Second stage of EPBC Act reforms announced: draft legislation expected shortly

Creation of two new independent agencies and $100m investment 6 min read

On 16 April 2024, the Federal Minister for the Environment and Water announced the progress of a discrete package of reforms to the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act). This is the second stage of the Government's 'Nature Positive Plan: better for the environment, better for business' (Nature Positive Plan).

Draft legislation is expected to be introduced into Parliament in the coming weeks to create two new national independent bodies:

• Environment Protection Australia (EPA): a new federal environmental regulator, which will administer and enforce a range of federal-level environment laws, including the new Nature Positive Legislation; and
• Environment Information Australia (EIA): which will house national environmental data, release State of the Environment Reports, and report on progress on national environmental goals.

The Government has also announced it is allocating $100m towards delivering faster environmental approval decisions for new projects, amongst other initiatives.

In this Insight, we highlight the key aspects of the reform package. We are monitoring the introduction of the draft legislation, expected during May 2024, and will provide further updates when the detail becomes available.

Background to the reforms

The EPBC Act is facing a period of significant reform.

Following the 38 recommendations made in the independent review of the EPBC Act by Professor Graeme Samuel AC in October 2020 (Samuel Review), the Government provided its response in its Nature Positive Plan dated December 2022.

The Nature Positive Plan identifies the priorities that will guide the Government's reform agenda for 'the most comprehensive remaking of national environmental law since the EPBC Act was first introduced'.¹

The first stage of EPBC Act reforms was completed in late 2023, with the creation of the Nature Repair Market and expanding the 'water trigger' for assessment of coal and unconventional gas developments.

The announcement is to progress the second stage of the reforms aligning to one of the three fundamental principles in the Nature Positive Plan, being:

'A commitment to restoring public accountability and trust in environmental decision-making through an independent EPA, regular reporting on progress towards environmental goals and making environmental data publicly accessible'.²

Minister for the Environment and Water of Australia, Tanya Plibersek has stated that the creation of the new EPA and EIA will deliver:

'… stronger environmental powers, faster environmental approvals, and more environmental information and transparency'.³

The third stage of the reforms will undergo a process of further consultation before exposure drafts of the new laws are released for public comment.

Environment Protection Australia

In assessing the effectiveness of decision-making, compliance and enforcement functions under the EPBC Act, the Samuel Review concluded that there are currently low levels of trust in the operation of the current regime, and that the Government's performance in making and enforcing decisions under the law is highly variable. It recommended reforms to ensure strength, consistency and independence in the compliance and enforcement system in particular.

In response, the Government will establish the EPA as a new national-level environmental regulator. Going further than the recommendations in the Samuel Review, the EPA's functions will extend beyond compliance and enforcement to also include assessment and approval decisions for new projects—shifting responsibility away from the Environment Minister to the new agency. The EPA will initially operate within the Department of Climate Change, Energy, the Environment and Water (DCCEEW) before becoming an independent statutory authority.

The EPA is proposed to have a broad range of functions and powers, including:

• assessing project proposals, issuing approvals and deciding post-approval matters;
• administering and enforcing a range of federal environmental laws, including the New Nature Positive Legislation plus the Sea Dumping, Ozone and Synthetic Greenhouse Gas Management, Hazardous Waste, Product Emissions Standards, Recycling and Waste Reduction, and Underwater Cultural Heritage Acts; and
• significant compliance and enforcement powers, including:
  • issuing 'stop-work' orders;
  • penalties of up to $780 million for intentional breaches of environmental laws;
  • initiating criminal proceedings; and
  • auditing businesses to ensure compliance with approval conditions.

Under the New Nature Positive Legislation the EPA will have primary responsibility for approving new proposals, it is proposed that the Environment Minister will be able to 'call in' proposals under assessment, diverting approval decisions for those projects away from the EPA. This could be a useful circuit breaker for proposals not progressing through EPA assessment processes. However, since the Minister's call-in power will not apply to proposals being assessed under state and territory-level accredited processes, it may have limited practical application.

Environment Information Australia

The Samuel Review identified that the current environmental data and information framework is complex, unreliable and incomplete, and recommended amalgamating environmental information and data systems into a single 'federated' data platform for environmental information.

The Government has established EIA within DCCEEW. The Nature Positive Plan proposes that EIA will be the source of trusted national environmental data and information to support decision-making and for proponents.

The new legislation is expected to establish a new statutory position of the Head of the EIA and provide for the independent statutory functions, powers and obligations of the position. It is expected that the EIA will have a range of functions related to managing environmental data and information, including managing a public data portal, reporting on environmental matters and preserving environmental data and information to support decision-making.

Although the draft legislation is not yet available, the Consultation Paper published by DCCEEW in December 2023⁴ proposed that EIA will:

• oversee and coordinate improvements to Australia's environmental data and information, and address key data and capability gaps;
• develop and implement a monitoring, evaluation and reporting framework on national environmental objectives;
• bring together and make accessible authoritative data from a range of sources, including proponents and state and territory regulators;
• oversee the preparation of a State of the Environment Report every two years;
• establish and maintain environmental-economic accounts, which will provide information about the extraction of natural resources, their use within the economy, natural resource stock levels, the changes in those stocks during a specific period and economic activity related to the environment; and
• track environmental trends and outcomes and report on progress towards environmental goals.

The Consultation Paper also indicates that the public portal will include a mapping visualisation tool to provide guidance to proponents to help avoid and mitigate impacts on environmental values and achieve faster environmental approvals.

EIA is also proposed to advise the Government on developing a new National Environmental Standard for data and information, as well as designating certain environmental information (such as a database or model held by EIA or other federal agencies or non-government entities) that it views as critical for supporting decision-making as National Environmental Information Assets.

We expect that the new EIA will have significant implications for the nature and extent of the information required to be provided by proponents in support of project applications.

$100 million investment

The Government has also announced it will invest $100m towards facilitating faster environmental approval decisions under the EPBC Act.

Minister Plibersek identified in a Media Release on 16 April 2024 that the investment will include:

• more support for staff to assess project proposals from business, including renewables and critical minerals;
• more tailored support to help business more effectively comply with environment law;
• more funding for research into threatened species, so that sensitive areas can be more easily avoided and suitable projects can be more quickly approved based on robust, existing publicly available data; and
• more planning—working with state and territory governments—in seven priority regions so it's clearer to business where complying development can more easily occur and where the 'no-go' areas are.

At this stage, no further information is provided in relation to the detail as to how this additional support and planning will be implemented and achieved.

What's next?

Draft legislation to give effect to this second stage of reforms is expected to be introduced into Parliament in the coming weeks—likely in May 2024.

Notwithstanding that only a discrete package of reforms has been announced at this stage, if passed by Parliament they are likely to significantly change the landscape for federal environment regulation—from the manner in which proponents apply for approvals under the EPBC Act and the extent of the supporting information that will be required to accompany any such application, to ongoing compliance with environment laws. Given the significance of the creation of a new independent EPA with new powers to audit compliance and issue 'stop-work' orders, it will be important for organisations to have strong environmental governance measures and systems in place to manage compliance.

We are monitoring the introduction of the new legislation and will provide further updates once more detail becomes available.