Proposed changes to Environment Protection Licences

In September 2013, the NSW Environment Protection Authority (EPA) released details of the proposed changes to the environmental licensing framework under the Protection of the Environment Operations (General) Regulation 2009 (NSW) (Regulation).  A new risk based licensing scheme (Scheme) is intended to come into effect from 1 January 2015.  Submissions to the EPA on the proposed introduction of the Scheme close on 1 November 2013.

Purpose of the Scheme

The Scheme is designed to provide an incentive for environmental protection licence (EPL) holders to comply with the environmental protection standards set by the EPA.  Under the Scheme, licensees assessed as having a poor environmental performance record will incur higher licence fees because they require a greater level of regulatory intervention, e.g., more intensive monitoring.  This allows for a risk assessment process that is proportionate to the level of environmental risk that the EPL holder generates which does not shift the burden of costs of such activities to the community.

The risk assessment process

The EPA will conduct a risk assessment for each EPL holder in consultation with the holder in order to determine:

• the appropriate environmental management category (A, B, C, D or E in descending order of performance), and
• the appropriate environmental risk level (1, 2, or 3 in ascending order of risk) for their activities.

The category will determine the risk of the EPL holder so that the EPA is able to ascertain the regulatory intervention required for that particular licensee.

To make this determination, the EPA will have regard to three factors:

• the day-to-day operations at the site
• the risk of pollution incidents occurring at the site, and
• the environmental management performance of the licensee.

Furthermore, the EPA will take into account the EPL holders history, including past compliance and non compliance and ways in which the EPL is trying to control or mitigate environmental risks.

Review of risk assessments

Following the initial risk assessment, the process will be repeated after a period of five years, unless:

• an environmental incident or report of non-compliance triggers a review ; or
• an EPL holder requests that the EPA review their environmental performance before that time.

Calculation of the licence administrative fee

The licence administrative fee for each EPL holder will be calculated based on their environmental management category and environmental risk level in accordance with the method set out in Schedule 1 of the Regulation.

Public availability of information

The environmental risk level for each EPL holder will be published on the EPA’s Public Register in order to provide the public with increased access to information on the environmental performance of industrial operators and facilitate greater transparency in regard to environmental assessment processes.

Implications of the proposed amendments

The proposed new scheme for assessing a licence holder’s risk will mean that licensees that rate higher on the risk assessment scale will be more heavily regulated by the EPA in addition to having increased administrative fees.  This includes increased pollutant fee units and increased fees payable for clean up notices, prevention notices and noise control notices.  This means that if your operations have a poor environmental performance record as a result of past conduct, you are likely to be impacted most significantly by these changes.

Samantha Daly, Patrick Holland, Brendan Tobin, Kate Swain