Australian Court Rules Environmental Regulator is Duty Bound to Develop Climate Change Policies | Jones Day

In Short

The Situation: A climate action group commenced legal proceedings seeking to compel an Australian environmental protection regulator to develop instruments aimed at combatting climate change in Australia’s most populous state of New South Wales (“NSW”).

The Decision: In a landmark decision, Chief Judge Preston of the NSW Land and Environment Court held that the NSW Environment Protection Authority (“EPA”) had not discharged its duty to develop environmental quality objectives, guidelines and policies to ensure environment protection from climate change, and ordered the EPA to develop such instruments going forward.

Looking Ahead: The decision is the latest in a series of Australian and international cases which have found that regulators and government decision-makers owe positive duties to address climate change.

The Facts

In April 2020, a climate action group called Bushfire Survivors for Climate Action Incorporated (“BSCA”) filed civil enforcement proceedings against the EPA in the NSW Land and Environment Court.

BSCA sought an order in the nature of mandamus to compel the EPA to perform its statutory duty under s 9(1)(a) of the Protection of the Environment Administration Act 1991 (NSW) (“POEA Act”). One of the requirements of the POEA Act is that the EPA perform particular tasks in relation to the quality of the environment. Specifically, s 9(1)(a) requires the EPA to “develop environmental quality objectives, guidelines and policies to ensure environment protection”.

BSCA’s primary argument was that climate change poses a significant and “existential” threat to the environment and the EPA had failed in its statutory duty to develop quality objectives, guidelines or policies to protect the State’s environment from climate change.

In making these arguments, BSCA relied on expert evidence given by the former Chief Scientist of Australia, Professor Penny Sackett, and on reports published by the Intergovernmental Panel on Climate Change (“IPCC”), including the recently released Climate Change 2021: The Physical Science Basis. Contribution of Working Group 1 to the Sixth Assessment Report. Notably, the EPA did not challenge the evidence of Professor Sackett, including her analysis of the causes of climate change and its consequences. The parties’ agreed statement of facts accepted that:

  • Anthropogenic greenhouse gas emissions have caused or contributed to an increase in the frequency of extreme heat events in Australia;
  • The climate of New South Wales is changing due to global warming; and
  • If there is a 1.5—2.0°C temperature rise, the risk of widespread impacts on the most vulnerable will rise from moderate towards high.

In contesting the claim, the regulator submitted that there is nothing it can do to “ensure” that the state’s environment will be protected from climate change, as climate change is a global problem which cannot be meaningfully addressed without multiple local actions to mitigate greenhouse gas emissions by sources and remove greenhouse gases by sinks.

The Decision

Chief Judge Preston’s key finding in Bushfire Survivors for Climate Action Incorporated v Environment Protection Authority [2021] NSWLEC 92 is that the EPA’s duty under s 9(1)(a) requires the regulator to develop environmental quality objectives, guidelines and policies to ensure environment protection from climate change. Notably, his Honour held that the duty does not require such instruments to address the topic of climate change at the level of specificity claimed by BSCA (i.e., to regulate and reduce greenhouse gas emissions consistent with limiting global temperature rise to 1.5°C above pre-industrial levels). Further, the Court emphasised that the duty is not to ensure environment protection itself. Rather, ensuring environment protection is the norm and the end towards which, the EPA is required to develop environmental quality objectives, guidelines and policies. In reaching this conclusion, the Chief Judge held that the evidence before the Court established that, at present in New South Wales, “the threat to the environment of climate change is of sufficiently great magnitude and sufficiently great impact as to be one against which the environment needs to be protected”.

The Court found that the EPA had not fulfilled its statutory duty as it was unable to point to any document which, in the Court’s view, amounted to an “instrument” developed by the EPA under s 9(1)(a) to ensure protection of the environment in NSW from climate change. Of the seven documents relied on by the EPA for this purpose, two of them had not been developed by the EPA, and the other five did not ensure environment protection from climate change as, broadly speaking, the content of those materials was purely aspirational or descriptive and lacked detail as to the measures, approaches or tools to be used to reduce greenhouse gas emissions.

Having found that the EPA had not discharged its statutory duty, his Honour issued a mandamus to compel the EPA to develop quality objectives, guidelines and policies to ensure environment protection from climate change.

Ramifications

The decision marks the first time an Australian Court has ordered a regulator to take significant action in respect of climate change. We anticipate that the development will increase the pressure on Australian legislators and regulators alike to implement reforms to reduce greenhouse gas emissions which, inevitably, will impact the way that business is done in Australia.

Notably, the BSCA decision was delivered on the same day that an unprecedented claim was filed in the Federal Court of Australia by the Environmental Defender’s Office (which also represented BSCA) against one of Australia’s largest gas producers, Santos Limited. As noted in our recent Alert, the claim alleges, among other things, misleading or deceptive conduct in respect of representations made as to “clean energy”, and of having a clear and credible road map to reach net zero emissions by 2040 which includes reliance on carbon capture storage technology.

The BSCA decision also follows the recent decision of the Federal Court in Sharma v Minister for the Environment [2021] FCA 560 in which the Court ruled that, in determining whether to approve a coal mine development, the Federal Minister for the Environment owed a duty of care to Australian children to protect them from harms caused by climate change.

Three Key Takeaways

  1. The primary environmental regulator for NSW, the EPA, has been found to be in breach of its statutory duty and, consequently, ordered by the Chief Judge of the Land and Environment Court to develop environmental quality objectives, guidelines and policies to ensure environment protection from climate change.
  2. The decision is the latest in a series of Australian and international cases to hold that regulators and government decision-makers owe positive duties to seek to reduce the harms of climate change.
  3. In light of this growing body of case law, businesses with an Australian presence, particularly those in emissions-intensive sectors, should be aware that regulatory reforms are likely to follow in the wake of such decisions and these reforms may well impact the way they conduct their business in Australia in the future.

1 Comment

  1. Today, I went to the beachfront with my children. I found a sea shell and gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and screamed. There was a hermit crab inside and it pinched her ear. She never wants to go back! LoL I know this is totally off topic but I had to tell someone!

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