Waste or resource: Classifying excavated material

Whether you are removing excavated soil or importing fill to your site, incorrectly testing and classifying these materials could have disastrous consequences for both your project and the environment.

In January 2024, a parent found chunks of bonded asbestos in the recycled mulch at a new playground in Sydney’s inner west. This kickstarted the largest environmental criminal investigation in the history of the NSW Environment Projection Authority (EPA) –  more than 300 sites were inspected and 79 were found to have used the contaminated mulch.

The three companies involved and one individual are now facing 102 alleged offenses in court – but how does this happen in the first place?

Before it was delivered to the park, the mulch was tested at its source for contaminants including heavy metals, poisons and foreign materials using the NSW EPA's contaminated land guidelines.

When it was imported from the source site to the construction site, it was tested again. And in both cases, none of the samples tested positive for contamination.

So, how did this supposedly clean fill end up contaminated?

Resource recovery in Australia – what are the regulations

Fill comes from two main sources: natural material excavated from another site, and recycled material, such as processed construction and demolition waste, that meets a standard for reuse. 

State environment protection authorities encourage reuse of surplus, uncontaminated soil or construction waste in place of landfill disposal. This supports the National Waste Policy, which aims to avoid waste and increase the use of recycled material, and the 2024 action plan target to double the circularity of the Australian economy by 2035.

Excavation for basements, roads and services produces surplus material, and levelling, backfilling and embankments need material brought in. In every state, material that leaves the site where it was generated is treated as waste unless it has been classified under a pathway that allows reuse. Developers who misjudge that classification can face stop-work notices, disposal costs and delayed approvals.

Because most urban land has an industrial, commercial or agricultural history, waste soil and materials from these sites can contain contaminants such as heavy metals, hydrocarbons, PFAS, asbestos or pesticides that may not be visible. Soil qualifies as fill only where contaminants fall below prescribed limits. Above those limits it is managed as a higher-hazard waste, and must be tracked, transported and either treated or disposed of under stricter controls at a licensed facility.

Part of the challenge, however, is that the environmental laws and regulations around fill reuse and categorisation are governed at a state level. While there are many similarities, fill is not always classified in exactly the same way in New South Wales as it would be in Victoria, for example.

On top of that, developers wanting to import materials on site need to get approval from their local council as part of the planning permit, may also impose unique requirements in addition to those set by the state’s environment protection authority.

In Victoria, the Environment Protection Act 2017 and the Environment Protection Regulations 2021, state that all soil removed from a site is industrial waste and must be classified before it is transported. This means identifying which waste code(s) it falls under and determining whether the waste is also priority waste or reportable priority waste.

If your soil is identified as priority waste, you’ll also need to assign it to a priority waste category, which for soil will be category A, B, C, D or soil containing asbestos only.

Category D applies only to soil and covers the least hazardous contaminated soil. If the waste soil is Category D, it's reportable priority waste, and the reportable priority waste duties also apply.

The priority waste category determines which landfills can receive the waste soil, what permissions you need to obtain to contain the soil on-site and the waste levy that needs to be paid in order to dispose of the waste soil at a landfill.

The more hazardous the soil is, the higher the waste levy.

Fill material is industrial waste, but not priority waste or reportable priority waste, and it is considered safe to use without containment.

To be considered fill material, soil must have contaminant concentrations at or below the limits in EPA Victoria’s Waste disposal categories – characteristics and thresholds publication, with leachability tested using the Australian Standard Leaching Procedure.

Conversely, in New South Wales, the Protection of the Environment Operations Act 1997 and the Waste Regulation 2014 set the framework, and the state uses two main categories for excavated soil that is suitable for re-use: Virgin excavated natural material (VENM) and Excavated natural material (ENM).

VENM is natural, uncontaminated soil, rock, clay, gravel or sand that has not been disturbed before excavation and has not been mixed with other waste. A VENM certificate should accompany it.

