The changes to ACT environmental protection law will allow a polluter to enter into a binding agreement to make reparations for their harm.

That gives the government another option to go after polluters other than criminal prosecution, which is rarely used, or infringement notices.

The changes will also allow the ACT's watchdog, the Environment Protection Authority, to intervene proactively in cases where there is a potential for harm to the environment, rather than after harm has already occurred.

The ACT government can also now be held criminally liable for offences against the Environment Protection Act, something from which it has enjoyed immunity.

Environment Minister Simon Corbell said the changes gave the authority a wider range of tools to prevent damage to the environment.

"It is important that we act proactively to reduce the risk of pollution," Mr Corbell said.

The changes were passed with the help of the ACT Greens MLA Shane Rattenbury, who said they were an important step forward.

Mr Rattenbury said the powers could have helped in the case of Koppers Wood Products, whose timber treatment activities saw carcinogenic toxins poison groundwater in Hume, leaving a clean-up bill of more than $1 milllion for the site's new owners.

"This gives the EPA a much stronger power to act before something becomes an issue, it gives them a stronger proactive capability," he said.

"If we look through what happened at Koppers, there were a number of issues that arose there, but this definition certainly would have helped."

But Mr Rattenbury said the authority must be properly resourced to be able to effectively carry out its work.

"We need to have good laws for the EPA first and foremost, but then a strong culture of enforcement and adequate resources to do that enforcement.

"We can have the best laws in the world, but if the EPA does not have the capability or the willingness, then companies will get away with environmental crimes."

The laws also give powers for entities to be prosecuted for pollution that occurs outside the ACT but affects the territory's environment.

It also creates an internal review process within the authority, allowing outside parties to seek review of a decision it has made.

The changes came after a review of the Environment Protection Act and mirror laws in other states and territories.