Australia's proposed National Environmental Standards

What you need to know

• The Australian Department of Climate Change, Energy, the Environment and Water (DCCEEW) has released a set of five draft National Environmental Standards (NES) as part of a suite of consultation papers. These are part of a package proposing substantial reforms to Australian environment legislation to replace the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act). 
• The draft NES for Data and Information and NES for Community Engagement and Consultation would increase obligations on proponents to self-assess and consult prior to making an application.  
• The draft NES for First Nations engagement and participation in decision-making has not yet been released.

What you need to do

• Businesses should consider the potential impacts of the proposed reforms on their business and if they should participate in consultation either directly or through a relevant industry body.  
• Keep an eye out for exposure draft legislation, if it is released before any of the reform Bills are introduced into Parliament.

Our alert series about the reforms

This is the third of a series of alerts about the reforms. 

We provide an overview of the reforms and details of the proposed new Environmental Protection Australia (EPA) and Environment Information Australia (EIA) in our 13 February 2024 alert "Overhaul of Australian environmental laws begins in earnest with release of detailed consultation papers". 

Our 28 February 2024 alert "Assessment pathways under Australia's proposed new Federal environmental laws" outlines the differences between the current and proposed new assessment pathways.

This alert focuses on the proposed draft National Environment Standards.

National Environment Standards

The proposed National Environmental Standards (NES) are intended to form a centrepiece of Australia's new national environmental laws.  

This was a key recommendation from Professor Graeme Samuel AC's Final Report on the Independent Review of the EPBC Act.

What are NES?

NES will guide decision-making by setting outcomes and objectives for regulated activities under the new legislation, consistent with the objects of the legislation and Australia's international environmental obligations.  Decision-makers will be required to consider and apply relevant NES when making a decision regarding a proposed action.

How would NES be made?

The power to make, vary and revoke NES would rest with the Minister under the reformed legislation.  In exercising this power, the Minister would be required to give written notice to Commonwealth, State and Territory bodies or strategic assessment holders affected by the new or amended NES, and to publish a draft NES for comment for a minimum of 30 business days.

The Minister will have regard to the advice of statutory committees established under the new legislation when making, varying or revoking a NES.

Draft NES for Matters of National Environmental Significance 

The draft NES for "Matters of National Environmental Significance" (MNES) is directed to the protection, conservation, and restoration of nine identified environmental and heritage MNES: 

The restoration component relating to the Great Barrier Reef Marine Park was removed in the version of the draft NES for MNES published in the February 2024 consultation papers.

This draft NES sets out the requirements for relevant decisions affecting each of the nine MNES.  The requirements in relation to all nine MNES include that decisions should:

• be based on appropriate information and data;
• meet the objectives of maintaining and improving MNES conservation, management, and recovery; and
• provide early opportunities for Traditional Owner consultation, and enabling monitoring, evaluation, and reporting of outcomes.

There are additional specific requirements for decisions relating to particular MNES.

The identified MNES are the same as those contained in the current EPBC Act.  The "water trigger" of item nine was amended in December 2023 to include all types of unconventional gas instead of only coal seam gas (see the Nature Repair (Consequential Amendments) Act 2023 (Cth)).

Draft NES for Restoration Actions and Restoration Contributions

Environmental offsets reform was a key plank of the Government's Nature Positive Plan.  The government is committed to reform environmental offset arrangements to ensure they deliver gains for the environment and reduce delays for project developers.

The reforms propose that proponents compensate for all residual significant impacts by delivering a restoration action or making a restoration contribution.  This is set out further in the draft NES for "Restoration Actions and Restoration Contributions".

The draft NES would require proponents to compensate for any "residual" significant impacts by:

• delivering a restoration action; and/or
• making a restoration contribution (ie a payment to the Government to offset impacts on protected matters).

It would be open to proponents to choose their preferred option (or a combination thereof).

In accordance with the mitigation hierarchy, restoration actions and contributions can only be used to address residual impacts once the proponent has first taken all reasonable steps to mitigate and avoid impacts on MNES.

The draft NES sets out requirements for how restoration actions and contributions must be undertaken, and provides a framework for how the Australian government must use any payments for environmental restoration.

Restoration actions must:

• be feasible, highly certain, and deliver adequate benefits and projected gains; 
• be located in an area relevant to the impacted MNES;
• prioritise restoration and management actions over averted loss actions, and direct action over indirect restoration action unless otherwise provided in conservation planning documents;
• be additional to existing actions and regulatory obligations unless the action is an approved action that meets the requirements of the NES or a registered advanced restoration action;
• be securely protected such that there is a reasonable expectation that the projected gain will be delivered and maintained for the duration of the impact;
• commence prior to the impact from the approved action; and
• be detailed in a restoration action management plan subject to expert review, and to be published before commencement of the action.

Restoration contributions must:

• be included in conditions of approval; and 
• be paid to the Restoration Contributions Fund prior to the commencement of the impact. 

The Restoration Contributions Fund is a special account established by the Federal Government for the purposes of receiving and investing restoration contributions.

