Claire Smith
Partner •
Sydney
Clean Air Bill 2021 tightens air pollutant emission standards for NSW's coal-fired power stations
There is likely to be considerable debate on the Protection of the Environment Operations Amendment (Clean Air) Bill 2021 (NSW), given the potential cost of implementing best available control technology to reduce pollutant emissions and also the planned closure of a number of NSW coal-fired stations.
The Protection of the Environment Operations Amendment (Clean Air) Bill 2021 (NSW) proposes to introduce stricter exceedance limits for solid particles, nitrogen oxide, sulphur dioxide and mercury emitted by coal-fired power stations in NSW. If enacted, the proposed exceedance limits would override any current limits outlined in regulations (if transitional provisions are not included) and could have immediate effect.
Background: the current regulation of air pollutants
The emission of air pollutants from coal-fired power stations in NSW is currently regulated by a combination of:
- the Protection of the Environment Operations Act 1997 (NSW) (POEO Act);
- the Protection of the Environment Operations (Clean Air) Regulation 2021 (NSW) (Clean Air Regulation); and
- individual environment protection licences held by each coal-fired power station.
Collectively, the POEO Act and the Clean Air Regulation require coal-fired power stations to adhere to emissions standards of solid particles and nitrogen oxides, with no standards of concentration for the emission of mercury and sulphur dioxide outlined by the POEO Act or the Clean Air Regulation. Emissions limits for mercury and sulphur are regulated by environmental protection licences that are held by the power station operators. These licences often set tighter emissions limits for solid particles and nitrogen oxides than those that are stipulated under the POEO Act and the Clean Air Regulation and are currently do not include consistent limits for each power station.
What is the Clean Air Bill proposing?
The bill proposes to amend section 128 of the POEO Act by inserting a new clause that would standardise the concentration for emissions of the four main air pollutants emitted by coal-fired power stations in NSW: solid particles, nitrogen oxide, sulphur dioxide and mercury. The bill intends to embed the regulation of these air pollutants into the POEO Act, giving the exceedance limits better statutory protection and authority. The exceedance limits under the bill would apply despite any other standards prescribed by the regulations. The proposed exceedance limits would bring NSW into compliance with the World Health Organisation Global Air Quality Guidelines (WHO Guidelines).
The bill seeks to implement the new exceedance limits with immediate effect. However, in order to comply with these proposed limits, coal-fired power stations may have to install costly best available control technology (BACT). A 2020 report by WSP Global, commissioned by the Australian Energy Council (AEC), indicates an estimated $4 billion investment in BACT over the next eight years would be necessary to comply with the proposed standards under the bill.
Next steps for the Clean Air Bill
The Upper House referred the bill to the Portfolio Committee which issued its final report on 17 November 2021, stating that NSW's coal-fired power stations are "emitting air pollution at concentration levels above their international counterparts". In support of the bill, the Committee acknowledged that the bill's stricter thresholds for the concentration of solid particles, nitrogen oxides, sulphur dioxides and mercury would drive the installation of pollution control technology in line with international standards. The Committee recommended that the bill, along with committee comments and stakeholder views outlined in the final report, be debated in the Upper House. Bipartisan support of the Committee's final report and recommendations means that the bill is likely to be introduced for debate in February 2022.
There is likely to be considerable debate on the bill given the potential cost of implementing BACT to reduce pollutant emissions and also the planned closure of a number of NSW coal-fired stations.
The debate on the bill is likely to occur at same time the EPA is undertaking a comprehensive review of NSW's Clean Air Regulation, due to be completed by September 2022, with the EPA likely to be carefully considering its approach to future regulation following the recent finding by NSW's Land and Environment Court in Bushfire Survivors for Climate Action Inc v EPA [2021] NSWLEC 92 that the EPA had failed to fulfil its statutory duties on climate change.
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