In May 2020, with little fanfare, two documents were handed to the Independent Planning Commission – a “Memorandum of Understanding” with the NSW Department of Planning, Industry and Environment, and a “Statement of Expectations” from Mining Minister Stokes.
In the wake of the February 2019 Land and Environment Court’s Rocky Hill decision, an emboldened IPC had begun applying greenhouse gas emission conditions on resource project approvals.
Incensed, Stokes sought to reel the IPC back in, by “clarifying” its role.
The Dendrobium Mine expansion would test whether the IPC had got the message.
Dendrobium expansion
In December 2020, the IPC lent an ear to a bitterly divided community – should South32’s longwall coal mine due to expire in 2030 be extended to 2048, allowing the extraction of coal under two further apportioned special areas of Sydney’s water catchment?
The NSW DPIE recommended approval. Their assessment did not share Water NSW’s concerns about water loss, presented a catastrophic economic scenario if the mine was not approved authored by a carefully selected controversial economist, and was adamant that the compensation and offsets were suitable.
Many local employees of the steelworks and South32 opined for furtherance of the status quo.
Water experts, economists, botanists, engineers, development academics, sociologists, think tanks, and several community groups aerated their grievances at the prospects of approval. Pleas were made that good policy would turn Port Kembla into a green steel making hub by 2030.
What was clear from the submissions, was that the public vested their hope in the IPC, as a body that could shape NSW policy.
Whether these efforts were made in vain hung on two key questions:
1. What weight should be given to the NSW DPIE’s assessment?
2. Could the IPC, in the absence of a plan to carry NSW to net zero by 2050, make a decision that it believed was necessary to achieve it?
The impact of Rocky Hill
Downstream greenhouse-gas emissions (ie emissions that are generated from the burning of coal rather than extraction) are a relevant consideration for the IPC – it is required by a planning instrument, the Mining SEPP.
In April 2019, the Land and Environment Court’s took a bold approach to greenhouse gas emissions reduction in its decision regarding the Rocky Hill coal mine. Although climate change was not the reason the Court rejected the mine, it was a relevant consideration.
Significantly, the Court rejected arguments that the lack of a NSW Government or Federal policy to reach net zero by 2050, a target that NSW had committed to, prevented the Land and Environment Court from making a decision that it saw as important to net zero by 2050.
The Court refused to endorse a blanket refusal of all new coal mines, instead supporting a case-by-case consideration the application’s greenhouse gases and their contribution to global climate change.
United Wambo
In August 2019, in step with the Rocky Hill decision, the IPC approved the United Wambo open-cut coal mine. But affixed to the approval was a condition that the company had to make all reasonable and feasible efforts to ensure the coal was only exported to countries that were a party to the Paris Agreement or deemed to have similar policies by the Secretary of NSW DPIE.
The NSW DPIE wrote to the IPC telling them they overstepped the mark by regulating international trade.
Minister Stokes angrily introduced a Bill to NSW Parliament seeking to remove the requirement in the Mining SEPP to consider downstream greenhouse gases and prohibit the IPC from imposing conditions to the furtherance of such an end. That Bill is currently still awaiting a second reading debate in the Legislative Assembly.
Stokes also instigated an investigation by the Productivity Commission into the IPC.
The Productivity Commission Report
The Productivity Commission (PC) found that the “nature and extent of the IPC’s independence is not entirely clear.”
The PC pointed to the Environmental Planning and Assessment Act (EP &A Act), which set out the IPC’s function but did not constrain it with ‘objectives.’
The PC identified overlap of function at times between the IPC and the NSW DPIE in their assessment functions but pointed out this was permitted by the EPA Act – the IPC was not constrained by the NSW DPIE’s assessments, they could undertake their own.
Whilst acknowledging the importance of the independence of the IPC, the PC recommended that the Minister issue “outcome focused objectives” to the IPC, and to attempt to more explicitly set out the IPC and NSW DPIE’s respective functions and a protocol for the IPC to follow in clarifying with the Minister when questions of policy arise.
The MOU & the Statement of Expectations
The IPC was given a Memorandum of Understanding to sign with the NSW DPIE. This document is relatively benign. It did not explicitly seek to stop the IPC from underwriting the NSW DPIE’s assessments. The wording is vague, with the DPIE vowing to ensure its assessments and advice is sufficient and appropriate so as to avoid duplication. It required that the DPIE’s assessment be the “starting point” for the IPC’s determination, but it did not state that the assessment be determinative. The NSW DPIE would seek to “support” the IPC should it want more assessments to be made.
However, the Statement of Expectations from the Minister was acrimonious. The IPC, it wrote, was expected to make decisions based on policy and informed by the NSW DPIE’s assessment.
The Dendrobium decision
The IPC did not deliver a decision “informed” by the NSW DPIE’s assessment.
Instead, it heard the concerns of Sydney Water, the Independent Panel for Mining, and ecologists. The environmental and economic impact of greenhouse gases were considered, and the catastrophic economic scenario characterised by South32 and the NSW DPIE if the mine was not approved, was rejected.
In one small paragraph of its decision, the IPC delivered a message to Minister Stokes:
“the commission considers it is permitted to take into account the Department’s assessment, but that it should be weighed in the same manner as the other material in this statement of reasons. To the extent that any policy outside of the EP&A Act purports to require the Commission to give the Department’s assessment greater weight than the other material, the commission has not applied that policy.”