Air pollution has emerged as a major environmental problem in Indian cities and towns. Automobiles are a leading source of this pollution. The government response to this challenge is twin-fold — making available less polluting fuel and enforcing regular pollution checks on cars and other automobiles.

Despite loopholes in implementing ‘pollution under check’ certification, the regulatory measure has helped keep pollution levels under control to a great extent.

The situation with air pollution from industrial units, however, is different.

Under the environmental laws, every unit is supposed to keep air emissions and water quality within the regulatory limits. All this is laid down as part of green clearance, but compliance as well as monitoring is lax.

The regulatory mechanism in the form of State pollution control boards lacks the capacity to handle the task of regularly monitoring air and water pollution levels from individual units. The boards mostly go by data submitted by polluters themselves.

As a solution to this problem, the High Court of Gujarat had mandated a system of third-party pollution audits of industrial units in 1996.

Even this system has failed to keep pollution under check, as a recent study by scientists from the Massachusetts Institute of Technology (MIT) and Harvard has revealed.

Having exposed the faults in the third-party system, fortunately MIT and Harvard researchers have demonstrated a way to make third-party audits meaningful.

How it works

First, let us see how the existing third-party audits work. Under this system, external auditors are supposed to take periodic readings of key water and air pollution parameters. Researchers carried out a scrutiny of audits done for 250 industrial units in Ahmedabad and Surat. They then compared this data with independently collected pollution data, which revealed that 29 per cent of audit reports were falsely reporting pollution levels as below the regulatory norms. For particulate matter pollution, for instance, auditors reported that 7 per cent of plants violated the standard, while in reality 59 per cent were in violation.

The reason, according to the study, is the fact that auditors were being paid directly by companies being audited and there were no incentives for correct auditing. Auditors in status quo plants were paid about Rs 24,000 per audit on average, which is well below the average cost of conducting a full audit at Rs 40,000. This means many auditors were not conducting all the tests needed for a proper audit and were concocting data.

The other half of the study has thrown up more interesting results and a possible solution to this vexed problem. The research team picked up another 233 units in the two industrial hubs and introduced a new audit system in collaboration with the Gujarat Pollution Control Board (GPCB). Under this system, auditors were paid from a central pool instead of by units being audited directly. Auditors were paid a fixed fee of Rs 45,000 per audit from the common pool.

This was unlike the existing system in which auditors were paid directly by plants and prices were often negotiated. The auditors paid from the common pool were randomly assigned to industrial plants they would monitor. The audits they conducted were also monitored. Auditors were aware that they may be double checked, but were not told when.

Twenty per cent of pollution readings by randomly assigned auditors were randomly selected to be double-checked by technical staff of independent engineering colleges. Both auditors and independent checkers used the same technology and standardised protocols to measure water pollutants (biochemical oxygen demand, chemical oxygen demand, total dissolved and suspended solids) and three air pollutants: sulphur dioxide, nitrogen oxides and suspended particulate matter.

Dramatic results

The results of this experiment were dramatic. Auditors reported much higher pollution levels. Across several different air and water pollution parameters, inaccurate reports of plants complying with the set standards dropped by about 80 per cent. The number of polluting units reporting levels right below the standard limit fell. It was also noted that the same auditors reported pollution more accurately under the new system than they did in comparison plants that they were auditing at the same time. This shows that the new system led to increased accuracy.

Most important, the new audit system led to actual reduction in pollution levels. Industrial units facing the new auditing system reduced pollution by 0.21 standard deviations on average, according to results of the study published in the Quarterly Journal of Economics this month. The pollution reductions, according to the study, came from the highest-polluting plants. The State pollution board penalises defaulting units with harsh steps like plant closure. The results of the experiment showed that the dirtiest plants responded by reducing emissions the most.

Making a difference

The experiment has clearly indicated that removing ‘conflict of interest’ from pollution audits, coupled with incentives for honest auditing, dramatically improved the outcome. False or doctored audit reports mean continued pollution and non-compliance with the law. It also shows that proper and full audits help dirtying units to clean up.

Pollution control boards all over the country need to look at the results of this study seriously and evolve a system of paying auditors from a centralised pool and randomly assigning them to polluting units in place of current system of companies hiring their own pollution auditors.

A larger question would be: Can the same system be extended to other parts of the green regulation in India, say to conduct of environment impact assessments (EIAs) or compliance of environment management plans (EMPs)?

Currently, project proponents select EIA consultants from a list of accredited consultants (the process of accreditation is also a contentious issue) and pay them directly. There have been a number of instances in which EIA consultants have simply copied from EIA reports of other projects.

Similarly, there is no credible system in place to oversee implementation of EMPs. Can this system be replaced by one in which EIA consultants are randomly assigned to project proponents and are paid through a central fund? Will it improve the quality of EIAs done and remove conflict of interest from the process? Can a similar system be developed for EMP compliance? Only thorough field research as done in Ahmedabad and Surat can give us some convincing answers.

(The author is a science journalist and author based in New Delhi.)

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