The NSW Environment Protection Authority (NSW EPA) has announced plans to impose new environment protection licensing requirements on almost 200 licensed premises.
Snapshot
- Starting in 2026, around 200 licensed premises will face new reporting requirements under their environment protection licences (EPL).
- Licensees will need to publish their emissions, set reduction targets, and refresh their strategies every three years to stay on track.
- Long-term plans for enforceable emissions limits loom.
Background
In Bushfire Survivors for Climate Action Incorporated v Environment Protection Authority (2021) 250 LGERA 1 (see our article on that decision here) the Land and Environment Court found that the NSW EPA has a statutory duty to "develop environmental quality objectives, guidelines and policies" to protect the environment against threats like climate change.
In response to that decision, the NSW EPA published a Climate Change Policy and Action Plan 2023-2026 (Plan) (see our article on the Plan here).
In an effort to deliver on their commitments in the Plan, the NSW EPA has proposed reforms to modernise the EPL framework under the Protection of the Environment Operations Act 1997 (NSW) (POEO Act).
Three Consultation Papers have been released, including the:
- Proposed Climate Change Licensee Requirements Consultation Draft;
- Climate Change Mitigation and Adaptation Plans: Proposed Mitigation Requirements Consultation Draft; and
- Proposed Greenhouse Gas Mitigation Guide for NSW Coal Mines Consultation Draft.
Who Will Changes Apply to?
The proposed new requirements will generally apply to licensed premises that emitted 25,000 tonnes or more of CO2-e per year in any of the previous three financial years, though some will only apply to specific industries such as coal mines. It is possible that the new requirements would be expanded to apply to a broader group of licensees in the future.
The following table contains a more detailed outline of the application of each requirement. The requirements themselves are covered further below.
|
Requirement |
Who? |
By When? |
|
Safeguard mechanism facilities (i.e. industrial facilities emitting more than 100,000 tonnes of CO2-e per year) |
28 February 2026 and then annually after this. |
|
Coal mines that emitted 25,000 tonnes or more of CO2-e per year in any of the previous three financial years |
28 February 2026 and then annually after this. |
|
|
Remaining facilities that emitted 25,000 tonnes or more of CO2-e per year in any of the previous three financial years |
28 February 2027, and then annually after this. |
|
|
Safeguard mechanism facilities (i.e. industrial facilities emitting more than 100,000 tonnes of CO2-e per year) |
31 October 2026 and then updated every three years after this. |
|
Coal mines that emitted 25,000 tonnes or more of CO2-e per year in any of the previous three financial years |
31 October 2027 and then updated every three years after this. |
|
|
Remaining facilities that emitted 25,000 tonnes or more of CO2-e per year in any of the previous three financial years |
31 October 2027 and then updated every three years after this. |
|
|
Coal mines |
The expected commencement dates of the seven requirements are as follows:
|
|
Other licensees |
No timeframe yet. |
|
|
Underground coal mines |
31 October 2026 |
|
All licensees |
No timeframe yet. |
Proposed Requirements
The first of the Consultation Draft Papers contemplates five requirements for EPL holders, each to be phased in at different times.
1. Annual climate change emissions reporting
From February 2026, the EPA has proposed requiring certain licensees to submit an 'Annual Climate Change Emissions Report'. It must include:
- scope 1 emissions;
- scope 2 emissions;
- energy consumed;
- energy produced;
- emissions intensities; and
- energy intensities.
The EPA's intention is to be provided with the same data licensees provide to the Clean Energy Regulator.
Draft licence conditions to implement this requirement have been published in the consultation draft and are available to review here.
Data will be published following the NSW EPA's analysis.
2. Climate Change Mitigation and Adaptation Plans
From 31 October 2026, the EPA is proposing to progressively require licensees to prepare, implement and report against Climate Change Mitigation and Adaptation Plans (CCMAPs).
Within the CCMAPs, licensees will be expected to:
- publish current and projected emissions;
- outline existing and planned mitigation measures; and
- establish emissions reduction goals.
The initial focus would be on mitigation requirements for large emitters, and over time the EPA will release guidance on climate change adaptation.
Licensees must make CCMAPs and progress reports available on a publicly accessible website, and CCMAPs must be updated every three years.
Organisations that have already implemented similar plans under other schemes can re-use existing documentation, provided any gaps are addressed through an addendum.
3. Specific mitigation actions
Targeted mitigation requirements will be developed for specific industry sectors to implement specific technologies, processes or emission actions.
The first of these is the Greenhouse Gas Mitigation Guide for NSW Coal Mines (Guide). The Consultation Draft Paper for the Guide indicates its key objectives will be to:
- destroy methane in drainage gas at underground mines;
- minimise methane entering ventilation air by addressing methane leaks from old mine workings at underground mines;
- destroy ventilation air methane at underground mines; and
- reduce fossil diesel emissions at all coal mines.
4. Emissions measurement
The NSW EPA also proposes onsite greenhouse gas monitoring for certain licensees. This marks a shift from reliance on estimated emissions toward direct measurement.
To achieve this, the NSW Government would establish regional greenhouse gas monitoring equipment networks. These networks would supply information regarding CO₂-e concentrations in certain regions and help to attribute the emissions to a source.
As an example, from October 2026, the EPA proposes that underground coal mines that emit more than 25,000 tonnes of CO₂-e per year use certified instruments to measure methane concentration in ventilation air. All other facilities will only receive onsite monitoring requirements once regional networks have gathered sufficient data.
5. Greenhouse gas emission limits on licences
In the long-term, the EPA would progressively apply greenhouse gas emission limits on new and existing EPLs in key sectors.
The introduction of this step will depend on the progress of emissions measurement, sector-based greenhouse gas budgets and CCMAPs being in place.
Assistance for Licensees
To assist in meeting some of the proposed requirements, eligible licensees may apply for the High Emitting Industries Fund (Fund). The Fund is available for eligible projects to:
- accelerate scope 1 emissions reduction projects, including late-stage feasibility studies, commercial trials, business case development, and front-end engineering and design; and
- implement decarbonisation opportunities at NSW manufacturing and mining facilities.
Next steps
To provide feedback to the NSW EPA, licensees can:
- complete the online survey here;
- provide written feedback by emailing a submission to climatechange.review@epa.nsw.gov.au; or
- post a submission to:
Manager, Climate Change Policy
NSW Environment Protection Authority
Locked Bag 5022
Parramatta NSW 2124
Submissions are due by 5pm on 7 October 2025.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
