Conflicts of interest in environmental planning

Andrew Norton has an interesting article on some unintended consequences of proposed reforms to Victoria's local government legislation. Reforms desgined to reduce the potential for conflicts of interest could undermine, rather than strengthen, the rights of residents to partcipate in the planning process:

In the future, local councillors may be prevented from voting on the very motions before council they may have been elected to support or oppose.

For example, they will be held to have become an ‘interested party’ if they have lodged an appeal in relation to a council decision, or have made an objection or submission. Say the Council wants to cut down the trees in your street, or redirect its traffic, or let someone build a house that overshadows your garden. You go through the normal proceses to protect your interests, by making an objection. This fails.

So you run for election on one of these issues, win a mandate to act on them, and then because of your earlier steps to protect your interests you cannot vote on the matter. Not only are you deprived of your right to vote, but the democratic will of the people who supported you is also frustrated.

Lawyers leading the way on climate change?

People around the world are starting to sue each other over climate change. There have been some interesting cases and there are more in the pipeline: probably the biggest is California's action against car manufacturers.

There's an article by Richard Ackland in today's Sydney Morning Herald that's worth a read:

It stands to reason that if governments, or their pals in business, don't fix things up, lawyers will enter the void and sue the pants off anyone they can get their hands on. We see it all the time with litigation against cigarette manufacturers, the miners and purveyors of asbestos, and the pushers of fatty foodstuffs ("cheeseburger litigation")...

So it's only a matter of time before a global warming litigation industry builds up a decent head of steam. One would think the scientific evidence is sufficiently in to meet a civil standard of proof.

I've written before about climate change litigation, both here and at the now-dormant Australian environmental law blog, ozelaw.

I have two main thoughts on climate change litigation:

• It's a lousy way to influence climate change policy or to do anything about climate change;


• Climate change cases will become less common, not more common.

Litigation, if it's good for resolving any disputes, is good for resolving simple disputes between two parties. Climate change is a big, global, complicated problem, where everyone in the world is a potential plaintiff (we'll all be affected to some extent by climate change) and everyone is a potential defendant (we all contribute to it). Attributing blame and working out damages is fraught to say the least.

In my view, climate change litigation will not do much to prompt good policy. And I think there's a danger if sympathetic judges overreach and these cases are successful.

Take the California vs car-makers case, for example. California argues that it will incur costs due to global warming contributed to by people driving cars made by car-makers. I don't doubt that's true. But should car-makers compensate the Californian government for that?

I'm sure the Californian government itself has undertaken a lot of action and made a lot of decisions over the last century that has contributed to global warming. Should the government of Tuvalu, low-lying Pacific island that's greatly affected by climate change, sue the US for the industry support it has provided to car manufacturers in the past? Should it sue the State of California for not banning cars as soon as global warming hit everyone's radar? Would California then seek a contribution from Brazil or Indonesia or Australia for allowing forests to be felled?

This is a problem that requires global co-operative solutions and I don't think legal blame games are going to help.

Climate change cases have been a good way to get climate change on the agenda, because the media seems to love a good legal stoush: where big global dramas get played out in the microcosm of a courtroom, reduced to some bite sized legal arguments and decided neatly by a judge. (If you ever actually read these cases though, they tend to come down to something arid like whether section 35ZZ requires a consideration of all "relevant" factors or only all "pertinent" factors and whether there's a difference between "pertinent" and "relevant". The big issues of principle are notably absent). Anyway, there's no doubt that climate change is on the agenda now - I'm not sure what more these cases will achieve.

Still, I'll be watching with interest...

How do we resolve environmental disputes?

A lot of environmental disputes are conflicts over resources and, underlying them, are conflicts over values – which of two things is more important.

A browse through environmental news stories this morning gives a number of examples.
In the US, the Fish and Wildlife Service has granted approval under the Endangered Species Act for a windfarm to operate even though it is expected to wipe out 5% of the global population of the critically endangered Puerto Rican Nightjar (story via NeoCommons).

Here, the conflict is between providing energy in a way that doesn’t worsen climate change and between protecting a critically endangered bird. (It’s the same conflict that Australia has recently grappled with.)

