Coal ash is one of Australia's biggest waste problems and accounts for nearly one-fifth of the entire nation's waste stream.

Key points: Coal ash accounts for 18 per cent of Australia's entire waste stream

Coal ash accounts for 18 per cent of Australia's entire waste stream 44 per cent of coal ash is saved from dumps, and only half of that is used for beneficial purposes

44 per cent of coal ash is saved from dumps, and only half of that is used for beneficial purposes Some people believe the concrete industry is intentionally limiting the use of coal ash as a substitute for cement

Every year Australian coal-fired power stations produce 12 million tonnes of ash from burning coal.

Per capita, that is 500 kilograms a year for every Australian.

The ash is captured in the power station smoke stacks, and most of it is mixed with water to create a sludge which is pumped into large containment dams that continue to grow each day.

"The biggest problem is trying to explain to people how big the problem is," Paul Winn, an environmentalist who has spent years investigating coal ash, said.

"Most ash dams are hidden behind large fences within power stations, and I would say most people in Australia have never seen one. When you do they're very, very stark."

Across Australia the biggest ash dams can be found at Eraring, Vales Point, Liddell and Bayswater in NSW, Gladstone and Millmerran in Queensland and the now-closed Port Augusta in South Australia.

Environmental concern

Coal ash contains high concentrations of heavy metals, which Mr Winn said can pollute surrounding areas, either by controlled releases by the power stations, emergency dam overflows in heavy rain, or through seepage into the soil.

Paul Winn is calling on state governments to encourage more ash recycling. ( ABC News: Ben Millington )

He said most countries line ash dams with a impervious membrane to prevent water leaching into groundwater and nearby waterways, except in Australia.

"Some of the older ash dams in India for example you might find in a similar state to the ones that we have … but most, if not all of the ash dams that we have are unlined," Mr Winn said.

"Therefore all of them would be polluting to some extent."

Mr Winn says the power stations in NSW are permitted to pollute with impunity, with limited monitoring in place, few pollution limits on their environment approval licenses and small pollution.

"There's just no incentive for power stations to do anything with their coal ash except dump it in these toxic dams."

The NSW EPA says all NSW coal-fired power stations are subject to stringent legally enforceable conditions under their environment protection licenses.

Toxic lake legacy

The southern end of Lake Macquarie in NSW is home to two ageing coal-fired power stations which store a combined total of 60 million tonnes of coal ash in dams next to the lake.

Extensive water and sediment sampling has been conducted around the Vales Point and Eraring power stations by the Hunter Community Environment Centre.

It found levels of selenium, zinc, nickel, copper, aluminium, iron, manganese, cadmium and lead in most samples were above healthy environment guidelines set by the Australian and New Zealand Environment and Conservation Council.

"Sediment in the creek receiving the Eraring ash dam overflows was found to have a selenium concentration of 110 parts per million, more than 55 times the level recommended to protect sensitive fish and birds," Mr Winn said.

The NSW EPA warns fishermen not to eat more than three servings of fish from the lake due to high levels of selenium.

But Larissa Schneider from the Australian National University, who did a PhD on tracing pollution in Lake Macquarie, said people should also be worried about the impact on fish and the marine environment.

"High concentrations of selenium cause reproduction impairment, so the fish will stop reproducing and we're going to lose fish species in the lake before we can see any visual effect," Dr Schneider said.

"So at the moment we are not getting people dying or we are not in a catastrophe type of situation, but we are in a position that we should actually be looking at regulations and trying to control this pollution rather than worrying about if the fish will make me sick."

Dr Larissa Schneider from ANU completed her PhD on tracing pollution in Lake Macquarie. ( ABC News: Ben Millington )

The owner of Vales Point power station, Delta Electricity, did not respond to the ABC's questions.

Eraring's owner Origin Energy said it monitors pollution as per its environment license and that a new approach to ash management has helped reduce the potential for pollution to migrate off site.

A concrete solution

Coal ash is not just a waste, but a resource in demand in the construction industry to be used to make concrete.

The fine ash, known as fly ash, can act as a partial substitute to cement, with added benefits.

Eraring Power Station next to Lake Macquarie in NSW covers spans almost 1.5kilometres. ( Supplied: Hunter Community Environment Centre )

"It makes the concrete technically better and reduces the amount of cement that's used in that concrete, and cement is the second largest greenhouse gas contributor," coal ash consultant Ron McLaren said.

But despite the abundance, viability, and applicability of fly ash, its utilisation in Australia is among the worst rates in the world.

Only 44 per cent of fly ash is saved from ash dumps and of that half is recycled into beneficial products like concrete.

By comparison India reuses 61 per cent, China 69 per cent, the UK 70 per cent and Japan 97 per cent. While the global coal ash reuse average is 53 per cent.

Despite significant research, Australia has also failed to develop other reuse industries which are growing overseas, including utilising coal ash to make bricks, construction blocks and lightweight aggregate.

Is big business to blame?

Some experts believe that repurposing fly ash isn't happening on a large scale due to the self interest of a handful of powerful cement manufacturers.

"The industry is now dominated by the cement companies," Mr McLaren said.

"And the cement companies have got other reasons not to utilise fly ash — in other words they make more money from cement based products that from fly ash."

Mr McLaren said the rate of reuse has failed to grow because cement manufacturers have secured contracts with power stations for exclusive access to coal ash.

"They are the bad guys, they have stifled what could have been," he said.

The ABC spoke to numerous sources within the construction industry which supported the essence of Mr McLaren's assertions, but many were fearful to speak out because they rely on the supply of cement.

The Australian Competition and Consumer Commission has investigated the industry in Queensland, and in 2017 Cement Australia was fined $20 million for restricting fly ash supply.

Industry body Cement Concrete and Aggregates Australia (CCAA) says fly ash must meet exacting standards to be suitable for concrete and 90 per cent of what is available is used.

But Mr McLaren refutes that, and says an ash dumping levy on power stations could break their often cosy relationship with cement manufacturers.

"Obviously it would be handy if there was legislation to stop the existing monopoly or duopolies that exist and there could be a levy on fly ash dumping," he said.

"Say a tax of $5 a tonne would focus people's minds on reuse of material and make some marginal enterprises then cost effective.

"There is demand and obviously we're in an infrastructure boom, there's concrete being poured in every capital city in large volumes and there could be more fly ash in all of that concrete."

Crushed by anti-competitive conduct

Maroun Rahme is a Sydney developer and founder of the company Nu-rock which is utilising coal ash to make construction blocks.

"They're 95 per cent coal ash, they're lightweight, they're carbon neutral and they cost a third of the price of other fire rated concrete blocks on the market," Mr Rahme said.

"It's the perfect solution to what is a very big problem because there's a lot of (coal ash) waste on the ground.

Most coal ash dams in Australia have no membrane lining to prevent heavy metals seeping out. ( Supplied: Hunter Community Environment Centre )

"But we haven't been able to break into the market for the last 20 years, because of the cement industry."

Mr Rahme has established a small pilot plant at Mt Piper Power Station in Lithgow NSW to produce blocks for his own development projects.

He said he has plans for large scale plants which could be set up to mine existing ash dams for years to come.

So far he has only had interest from other countries such as Vietnam, which has embarked on a government-led push to reduce ash waste.

"We don't have the legislation from the Government to encourage the power utilities to utilise their waste — their attitude is, 'as long as we can keep dumping it, it's ok'."