Victoria urgently needs more disposal facilities for dangerous and toxic waste, according to a new report on a spate of toxic factory fires in the state.
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A perception of a "lax system of enforcement" by responsible agencies has also been blamed for encouraging the illegal stockpiling of chemicals.
The Victorian parliament is investigating the state's recycling and waste management, publishing an interim report on Tuesday focused on three big fires at industrial sites sparked in part by waste issues.
Two of the fires, in Coolaroo in 2017 and Campbellfield in 2018, were linked to the over-stocking of recyclable and chemical waste.
The third, at West Footscray in 2018, was related to the illegal stockpiling of industrial and chemical waste.
The inquiry heard illegal stockpiling was likely caused by a perception of a lax system of enforcement and penalties regarding chemical waste storage.
WorkSafe, which is leading efforts to dispose of such waste, said there is also insufficient capacity in the state to get rid of it.
The agency told the inquiry there has been up to 25 million litres of illegally dumped chemical waste discovered at thirteen industrial sits in Epping, Campbellfield and Craigieburn alone.
The report comes as the Victorian government announced up to 10 years jail and fines of $6.4 million for chemical stockpiling and threw a lifeline to the receivers of the state's largest recycling processor.
SKM recently collapsed owing more than $100 million to creditors, after a series of factory fires and government shutdowns because of safety risks.
The Andrews government will loan $10 million to the company's receivers KordaMentha to help pay for repairs and maintenance on machines at four sorting sites in an effort to prevent the refuse going to landfill.
A site at Laverton is expected to return to operation within five weeks, with the other sites at Coolaroo, Hallam and Geelong to follow.
"The priority is to clear those sites of the existing stockpiles and test the machinery to ensure that it is able to receive materials from outside of those sites," Energy Minister Lily D'Ambrosio told reporters on Tuesday.
A spokesman for KordaMentha says the government's loan will help "get things moving again".
"We've just got to find out what we can do as quickly as we can to try and break the deadlock," they told AAP.
Ms D'Ambrosio said whoever buys the recycling processor will have to pay back the loan, but would not say whether they would have to pay interest.
The state government and local councils are also looking to trial increasing the number of recycling bins for household waste so there is less contamination, which happens in the current co-mingled system.
The Municipal Association of Victoria says the loan will help resolve the state's immediate recycling crisis and some councils were already trialling a fourth bin for glass.
Australian Associated Press