In NSW, the State opposition has called for national parks to be opened up for grazing to help farmers during the current drought.

Here, a land use conflict is at its core a conflict between income for struggling rural communities and the protection of fragile, rare and / or biologically important ecosystems.

And at a national level, the federal opposition states that, if elected, it will buy irrigation licences on the water market to improve river health. Farmer groups oppose this idea, as it will raise the price of water entitlements and mean less water used for agricultural production. Again, this is a conflict between using water to boost farm incomes or to improve the health of river ecosystems.

I’m just as interested in the processes and methods we use to resolve these conflicts as I am in the issues underlying the conflicts. My interest in economics stems from the fact that I think it provides a particularly useful set of tools for resolving resource use conflicts.

One of the powerful aspects of market systems is they allow us to resolve disputes by comparing apples and oranges. What is more important? Reducing carbon dioxide emissions by x megatonnes per year (by building a windfarm) or protecting y hundred critically endangered birds (by not building a windfarm). These are analogous to the disputes that markets resolve every day.

Should our society invest more money in IT, pharmaceuticals, agriculture, resources or manufacturing? This is a decision that no-one could hope to make – and no-one has to make because millions of individuals make their own decisions about where to invest their money and labour. Some new land is released in western Sydney. What should we build there? How many houses, how many shopping centres, how many factories, how many schools and hospitals? Well, governments make some of these decisions and guide or restrict others, but mostly these decisions are made by households and businesses. Would we be better using the Hunter Valley for coal mining, wine production or cattle? Well, mostly miners, farmers and grape growers can decide for themselves which land they’re prepared to buy.

Of course the trouble with our bird and windfarm problem is that the Puerto Rican windjar can’t buy up the land to protect their homes. Nor realistically can the residents and wildlife of places around the world particularly affected by climate change each pitch in a bit of cash to buy the land for the windfarm. Someone has to make a value call here: what is worth more? X megatonnes carbon dioxide or y hundred Puerto Rican Nightjars?

But we should always be on the lookout for tools that will make this decision easier, that will avoid what are essentially arbitrary value calls like this. Can we delve deeper?

I don’t know much about the background of this US case, but in a similar Australian conflict last year there was a simple solution. In that case, a proposed windfarm would kill, on average, one bird every 100 or so years. In a global population of only 150 birds, the federal Environment Minister decided that impact was too high and refused to let the windfarm go ahead. However, the birds can be bred in captivity relatively cheaply and then successfully reintroduced into the wild. A condition that the windfarm pay for a breeding program suddenly changes the equation from the unresolvable "Which is worth more: one bird saved versus x megatonnes of emissions saved?" to "Which is worth more: one bird saved versus 20 birds bred and reintroduced and x megatonnes of emissions saved?" – a question that is much easier to answer.

Of course, many or most environmental conflicts do come down to conflicts over values that can’t be sidestepped. But when we can sidestep them, we should. Requiring developers to fund measures that counteract the negative environmental impacts of their developments, where practical, means that government decision-makers don't need to make invidious jobs-versus-environment value judgements.

New Australian environmental law blog: ozelaw

I've set up a new group blog dedicated to Australian environmental law, called ozelaw.

The aim of the ozelaw blog is to bring news, commentary and analysis on environmental law in Australia.

I've set up the ozelaw blog because there doesn't seem to be much in the way of online sources of up-to-date information and, in particular, discussion and comment on trends in Australian environmental law.

Hopefully the ozelaw blog will become a forum for those interested in environmental law and environmental policy in Australia to learn and share their thoughts and experience. Hopefully it will also be a useful resource for people looking for general information on Australian environmental law.

The blog is in its early days and we're just starting to get a few contributors together but there's a few posts up including one on Friday's decision by the Australian Federal Court to allow the Humane Society International to bring an action challenging Japanese whaling in Australia's Antarctic waters.

I don't intend to do much writing there as I'm already pretty busy with this blog, work and uni (and, you know, having a life and stuff). So hopefully the blog will gather some good contributors and some momentum of its own.

Anyway, if you're interested in environmental law, have a look.

Environmental impact assessment: is it efficient?

