to waste watermanagement are available for acceptance of MoEFCC and CPCB
An inventory and gap analysis of the existing incentive mechanismsfor sustainable industrial production, in particular to waste watermanagement are available for acceptance of SIIDCUL and SIDA
Five incentive mechanisms to promote sustainable industrialproduction by companies or industrial area administrations (focus onwaste water management) are agreed by the stakeholders (viz.MoEFCC and CPCB).
Five incentive mechanisms to promote sustainable industrialproduction by companies or industrial area administrations (focus onwaste water management) are agreed by the stakeholders (viz.SIIDCUL and SIDA).
Base value Target value Base value Target value
Base value Target value Base value Target value
Stock-taking
Gap analysis
Incentive mechanisms
0
0
1
1
0
0
1
1
3 5 0 5
Overall approach and phasing
1
Baseline / Inception
2
Gap assessment
3
Recommendations
• Institutional stakeholder map;
• SEIP II program;• Broad menu of options of
incentive mechanisms;• Existing incentive
mechanisms;• Case studies on potential
best practices / new mechanisms.
• Mapping the gaps in existing incentive framework;
• Preliminary screening of the other potential incentives that can be applied;
• Shortlist of additional incentive mechanisms for detailed assessment;
• Review of existing incentive mechanisms and potential changes;
• Stakeholder consultations.
• Detailing and profiling the additional / new incentives;
• Detailing and profiling the changes to existing incentive mechanisms;
• Prerequisites for implementation of the proposed incentives• Institutional• Legal / regulatory• Monitoring /
enforcement
Stakeholder mapping
Government Parastatals/ autonomous bodies Private sector
National
MOEFCC
Ministry of MSME
Ministry of Textile
Ministry of Steel
DPIIT
CPCB
National Green Tribunal
NMCG
NRCD
BIS
Various Industry associations
Developers / technology advisors – Ion
Exchange India, VA Tech Wabag, Ramky etc.
State
Department of Industries
Department of
Environment and Forests
UEPPCB
SIIDCUL
SIDA
Directorate of Industries
State Ganga Committee
SPMG
SIIDCUL Manufacturers Association of
Uttarakhand (SMAU)
SIIDCUL Entrepreneurs Welfare Association
(SEWA)
SIIDCUL Industrial Association (SIA)
Association of Pharma Manufacturers (APM)
Local Chapter of PHD Chamber
Local Chapter of ASSOCHAM
Local -
Regional Offices, UEPPCB
Regional Offices, SIIDCUL
District Ganga Committee
District Industries Center
SK UEM Water Projects (CETP Operator)
Industrial estate-specific associations
Existing incentive mechanisms
Sr.
No. Incentive scheme/Type of Incentives
Fu
nd
s / G
ran
ts /
Su
bs
idy
Dep
os
it r
efu
nd
sy
ste
m
Tra
din
g r
eg
ime
s
Te
ch
nic
al
as
sis
tan
ce
Aw
ard
s /
Pro
du
ct
rec
og
nit
ion
Po
llu
tio
n c
ha
rges
/
tax
es
Lia
bil
ity
1 Rajiv Gandhi Environment Award for Clean Technology
2 Assistance for Abatement of Pollution and Environment Policy & Law
3 Eco-mark
4 National Award for Prevention of Pollution
5 Industrial Infrastructure Upgradation Scheme
6 Credit Linked Capital Subsidy Scheme (CLCSS)
7 Micro & small enterprises cluster development scheme
8 Integrated Processing Development Scheme (IPDS)
9 Financial Support to MSMEs in ZED Certification Scheme
10 Cleaner Production Award
11 Award scheme for secondary steel producer
12 Industrial Pollution Abatement through Preventive Strategies
13 Common Effluent Treatment Plant (CETP)
Incentive mechanisms
Types of incentives
1. Financial
1. Price rationing
2. Subisidies
3. Quantity rationing
4. Liabilities
2. Non-financial
1. Ease of doing business
2. Marketing incentives
3. Voluntary covenants
Types of incentives
Incentive category Incentive type Description
Financial
Price rationing Environmental cost is transferred to the industries by pricing the extent of pollution
Subsidies Support is provided to industries to help them on pollution control
Tradable permits The overall pollution level is capped but industries can re-distribute extent of pollution through trading of their permits
Liabilities Industries pay an upfront refundable deposit, burden of proof of compliance is with the industries
Non-financial
Ease of doing business Reward in the form of reduced compliance requirements
Marketing incentives Reward in the form of recognition
Voluntary covenants Partnerships between industry & government for mutually agreed outcomes
Price rationing
●Options: Water charges, effluent charges, ambient charges, product,
charges
●Legislation: May require modification
●Potential for conflict: Industries may resist process changes and potential
financial impact
● Issues related to monitoring: This requires reliable & continuous
monitoring of effluent and wastewater discharge
●Precedence for use of the instrument: There is no precedence for price
rationing in India, but CPCB has introduced continuous online effluent
monitoring
Subsidies
●Options: Fee discounts, rebates, capital grants
●Legislation: No legal amendments are required
●Potential for conflict: Opposition from environmental groups on polluter
pays principle
● Issues related to monitoring: Periodic monitoring of construction progress
& post-commissioning monitoring of operations
●Precedence for use of the instrument: CETP Scheme, Modified IIUS,
IPDS, etc.
