The EPA issued the fine after it alleged the company was sorting and storing bottles and cans at a Beresfield site when it was unlicensed to accept that type of waste.

The company may pay the penalty notice, seek a review, or choose to have the matter determined by a court.

Investigations have found the company received over 15,000 tonnes of waste at the Beresfield site between 1 November 2018 and 31 October 2019.

Cleanaway stopped receiving the waste after action was taken by the EPA and began taking it to a site at Kooragang Island.

"Cleanaway holds over 30 environment protection licences for waste related activities in NSW and should be aware of the process to lawfully process and store waste in NSW," EPA Director Regulatory Operations Metro North Adam Gilligan said.

"Investigations found that waste was being stored without proper controls near a stormwater drain, increasing the risk of pollution and environmental harm.

"The NSW Container Deposit Scheme is designed to remove litter from the environment, and it is important that the environment remains protected throughout the entire process," Mr Gilligan said.

Penalty notices as one of a number of tools the EPA uses to achieve environmental compliance.

Other tools include official cautions, notices and directions and prosecutions, licence conditions and formal warnings.

More compliance details at epa.nsw.gov.au/legislation/prosguid.htm