For anyone who's still interested, some more thoughts on whether it's worthwhile to carry out environmental impact assessment for large projects that make a relatively minor contribution to a large problem...

Following last week's discussion on EIA, I think it’s useful to look at the economics of EIA, that is, compare the economic costs and benefits of assessing projects, granting or refusing consent and imposing conditions.

The costs are:

• the cost of the assessment process: the cost to the project proponent of engaging consultants to do an initial assessment of the environmental impact and prepare an environmental impact assessment; the cost to government of considering the impacts, making its own enquiries where necessary and making a decision about consent and conditions; and the cost to third parties of informing themselves about impacts and making submissions to government.
  
• the cost to the proponent of the project being refused or the cost of taking extra measures to comply with conditions of consent.

The benefits are the reduction in external environmental costs imposed on the community by the proposed development. Those benefits arise either because (in extreme cases) the development is refused consent or because conditions are imposed which ameliorate negative impacts of the development.

EIA is therefore efficient from a cost-benefit point of view when the negative externalities that are removed because of conditions (or consent being refused) are greater than the cost to the proponent of complying with the conditions plus the cost to government, the proponent and other interested parties of going through the EIA process.

The benefits are therefore likely to outweigh the costs when the negative impacts of the development are easily identified and can be reduced at a reasonable cost. The EIA process for the bald hills windfarm (see my earlier post) was a classic case where the EIA process could have been efficient but where the decision in my opinion was not. The relevant environmental impacts were the impacts on the orange-bellied parrot and could be estimated as the death of one bird on average every 109 years. I don’t know the cost of the assessment process but the cost of the decision was very substantial: the Minister refused consent to a substantial and otherwise commercially viable energy development. Whether the benefits of that decision outweigh the costs can be debated but, as Harry Clarke has pointed out, the costs of the decision are certainly far higher than the costs of imposing conditions on the development that could have had a far greater benefit for the survival of the parrot: the parrot can be bred in captivity and returned successfully into the wild at a quite modest cost: one that the windfarm could certainly have afforded. This measure could quite cheaply have benefited the parrot population by two or three individuals per year. Compare that to an expensive decision that benefits the population by, on average, one individual every 109 years.

When the environmental impact that you’re worried about is greenhouse emissions from downstream use of a product, I doubt that EIA is an efficient way to attempt to reduce those impacts. First, as discussed last time, the impacts from this particular development are difficult to assess so the assessment process is likely to be difficult and costly. Secondly, the conditions that can be imposed are unlikely to deal with the problem. The only substantive way to reduce emissions from burning the coal from a mine is not to mine it (other than – perhaps - placing some conditions on how it’s processed to, say, reduce the fuel’s moisture content). So the only effective decision the government can make is to approve or not approve the mine. Conditions about how the fuel is used etc really need to be placed on the user of the fuel. As discussed yesterday, since power stations can source their coal from anywhere, it is questionable whether refusing consent for a mine would reduce greenhouse emissions in any case.

Cumulative impacts

A closely related issue is that of ‘cumulative impacts’. This is the ‘death by a thousand cuts’ problem: each development has only a small, possibly trivial, impact on its own but collectively the impact is serious. Assessment of each project on its own fails to protect us from these serious cumulative impacts.

The solution, according to the applicants in the Isaac Plains case, is that the ‘cumulative impacts’ contributed to by a proposed development should be considered by the decision-maker. As I’ve discussed before, this is the basis on which the federal Environment Minister made a decision earlier this year to refuse consent to a windfarm: it would have an impact on the orange-bellied parrot that is trivial on its own. But the impact, in combination with existing and under-construction windfarms, was so serious that the proposed development should be refused: enough was enough and the Minister had to draw a line somewhere.

I’m not sure about this. In principle, a project should be assessed on its own merits. You should compare the costs of this project with the benefits of this project and determine whether the project should go ahead or what conditions should be attached. It seems inappropriate to compare the costs of this project and others like it with the benefits of this project and others like it and then determine whether the project should go ahead or what conditions should be attached – it just seems to be asking the wrong question.

