Citing significant adverse social impacts, the Land and Environment Court of New South Wales recently rejected Gloucester Resources Pty. Ltd.'s ("GRL") appeal of the Minister for Planning's refusal of a state significant development application for consent for the Rocky Hill Coal Project (the "Project"), a proposed new open cut coal mine in the Gloucester Valley in New South Wales, Australia, which would produce 21 million tonnes of coking coal over 16 years. Gloucester Resources Pty. Ltd. v. Minister for Planning [2019] NSWLEC 7 (8 February 2019).

Gloucester Groundswell Inc., a local community action group, was allowed to join as a party to the proceedings and submitted that the Project should be refused because the GHG emissions from the Project would adversely impact measures to limit anthropogenic climate change.

GRL did not contest that climate change is real or that anthropogenic GHG emissions must be reduced rapidly in order to meet the internationally agreed temperature targets of 1.5 or 2 degrees Celsius, but did contest that the Project needs to be refused in order to achieve these targets. The Court disagreed, finding that:

  • Refusing approvals for new coal mines that will produce substantial new GHG emissions is a legitimate way to assist in achieving targets set by international agreements.
  • Although the aggregate estimated GHG emissions over the life of the Project represent a small fraction of total global GHG emissions, the Project is a sizeable individual source that will contribute cumulatively to global GHG emissions. Aggregate Scope 1, 2, and 3 emissions (covering both direct and various types of indirect emissions) over the life of the Project are estimated to be at least 37.8 Mt CO2-e.
  • GRL presented no evidence of any specific plans to net out GHG emissions and make the Project carbon neutral. The Court, therefore, rejected as speculative and hypothetical the argument that the Project will not necessarily exceed the carbon budget because emissions can be reduced in other ways.
  • The Project is unnecessary because other existing and approved coal mines can meet the future demand for coking coal. Relying on Dutch and U.S. cases, the Court rejected the argument that GHG emissions will occur whether or not the Project is approved because of market substitution (opening of mines in countries with lower environmental standards) and carbon leakage. The Court ignored prior Australian cases that have accepted the market substitution argument.

In short, the Chief Judge found that an open cut coal mine in this part of the Gloucester Valley would be in the wrong place at the wrong time. Wrong place because an open cut coal mine in this scenic and cultural landscape, proximate to many people's homes and farms, will cause significant planning, amenity, visual, and social impacts. Wrong time because the GHG emissions of the coal mine and its coal product will increase global total concentrations of GHGs at a time when a rapid and deep decrease in GHG emissions is urgently needed to meet generally agreed climate targets.

This case does not mean that a coal mine proposal in New South Wales will never be approved. But for a project proponent to obtain consent for any new coal mine proposal, the project must demonstrate significant net benefits and provide meaningful mitigation measures.

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