New rehabilitation and decommissioning requirements for renewable energy projects in NSW

Until now, unlike mining and other resources projects, there has been no formal regulatory framework in NSW governing the decommissioning of renewable energy projects, the remediation of land following decommissioning, or the financial security underpinning those obligations. Landowners and developers have been left to negotiate these matters privately, often with vastly different expectations around end-of-life risk, restoration standards and decommissioning bond requirements. That is about to change.

The Energy and Other Legislation Amendment (Renewable Energy Infrastructure) Bill 2026, introduced by Mr J H Griffin MP into the Legislative Assembly, proposes amendments to four pieces of legislation to impose significant new obligations for certain solar and wind projects:

• the Electricity Infrastructure Investment Act 2020;

• the Environmental Planning and Assessment Act 1979;

• the Protection of the Environment Operations Act 1997 (POEO Act); and

• the Environmental Planning and Assessment Regulation 2021.

The focus of the reforms is threefold:

1. decommissioning of solar and wind energy infrastructure,

2. remediation of land on which that infrastructure is located, and

3. the provision of financial security to back those obligations.

Which renewable energy developments does the Bill apply to?

The new decommissioning and security conditions under the Environmental Planning and Assessment Regulation apply to development consents for electricity generating works using a solar or wind energy source that are either:

• State significant development (SSD); or

• other electricity generating works permitted with consent under State Environmental Planning Policy (Transport and Infrastructure) 2021, Chapter 2, Part 2.3, Division 4 (Transport Infrastructure SEPP).

The environment protection licensing reforms under the POEO Act apply to the same class of development.

Decommissioning planning

If the Bill is passed, the objects of the Electricity Infrastructure Investment Act 2020 will be expanded to include ensuring that renewable energy infrastructure is decommissioned efficiently and that land on which decommissioned infrastructure was located is appropriately remediated. Under the Bill, remediation is defined as "the restoration or rehabilitation of land to the condition the land was in before the construction or operation of the infrastructure".

The NSW renewable energy sector board will be required to propose amendments to the existing NSW renewable energy sector plan addressing how those decommissioning and remediation objectives will be achieved, following consultation with network operators, affected landholders and relevant community organisations.

Environment protection licences for solar

If passed, the Bill will expand the list of scheduled activities under the POEO Act to include solar electricity works, meaning that an environment protection licence will now be required to carry out state significant solar developments or solar projects requiring development consent under the Transport Infrastructure SEPP.

The Bill will also introduce a new requirement for Ministerial consent prior to the transfer of an environment protection licence relating to solar or wind electricity generating works. The Minister must not consent to a transfer unless satisfied the proposed licensee is a fit and proper person. This amendment brings renewable energy projects into line with other electricity generating, waste and resources projects in NSW.

Decommissioning conditions on development consents (SSD and Transport Infrastructure SEPP only)

The Bill proposes to impose conditions on development consents requiring that, so far as is practicable, when electricity generating works are decommissioned:

• materials used in the development are reused or recycled; and

• the land is restored or rehabilitated to its pre-development condition, including in relation to disturbances to the land and changes to drainage patterns or flows in waterways.

Restoration or rehabilitation works must commence within two years after decommissioning.

Financial security requirements (SSD and Transport Infrastructure SEPP only)

The Bill proposes that security conditions will be included in development consents and developers will be required to provide security to the consent authority before carrying out work under a development consent. The Bill provides two alternative forms of security:

• a cash deposit paid directly to the consent authority; or

• a guarantee from a body regulated by APRA (being the Australian Prudential Regulation Authority) that is satisfactory to the consent authority.

If the cash deposit option is chosen, the Bill provides for payment by instalments: 50% of the assessed security must be deposited before carrying out work (the initial deposit), with the balance deposited in 4 equal instalments at five-year intervals after the initial deposit.

Key points on the amount of the security determined by the consent authority (assessed security) include:

• The assessed security must not exceed 50% of the estimated costs of restoring or rehabilitating the land;

• The consent authority must not take into account any estimated income the developer may receive from the reuse or recycling of materials;

• The consent authority must reassess the security amount every five years; and

• If no claim is made against the security, it must be refunded to the developer.

Key takeaways and actions to consider

The proposed reforms signal a clear direction for end-of-life obligations across the NSW renewable energy sector. While the proposed amendments to planning law currently refer to "electricity generation works", it is not clear whether the changes to the environmental licensing regime are similarly constrained or are also intended to capture "electricity storage works" such as battery energy storage projects.

Developers of in-scope SSD and Transport Infrastructure SEPP solar and wind projects should:

• review existing development consents and assess whether any proposed modifications post-commencement would enliven the new decommissioning conditions;

• begin considering the form of financial security most appropriate for their project; and

• factor land restoration and rehabilitation obligations into their decommissioning planning.

Operators of in-scope solar energy projects should:

• assess whether an environment protection licence will be required and take steps to obtain one before 1 July 2026; and

• ensure that any proposed licence transfers obtain prior Ministerial consent.

Please contact us if you would like to discuss how this Bill may affect your projects.