That said, the alternative is not particularly attractive either. Consider a threatened plant affected by development. There are 100 hectares of the plant left. A development proposes to clear 1 hectare of it for some modestly beneficial community infrastructure. The modest community benefits are deemed to outweigh the environmental costs (it’s only one hectare) so the development is approved. Similar developments are proposed again and again and the equation is the same. Imagine that soon there’s only 30 hectares left. Suddenly a project that will bring enormous benefits to the community is proposed but it will involve clearing 10 hectares: a third of the entire distribution of a now critically endangered species. The choice is now difficult: miss out on huge community benefits or push a species to the brink of extinction. Perhaps the choice could have been avoided if, earlier on when 100 hectares were still left, a decision had been made that the cumulative pressures on this plant were likely to be huge over the next few years and so only projects that had either very large benefits or negligible impacts on the plant would be considered.

It is difficult to do this when approving individual projects though. At which stage do you decide that although the benefits of this project exceed the costs of this project, you’ll nevertheless reject the project because, if projects like this keeping being approved, in a couple of years we’ll reach a stage where it’s too costly to approve any more?

The cumulative impacts problem is a big one and EIA is one way of dealing with it. A better way in my opinion is to deal with it at more strategically: either through planning law (eg, zoning certain areas to protect threatened species so that these conflicts don’t emerge) or economic instruments (providing economic incentives to protect and rehabilitate threatened species sites).

And those instruments are a discussion for another day...

Save the whales

The International Whaling Commission wrapped up yesterday and Vincenze and Harry Clarke have good pieces on the issues behind the debate.

Climate change litigation in Australia

Last post I presented the factual scenario underlying a Federal Court decision that was handed down last week. To recap, the federal government is empowered by the Environment Protection and Biodiversity Conservation Act to consider the environmental effect of proposed developments. Specifically, it is required to consider whether a proposed development is likely to have a significant impact on a matter of national environmental significance (which includes world heritage areas among others – see my EPBC Act primer).

Two coal mines were proposed in Northern Queensland, near a World Heritage area containing rainforests and coral reefs. The coal mined from these new mines is mostly intended to be exported and its burning will create annual greenhouse emissions equivalent to one-quarter of Australia’s current annual emissions. Emissions lead to climate change which are predicted to have a devastating impact on tropical rainforests and coral reefs in Australia.

Blake Dawson Waldron has a good summary of what is not a terribly well-written judgment. The applicant in the case argued:

• the Minister’s delegate had not properly considered the ‘downstream’ indirect impacts, ie, damage from climate change from emissions from burning the coal;
• the delegate had not applied the precautionary principle; and
• the delegate had not properly assessed the ‘cumulative impacts’ of coal mining.

As far as I can tell from the judgment, the judge decided that:

• the delegate had considered downstream impacts and he probably didn’t have to anyway;
  
• the precautionary principle isn’t relevant to this decision;
  
• the delegate was not required to look at the cumulative impacts.

Today I’d like to make a few comments and observations about the role of environmental impact assessment (EIA). Tomorrow I’ll look a the economic efficiency of EIA, the use of the precautionary principle and how to look at cumulative impacts.

Environmental impact assessment

As an environmental lawyer, one of the reasons I’m so interested in economic instruments for environmental policy is that environmental law (and traditional environmental impact assessment) does a pretty lousy job at resolving environmental conflicts in many cases. Often it’s just not the right tool.

The reason is that most resource and environmental conflicts involve many players - many sources of a problem, many people affected by those sources: many potential winners and losers. Environmental impact assessment tends to work well when there's one big project that has one or two big impacts that are well defined and understood.

Should governments assess the environmental impacts of projects before approving them? Well, sometimes. Should it assess the greenhouse implications of proposed developments? I’m less sure.

Consider the analytical process of assessing the environmental impact of greenhouse emissions from the burning of coal produced at a proposed coal mine. It’s extremely difficult. What additional emissions will be produced because of this mine? It’s hard to say. If the coal is to be exported, presumably it is to satisfy existing demand. It’s quite likely that the coal burnt would simply have been sourced from some other supplier. If the proposed mine is very large, it’s possible that the additional supply could reduce the world market price of coal, encouraging more to be burnt. But the world market for coal is enormous.

