An overview on the new concept of The Environment Protection Act, 2019 and extended commercial scope of The Environment Protection Rules, 2020

May 20, 2025

Government has  brought The Environment Protection Act, 2019 and Environment Protection Rules 2020 repealing the Environment Protection Act, 1996 and Environment Protection Rules 1997. The newly amended Act and Rules has extended and widened the various scope and working areas on business or industrial sector as well as brought a change in the operational issue of the IEE and EIA. 

This article provides the information on the extended commercial scope of Environment Protection Rules, environment study reports as well as operational issues of the environment protection act.

Environment impact assessment (EIA) and Initial environmental examination (IEE) are both types of environment study reports prepared whenever any construction is done whether it is development project with national priority, a project that is approved by investment board, a project of national pride, a development work or any construction work.  

Laws and rules that addresses the EIA and IEE

1) Environment Protection Act, 2076

2) Environment Protection  Rules, 2077

Regulating Authorities

Regulating authorities under the act include following authorities;

1) Government of Nepal,

2) Environmental Inspector,

3) Environment Protection Council

4) Department of Environment,

5) Ministry of forests and environment.

Ministry of Forestry and Environment is the competent authority to get approval of the environment study report addresses all the issue related to IEE and EIA. 

According to the Environment Protection Act, 2076 sec 2(t), environment study report means a report prepared with respect to the brief environment study, environment impact assessment or initial environmental examination.

Environment Protection Act, 2076 sec 2(m), has define Initial environmental examination as "initial environmental examination" means an analytical study or evaluation to be conducted to ascertain whether, the proposal makes the adverse impact on environment or not while implementing and with the respect the measures to be adopted to avoid or mitigating such impacts by any means.

Environment protection Act, 2076 sec 2(v), has define Environment Impact Assessment as, "Environment Impact Assessment" means an detailed study or evaluation to be conducted to ascertain whether, the proposal makes the adverse impact on environment or not while implementing and with the respect the measures to be adopted to avoid or mitigating such impacts by any means.

The Environment Protection Act, 2076 which has replaced the environment protection act, 2053 has codified IEE and EIA under environmental study report and clearly defined its meaning. It has also brought a new concept on the study report that is brief environmental study. Sec 2(y) "Brief environmental study" means, a study to be made briefly as to the measures to be adopted for avoiding or mitigating the adverse effects on the environment as a result of implementation of any proposal".

New Concept: Environment Management Plan and Strategic Environmental Analysis

Environment Management Plan

The Act has brought new concept that is environment management plan, which talks about the mitigation of environmental adverse impact in course of implementation of construction project. The Act has stated, before implementing any proposal, proponent shall prepare the environment management plan. The Act has further stated that, if the environment management plan does not appear to be effective to mitigate environmental adverse impact set out by the proponent, the concerned body shall give the effective measure to mitigate the environmental adverse impact which shall be adopted by the proponent and should bear all the expenses. The management plan made by proponent should be made clear and submit its progress report to the concerned body in every six months after commencement of the project implementation.

Strategic Environment Analysis (SEAN)

Strategic Environment Analysis is also a new concept of an Environment protection act. According to the Act, before the implementation of any project, program or policy the strategic environment analysis need to be carried out and such policy, program or project should be specified by the government of Nepal by the notification in the Nepal Gazette. Strategic environment Analysis is the process of analyzing the environmental problems and opportunities for development to define main actors and to set the strategic goals at early stage. The Act has just introduced the Strategic Environmental Analysis hasn’t further talked about its process. Basically, SEAN focuses on the interactions between ecosystems and human society that aims to develop intuition in these complex interrelations and agree upon strategic goals.

To check whether the work is being carried out in accordance to the environmental study report (ESR), environmental inspector is a competent authority to carry out monitoring and inspection.

The proposals where a proponent needs to do Initial Environmental Examination for the establishment of industries for commercial purpose are as follows,

The Environment Protection Rules, 2020 schedule 2,

A) Forest sector

1) Establishment of medicinal herbal center for commercial production of herbs or aromatic plants in the public plantation area,

2) Construction of resort or hotel which has bed up to 25 beds , hospital or educational institution which has bed up to 25 beds in the forest area, within the conservative area of forest area, within the intermediate zone of forest area, wetland area or within environment protection area. 

B)  Industrial sector

1) Establishment of industries that produces alcohol by blending process of blending and establishment of distilleries equipped with boiling and fermentation facilities with a production capacity of 5,00,000 liters per day. 

2) Establishment of carbonated or non-carbonated beverages, juice producing industries.

3) Establishment of industry producing vegetable ghee or edible oil.

4) Establishment of industry producing more than 10 metric tons of daily foods.

