The appetite of State Governments in Australia to change the regulatory regime controlling the development of wind farms is well known to the wind industry sector. For example, in 2011 the Victorian Government introduced broad and more stringent controls for wind farm facilities. In 2012 the NSW Government is considering adopting similarly stringent controls in the as yet to be finalised ‘NSW Planning Guidelines: Wind Farms’.  

While the concept of regulatory change may not be new, the two recent Victorian decisions of Bald Hills Wind Farm Pty Ltd [2012] VCAT 1092 (Bald Hills) and Sisters Wind Farm Pty Ltd v Moyne Shire Council & Ors [2012] VSC 324 (Sisters) highlight some of the risks that can arise from regulatory change for developers of wind farm projects.

Sisters Wind Farm

In Sisters the Supreme Court of Victoria held that the Victorian Civil and Administrative Tribunal (Tribunal) must determine the developer’s application for a wind farm in accordance with the law as at the date of the Tribunal’s decision. This means that the Tribunal is required to assess the wind farm project against the more stringent noise controls in New Zealand Standard NZ 6808:2010, ‘Acoustics – Wind Farm Noise (2010 Noise Standard)’ rather than more lenient noise controls that applied as at the date the Council refused the developer’s application or the date the developer lodged the merit appeal to the Tribunal.

By way of background the proponent, Sisters Wind Farm Pty Ltd, had originally applied to Moyne Shire Council in December 2008 for a planning permit to construct and operate a 30MW wind farm between Mortlake and Terang in rural Victoria.

At the time of the application, the Moyne Planning Scheme required the noise impacts of the proposal to be assessed in accordance with New Zealand Standard NZ 6808:1998 ‘Acoustics – the Assessment and Measurement of Sound from Wind Turbine Generators (1998 Noise Standard).

The Council refused the permit application on a number of merit grounds. The proponent subsequently applied to the Tribunal to review the Council’s decision.

In April 2010 the Tribunal held that no permit should be granted based on its finding in relation to noise impacts of the proposal on sensitive receptors. At the time of the Tribunal’s decision, the Moyne Planning Scheme required the Tribunal to apply the 1998 Noise Standard, however in error the Tribunal applied a new and more onerous noise standard, being the 2010 Noise Standard.

The proponent subsequently appealed to the Supreme Court of Victoria. By this stage, the parties had agreed that the Tribunal made an error in applying the 2010 Noise Standard. In December 2010 the Supreme Court made orders by consent remitting the proceedings to the Tribunal to be decided again in accordance with law.

In March 2011 Moyne Planning Scheme was amended to replace the 1998 Noise Standard with the 2010 Noise Standard. A dispute arose between the parties as to which version of the Moyne Planning Scheme (and hence which Noise Standard) would apply for the purposes of the remitted hearing.

Both the Tribunal (at a preliminary hearing), and the Supreme Court of Victoria on appeal, held that the Tribunal is required to determine the application in accordance with the law as at the date of the new hearing. Justice Emerson acknowledged, however, that ‘This result may seem harsh for the appellant, which has been deprived of the opportunity to have its application for a planning permit determined by reference to the more lenient 1998 Standard through an error by the Tribunal in its first decision that was apparently brought about by incorrect submissions as to the applicable Standard made by the Council.’

Bald Hills Wind Farm

In Bald Hills, the Tribunal held that the endorsement of development plans under a development consent is not an opportunity for the Minister to have ‘second thoughts’ in relation to the approved project and seek to apply more stringent noise controls. Further that the Minister had failed to make a decision in respect of the development plans within a reasonable period of time (approximately 2 months). The Tribunal subsequently stepped into the shoes of the Minister and approved the development plans. This allowed the developer the opportunity to commence the development prior to the permit lapsing on 19 August 2012. If the permit had lapsed, then changes to the planning controls in Victoria (such as the 2010 Noise Standard referred to above) would have precluded the developer from obtaining approval for the current wind farm design. 

By way of background, the developer, Bald Hills Wind Farm Pty Ltd, obtained a planning permit to construct and operate the Bald Hills Wind Farm on 19 August 2004.

The permit was due to expire if the development was not started by 19 August 2012. The permit required certain plans to be approved to the satisfaction of the Minister for Planning before the development could lawfully commence.

The imperative faced by the proponent was that since the permit was granted, planning controls for wind farms in Victoria had changed (see Planning Scheme Amendment VC78 and Planning Scheme Amendment VC82). The changes to the planning controls imposed more stringent controls on wind farms (such as the 2010 Noise Standard referred to below) with the effect that the wind farm currently approved under the permit could not now be approved if the proponent was required to lodge a new application.

The proponent had lodged all the required plans with the Minister, however the Minister had failed to approve the plans. The proponent subsequently commenced proceedings in the Tribunal under section 149(1)(d) of the Planning and Environment Act 1987 (Vic) to review the failure of the Minister to make a decision to approve the development plans within a reasonable time after they were referred to him.

The Tribunal observed that what constitutes ‘a reasonable time’ is a matter of fact to be determined having regard to the specific facts and circumstances of each case. Relevant factors include, amongst others, the type of approval, the history of the matter, the complexity and the implications of delay in decision making.

The Tribunal went on to hold that ‘the Minister, as a responsible authority, has a duty to be fair. We do not consider it would be fair or reasonable in the circumstances of this case for the Minister to delay making a decision about whether to approve the development plans under the permit for so long as to render futile the applicant’s ability to comply with the permit and commence development before 19 August 2012.’

A key issue considered by the Tribunal was whether the approval of development plans was another opportunity for the consent authority to assess the potential impacts of the wind farm (such as noise impacts). In this regard the Tribunal concluded that ‘once granted, it is fundamental to the integrity of the planning system that a permit can be relied upon to provide certainty to the permit holder that they can proceed with the development authorised by the permit, subject to complying with conditions.