Environmental impact assessment in Australia: what project owners need to understand early

For many project owners, environmental approval is something to be “obtained” once the design is settled: a box to tick, a consultant to engage, a report to lodge. That view is understandable, and it is the single biggest reason environmental assessment causes delay, redesign and cost. By the time a design is settled, the most important environmental decisions have already been made, often without anyone noticing. Where the building sits, how much land is cleared, where water goes, which route a pipeline takes and how the site is accessed largely determine the environmental effects, and therefore what assessment and approvals will be needed.

Environmental impact assessment (EIA) is the process of identifying, predicting and evaluating the likely environmental effects of a proposed action before a decision is made about whether and how it should proceed. In Australia it operates at two levels: Commonwealth law, which deals with matters of national environmental significance, and state and territory law, which deals with most other planning and environmental matters. Local councils also consider environmental effects through development approval.

This article explains, in general terms, how EIA works in Australia, when the Commonwealth’s main environmental law may apply, the typical stages of an assessment, how mitigation and offsets fit in and why starting early is the most valuable thing a project owner can do. It is general information, not legal or environmental advice. Environmental law changes regularly, differs between jurisdictions and depends heavily on the specific site, so engage qualified advisers early on any project that might trigger assessment.

Two levels of environmental assessment

Commonwealth: the EPBC Act

The Environment Protection and Biodiversity Conservation Act 1999 (Cth), usually called the EPBC Act, is the Commonwealth’s central environmental law. It requires approval for actions that have, will have or are likely to have a significant impact on a matter of national environmental significance. These matters are:

• world heritage properties;
• national heritage places;
• wetlands of international importance listed under the Ramsar Convention;
• listed threatened species and ecological communities;
• listed migratory species;
• Commonwealth marine areas;
• the Great Barrier Reef Marine Park;
• nuclear actions, including uranium mining; and
• a water resource, in relation to coal seam gas and large coal mining developments.

The Act also applies to certain actions on or affecting Commonwealth land, and actions by Commonwealth agencies.

The key word is significant. The Commonwealth publishes significant impact guidelines that help proponents judge whether an impact is likely to be significant, considering factors such as the sensitivity and value of the environment, and the intensity, duration, extent and likelihood of the impact. Many projects affect a listed species or habitat in some way without the impact being significant. Others, including relatively small ones, can have a significant impact if they affect critical habitat for a species with a very limited range.

Taking an action that requires approval without obtaining it can attract substantial penalties. The Commonwealth has also been reforming its environmental laws in recent years, so check the current requirements and guidance with the responsible department before relying on any summary, including this one.

States and territories

Most environmental assessment in Australia happens under state and territory law, usually through planning and environmental legislation. Each jurisdiction has its own framework. Examples include the Environmental Planning and Assessment Act 1979 in New South Wales, the Environment Effects Act 1978 in Victoria, the Environmental Protection Act 1986 in Western Australia and the State Development and Public Works Organisation Act 1971 for coordinated projects in Queensland. Other states and territories have their own legislation.

State frameworks typically scale the assessment to the project: from standard development applications assessed by councils, through more detailed assessments for larger or riskier developments, to full environmental impact statements for major projects. Separate environmental licences or authorities may be needed to operate, for example for emissions, waste or water discharges.

Working across both levels

A project may need both state and Commonwealth approval. To reduce duplication, the Commonwealth has entered bilateral agreements with the states and territories that allow, in certain cases, a single assessment process to satisfy both levels. Even then, the Commonwealth may still make its own approval decision. Understanding early which approvals are needed, and how they interact, prevents parallel processes from falling out of step.

When a small or medium project may be affected

Major mines, ports and highways are the obvious examples, but EIA questions arise on many ordinary business projects. Common triggers include:

• Clearing native vegetation, which may be regulated under state law and may affect habitat for listed species.
• Work near waterways, wetlands or the coast.
• Sites with known or suspected contamination, often former industrial land.
• Heritage, including Aboriginal cultural heritage, which is protected under separate state and Commonwealth laws and may require consultation with Traditional Owners.
• Emissions, noise, odour, dust or water discharges from new operations.
• Changes to an existing approved operation, which may need modification approval.

A factory expansion onto adjoining bushland, a new warehouse on a former industrial site or a regional processing plant with a new water discharge can all raise environmental assessment questions.

The stages of an environmental assessment

Assessment processes vary, but most follow a similar logic.

Screening and scoping

Screening decides whether an assessment is needed and how detailed it must be. For EPBC purposes, a proponent who considers that an action may have a significant impact on a matter of national environmental significance can refer it to the Commonwealth, which decides whether it is a controlled action requiring assessment and approval and, if so, the method of assessment.

Scoping identifies the issues that matter most for this project and site, and the studies required. Good scoping focuses effort on genuine risks rather than producing encyclopaedic reports that cover everything at the same depth.

Baseline studies take time

Baseline studies describe the environment as it exists before the project. Ecological surveys often need to be done at particular times of year, when a plant flowers, when migratory birds are present or after rain. Groundwater and water quality monitoring may need several months of data. These requirements can add a year or more to a program if they are discovered late. Asking early what seasonal data will be needed is one of the most effective ways to protect a project schedule.

Cumulative effects

An individual project’s effect may be modest, but its effect combined with other existing and planned activities may not be. Assessors increasingly expect proponents to consider cumulative effects, such as the combined loss of habitat across a region, or the combined load of several discharges into one waterway. The beyond the fence line article explains why effects that add up deserve attention even when each contribution seems small.

