A plan to build a controversial waste incinerator in Sydney's west has been knocked back but there are fears a new application could be made unless the state's environmental laws are strengthened.

The NSW Independent Planning Commission on Thursday rejected the proposal for the facility which would have burnt up to 1.3 million tonnes of waste per year in Eastern Creek.

“There is sufficient uncertainty around the project’s impacts on air quality, water quality and human health, that means the project is not in the public interest,” the commission said in a statement on Thursday.

The plant was to operate 24/7 and could have generated enough electricity for 100,000 homes.

It had previously been knocked back by the NSW government amid a community outcry. The proposal received 949 public objections including from two local councils.

The planning commission on Thursday said there was “insufficient evidence” the facility’s pollution control technologies were capable of appropriately managing the emissions it would have created.

Blacktown City Council says it’s been a “long saga” for western Sydney residents.

Mayor Stephen Bali remains concerned the company behind the project, Next Generation, could lodge a new amended development application and hence wants the state government to introduce “much stricter” environmental laws.

The NSW opposition argues it’s taken the coalition “far too long” to reject the proposal but believes communities in western Sydney can now breathe a sigh of relief.

“The government should never have allowed this incinerator proposal to reach this stage, especially when their own agencies, the NSW Environment Protection Authority and NSW Health, objected to it,” opposition spokeswoman Penny Sharpe said in a statement on Thursday.

Community group No Incinerator for Western Sydney said it was a “huge win” for the community and Sydney’s air quality.

Next Generation can appeal the commission’s decision in the Land and Environment Court. The company has been contacted for comment.

By Dominica Sanda