What impact will those additional emissions have on global climate change? What impact will any such increased climate change have on Australia?

Look, it’s not hard to draw conclusions that burning coal produces disproportionately large greenhouse emissions that aggravate climate change causing harm to environments in Australia and around the world, and that burning coal should therefore be discouraged. But the role project-by-project environmental impact assessment is to examine the environmental impact of a particular project. It’s relatively easy to examine impacts on a local environment from a new coal mine, but it’s extremely difficult to examine impacts (locally or globally) from downstream greenhouse gas emissions.

Does that mean we should ignore greenhouse emissions when assessing large projects of this nature? No. But I think we should do it modestly. And it may be that coal mines are not a good target. If it was coal-fired power station, it would be a little different. We could compare its emissions to alternative projects: If we refuse consent to a new coal-fired power station would a lower-emission gas-fired station be built instead? That’s a relevant consideration. We could examine the technology it uses and its likely emissions compared with other new plants being built. We could place conditions on it that require cost-effective measures to be undertaken to reduce its emissions or perhaps even offset them.

It may be that the government can and should consider some of these measures with a coal mine. But it’s more difficult to say 'what is the impact of this project?'.

The difficulty with using project approval to carry out this function is it’s just not very efficient. Hundreds of developments are referred to the federal government each month. Should proponents detail greenhouse emissions for each project and suggest measures to minimise them? Well it’s certainly arguable that they should.

But much more efficient is simply to price greenhouse emissions appropriately, via a carbon tax or emissions trading scheme. Give developers and incentive to reduce emissions themselves. Let them come up with ways to reduce emissions, rather than the government imposing them as conditions.

Of course, this argument is a little trite. It’s all very well to advocate pricing mechanisms, but we don’t have them yet. Isn’t environmental assessment of emissions better than nothing, which is our current alternative? Well yes, I’ll certainly admit that – and that’s why environmentalists are bringing cases like this one. But it’s far from perfect.

What do you think?

Should government project approvals consider greenhouse emissions?

I’m interested in getting readers’ thoughts on the following scenario:

Two coal mines are proposed in Northern Queensland, near a World Heritage area containing rainforests and coral reefs. The coal mined from these new mines is mostly intended to be exported and its burning will create annual greenhouse emissions equivalent to one-quarter of Australia’s current annual emissions. Emissions lead to climate change which are predicted to have a devastating impact on tropical rainforests and coral reefs in Australia.

The federal government is empowered to consider the environmental effect of proposed developments. Specifically, it is required to consider whether a proposed development is likely to have a significant impact on a matter of national environmental significance (which includes world heritage areas among others – see my EPBC Act primer).

Should the government consider the possible environmental impact of emissions from the burning of coal mined from these projects? More generally, should governments be approving or not approving very large coal mines and similar projects based on their greenhouse emissions (or emissions from use of the products they produce)?

The Australian Federal Court on Thursday handed down its decision on this in Wildlife Preservation Society of Queensland v Minister for the Environment. ABC online and Sydney Morning Herald have reports on the decision. The decision itself isn’t very illuminating but I think the issues behind it are fascinating and important.

I’ll give you some of my thoughts in the next couple of days, but I’d really appreciate any of your thoughts in the meantime.

An Environment Protection and Biodiversity Conservation Act primer: Part 2

Yesterday, I looked at the limited scope of the Act and why it is inappropriate for dealing with cumulative impacts, in the context of the Australian Environment Minister's decision to refuse consent to a windfarm which could harm the endangered orange-bellied parrot. Today I look at how imposing conditions under the EPBC Act allows for win-win outcomes and some lessons for us from this situation.

Win-wins are commonplace under the Act

The media reports on this issue seem to have assumed or implied that the Minister had only two choices: to approve the windfarm or to reject it. Harry Clarke has pointed out that there was a straightforward win-win solution here: the parrots can be successfully bred and returned to the wild, so the windfarm could be allowed with the condition that it pay for a breeding and release program that returned a few parrots each year to the wild population.

Similarly, Chris Tzaros, who co-ordinates the Orange-bellied Parrot Project said he was surprised by the Government's decision, saying he thought Bald Hills could have been safely approved with a conservation management plan.