The mitigation hierarchy

Mitigation is usually approached through a hierarchy, applied in order:

1. Avoid the impact, for example by relocating the building footprint away from sensitive habitat or choosing a different route.
2. Minimise the impact that cannot be avoided, for example through construction timing, sediment controls, noise barriers or lower-impact methods.
3. Rehabilitate or restore affected areas after construction.
4. Offset residual impacts that remain after the other steps, by securing and improving equivalent environmental values elsewhere.

The order matters. Regulators generally expect avoidance and minimisation to be genuinely explored before offsets are proposed. Offsets are governed by Commonwealth policy for EPBC purposes and by state schemes in several jurisdictions, and they can be expensive and slow to secure. Treating offsets as a simple payment to make the problem go away is a common and costly misunderstanding.

The most effective avoidance happens at the earliest design stage, when moving a footprint costs little. Once detailed design, procurement and financing are complete, avoidance becomes expensive and minimisation and offsets become the only options.

Consultation and social licence

Public consultation is part of most significant assessments. It is also a practical opportunity. Neighbours, community groups, Traditional Owners and local authorities often hold knowledge that improves the project: where water actually flows in heavy rain, which roads become congested, which places matter culturally. Early, genuine engagement reduces the risk of objections, appeals and delays, and helps build the social licence that projects need to operate smoothly over their lives.

Conditions and compliance

Approvals usually come with conditions: management plans, monitoring, reporting, limits on activities, offset requirements and timeframes. Conditions are legally enforceable and can last for the life of the operation. A project owner should understand the likely conditions before committing to a design or budget, and should plan the people, systems and costs needed to comply.

Compliance is an operating responsibility, not a construction one. The environmental management system you can actually run article explains how to build environmental obligations into everyday operations so that conditions are met reliably.

A worked example

This is an illustrative example. The business, site and events are hypothetical.

A regional food manufacturer plans to expand its plant onto three hectares of adjoining land it already owns. The land includes a strip of remnant native woodland along a creek. The project team’s first concept places a new warehouse and truck turning area across the woodland, because it is closest to the existing loading dock.

An environmental consultant engaged at concept stage carries out a desktop screening. It identifies that the woodland may be habitat for a threatened species listed under both state and Commonwealth law, that clearing native vegetation needs state approval, and that the creek is close to a proposed stormwater outlet. The consultant advises that targeted surveys for the species can only be done in late spring, about seven months away.

Rather than waiting, the team develops an alternative layout that places the warehouse on the cleared paddock to the east, keeps a vegetated buffer along the creek and moves the stormwater outlet to a treatment basin. The truck route becomes 60 metres longer, adding modest construction and operating costs. The surveys are still carried out to confirm the position. Because the revised layout avoids the woodland, the consultant’s assessment is that a significant impact on the listed species is unlikely, and the project proceeds through state development approval with conditions on stormwater quality and the creek buffer.

Had the original layout proceeded to detailed design, the project would have faced survey delays, a likely Commonwealth referral, uncertain assessment timeframes and possibly offset costs, all to save 60 metres of driveway.

How this applies to a small Australian business

• Screen sites before buying or designing. Check vegetation, waterways, heritage, contamination and zoning before committing to a site or layout.
• Engage advisers early. A short desktop assessment at concept stage costs little and can prevent expensive redesign.
• Ask about seasonal surveys. Find out what data must be collected when, and build it into the program.
• Design to avoid. Moving a footprint at concept stage is usually the cheapest mitigation available.
• Understand which approvals apply. Council, state and, where relevant, Commonwealth approvals may all be needed.
• Plan for conditions. Budget for the monitoring, reporting and management that approval conditions will require.
• Keep records. Assessment reports, approvals and compliance records may be needed for decades.

Common mistakes

• Treating approval as a final step. The design decisions that determine environmental effects are made early.
• Assuming a small project cannot trigger Commonwealth law. Significance depends on the environment affected, not just project size.
• Starting surveys too late. Seasonal requirements can add many months.
• Jumping to offsets. Regulators expect avoidance and minimisation first, and offsets can be costly and slow.
• Consulting only to comply. Late or token consultation invites objections.
• Ignoring conditions until operation. Conditions create ongoing costs and obligations that should be planned from the start.
• Relying on out-of-date summaries. Environmental laws and guidance change; check the current position.

Frequently asked questions

Do we have to refer every project to the Commonwealth? No. Referral is required where an action is likely to have a significant impact on a matter of national environmental significance. Where there is genuine uncertainty, advisers may recommend a referral to obtain a decision.

Who prepares the assessment? Usually the proponent, with specialist consultants, under requirements set by the assessing authority.

Can approval conditions change later? Conditions can sometimes be varied through a formal process, and changes to an approved project may need a new or modified approval.

Questions to ask

• Does our site or project involve native vegetation, waterways, heritage, contamination or emissions?
• Could the project affect any matter of national environmental significance?
• Which council, state and Commonwealth approvals might be needed?
• What surveys are required, and when must they be done?
• How could the layout or design avoid the most sensitive areas?
• What conditions are likely, and what will it cost to comply with them for the life of the operation?
• Who in our business will own environmental compliance after approval?

Bringing it together

Environmental impact assessment is not a final approval step but a way of thinking about a project from its earliest stages. In Australia, the EPBC Act applies to significant impacts on matters of national environmental significance, while state and territory laws govern most other assessment and approval. The process moves from screening and scoping through baseline studies, impact prediction, mitigation, consultation and decision to long-term compliance. The cheapest and most effective step available to any project owner is to screen sites and layouts early and design to avoid sensitive areas, because once a design is settled, the options narrow and the costs rise.

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Source: KEVOS editorial notes. Examples in this article are illustrations. This article provides general information and does not constitute legal or environmental advice.