New South Wales (NSW) is moving towards a more sustainable future in the coal mining industry with four key decisions announced in the last three weeks of September. These decisions include planning, legislation, and legal rulings that highlight the necessary policy and planning improvements to support the transition to net-zero carbon.
Approval of the largest coal mine in NSW history
The first decision was announced on September 30 by the Independent Planning Commission of New South Wales (IPC), which includes the largest coal mine approval in the state's history. The expansion operation requests for two Hunter Valley Operations (HVO) mines were approved. On October 7, the High Court of Australia rejected MACH Energy's request to revert to the IPC's approval of the Mount Pleasant optimization project, which had been overturned by the New South Wales Court of Appeal due to the lack of consideration for Scope 3 emissions impacts.
Increased production and job support
In response to the High Court's decision, the NSW Premier announced on October 19 a law allowing MACH Energy to increase coal production at Mount Pleasant by up to one-third under the current lease until 2032. Additionally, on October 21, the NSW Parliament passed a bill dedicated to establishing the Future Jobs and Investment Agency (FJIA). This agency will provide funding and assistance for job transitions for coal workers after mines close.
Job protection and public interest
Job protection and public interest are key topics of these decisions. Each of these decisions is significant on its own, but together, they reflect the priorities and key issues of the NSW government within the framework of its legal obligations, particularly as defined by the High Court of Australia. For example, under the law announced on October 19, MACH Energy is required to guarantee 400 jobs that would be at risk without the increase in production.
The Independent Planning Commission of New South Wales has stated in its HVO ruling that the continued employment of 1,500 workers and other public benefits from the mine outweigh the costs associated with the emission of over 800 million tons of greenhouse gases. These decisions also emphasize that the granting of mining licenses and job protection is justified by referring to the net public benefits created by the projects.
Challenges of economic assessment and emissions impacts
The issuance of mining licenses and job protection is justified by referring to the net public benefits created by the projects. However, economic assessments that do not fully consider the impacts of Scope 3 emissions need to be revisited. IEEFA has previously pointed out methodological flaws outlined in the NSW government's guidelines, which are inadequate not only in terms of valuing emissions but also omit part of the costs considering NSW's share of the global population.
These methodological flaws and the need for a revision of the guidelines have become more pressing. Additionally, the need for viable exit plans from mines and providing at least three years' notice before mine closures to ensure community assurance are other challenges ahead.
