Significant reforms to NSW Environment Protection Licences under POEO Act: what licensees need to know

The NSW Environment Protection Authority (EPA) is reforming its licensing system under the Protection of the Environment Operations Act 1997 (NSW) (POEO Act) to increase responsiveness, transparency and community access to environmental information. The reforms are intended to make the licensing system clearer and more user-friendly.

Transitioning from retrospective Annual Returns to near real-time reporting of non-compliances

Under the proposed changes, the current requirement to submit an Annual Return will cease for most licensees and be replaced by near-real time reporting obligations. However, load-based licence (LBL) holders will still need to submit a simplified Annual Return to report LBL data used to calculate the annual fee.

According to the EPA, the change to reporting non-compliances in near-real time is aimed at:

• providing an opportunity for earlier interaction between licensees and the EPA to address issues, drive environmentally responsible behaviour and improve environmental and human health outcomes;

• assisting the EPA to respond early to any increase in risk and to focus resources where they are needed both at a site/operator level and a broader/strategic level; and

• providing more timely information to the community.

Under the near-real time reporting system, licensees will be required to report non-compliances via the EPA's online digital portal eConnect EPA within 14 days of becoming aware of the non-compliance. For each non-compliance, licensees will be required to provide a range of information, including:

• the date the licensee became aware of the non-compliance and the date(s) the non-compliance occurred, including if the non-compliance is continuing;

• whether the non-compliance relates to air, water/land, noise or waste matters (if applicable), and whether the non-compliance relates to a pollution incident; and

• various particulars of the non-compliance, including the location, duration, cause or suspected cause, any mitigation actions taken or proposed to be taken, and any actions taken or proposed to be taken to prevent reoccurrence of the non-compliance. 

After a non-compliance is reported by a licensee, the EPA may contact the licensee for additional information, carry out an inspection, and/or take any other appropriate actions in accordance with its Regulatory Policy. If a non-compliance has not been rectified within 14 days, licensees are still required to report the non-compliance within 14 days of becoming aware of the non-compliance and indicate to the EPA that it is continuing.

While removing the need for annual returns reduces one layer of administrative burden, there is some concern that the new real time reporting will result in duplicative reporting for those licensees that already have to report significant incidents in accordance with the POEO Act. Further, annual returns typically picked up minor or administrative non-compliances connected with reporting or monitoring issues where there was no risk of harm to human health or the environment. There is no materiality threshold for non-compliance reporting even for very trivial matters.

Introducing a new risk-based system to replace Environmental Risk Assessments (ERAs)

The proposed changes to the 5 yearly ERA will focus on the introduction of the new risk-based system that will incorporate more dynamic risk indicators, such as:

• trend changes in monitoring data;

• changes in site operations;

• incidents and non-compliances; and

• inspection outcomes.

The new indicators will assist the EPA to identify changes in risk more effectively, allowing for timely and proactive measures to minimise the potential for environmental harm. The EPA has flagged that inspection frequencies may also change, as they will no longer be tied to static risk factors.

Monitoring data

In the short term, prior to the staged introduction of the EPA’s changes to monitoring data reporting requirements, licensees will need to submit an annual summary of monitoring data (reporting maximum, minimum, and mean values) via the eConnect EPA portal at the end of each licence reporting period.

The EPA’s position is that access to more timely data will enable it to work collaboratively with licensees to identify emerging trends and take proactive steps to minimise potential environmental harm.

In the longer term, near real-time data submission of monitoring data may be required.

The EPA is also exploring a digital system for near real-time monitoring data submission, and a new public-facing platform to improve community access to monitoring information in near real-time.

EPA consultation with stakeholders

The EPA is engaging and consulting with stakeholders to ensure the reforms are practical, well-supported and informed by feedback. We understand that the EPA is currently writing to environment protection licence holders asking them to provide submissions commenting on the proposed reforms to the licensing system.

The EPA has also stated that it will issue a draft notice of licence variation to all licensees explaining the proposed changes to conditions.

Implementation timeline

According to the EPA, these licensing reforms will be introduced in stages from September 2025 to 2028:

• August 2025 onwards: the EPA will be considering any licensee feedback on the proposed draft licence conditions and may undertake further consultation if needed.

• Late 2025: commencement of first licence condition updates, including the shift to near real-time non-compliance reporting, with licensees being required to report any non-compliances via the EPA’s online portal, eConnect EPA, within 14 days of becoming aware of the non-compliance.

• 2025-2028: gradual rollout of a new digital system to collect and analyse monitoring data and public-facing display tools.

Next steps

If you would like any assistance in understanding the proposed reforms to the licensing system or in preparing submissions on the reforms, please do not hesitate to contact us.