5) Establishment of water treatment industry at a rate of more than 10 liters per second for commercial purposes other than pipelines.

6) Establishment of cooking (LPG) gas, bio gas, natural gas refiling, filing, production and distribution industries.

7) Establishment of pulp and paper industries, except traditional cottage industries, with a production capacity of 100 metric tons per day.

8) Establishment of jute industry.

9) To generate 5 to 50 MW renewable energy technology (solar, wind, biological, etc.) for its use by the industry.

C) Housing, slum development and urban development sector

1) To construct a joint building with a built up area or floor area of ​​more than 5,000 to 10,000 square meters area, which is both residential, commercial or residential and commercial in nature,

2) Construction of cinema halls, theaters, community forest buildings, stadiums, concert halls, sports complexes with a simultaneous arrival of 1,000 to 2,000 people,

3) To construct hard surface pavement (Dry port, Bus Park, parking lot) of more than 5 hectares.

D) Water resource and energy sector

A) Under power generation

1) Construction of hydropower generation projects of 1 to 50 MW capacity,

2) To generate electricity from 1 to 5 MW capacity of mineral oil or gas,

3) To produce biogas of more than 1500 gun meters capacity.

E) Renewable energy sector

1) To operate power projects from solar energy with a capacity of more than 1 to 10 MW,

2) To operate power projects from wind energy with a capacity of more than 1 to 10 MW,

3) To operate power projects from wind energy with a capacity of more than 0.5 to 2 MW,

F) Tourism sector

1) To build, establish and operate a hotel or resort with 51 to 100 beds,

2) To operate the house boat (floating house) to be established in the lake,

G) Agriculture sector

1) Construction work to raise more than 30,000 birds,

2) Construction work to raise more than 1,000 large quadrupeds,

3) Construction work to raise more than 5,000 small quadrupeds (sheep and goats),

4) Construction work for raising more than 2,000 pigs,

5)  Construction of ponds for hatcheries to produce more than 250 million fish fry annually,

6) To build parent and grandparent poultry and hatchery.

H) To establish the following agro based industries,

1) Establish a milk processing industry (including milk products) with a capacity of more than 10,000 liters per day,

2) Establish more than 5 metric tons of fish and meat processing industry daily,

3) Establishment of industry processing of more than 10 metric tons of fruits or vegetables daily,

4) Establishment of Industry to produce 2 to 10 metric tons of organic manure daily.

The proposals where a proponent needs to do Environmental Impact Assessment for the establishment of industries for commercial purpose are as follows,

A) Forest sector

1) Construction of resort or hotel which has bed up to 25 beds , hospital or educational institution which has bed up to 25 beds in the forest area, within the conservative area of forest area, within the intermediate zone of forest area, wetland area or within environment protection area. 

B) Industrial sector

1) Establishment of industries that produces alcohol by blending process of blending and establishment of distilleries equipped with boiling and fermentation facilities with a production capacity of 5,00,000 liters per day. 

2) Establishment of industries for making baked bricks, tiles etc. with an annual production capacity of 30 million pieces.

3) Establishment of pulp and paper industries with a daily production capacity of 100 metric tons.

4)  The industry will generate more than 40 MW of renewable energy technology (solar, wind, biological etc.) for its use to generate electrical energy from congeneration DG sets.

5) Establishment of industries producing highly hazardous substance such as isonite, mercury compound.

6) Establishment of radio / radiation emission (nuclear/atomic processing) industry,

7) Establishment of industry, investing more than Rs. 2 billion in machine tools that is apart from computer software, software preparation using electronic equipment, online services, internet, radio, cable network services or training, consulting.

C) Housing, slum development and urban development sector

1) Construction of cinema halls, theaters, community forest buildings, stadiums, concert halls, sports complexes with a simultaneous arrival of more than 2,000 people

D) Water resource and energy sector

A) Under power generation,

1) Construction of power generation projects with a capacity of more than 50 MW,

2) To operate coal or nuclear power generation projects with a capacity of more than 1 MW,

E) Renewable energy sector

1) To operate power projects from solar energy with a capacity of more than 10 MW,

2) To operate power projects from wind energy with a capacity of more than 10 MW,

3) To operate power projects from bio-energy with a capacity of more than 2 MW.

F) Tourism sector

1) To build, establish and operate hotels or resorts with more than 100 beds.

This aricle is prepared by the Atish Maharjan, who is legal intern in the Sada Associates. Atish is currently working as a Research Assistant. Atish is pursuing Bachelor in law (B.A. LL.B.)  in kathmandu school of law. 

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Please note that this guide is published for general information only and should not be considered as legal advice. You are requested to seek legal advice for specific factual situations. Please note that copyright for this article vests on Sada Associates