Introduction
Litigation focusing on climate change has now firmly emerged in Australia. Below is a summary of the four recent proceedings of particular importance.
What is clear from these proceedings is that approval authorities in Australia will increasingly be required to have regard to principles of ecologically sustainable development when assessing proposals for major projects, including mining projects. These principles necessarily include an assessment of indirect environmental impacts, such as the greenhouse gas emissions, resulting from downstream activities.
A proponent must therefore be aware of the possibility of legal challenge to a proposal on grounds of inadequate assessment of downstream impacts of the proposal, including greenhouse gas emissions.
The four recent proceedings are:
- Wildlife Preservation Society of Queensland Proserpine/Whitsunday Branch Inc v Minister for Environment & Heritage [2006] FCA 736, a decision of the the Federal Court (in Queensland) on 15 June 2006 (Isaac Plains and Sonoma Coal Mines case)
- Gray v The Minister for Planning [2006] NSWLEC 720, a decision of the New South Wales Land and Environment Court on 27 November 2006 (Gray’s case)
- Taralga Landscape Guardians Inc v Minister for Planning and RES Southern Cross Pty Ltd [2007] NSWLEC 59, a decision of the NSW Land and Environment Court on 12 February 2006 (Taralga case), and
- Xstrata Coal Queensland Pty Ltd v Queensland Conservation Council [2006] AML 207/2006 ENO 208/2006, a decision of the Queensland Land and Resources Tribunal on 15 February 2007 (Xstrata case).
In this case, the Wildlife Preservation Society of Queensland (Proserpine/Whitsunday Branch) (society) proceeded against the Federal Minister for Environment & Heritage. The case concerned the proposed Isaac Plains and Sonoma Coal Mines. The society argued that downstream carbon emissions from coal from the proposed mines rendered the mining proposal a ‘controlled action’ under the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act). The minister had decided that the mining proposal was not a ‘controlled action’ because it was ‘not likely’ to have a significant impact on the environmental matters protected under the EPBC Act (protected matters). The society applied for a review of this decision.
The court rejected the society’s application. The court found the thrust of the society’s argument was that ‘likely’, where used in relevant provisions of the EPBC Act, meant ‘possible’ and that the minister should have declared the proposal to be a ‘controlled action’ because of the ‘possibility’ of adverse environmental effects from the coal proposed to be mined. The court rejected this argument, affirming that there must be at least a ‘likely’ significant impact. The court accepted the minister’s conclusion that the possibility of increased concentration of greenhouse gases in the atmosphere resulting from the proposed mines was speculative and merely theoretically possible. There was no suggestion that the mining of coal pursuant to the proposals would increase the amount of coal burnt in any particular year and, if there were any increased emissions, the additional impact on protected matters would be insignificant.
These implications came to the fore in Gray’s case. The Isaac Plains and Sonoma Coal Mines case was referred to in argument in Gray’s case but was rejected by the Land and Environment Court as not relevant to the particular issue before it, namely, the scope of the environmental impact assessment procedures in New South Wales under Part 3A of the Environmental Planning and Assessment Act 1979 (EPA Act) (which regulates ‘major projects’ in New South Wales).
The proceedings concerned the application made by Centennial Hunter Pty Limited (Centennial) for project approval to construct and operate an open cut coal mine with a production capacity of 105 million tons per annum and an estimated operational life span of 21 years at Anvil Hill in the Hunter Valley (Anvil Hill Project) under Part 3A of the EPA Act. As contemplated by the procedures in that Part, the Director-General of the Department of Planning (D-G) issued environmental assessment requirements (EARs) for the Anvil Hill Project, an environmental assessment addressing those requirements (EA) was prepared and submitted to the D-G, and the D-G formed the view that the EA addressed the EARs. Mr Gray, a law student, brought proceedings under the open standing provisions of the EPA Act seeking a declaration that the D-G’s view (namely: that the EA addressed the EARs) was void and without effect as the EA did not include an assessment of the indirect greenhouse gas emissions which will result from the burning of the coal intended to be recovered from the Anvil Hill mine.
Centennial having lodged an application for approval under Part 3A of the EPA Act for the Anvil Hill Project, section 75F of the EP&A Act required the D-G to notify Centennial of the EARs for the Anvil Hill Project. The EARs included a requirement that ‘air quality—including a detailed greenhouse gas assessment’ be assessed. The EA prepared by Centennial included a greenhouse gas and energy assessment but this assessment did not include an assessment of the indirect greenhouse gas emissions which will result from the burning of the coal intended to be recovered from the Anvil Hill mine (referred to as ‘scope 3 emissions’). Section 75H of the EPA Act allows the D-G to either require a proponent to resubmit an amended EA which adequately addresses the EARs or, to accept the EA submitted and to place it on public exhibition. After receiving Centennial’s EA, the D-G wrote to Centennial advising that the EA submitted adequately addresses the EARs and subsequently placed the EA on exhibition. A number of the submissions received during the exhibition period related to the issue of the ‘scope 3 emissions’ and subsequently Centennial provided further information to the D-G addressing this issue but this information was not collated into a revised environmental assessment report nor was it made publicly available.
