This month the NSW Government published a ‘Strategic Statement on Coal Exploration and Mining in NSW’ (Statement) which provides much needed clarity for the coal industry and the community in relation to the policy position of the Government regarding the future of coal exploration and mining projects in NSW.
The Statement is a welcome addition to the NSW policy framework after what has been a bumpy road for the NSW coal industry over the last 18 months, following events such as the ‘Rocky Hill’ decision of Preston CJ in the Land and Environment Court, the inclusion of the first ‘export management plan’ condition in a State Significant Development consent for the United Wambo mining project and the refusal of Kepco’s Bylong coal project (which is currently the subject of an appeal in the Land and Environment Court).
The objective of the Statement is to ‘provide greater certainty to explorers, investors, industry stakeholders and communities about the future of coal mining in the state’ and set out ‘how the NSW Government is taking a responsible approach to the global transition to a low carbon future.’ The Statement provides a balanced consideration of the ongoing global demand for coal, and therefore the need for ongoing support of the NSW coal industry to meet this demand, with the need to support the transitioning of certain ‘coal-dependant’ regional communities over the longer term as global economies move towards alternative energy sources.
Some of the most significant aspects of the Statement include the following acknowledgments and commitments by the NSW Government:
To achieve the above objectives the Statement includes a ‘plan of action’ in four areas:
Notwithstanding the predictions for ongoing global demand for coal in the short to medium term, the Statement acknowledges that in the long term there is uncertainty about global demand for thermal coal and that the NSW Government will continue to monitor global coal demand and domestic production and emissions to ensure it takes a flexible and adaptive approach.
Whilst the Statement is relatively high level, it provides a degree of certainty and assurance for the coal industry as well as regional communities in NSW about the future of coal exploration and mining. Many recent determinations of development applications for coal mining projects by consent authorities have highlighted the level of uncertainty and policy ‘gap’ that existed in relation to the NSW Government’s position on the future of coal, including the ongoing demand for coal and issues such as market substitution and carbon leakage. Following the recent review of the IPC and the subsequent release of the Statement of Expectations by the Department of Planning, Industry and the Environment (DPIE) and Memorandum of Understanding between the IPC and DPIE, it is clear that the IPC must apply any applicable government policies, which will now include the Statement.
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