Is Cenagen’s project
'Energy from Waste'?
If so, what are the implications? 

What does Cenagen say about its project being “Energy from Waste” (EfW)?

Quotes:

(Some) have questioned whether the proposal fits within NSW policy settings for Energy from Waste facilities, arguing Kandos is not a designated precinct for that type of development.

Cenagen has disputed that characterisation, saying the project is not an Energy from Waste facility and fits within existing legislation.

Mudgee Guardian (11/6/26): “A billion-dollar promise for Kandos now has a front door in the middle of town”

In a statement to the Mudgee Guardian, the company said its process uses advanced gasification technology to convert processed waste into low-carbon fuel and greenhouse products. (emphasis added)

Mudgee Guardian (26/4/26): “Questions raised over whether billion dollar Kandos project can proceed”

But what does the NSW Environment Protection Authority (EPA) say?

The NSW EPA is responsible for administering the framework that determines what constitutes Energy from Waste (EfW) and where EfW facilities may be located.

The NSW EfW framework classifies facilities based on what they do and how they operate.

Under the NSW framework, Energy from Waste (EfW) involves:

• thermal treatment of waste; and

• energy recovery from that waste¹.

Fuel production (in this case, methanol) is expressly included within the concept of energy recovery¹.

Applying the NSW definition to Cenagen's own description of the process leads to a straightforward conclusion: even though it is not incineration, and even though it is producing methanol, it would still be classified as an Energy from Waste project.

The EPA itself has clarified this position in a letter to a local resident. The key paragraph in that letter says:

Section 143 of the Regulation also makes it clear energy recovery from waste includes recovery in the form of electricity, heat or fuel. The prohibition is therefore not limited to proposals that generate electricity, and also applies where waste is thermally treated to produce fuels such as syngas or chemical fuels such as methanol.2

You can view the full text of the letter here.

If Cenagen is Energy from Waste, can it proceed in Kandos?

No. Not as things currently stand.

Currently, Energy from Waste facilities are only permitted in certain precincts and other approved locations. (For more information on Energy from Waste precincts, and where they currently are in NSW, click here.)

Kandos is not one of them.3

That is why the question of whether the project is properly classified as Energy from Waste is so important.

The rules around Energy from Waste would need to change if the Cenagen project is to go ahead here.

Could the rules be changed?

Potentially, yes.

Governments can amend policies, regulations and planning frameworks.

However, that would itself be a significant public policy decision.

The current NSW framework reflects a deliberate choice about where Energy from Waste facilities should be located.

Kandos is not currently within a designated Energy from Waste precinct.3

What would that change involve? And what issues would it raise?

Any change to the current framework would itself be a significant public policy decision and would likely be subject to public consultation and parliamentary scrutiny4.

And the issue for government – and communities around the state – is this:

If Cenagen's project can be allowed outside a designated EfW precinct by changing or departing from the current framework, it could create a precedent for other waste-to-fuel or waste-to-energy proposals to be advanced in locations that have not previously been identified as suitable Energy from Waste precincts.

Sources:

¹ Protection of the Environment Operations (General) Regulation 2022 (NSW), especially s143, and the NSW Energy from Waste framework, as confirmed in answers given to questions in NSW Budget Estimates (Rath Q306–309). These sources confirm that energy recovery includes recovery in the form of electricity, heat or fuel, and that the prohibition is not limited to electricity generation.

² NSW EPA letter to a local resident regarding Energy from Waste classification and the Cenagen proposal, including the paragraph stating that the prohibition is not limited to proposals that generate electricity and also applies where waste is thermally treated to produce fuels such as syngas or chemical fuels such as methanol. [Hyperlink to be inserted.]

³ NSW Energy from Waste policy framework and Protection of the Environment Operations (General) Regulation 2022 (NSW), including provisions identifying the precincts and other approved locations where Energy from Waste facilities may be permitted.

⁴ Subordinate Legislation Act 1989 (NSW) and NSW Parliamentary procedures relating to statutory rules and disallowance. Significant changes to regulations are ordinarily subject to regulatory impact assessment, consultation requirements and parliamentary scrutiny, although the precise requirements depend on the legal mechanism used.