The court held that Part 3A of the EPA Act only authorises the D-G to place an EA on public exhibition if, in the D-G’s view, it adequately addresses the EARs issued by the DG. The court held that, while it was not empowered to review the merits of the decision of the D-G in this regard, it was able to apply ordinary principles of administrative law including the requirement that decision-makers take into account relevant considerations. The court went on to hold that ‘environment assessment’ (as required by Part 3A of the EPA Act) extends to require a proponent to consider impacts which have a ‘real and sufficient link’ to the proposed project, including indirect impacts, unless they are ‘not likely to occur’ or the contrary is made clear in the environmental assessment requirements issued by the D-G. The court held that:
… there is a sufficiently proximate link between the mining of a very substantial reserve of thermal coal in NSW, the only purpose of which is for use as fuel in power stations, and the emission of GHG which contribute to climate change/global warming, which is impacting now and likely to continue to do so on the Australian and consequently NSW environment, to require assessment of that GHG contribution of the coal when burnt in an environmental assessment under Pt 3A.
Further, the court held that, in determining whether an environmental assessment under Part 3A of the EPA Act adequately addresses the environmental assessment requirements, the D-G was required to have regard to the principle of ecologically sustainable development, in particular, the precautionary principle and the principle of intergeneration equity.
Accordingly, her Honour found that the D-G’s decision was invalidly made, as failing to take into account relevant considerations, and made a declaration that ‘the view formed by the D-G on 23 August 2006 that the environmental assessment lodged by [Centennial] in respect of the Anvil Hill Project adequately addressed the D-G’s requirements is void and without effect’.
The impact of the court’s decision should not be overstated. The judgment will not operate to prevent the minister from ultimately approving the Anvil Hill Project. It merely makes clear that all decision makers under Part 3A of the EPA Act must take into account the principles of ecologically sustainable development in reaching their decisions. The judgment also provides a strong indication that, in the case of a coal mine, this will require an assessment of indirect environmental impacts such as the greenhouse gas emissions resulting from the burning of coal.
It is important to note that the principles of ecologically sustainable development form part of a much broader suite of relevant considerations to be taken into account, and will not necessarily outweigh these broader considerations. Indeed, the court specifically noted that ecologically sustainable development principles do not require greenhouse gas issues to override all other considerations.
In short, a decision maker under Part 3A of the EPA Act (whether in relation to a mine or otherwise) must take into account the principles of ecologically sustainable development (including greenhouse gas issues) in reaching their decision under that Part of the EPA Act. A proponent of a major project must therefore be prepared to have a project assessed on this basis in order to avoid costs and delays associated with resisting a legal challenge akin to Gray’s case.
The proceedings in the Taralga case concerned a windfarm at Taralga, about 140km south-west of Sydney. The court approved the proposed development, notwithstanding objections on grounds of impacts on flora, fauna and visual amenity, and on grounds of noise impacts.
The principal ground of approval was the overriding public interest in renewable energy development. The court concluded that this public interest outweighed any private disadvantages to the Taralga community or specific landowners. The court held that the full original scope of the windfarm should be permitted and that the minister’s condition requiring deletion of seven turbines should be removed.
On 10 November 2004, the proponent RES Southern Cross lodged a development application (DA) with Upper Lachlan Shire Council. The minister directed the DA to be referred to him for determination under (the now repealed) section 88A of the EPA Act. The DA proposed the constructions and operation of 69 wind turbines each with a 65m tower; an electrical substation and control building; underground electrical cables; two overhead power poles; a TV re-transmitter tower; and a network of access tracks. The DA was exhibited and a total of 228 submissions and two petitions were received in response. Of the submissions from the public and special interest groups, 165 objected to the proposal, 30 supported it and 23 raised concerns but did not state a clear position. One petition was in favour (with 168 signatures) and one opposed (with 113 signatures). On 17 January 2006, the minister approved the application subject to a broad range of conditions of consent, including the removal of two rows of turbines due to what the minister considered to be unacceptable visual amenity impacts.
