19 October 2018

Head north for change – new Northern Territory environmental reforms

This article was written by Matthew Austin.

The Northern Territory Government has further advanced its overhaul of the current Northern Territory environmental regulatory system with the public release of the draft Environment Protection Bill 2019 (draft EP Bill) and Environment Protection Regulation (draft EP Regulation) for consultation until December 2018.

The draft EP Bill and Regulation represent Stage One of the Government’s environmental assessment and regulation reform to replace the existing Environmental Assessment Act 1982 and Environmental Assessment Administrative Procedures and broadening regulatory powers generally.

Key proposals include the introduction of a new environmental impact statement (EIS) and environmental approval (EA) framework, environmental bonds and levies, compliance and enforcement measures and expanded avenues to appeal decisions made during and after a project’s environmental assessment.

Stage 2 of the Northern Territory’s environmental reforms will focus on the management of waste and pollution, native vegetation clearing, contaminated land management and the impacts of mining activities on the environment. Development of the Stage 2 reforms has commenced and is anticipated to enter public consultation in 2019.

Reform of Environmental Assessment and Approval

The draft EP Bill and Regulation seek to introduce a comprehensive regime for environmental assessment and approvals together with compliance and enforcement mechanisms consistent with environmental protection laws in other Australian jurisdictions. This is to be achieved through the introduction of a new environmental approval framework that will regulate activities likely to have a significant impact on the environment.

Under the new assessment regime, a project proponent will be required to refer a project to the Northern Territory EPA if a referral or approval trigger is met. If the Northern Territory EPA believes a proponent is taking an action that should have been referred, the EPA can issue a written call-in notice requesting the proponent refer the action for assessment. Failure comply with a call-in notice will be an offence.

Once a referral is received the Northern Territory EPA will conduct a preliminary review of the project to determine whether the project will have a ‘significant environmental impact’ – an impact of major environmental consequence having regard to the context and intensity of the activity.

If the referral is accepted the EPA will open the referral to public consultation and provide the referral to the relevant government agencies for comment. Assessment of the referral may be performed on the referral information or the applicant may be required to provide a supplementary environmental report or an EIS for the project. Projects considered to pose a high risk of a significant environmental impact may be assessed by way of public inquiry. Following assessment the EPA will provide a recommendation to the Minister of the Department of Environment and Natural Resources to grant or refuse an EA for the project.

The proposed EA will not replace any other project approvals required under separate legislation and will set conditions for project operations similar to the EA schemes in place in other Australian jurisdictions.

Financial Bonds, Levies and Assurances

The Northern Territory Government has also proposed a suite of financial measures aimed to minimise the Government’s exposure to rehabilitation costs and to promote responsible environmental management.

Under the draft EP Bill the Minister may require a project operator to pay a bond as an EA condition to ensure the project operator is responsible for the cost of rehabilitating any environmental damage caused. The value of an environment protection bond is determined according to the environmental risks and impacts of the proposed actions and the level of uncertainty in assessing those risks and impacts. The Minister may accept bonds in the form of cash or bank guarantee.

The draft EP Bill also proposes the introduction of an environment protection levy framework to act in addition to the environment protection bond scheme. The levy charged will fund environmental emergency, rehabilitation and research activities undertaken by the Northern Territory Government. Contributions made under the levy scheme are to be placed in an environment protection fund and are non-refundable. The class of persons liable to pay the levy and the amount to be paid are yet to be finalised.

A further non-refundable financial assurance may be required by the Minister as part of an application for a closure certificate. The assurance will address any potential future liabilities and remediation costs that may arise following completion of the rehabilitation and remediation activities required by a project EA.

Compliance and Enforcement

Complementing the new assessment and approval regime are a range of compliance and enforcement measures that could be pursued to ensure an EA holder is acting in compliance with conditions provided in their EA. Key compliance measures provided for in the draft EP Bill are:

  • Environmental protection notices;
  • Stop work notices;
  • A duty to notify of environmental incidents; and
  • Project environmental audits.

Project operators that have completed a project may also be issued with a closure notice under the draft EP Bill, requiring the person to undertake continued monitoring and management action at the project site.

The draft EP Bill proposes a range of offences to ensure compliance by EA holders. In addition, the draft EP Bill provides for enforcement measures including an enforceable undertaking to rehabilitate environmental harm.

The draft EP Bill also sets out a series of principles to be considered when imposing a penalty for an environmental offence. This includes the benefit obtained or likely obtained by the offender, the extent of environmental harm caused and whether there is a need to deter cumulative impacts of the conduct by the offender.

New Avenues of Appeal

A common theme arising from recent consultation undertaken by the Northern Territory Government as part of the inquiry into onshore hydraulic fracturing was the need to improve public accessibility to the environmental assessment and approval regimes. The Government has responded to this requirement by broadening access to appeal avenues available as part of the Stage One reforms.

Under the draft EP Bill, any person may seek judicial review of a decision of the Minister or CEO the Department, the Northern Territory EPA or an environmental officer made regardless of whether the applicant has been affected by the decision. Open standing for judicial review is designed to increase transparency in the decision-making process compared to existing procedures.

The draft EP Bill also proposes to expand the avenues for merits review of decisions made to ‘eligible persons’. The classes of ‘eligible persons’ is proposed to include:

  • the applicant for the decision;
  • a person directly or indirectly affected by the decisions;
  • a member of an environmental, community or industry organisation (whether incorporated or not);
  • an Aboriginal Land Council;
  • a Registered Native Title Prescribed Body Corporate or a registered claimant under the Native Title Act 1993 (Cth);
  • a local government body; and
  • a person who has made a genuine and valid submission during an assessment or approval process under the draft EP Bill.

Key decisions subject to judicial and merits review under the draft EP Bill include the acceptance or refusal of a referral application for the EA assessment process, grant or refusal of an EA and decisions to impose a specific condition on an EA.

Transitional Provisions

Provisions for transitioning existing projects are yet to be finalised. The Northern Territory Government is currently seeking public and industry consultation to develop appropriate transition mechanisms.

Looking Forward

The draft EP Bill and Regulation represent one of a number of environmental reforms occurring across the Northern Territory. Stage 2 of the Northern Territory’s environmental reforms is currently under development and is anticipated to open for consultation in 2019. The Northern Territory Government has also proposed significant licencing and compliance reforms to the Water Act 1992 in the Water Legislation and Amendment Bill 2018 which was referred to the Economic Policy Scrutiny Committee in August 2018.

The Northern Territory Government is accepting submissions on the draft EP Bill and EP Regulations until 3 December 2018. KWM will continue to monitor and report the progress of the Northern Territory reforms across the coming months.

Should you have any questions about the ongoing environment and water policy reforms happening across the Territory, please do not hesitate to contact us.

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