20 changes to the EPA you need to know about

In 1971, the Victorian EPA was established under the Environment Protection Act 1970 (Vic) (EP Act).  It was the second EPA to be established in the world.  On 2 December 1970, the first EPA was established in the USA.

Now 47 years after the inception of the EPA, the Environment Protection Act (Amendment) Act 2018 (Vic) was passed by the upper house on 9 August 2018 and lower house on 23 August 2018.  This Act follows the report of the Independent Inquiry into the EPA in March 2016 and the State Government’s response to that report in January 2017.  There are a large number of changes to the EPA and its powers that you and your clients need to know about if you practice in the area:

  1. Risk-based regulation: The Act represents a highly significant shift to a ‘risk based’ approach to regulation rather than simply managing the impacts of pollution on segments of the environment through the grant of works approvals and conditions on licences.
  2. Public health: While the purposes of the Act are almost identical to the purposes of the EP Act, there is a shift towards human health.  For example, the new principle of conservation requires biological diversity and ecological integrity to be protected for purposes that include the protection of human health.
  3. Governing body: The first phase of reform has already been implemented by passage of the new Environment Protection Act 2017 . Since 1 July 2018, the EPA has a new Governing Board.  The statutory role of Chief Environmental Scientist was also created.
  4. Mandatory reporting: The Act creates a new duty to notify pollution incidents as soon as reasonably practicable and a duty to take action to respond to harm caused by a pollution incident and to notify certain contamination.
  5. Corporate veil: The Act provides power for the EPA to direct a notice to a related or ‘associated’ entity over which the body corporate had control if the entity is being wound up or it has failed to comply with a notice from the EPA.  Exercise of that power is subject to a test that requires knowledge, a position of influence and a failure to exercise due diligence by the associated entity.
  6. Clean up powers: The EPA may take action in response to immediate or serious risk of harm to human health or the environment including conducting a clean up.  The EPA may make a claim on a financial assurance to cover the costs of the clean up.
  7. Cost recovery powers: The EPA may recover its reasonable costs in relation to issuing notices including improvement notices, prohibition notices, environmental action notices or site management orders.  The costs are recoverable against a person who the EPA reasonably believes caused the circumstances.  Reasonable  costs include legal costs.  Unrecovered costs may become a charge on the land and the EPA may lodge a notice of that charge with the titles office which is required to be noted in the Register.
  8. Third party rights: Third parties whose interests are affected by a contravention or non-compliance or who have been granted leave of a court may take action if the EPA has not taken enforcement or compliance action.  A court may make an order restraining a person from engaging in specified conduct or requiring specific action to be undertaken if the court considers appropriate.  Interim orders may also be made.
  9. Compensation for third parties: A court may make a compensation order requiring a person to pay compensation for injury, loss or damage and costs incurred by the interested third party.
  10. General environmental duty: A breach of the general environmental duty may incur a penalty up to 10,000 penalty units (currently $1,611,900) for a body corporate or 2000 penalty units (currently $322,380) for a natural person.  The general environmental duty requires a person engaging in an activity that may give rise to risks of harm to human health or the environment from pollution or waste to minimize those risks so far as reasonably practicable.  A breach of the general environmental duty in the course of conducting a business or undertaking is an indictable offence.  Multiple or aggravated breaches of this duty attract higher penalties – currently up to $3,223,800 for a body corporate.
  11. Development licence: Works approvals are replaced with ‘development licences’ for ‘development activities’.  A requirement to hold a development licence is triggered for construction or installation of plant or equipment or development of processes or systems for a prescribed development activity.  Certain modifications to plant, equipment, processes or systems which may create a risk of material harm to human health or the environment from pollution or waste may also trigger a requirement to hold a development licence.  This reform is coupled with a new definition of environment.
  12. Definition of environment: The old concept of ‘segments of the environment’ is replaced with a very broad definition that includes climate, water, land, atmosphere, sound, odour, taste, plants and animals and social aesthetics.
  13. Operating Licences, Permits and Registrations: The Act requires an operating licence for a prescribed operating activity and a permit for a prescribed permit activity.  A new concept of a pilot project licence is also introduced.  A registration activity triggers a requirement for authorization.  Refusal triggers a right of appeal to VCAT.
  14. Licence reviews: Operating licences must be reviewed after 4 years.  Conditions of the licence may then be varied by EPA or the licence revoked.
  15. SEPPs: SEPPs are replaced with environment reference standards which identify environmental values.
  16. Waste: The regulation of waste emissions requires detailed review by operators and industry because it represents a transformative change to waste regulation in Victoria.
  17. Audits: A new tool called a preliminary risk screen is introduced to define the scope of environmental audits.  Environmental auditors have new duties to notify the EPA in relation to imminent danger or an imminent state of danger to human health or the environment .
  18. Planning permits: The Act requires a development licence applicant to provide a copy of a planning permit or the planning scheme amendment to the EPA as part of the development licence application.  In that sense, planning permits are intended to precede the grant of EPA licences.
  19. Public Register: A new Public Register is created.  This is intended to contain details of enforceable undertakings, licences, permits or registrations that have been issued by EPA and conditions that attach in addition to the term.  The register is to be made available for inspection by the public.  Exemptions for persons or classes or persons may be applied for.
  20. VCAT Review: Rights of review to VCAT lie from decisions by the EPA to issue a notice such as an improvement notice; a prohibition notice; a notice to investigate; an environmental action notice or an abatement notice.  Further, a large list of decisions by the EPA under the Act are reviewable to VCAT including on applications for permits or authorisations, requirements to provide environmental assurances.  An application for review of a reviewable decision must be made within 15 days.  Limited grounds of review apply to certain decisions.