The court considered the broader policy framework in relation to climate change, the energy industry, sustainable development and renewable energy. Regarding climate change, his Honour referred (at [69]) to the Intergovernmental Panel on Climate Change (IPCC)’s recent report Climate Change 2007: The Physical Science Basis (2007 IPCC report) which attributes marked increases in global atmospheric concentrations of carbon dioxide primarily to fossil fuel use and land-use change. The court appeared to adopt the 2007 IPCC report as authority for the conclusion that ‘global atmospheric concentrations of carbon dioxide, methane and nitrous oxide have increased markedly as a result of human activities since 1750 and now far exceed pre-industrial values’, and for the attribution of these chan ges ‘primarily to fossil fuel use and land-use change [and] agriculture’. The court noted (at [72]) that the energy industry is by far the largest contributor to greenhouse gas (GHG) emissions and acknowledged the difficulty in dealing with the implications of climate change while continuing to meet the needs of growing populations. The court also referred to intergenerational equity and said (at [74]) that the attainment of it in the production of energy involves, inter alia, substituting energy sources that result in less GHG emissions for those that result in more GHG emissions. Finally, the court pointed out (at [75]) that renewable energy sources are an important method of reducing GHG emissions and (at [79]) that wind energy involves the emission of almost zero GHG’s after construction of the wind turbines.
Against this policy framework, the court concluded (at [352]) that the overall public benefits of the development outweighed any private disadvantages either to the Taralga community or specific landowners. The court held that the full original scope of the windfarm should be permitted and the minister’s condition requiring the removal of two rows of turbines should be deleted.
The court acknowledged (at [116]) that the ‘insertion of windfarms into a rural landscape involves interrupting the rural and natural cohesion of that landscape’. The court conceded that the proposal would create a change to the village’s outlook but decided (at [146]) that, on balance, ‘there is a significant public interest … in adoption of alternative, more environmentally friendly, energy generation sources’ and (at [147]) ‘the broader public interest must outweigh this impact’.
The court stated that the development was not likely to comply with the prescribed noise limits at a nearby property (the Ross property). The court said (at [244]) that this, when coupled with the severe visual impact of the proposal on that property, ‘renders these impacts unacceptable’. The court therefore imposed a condition of consent giving the Rosses the option of requiring the proponent to purchase their property. In other words, this purchase option, rather than refusal, was held to be a sufficient response, in the context of the policy framework and the development’s overall public benefits.
The court imposed conditions of consent requiring further survey work to be undertaken to determine whether threatened native orchid and grassland species exist on the land to be disturbed by the windfarm. If either is found to occur, it is to be relocated and the area containing either species is to be fenced off during construction.
The court held that the proposed development is likely to have an impact on Wedge-tailed Eagles living in the locality. With the imposition of appropriate amelioration measures the likely mortality rate would be about three birds per year. The court held (at [270]) that an appropriate (albeit arbitrary) response would be to require by condition of consent a compensatory payment to the New South Wales Wildlife Information and Rescue Service of $1,500 per eagle death, which adopts a ‘polluter pays’ principle to environmental harm.
In its decision delivered on 15 February 2007, the Queensland Land and Resources Tribunal took a different policy approach to the one taken by the Land and Environment Court in the Taralga case.
Argument in the Xstrata case was heard on 31 January 2007. Both the Isaac Plains and Sonoma Coal Mines case and Gray’s case were referred to in argument. The Taralga case was not referred to in argument as the case had note been decided at the time.
On 7 November 2006, the Queensland Conservation Council (QCC) and the Mackay Conservation Group (MCG) lodged objections under the Mineral Resources Act 1989 (Qld) (MR Act) and Environmental Protection Act 1994 (Qld) (EP Act) to an application by Xstrata Coal Queensland Pty Ltd (Xstrata) for a mining lease and an environmental authority for the proposed Newlands Mine expansion. The main ground of objection was that, pursuant to the considerations listed in section 269(4)(j)–(l) of the MR Act and section 223 of the EP Act, the proposed expansion will cause adverse environmental impacts unless conditions are imposed to avoid, reduce or offset the emissions of greenhouse gases that are likely to result from the mining, transport and use of the coal from the mine.
The main issues which fell for consideration in the proceedings included:
- whether the transport and use of coal comes within the definition of ‘mining operation’/‘mining activity’ for the purposes of the MR Act and the EP Act
- whether the possible contribution to global warming from burning coal constitutes an adverse environmental impact for the purposes of the MR Act and the EP Act, and
- depending on resolution of the above two issues, whether conditions of the type sought by the objectors could be effectively imposed on a leaseholder.
Commentary — Early lessons to be learned
Despite the differences of approach in the courts and tribunals involved in the cases mentioned above, they nonetheless highlight the need for proponents of projects to be aware of the legal implications for the projects of their direct or indirect carbon emissions.
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