As I understand it, either solution was well within the Minister’s power, which makes you wonder whether the decision was more political than environmental. The Minister can approve project with all sorts of conditions.

The Age reported that the Minister's decision was only the fourth time an environment minister has invoked the EPBC Act to veto a proposed development, out of 2745 developments referred to the Government since it came into force six years ago. I spoke to one of the main EPBC Act decision-makers in the federal Department of Environment and Heritage last year about the success of the Act and this statistic. He made the point that many hundreds of projects had been modified substantially by conditions imposed by the Minister which made a huge difference to their environmental impacts. In his view, this was the real power and success of the Act.

He also commented that projects were never refused outright unless they were so inherently destructive that no conditions could be applied that would moderate their impact. In most of those cases, the projects were illegal under State law anyway and had been submitted only to make some kind of political point. This sounds very different to the situation with the Bald Hills windfarm project.

It's unclear why sensible conditions were not considered by the Minister in this case.

Some conclusions

Whether the Minister’s decision was politically-driven or not, it was certainly a bad one for the environment and in terms of social costs and benefits: it will likely save one bird every 109 years while sacrificing an otherwise viable development. And, in my opinion it represents appalling administration of the Act:

• It uses the Act inappropriately to address a cumulative impacts problem by prohibiting a development which will have a truly trivial affect on the problem;
  
• It does not consider imposing conditions which could actually have done something positive for the orange-bellied parrot while allowing an important renewable energy development to proceed.

There are reports that a legal challenge to the Minister’s decision is being considered. I would have thought such a challenge would have some legs. I think there’s questions about whether a windfarm that could kill on average one parrot every 109 years is a ‘significant impact’, as is required under the Act. I think there’s also an argument that the Minister’s consideration of the ‘cumulative impact’ of other sites, rather than just looking at the marginal impact of this development means that he has taken irrelevant factors into consideration, which would invalidate his decision. (I should point out that that’s not an argument that would be very popular with green groups, who have been pushing consideration of ‘cumulative impacts’ under the EPBC Act).

One last thing

Getting away from our discussion of the Act a little, but it would be remiss of me not to point out some pretty naughty out-of-context quoting by the Minister. In his media release he quotes this half of a paragraph from the report Wind farm collision risk for birds – Cumulative risks for threatened and migratory species (pdf) as being the reason for his decision and he even puts it all in bold:

Given that the Orange-bellied Parrot is predicted to have an extremely high probability of extinction in its current situation, almost any negative impact on the species could be sufficient to tip the balance against its continued existence. In this context it may be argued that any avoidable deleterious effect - even the very minor predicted impacts of turbine collisions - should be prevented.

He fails to quote the very next sentence though, which puts rather a different complexion on it. Let’s read the sentence now in its original context:

In this context it may be argued that any avoidable deleterious effect - even the very minor predicted impacts of turbine collisions - should be prevented. Our analyses suggest that such action will have extremely limited beneficial value to conservation of the parrot without addressing very much greater adverse effects that are currently operating against it.

Hmm. I guess saying "I have today made this decision which I’m advised will have extremely limited beneficial value" probably doesn’t sound quite as good in a press release, does it?

An Environment Protection and Biodiversity Conservation Act primer: Part 1

(OK, not the catchiest title, I’ll admit).

The recent debate over the decision by the Australian Environment Minister to refuse consent to a wind farm because of its possible impacts on the endangered orange-bellied parrot has prompted me to say a few things about Australia’s primary piece of environmental legislation, the Environment Protection and Biodiversity Conservation Act (EPBC Act).

In case you missed the story, orange-bellied parrots are highly endangered, with less than 200 left in the wild. They migrate between Tasmania and Victoria each year. The proposed wind turbines, on the Victorian coast, are in the vicinity of the parrot’s migration zone. Though no birds have ever been sighted near the site there is, according to reports provided to the Environment Minister, a possibility that windfarm turbines in coastal Victoria might kill one bird every year. With the population so endangered, the Minister made the decision not to allow an additional windfarm to go ahead.

The best summary of the political context for the decision – which is important if you want to understand the decision – is this article in the Age. I recommend reading it.