The reforms are proposed to have full effect by 1 December 2020, with staggered commencement dates to be proclaimed.

(c) Eliza M Bergin 2018

Water Overflow

What is the issue?

A recent decision of the Court of Appeal identifies seven factors to be considered and assessed in determining whether an overflow of water onto land is reasonable.[1]  These factors may have relevance to statutory agencies, Departments, Ministers and authorities responsible for public land or public infrastructure in particular, at times of heavy rainfall.

What was decided?

The Court of Appeal in Hazelwood Power Partnership v Latrobe City Council[2] held that the Morwell Main Drain was not a public drain for the purposes of the Water Act 1989.  Following that conclusion, the Court of Appeal considered whether the flow of water from the Morwell Industrial Estate and from the township of Morwell into the Morwell Main Drain was unreasonable.

Historically, the test of lawfulness for flow of water related to whether the landowner was uphill or downhill.  Called the ‘free flow principle’, it was considered that an owner of lower land was obliged to receive all flows of surface water onto his or her land that occurred naturally from the higher land.  The Water Act 1989 replaced the ‘free flow principle’ with a ‘reasonableness’ test.  That is, the question is no longer whether a flow of water is ‘natural’ but whether it is ‘reasonable’.

The Court of Appeal agreed with the trial Judge’s finding that the flow onto the Hazelwood land of waters generated in substantial part by the municipal drains on higher ground was reasonable.  The seven key factors considered in concluding that the water flow was ‘reasonable’ were:

  1. the contours of the land;
  2. the use of the lands concerned and the lands in the vicinity;
  3. the limited sense in which the water flow complained of from the Council drains could be said to be something other than a natural flow (ie, the ‘free flow’ principle);
  4. the purpose for which and degree of care with which the Morwell Main Drain was originally constructed by the SECV in 1949;
  5. no evidence of a lack of appropriate regard to cumulative impact of the subsequent drainage works which occurred over time;
  6. the fact that all drainage works were assumed to have appropriate statutory authority;
  7. the fact of prior consent or acquiescence to the flows of water for more than 60 years, since the Morwell Main Drain was first constructed by the SECV for the purpose of diverting flows of storm and rain water run-off from entering the open cut mine.

