05 August 2005
A challenge to a decision of Federal Environment Minister, Ian Campbell, under the Environment Protection and Biodiversity Conservation Act 1999 ("EPBC Act") was recently commenced by environmental group "Wildlife Preservation Society of Queensland". If the challenge is successful, applications for the development of at least some Australian coal mines will need to consider not only the direct impacts of the coal mine on the environment, but also the environmental impacts resulting from using that coal. For example, applications for development of Australian steaming coal mines may need to consider the greenhouse gas impacts of utilisation of coal from those coal mines.
The Society has applied to the Federal Court for a review of the Minister's decision that the development of the Isaac Plains Coal Project and the Sonoma Coal Project were not "controlled actions" under the EPBC Act and therefore did not trigger the EPBC Act's environmental approval regime. The Society contends that the Minister failed to take into account the indirect impact of the proposed coal mines on matters of national environmental significance. In particular, the Society asserts that downstream electricity generation will produce greenhouse gas emissions from the burning of coal, which in turn contributes to global warming and has adverse impacts on the Great Barrier Reef and protected species.
Although Isaac Plains and Sonoma Coal are purely mining operations and therefore merely produce coal rather than use coal in their operations, the application seems to contend that future usage of the coal in electricity generation will cause an impact on the environment that is indirectly attributable to the mine. This is the first time that a challenge to a decision by the Minister under the EPBC Act has been launched on the grounds of downstream greenhouse gas emissions.
The Society's challenge draws on two 2004 cases; the landmark Minister for the Environment & Heritage v Qld Conservation Council Inc [2004] FCAFC 190 (known as the "Nathan Dam Case") and the Victorian case of Minister for Planning v Australian Conservation Foundation [2004] VCAT 2029.
In the Nathan Dam case, it was found that the use of water downstream from the proposed dam (including its use for growing and ginning cotton and the cumulative and potential impact from downstream irrigation) was part of the "impact" of the action (although indirect) and therefore was required to be considered by the Minister when making a determination under the EPBC Act. It established that the Minister, when assessing "significant impacts", must consider indirect impacts whether or not those impacts are under the developer's control.
The Minister for Planning v Australian Conservation Foundation decision drew on the Nathan Dam finding, deciding that the environmental effects of greenhouse gas emissions caused by the coal use in electricity generation was a relevant matter to be considered under the Victorian law. In the Australian Conservation Foundation case, the proposed mine was being established by a power station to meet its coal supply needs. Therefore the mine and the end user, the power station, were related entities with tied operations. This differs greatly from the Isaac Plains Coal Project and the Sonoma Coal Project operations, where both mines supply coal into the market for consumption by unrelated (and most probably overseas) third parties. There are a number of other distinctions between this case and the situationpresented by the Isaac Plains and Sonoma developments.
Who will this action be relevant to?
The action has far broader consequences than for the two projects in question. The action attempts to extend the reach of the EPBC Act to an indirect greenhouse trigger. It is therefore significant to not only all proposed steaming coal mine projects and coal fired electricity generators, but also to all projects that have potential for greenhouse emissions.
It will also need to be considered before existing projects pursue expansions or amendments of environmental approvals.
Although the proceedings raise novel arguments, until it has been finally determined not all coal and energy projects will need to consider greenhouse emissions. On the current law there needs to be a sufficient nexus between the proposal and the environmental effect. This will depend on the facts of each case.