ENM is excavated natural material that contains at least 98 per cent natural material by weight but does not meet the VENM definition, for example because it has been stockpiled or processed. It must meet the chemical thresholds in the ENM Order 2014 and be applied to land under the ENM Exemption 2014, as engineering fill or in earthworks.

Material from a contamination hot spot, or containing asbestos, acid sulfate soils or potential acid sulfate soils, cannot be ENM. Soil that is neither VENM nor ENM must be classified under the NSW Waste Classification Guidelines (2014) before it leaves the site. Suppliers of ENM must keep records of quantities and recipients for six years. Supplying false or misleading information about a waste's classification is an offence. Testing by a NATA-accredited laboratory is common even where VENM is intended, because the site history is often uncertain.

Despite these nuances, a developer looking to import fill onto a site in any jurisdiction must ensure the material must meet the standards as set out by that state’s regulator, and the generator must test for contaminants that are known or reasonably expected to be present, and laboratory analysis must be done by a NATA-accredited laboratory.

Landowners and project managers who accept or later uncover contaminated fill face potential fines, and in serious cases imprisonment, if the contamination is not properly managed and removed. Projects can be halted by EPA or council cease and clean-up orders while the material is classified, capped or removed, pushing out construction programs and certificates.

Clean-up activities alone can be quite costly. In addition to the fees applied by the licenced disposal facility, the state’s environment protection authority will often impose a levy on the disposal of contaminated waste.

In New South Wales for example, the cost of disposing of contaminated fill runs to about $300 per tonne, a figure that escalates quickly with the volume involved. Beyond cost and delay, contaminated fill also carries genuine health risks for workers and the community.

Where are the risks?

In the case of the playground in Western Sydney, NSW EPA alleges that the contamination was caused by waste materials associated with construction and demolition activities entering the recycled mulch supply chain.

Investigators believe asbestos-containing materials were mixed into waste streams that were later processed into recycled mulch before it arrived on site.

However, it was the property owners that ultimately had to foot the bill for the clean-up of the contaminated land, and the project’s contractor entered into an enforceable undertaking to pay $150,000 for asbestos safety training.

The longer the supply chain, the greater the risk of fill arriving on sites without proper testing or a valid clearance certificate. Common risk factors include:

• Relying on geotechnical reports that do not adequately test for asbestos and other contaminants, instead of conducting comprehensive environmental site investigations by a qualified environmental consultant;
• Falling victim to fraudulent suppliers[1], contaminated fill can sometimes have fake classifications, and in some cases regulators have found that when construction waste being recycled as clean fill did not meet EPA contamination limits, suppliers would request retesting until limits were met; and
• Contaminants infiltrating clean fill sites through illegal dumping practices and environmental drift.

In Victoria, developers have a duty to manage contaminated land[2], even if they did not cause the contamination, and can be found liable for accepting contaminated materials. Developers and site managers are not expected to be environmental scientists, but a number of practical signs can indicate that supposedly clean fill deserves closer scrutiny before it is accepted or used.

A classification certificate or test report that is generic, undated, or does not clearly identify the specific site or stockpile the load came from; A NATA accreditation claim for the testing laboratory that cannot be independently verified; or test results that cover only a narrow set of contaminants, are all red flags that warrant further investigation.

Developers should also be wary of a supplier that is unwilling or slow to produce supporting documentation, offering only a verbal assurance that the material is clean – or one that offers an unusually low price.

It’s also important to inspect the material itself before it is offloaded to the site, and look out for any visible fragments of building material, discolouration, staining, odour or an oily sheen.

To protect their operations, developers should engage a qualified environmental consultant with current, relevant qualifications, who can carry out environmental site investigations and waste classification, separate from any geotechnical assessment of the site.

Recognising the warning signs, in both the sampling, reporting and the appearance of the physical material, and building verification into standard site practice rather than treating it as an afterthought, is what separates projects that catch a problem before it contaminates a site from those that discover it after the fact, at far greater cost.