The Court of Appeal noted that the flow carries an ongoing risk of serious damage to the Hazelwood land and the northern batters in particular.  However in this case, the flow was considered to be reasonable.

What does it mean for me?

Advisers in government should consider these 7 factors when making an assessment of whether water flows from public land or infrastructure into private drains or onto privately held land are reasonable, particularly at times of high rainfall or floods.

[1] Hazelwood Power Partnership v Latrobe City Council [2016] VSCA 129 (Warren CJ, Osborn and Beach JJ).  See further, section 20 of the Water Act 1989

[2] [2016] VSCA 129

First published on the VGSO Blog.

Water Bill Exposure Draft: what changes will flow?

Following a comprehensive review of Victorian water law, a Water Bill Exposure Draft was released to the public in December 2013.

The Exposure Draft proposes to bring the two current Acts that govern water use and management in Victoria – the Water Act 1989 and the Water Industry Act 1994 – into a single streamlined Water Act. In addition to ironing out issues created by confusing, duplicated and obsolete provisions in the current legislation, the Exposure Draft also seeks to modernise water management practices and implement Government policies including the Living Victoria policy and the forthcoming Melbourne’s Water Future strategy.

Although many features of the current legislative regime will remain the same, the Exposure Draft proposes a new, more logical structure that should make it easier to find relevant information. It seeks to streamline and consolidate provisions which are spread across the current Acts, both of which have been subject to many water reform amendments since their commencement. A table that sets out where the equivalent provisions in the current Acts can be located in the new Exposure Draft is available here. Some current provisions – such as those governing the power to impose water restrictions – will be dealt with by Regulation.

The Exposure Draft also proposes a number of substantive changes aimed at promoting ‘whole of water cycle’ management and to bring Victorian water law into line with contemporary water and legislative practice.  Four of the most substantive changes are outlined below.

New ‘core considerations’ for decision makers

Under the current legislation, the obligations on decision makers regarding matters that must be taken into account are difficult to navigate, inconsistent and repetitive. The Exposure Draft sets out a new single set of ‘core considerations’ at the front of the Bill which the Minister – or water corporations and catchment authorities acting on the Minister’s behalf – will be required to take into account before making certain decisions, including considering applications for new licences and water shares.

The proposed core considerations include the impact a decision will have on other water users, on environmental water (and water that may not meet the definition of ‘environmental water’ but which has multiple uses including preserving environmental values and the health of water ecosystems); and on the protection of the environment generally. The concept of ‘environmental water reserve’ has been replaced by the broader concept ‘environmental water’. This is intended to better capture the concept of water in life cycle terms including: water held under an entitlement or right for the environment, and water committed under other entitlements for environmental purposes.

Replacing the current piecemeal approach with a standardised set of core considerations that will govern the making of many decisions relating to water use and management should enable greater consistency and efficiency in decision making as well as ensuring environmental protection is a priority.


Water Resource Management Order

A new concept called the Water Resource Management Order (WRMO) is proposed to describe all water management arrangements for a particular area. This will act as an umbrella under which all entitlements in the particular area will sit. That means that bulk entitlements, water shares, take and use licenses as well as statutory rights (eg, for domestic and stock use) will be located in one place and easier to understand. The current mix of regulatory instruments have been described as complex and inconsistent. The WRMO proposes to simplify water system management rules. The WRMO will include cap and trade rules that determine the maximum volume of water that can be allocated within a particular area or water system.


Statutory rights for local councils to water in stormwater drains

At common law, the position in relation to property rights that attach to the water collected in stormwater pipes and drains is complex and difficult to understand. The Exposure Draft proposes to extinguish these common law rights and confer new express rights for local councils to manage water in their stormwater works.

