Snapshot

  • The NSW Court of Appeal (NSWCA) has dismissed an appeal from a decision of the Land and Environment Court of NSW (LEC) brought by KEPCO Bylong Australia Pty Ltd (KEPCO).
  • The appeal (and earlier judicial review proceedings) primarily concerned the application and construction of the State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 (the Mining SEPP).
  • Both judgments make important contributions to the growing body of jurisprudence in the area of climate change-related litigation and affirm the broad discretion of planning authorities in assessing climate change impacts.

Key takeaways

  • The NSW Independent Planning Commission (IPC) has a broad discretion to determine what constitutes an “applicable” policy, procedure or guideline for the purpose of considering assessments of the impacts of greenhouse gas emissions.
  • The IPC is entitled to consider the NSW Climate Change Policy Framework (NSW CCPF) for the purposes of “applicable” state policies under the Mining SEPP when having regard to scope 3 emissions.
  • It is unclear whether the Paris Climate Change Agreement 2015, outside of the NSW CCPF, could potentially be an applicable instrument when assessing scope 3 emissions.
  • It remains to be seen whether Preston CJ of LEC’s suggestion that the criterion for determining applicability by the consent authority is subjective, having regard to the relevant facts and circumstances, will be adopted in future planning decisions.
  • The IPC’s discretion has the potential to be extended considerably if Preston CJ of LEC’s finding is endorsed. The ability to seek review of the IPC’s decision regarding the applicability of a policy would also be significantly confined.
  • The decision builds upon the existing body of cases in which coal mines have been refused due to adverse effects from emissions (e.g. Gloucester Resources Limited v Minister for Planning [2019] NSWLEC 7).

Background

1. On 18 September 2019, the IPC refused to grant consent to KEPCO’s application for the development of a coal mine in the Bylong Valley in New South Wales. Read our post summarising the IPC’s statement of reasons and key takeaways for proponents of State significant mining projects in NSW here.

2. KEPCO sought judicial review of the IPC’s decision in the LEC. Bylong Valley Protection Alliance Inc was subsequently joined as a party to those proceedings on public interest grounds (read our post on this here). On 18 December 2020, the LEC dismissed the judicial review proceedings. On 14 September 2021, the NSWCA dismissed KEPCO’s appeal from those proceedings.

LEC decision

3. Eight grounds of review were raised in the judicial review proceedings. Six of these concerned the IPC’s construction or application of particular clauses of the Mining SEPP and the remaining two took issue with the IPC’s findings on the basis of insufficient evidence.

4. KEPCO was unsuccessful on all eight grounds of review. The LEC’s decision to uphold the IPC’s statement of reasons is in itself significant, particularly in light of the IPC’s endorsement of Preston CJ of LEC’s reasoning in Gloucester that the consent authority for a development should consider the cumulative greenhouse house gas emissions of the development. However, our summary below focusses on the reasoning of Pain J in the LEC in relation to the key ground of review concerning climate change issues.

Were the NSW CCPF and the Paris Agreement “applicable” policies? (Ground 3)

5. Under cl 14(2) of the Mining SEPP, the IPC was required to consider an assessment of the greenhouse gas emissions (including downstream emissions) of the development. In the course of doing so, it needed to have regard to any applicable State or national policies, programs or guidelines concerning greenhouse gas emissions.

6. KEPCO submitted that there were errors with the IPC’s reasoning regarding:

  1. its consideration of an “assessment” of greenhouse gas emissions; and
  2. what in fact constituted an “applicable” policy, program or guideline.

7. On the first issue, KEPCO submitted that, in determining whether to grant development consent, the IPC wrongly considered greenhouse gas emissions generally rather than an assessment of those issues, as cl 14(2) required. Pain J rejected this argument, finding that KEPCO focussed on one sentence in the IPC’s statement of reasons alluding to this and that a fair reading suggested that the IPC correctly understood its task.

8. On the second issue, KEPCO submitted that the IPC wrongly found the Paris Agreement and NSW CCPF to be “applicable” policies. Pain J also rejected this argument, on the basis that:

  1. the Paris Agreement, while referred to in the context of other materials considered by the IPC, had not in fact been relied on by it as an applicable policy; and
  2. the NSW CCPF was indeed “applicable” in the context of considering the impact of the project’s scope 3 emissions.

9. Pain J pointed to a number of factors in support of the view that the NSW CCPF was “applicable” – chief among them being that, as a matter of statutory construction, an “applicable” policy, program or guideline could capture a broad range of documents. In light of this statutory context and the IPC’s functions as a consent authority, Pain J held that the IPC has a broad discretion to determine “applicable” materials.

NSWCA decision

10. There were five grounds to KEPCO’s appeal, each of which were dismissed. Relevantly, one of them concerned whether the IPC and Pain J in the LEC erred in finding that the NSW CCPF was “applicable” for the purpose of cl 14(2) of the Mining SEPP.

11. Basten and Payne JJA held that the NSW CCPF was “applicable”, primarily on statutory construction grounds. Preston CJ of LEC agreed. His Honour’s judgment contains some important points on the breadth of this provision and discretion of the IPC:

  1. Given the consideration of an assessment of downstream or scope 3 emissions (as required under cl 14(2) of the Mining SEPP) is in its nature a wide task, the class of policies which might be “applicable” is enlarged.
  2. Whether or not a policy is “applicable” is a matter to be determined subjectively by the consent authority, having regard to the facts and circumstances of the development (although it is unclear the extent to which Basten and Payne JJA accepted this finding).