NES for Data and Information

The draft NES for Data and Information is a key component of the Nature Position Plan.  It sets out requirements to ensure environmental decision making and planning is transparent, defensible and informed by appropriate data and information. It sets out clear principles that guide the assessment of suitability and determining the appropriate use of environmental data and information.

Proponents will be required to demonstrate that data and information accompanying an application meets requirements around transparency, ethics and reliability.

What standards will proponents need to meet?

Proponents will need to show that data and information provided with assessment applications meets the following requirements.

Insights

It is particularly important that proponents understand what data they must provide, and how the quality of this data could impact their prospects of achieving a positive outcome.

Applications supported by data that does not meet the NES risk being negatively impacted because of a lack of reliable information.  

The introduction of the NES for Data and Information will place an additional burden on proponents by requiring them to conduct high-quality self-assessment and information gathering before submitting their application, and without preliminary assessment from the regulator about the project's likely impacts on protected matters.  

Draft NES for Community Engagement and Consultation

This draft NES aims to ensure effective community contribution to environmental decision-making, by placing additional consultation obligations on proponents that go beyond those in the current EPBC Act.  In addition to prescriptive consultation requirements placed on proponents, the draft NES also encourages proponents to go above and beyond in providing the public with information and the opportunity to comment.

Proponents are expected to begin the consultation process before making an application to the EPA, by providing:

• free public access to relevant information about the proposal and its likely impacts on protected matters (generally by publishing on the internet, but may also include other methods); and
• an opportunity for any person to make submissions to the proponent, for a period of at least 30 business days from the date of publishing the relevant information.

Proponents must provide opportunities for engagement, including for persons to seek clarification, by holding at least one public online meeting or public hearing in a relevant location where internet accessibility is limited.  Proponents should also provide multiple opportunities for engagement, offer multiple engagement methods, and/or provide additional time for public comment where circumstances may limit accessibility or for complex or contentious proposals.

What information will proponents be required to provide?

The draft NES requires proponents to provide specific information to the public and the community, including:

• information about the engagement process, including guidance on how to make a comment, and explanation of how confidential information is stored and shared, and an option for respondents to remain anonymous; and
• key information about the proposal, including likely impacts on protected matters, social and economic impacts, avoidance and mitigation measures, procedures for monitoring and recording environmental performance, and sources of information relied upon; and
• information related to category 1 and 2 greenhouse gas emissions applicable to the proposal that may be prescribed by the [Nature Positive (Environment) Act] or Rules, as applicable to the proposal.

The proponent must prepare a summary of the engagement and consultation process undertaken and provide this to the decision maker with the proposal.

Draft NES for Regional Planning

The draft  NES for Regional Planning was first released in the December 2023 consultation paper.  

The Commonwealth and State and Territory governments are to develop Regional Plans to deliver net positive outcomes for MNES in regions where there is conflict between development priorities and environmental and heritage values. 

This may be achieved through Regional Plans that avoid and mitigate the impacts of priority development actions on MNES and regional restoration measures that repair and compensate for impacts of priority development actions on MNES. 

Regional Plans should identify priority areas and opportunities for investment into protection, conservation and restoration activities within the region.  Regional Plans should also establish clearly delineated Conservation Zones for the protection, management and restoration of environmental values where specified classes of action will be prohibited and Development Zones where specified classes of action (priority development activities) can proceed with specified conditions, subject to registration with the EPA.

Ultimately, the goal is to enhance coordination between Commonwealth and State/Territory governments to reduce duplication of administrative and regulatory processes.

NES for First Nations engagement and participation in decision-making

The draft NES for First Nations engagement and participation in decision-making has not yet been released.  

It is being developed through a collaborative process led by the Indigenous Advisory Committee (IAC). A working group has been established to develop the standard and guide the additional engagement required with First Nations peoples and other stakeholders.

Next steps?

We understand the draft NES may be subject to change as the consultation process progresses.  We will keep monitoring as more Nature Positive Reform materials are made public.

The Government had initially set a very ambitious timeline for these reforms, planning to introduce legislation to parliament before the end of 2023.  It now seems likely, however, that draft legislation will not be available until the second half of 2024 and it is unclear if it will be publicly released before being introduced to Parliament.

For now, businesses should consider the potential impacts of the proposed reforms on their business and if they should participate in consultation either directly or through a relevant industry body.  

Want to know more?

"Government set to reform national environmental laws but there are some challenges for industry", 12 December 2022
Discusses the Federal Government's Nature Positive Plan.

"No new Federal cultural heritage legislation in 2023 – but change is coming", 25 July 2023
Discusses Federal cultural heritage law reform

"Overhaul of Australian environmental laws begins in earnest with release of detailed consultation papers, 13 February 2024
Provides an overview of the reforms and details of the proposed new Environmental Protection Australia (EPA) and Environment Information Australia (EIA). 

"Assessment pathways under Australia's proposed new Federal environmental laws", 28 February 2024
Outlines the differences between the current and proposed new assessment pathways.

Authors: Michael Voros, Counsel; Samantha Marsh, Lawyer and Alysha McCuish, Lawyer