I want to make some comments about the EPBC Act, because an understanding of the Act is also important if you want to understand what has happened here.

Scope

First, the scope of the Act is quite limited. Under the Australian Constitution, the States have general power over things such as the environment. The federal government has power over certain specified national issues, such as defence, trade and foreign affairs. Most of the federal government’s powers to affect the environment derive indirectly from the foreign affairs power: the federal government has entered into environmental treaties – such as the Convention on the Protection of Biological Diversity and the World Heritage Convention – and therefore must have the power to meet its obligations under those treaties. So its power over the environment is mostly limited to certain areas relating to its treaty obligations.

Under the EPBC Act, you need the Environment Minister’s approval for a project if it significantly affects a matter of "national environmental significance". These are:

• World Heritage values of World Heritage properties;
• wetlands of international importance;
• Commonwealth listed threatened species and ecological communities;
• listed migratory species;
• Commonwealth marine areas;
• nuclear actions; and
• listed National and Commonwealth Heritage places.

It is worth pointing out that the federal government would normally have no power to prohibit a windfarm. It has that power in this instance because the windfarm may have a significant impact on a threatened species.

This is relevant because if the federal government wanted, politically, to gain some control over windfarm policy in Australia, it would have to do so in a roundabout way, such as prohibiting any windfarms that happen to get caught in its jurisdiction and then putting pressure on the States to negotiate with it on a national policy. That is what some people have suggested this decision is really about and it is interesting that the Environment Minister has recently called for a national code on wind energy.

Inappropriate for cumulative impacts

An interesting aspect of this decision is that the Environment Minister has refused the proposed 52-turbine windfarm at Bald Hills but has approved substantially larger projects nearby – including one that, according to the Age article (and presumably under the curious licensing scheme of the Act), he has expressly authorised to kill three of the parrots each year.

The Minister has claimed that it is precisely because he has approved these other projects that he can’t approve this one:

The orange-bellied parrot was at such dangerously low levels in terms of population that any additional wind farm in this particular area would have an impact on the survival of the species. The fact is we have had a massive increase in investment in wind farms: 400 turbines have been built in the past four years and there are 145 more in the pipeline. That has cumulatively a new impact on the environment which we have for the first time sought to assess.

Interestingly, and contrary to every media report that I’ve seen, the report on impacts did not say that the Bald Hills windfarm could kill up to one parrot per year, it said that, in total, all existing and proposed windfarms in Victoria and Tasmania could kill up to one parrot per year. The contribution of the Bald Hill windfarm itself to this number is trivial. (The Minister never claimed that the Bald Hills windfarm would kill one bird per year either – I know journalists don’t read reports but surely they could at least read the Minister’s one-page media release). Incidentally, if you look hard enough and do a simple calculation, the report cited by the Minister does contain the actual number of parrots estimated to be killed by the proposed Bald Hills windfarm: one every 109 years.*

This illustrates one of the major limitations of the Act: it is a project-by-project approval scheme. Project approval schemes are good at dealing with the particular local impacts of individual projects. What they are not good at is dealing with cumulative impacts: where each project has only a small additional impact but many projects will collectively have a major impact. And yet the EPBC Act is meant to deal not with local impacts but with matters of national significance. Green groups have been calling on the government to use the EPBC Act to prohibit or modify projects – such as coal-fired power stations – that have relatively large greenhouse gas emissions. In my opinion, the EPBC Act is ineffective for this: you need national policies that cover energy, transport, etc, not tinkering with projects one by one.

(Economic instruments are perfect for addressing cumulative impacts: this is one of their major advantages).

Tomorrow I'll talk about how imposing conditions under the EPBC Act allows for win-win outcomes and some lessons for us from this debacle. I'll also point out how the Minister selectively quoted from the Report he relied on to imply that the Report said almost the opposite of what it actually said.

* Page 30 of the orange-bellied parrot chapter of the report (PDF here) sets out the most likely survivorship rate of the population at Bald Hills: 0.9999392. I have used the calculations set out on pages 32 and 33 to arrive at a figure of 0.00912 parrot mortalities per year, which equals one every 109.6 years.