diff --git a/compiler/cli/cli-common/src/org/jetbrains/kotlin/cli/common/Properties.kt b/compiler/cli/cli-common/src/org/jetbrains/kotlin/cli/common/Properties.kt
index c9968142efe..0ef60f1ac2d 100644
--- a/compiler/cli/cli-common/src/org/jetbrains/kotlin/cli/common/Properties.kt
+++ b/compiler/cli/cli-common/src/org/jetbrains/kotlin/cli/common/Properties.kt
@@ -33,6 +33,17 @@ enum class CompilerSystemProperties(val property: String, val alwaysDirectAccess
     DAEMON_RMI_SOCKET_BACKLOG_SIZE_PROPERTY("kotlin.daemon.socket.backlog.size"),
     DAEMON_RMI_SOCKET_CONNECT_ATTEMPTS_PROPERTY("kotlin.daemon.socket.connect.attempts"),
     DAEMON_RMI_SOCKET_CONNECT_INTERVAL_PROPERTY("kotlin.daemon.socket.connect.interval"),
+
+    /**
+     * Only specify that property if you want to avoid multiple initializations/disposals of KotlinCoreApplicationEnvironment
+     *
+     * **If not specified**, KotlinCoreApplicationEnvironment **WILL dispose** after all concurrent compilations finish,
+     * and will be re-initialized when starting new compilation
+     *
+     * If specified, KotlinCoreApplicationEnvironment will **NOT dispose** after all concurrent compilations finished
+     * and will be pinned with hard-reference
+     * **THIS LEAKS MEMORY**
+     * */
     KOTLIN_COMPILER_ENVIRONMENT_KEEPALIVE_PROPERTY("kotlin.environment.keepalive"),
     COMPILE_DAEMON_CUSTOM_RUN_FILES_PATH_FOR_TESTS("kotlin.daemon.custom.run.files.path.for.tests"),
     COMPILE_INCREMENTAL_WITH_ARTIFACT_TRANSFORM("kotlin.incremental.useClasspathSnapshot"),
diff --git a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/compiler/KotlinCoreEnvironment.kt b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/compiler/KotlinCoreEnvironment.kt
index b87ad9a4789..9c66efc2c32 100644
--- a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/compiler/KotlinCoreEnvironment.kt
+++ b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/compiler/KotlinCoreEnvironment.kt
@@ -443,9 +443,6 @@ class KotlinCoreEnvironment private constructor(
             val projectEnv = ProjectEnvironment(parentDisposable, appEnv, configuration)
             val environment = KotlinCoreEnvironment(projectEnv, configuration, configFiles)
 
-            synchronized(APPLICATION_LOCK) {
-                ourProjectCount++
-            }
             return environment
         }
 
@@ -453,15 +450,7 @@ class KotlinCoreEnvironment private constructor(
         fun createForProduction(
             projectEnvironment: ProjectEnvironment, configuration: CompilerConfiguration, configFiles: EnvironmentConfigFiles
         ): KotlinCoreEnvironment {
-            val environment = KotlinCoreEnvironment(projectEnvironment, configuration, configFiles)
-
-            if (projectEnvironment.environment == applicationEnvironment) {
-                // accounting for core environment disposing
-                synchronized(APPLICATION_LOCK) {
-                    ourProjectCount++
-                }
-            }
-            return environment
+            return KotlinCoreEnvironment(projectEnvironment, configuration, configFiles)
         }
 
         @TestOnly
@@ -506,14 +495,7 @@ class KotlinCoreEnvironment private constructor(
         ): KotlinCoreApplicationEnvironment {
             synchronized(APPLICATION_LOCK) {
                 if (ourApplicationEnvironment == null) {
-                    val disposable = if (unitTestMode) {
-                        parentDisposable
-                    } else {
-                        // TODO this is a memory leak in the compiler, as this Disposable is not registered and thus is never disposed
-                        // but using parentDisposable as disposable in compiler, causes access to application extension points after
-                        // they was disposed, this needs to be fixed
-                        Disposer.newDisposable("Disposable for the KotlinCoreApplicationEnvironment")
-                    }
+                    val disposable = Disposer.newDisposable("Disposable for the KotlinCoreApplicationEnvironment")
                     ourApplicationEnvironment = createApplicationEnvironment(disposable, configuration, unitTestMode)
                     ourProjectCount = 0
                     Disposer.register(disposable, Disposable {
@@ -522,18 +504,21 @@ class KotlinCoreEnvironment private constructor(
                         }
                     })
                 }
-                // Disposing of the environment is unsafe in production then parallel builds are enabled, but turning it off universally
-                // breaks a lot of tests, therefore it is disabled for production and enabled for tests
-                if (CompilerSystemProperties.KOTLIN_COMPILER_ENVIRONMENT_KEEPALIVE_PROPERTY.value.toBooleanLenient() != true) {
-                    // JPS may run many instances of the compiler in parallel (there's an option for compiling independent modules in parallel in IntelliJ)
-                    // All projects share the same ApplicationEnvironment, and when the last project is disposed, the ApplicationEnvironment is disposed as well
-                    Disposer.register(parentDisposable, Disposable {
-                        synchronized(APPLICATION_LOCK) {
-                            if (--ourProjectCount <= 0) {
-                                disposeApplicationEnvironment()
+                try {
+                    // Do not use this property unless you sure need it, causes Application to MEMORY LEAK
+                    // Only valid use-case is when Application should be cached to avoid
+                    // initialization costs
+                    if (CompilerSystemProperties.KOTLIN_COMPILER_ENVIRONMENT_KEEPALIVE_PROPERTY.value.toBooleanLenient() != true) {
+                        Disposer.register(parentDisposable, Disposable {
+                            synchronized(APPLICATION_LOCK) {
+                                if (--ourProjectCount <= 0) {
+                                    disposeApplicationEnvironment()
+                                }
                             }
-                        }
-                    })
+                        })
+                    }
+                } finally {
+                    ourProjectCount++
                 }
 
                 return ourApplicationEnvironment!!