Quantity rationing
●Options: Tradable water permits, tradable effluent permits
●Legislation: May require amendment
●Potential for conflict: Industries may resist process changes and potential
financial impact
● Issues related to monitoring: Requires continuous effluent vis-à-vis
individual permit allowances for each polluter
●Precedence for use of the instrument: No precedence in India
Liabilities
●Options: Deposit-refund schemes, environmental bonds
●Legislation: May require amendment
●Potential for conflict: Industries pay resist front-ended financial impact
● Issues related to monitoring: Reliable monitoring systems to verify claims
made by industries
●Precedence for use of the instrument: Liability estimated & imposed by
NGT and current practice of collected bank guarantee from non-complying
industries
Ease of Doing Business
●Options: Extension in consent period, reduction in inspection frequency
●Legislative background: No legal amendment required
●Potential for conflict: There may be opposition over relaxation in
environmental monitoring
● Issues related to monitoring: Reliable monitoring systems to verify claims
made by industries
●Precedence for use of the instrument: Extension in consent period
provided in Gujarat
Marketing support
●Options: Certification/ rating, awards, preferred procurement
●Legislative background: No legal amendment required
●Potential for conflict: Little or no potential for conflict
● Issues related to monitoring: Reliable monitoring systems to verify claims
made by industries
●Precedence for use of the instrument: Eco Mark scheme, ZED
certification, Awards for pollution control, etc.
Voluntary covenants
●Options: Corporate charters, eco-industrial parks, CSR
●Legislative background: No legal amendment required
●Potential for conflict: May be some opposition over objectivity of process or
due to any relaxations which go against the polluter pays principle
● Issues related to monitoring: Reliable monitoring systems to verify claims
made by industries
●Precedence for use of the instrument: Corporate Responsibility for
Environment Protection
Preliminary evaluation of incentives – Ease of implementation
Incentive mechanism Legislation Resistance Monitoring Precedence Aggregate
Price rationing
Subsidies
Quantity rationing
Liabilities
Ease of doing business
Marketing incentives
Voluntary covenants
Stakeholder perceptions
Perceptions
MO
EF
CC
CP
CB
Ch
am
be
r o
f
Co
mm
erc
e
SII
DC
UL
UE
PP
CB
SM
AU
Incentives are required for meeting minimum standards No No Yes No No No
Need to encourage industries to go beyond minimum standards Yes Yes Yes No Yes Yes
Reputational incentives, alone, are adequate for larger industries - Yes - - Yes No
Smaller industries would prefer financial incentives over
reputational incentives - Yes Yes - Yes Yes
Financial incentives in the form of discounts are preferred over
rebates by industries - - Yes - NA Yes
Rebate in consent fee would be an attractive incentive for
industries - - No - No Yes
Technical assistance is required for going beyond minimum Yes Yes Yes - No Yes
Eco mark was an effective reputational incentive scheme - - - - No No
Thank You
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