Under the Exposure Draft, all rights to water in local council and water corporation stormwater pipes and drains will be vested in the Crown, with the rights to take and use that water expressly conferred on local councils and water corporations. Having clear rights to use and control this water is aimed at encouraging investment in local projects to harvest and make use of stormwater that is currently going to waste.


Changes to the enforcement regime for water-related offences

The Exposure Draft also proposes a significant overhaul of the compliance and enforcement regime currently in place under the Water Act 1989 for water-related offences, including providing clearer explanations of what conduct will constitute an offence, and increasing penalties to improve deterrence.

The changes comprise multiple enforcement options that are more targeted to the nature of the particular offence, and provide alternatives to costly and time consuming court proceedings such as the use of penalty infringement notices.

The provision relating to liability for flows of water (currently s 16, new clause 671) has been clarified in a number of ways. The flows of water for which an owner of land may be held liable includes water from a tank, sewer, drain, pipe, fitting or appliance of any kind on the land.

The Exposure Draft also sets out new requirements for the valid appointment of appropriately trained Authorised Water Officers who will be responsible for administering the compliance and enforcement regime.

The Exposure Draft is open for public comment until 14 February 2014. Once finalised, it is intended that the new Water Bill will be introduced to Parliament during 2014 with a view to a new Water Act commencing on 1 January 2016.

First published on the VGSO Blog.

Water law changes in the pipeline

The Water Act 1989 (Vic), one of the longest Acts in the statute book, is under review.  Changes are not expected to significantly impact water users, however, it will change the way the Government manages water so it is important for government officers who work in areas affected by water law or the emergency services (as the review affects flood mitigation infrastructure) to keep abreast of the changes.

The Act provides the framework for allocating surface water and groundwater across Victoria.  It details the Crown’s entitlements to water and private entitlements to water from all rivers, streams and groundwater systems in Victoria, providing Water Authorities with bulk entitlements to water for urban supply or irrigation.  Authorities allocate a volumetric water entitlement to licenced individuals or companies for commercial or irrigation purposes.  It also gives individuals the right to take and use water for domestic and stock purposes.

The Act was developed over 20 years ago when the pressures on the State’s water resources were very different.  Its predecessor was enacted in the 1800s to allow the development of irrigation in northern Victoria.  Environmental considerations are a much more recent addition.  In particular, in 2005, the Act pioneered the use of the environmental water reserve, which was designed ‘to set aside a share of water in rivers and aquifers across the State for the environment’. This was the first time that rivers and aquifers gained a legal right to a share of their own water.

The purpose of the review of the Act is to streamline the legislative framework for water management and use.  This includes considering whether changes are needed to implement the Commonwealth’s Murray-Darling Basin Plan, released in November 2012.  The review will also implement new water policies adopted by the Government, including the Living Melbourne Living Victoria urban water plan and the land use change policy developed through the Western and Gippsland regional sustainable water strategies.

Currently, we are waiting with baited breath for the release of a discussion paper outlining proposed reforms to the Act and an exposure draft.  An expert panel established by the Minister is preparing this.  A six-week consultation process will occur following the release of the paper.

The discussion paper will consider the following issues:

  • Whether the way water resources are managed and allocated can be simplified, without having an adverse impact on entitlements.
  • Whether public dams that could present a hazard if they fail should be licensed in the same way as private dams.
  • Whether any further refinements to the water corporation governance reforms of 2012 are required.
  • Whether the current water service delivery functions and powers of water authorities can provide sustainable and integrated water services.  This includes ensuring the rights to alternative water sources are clear enough to enable greater use of recycled water and stormwater.
  • Whether the functions and powers that aim to protect and improve river health, floodplain management and regional drainage are sufficient.  This includes making legislative changes needed to implement the government’s response to the Environment and Natural Resources Committee inquiry into floodplain mitigation infrastructure in Victoria, some of which are discussed in the recently released Government’s Response to this inquiry.


First published on the VGSO Blog.