Living Wonders appeals – judgment overview

20 May 2024

On 16 May 2024, the Full Court of the Federal Court of Australia delivered its decision to dismiss the appeals in the Living Wonders cases.

Background to the appeals

In July 2022, the Environment Council of Central Queensland (ECoCeQ) requested the federal Environment Minister reconsider the environmental risk assessment for 19 large coal and gas projects under Australia’s national environment laws.

You can read more about the reconsideration requests and the evidence ECoCeQ provided to the Minister here.

ECoCeQ argued that the risk assessment decisions for the projects should be remade to recognise that the greenhouse gas emissions from using coal and gas produced by the projects would contribute to climate change, which would, in turn, harm Australia’s protected species, ecosystems and places.

Minister Plibersek made a decision in response to the reconsideration requests for the Narrabri Underground Mount Pleasant and Ensham coal mine extensions in May 2023. In these decisions, the Minister accepted that climate change will harm Australia’s protected species and places, but decided she could not be satisfied that the emissions from the two coal mine extensions would have an ‘impact’ on the protected species within the technical meaning of ‘impact’ under the national laws. You can read more about the Minister’s reasoning here.

ECoCeQ challenged the Minister’s decisions before Justice McElwaine in the Federal Court in September 2023. You can read about the initial hearings here.

In October 2023, his Honour Justice McElwaine handed down his decision in Environment Council of Central Queensland Inc v Minister for the Environment (No 2) [2023] FCA 1208. His Honour dismissed ECoCeQ’s case.

The appeals

ECoCeQ appealed Justice McElwaine’s decision to the full bench of the Federal Court. The appeals were heard by Chief Justice Mortimer and Justices Colvin and Horan in February 2024. You can read more about the appeal hearings here.

The judgment handed down by the Full Court

Justice Colvin delivered the judgment and orders of the Full Court on 16 May 2024.

All three members of the Court agreed that ECoCeQ’s appeal should be dismissed, but for different reasons. In summary, Chief Justice Mortimer and Justice Colvin found that ECoCeQ had misinterpreted the Minister’s reasons for her decision, and that ECoCeQ’s arguments about those reasons being unlawful were therefore incorrect. Justice Horan accepted ECoCeQ’s characterisation of the Minister’s reasoning process, but found that this way of reasoning was permitted under the law.

The majority judgment

ECoCeQ argued the Minister used a hypothetical or counter-factual ‘what if’ scenario in which these two coal mines don’t go ahead, but other coal mines of equivalent output do, as a critical step in deciding that the mines would not cause a ‘net increase’ in global greenhouse gas emissions (and, therefore, would not have an impact on protected species and places). ECoCeQ argued this type of ‘substitution’ reasoning was not allowed under the law.

Chief Justice Mortimer and Justice Colvin disagreed with ECoCeQ’s interpretation of the Minister’s reasons.

Their Honours examined the Minister’s reasons and concluded that:

  • The Minister accepted that the material provided to her by ECoCeQ showed that global greenhouse gas emissions would harm Australia’s protected species and places.
  • The Minister also accepted that if the emissions from combusting coal from the mines could be shown to be a ‘substantial cause’ of climate change, they would fall within the legal definition of ‘impact’.
  • However, the Minister decided that because there were multiple variables affecting whether the mines would cause a net increase in global emissions, and because any net increase to emissions that did occur would be very small, she could not be satisfied that emissions from the mines, if they went ahead, would be a ‘substantial cause’ of the climate harms to protected species, places and ecosystems.

Their Honours found that in her reasoning process, the Minister had assumed the mines would go ahead and had not done the counterfactual reasoning ECoCeQ had argued she did. This meant that ECoCeQ’s arguments about this reasoning being unlawful had to be dismissed.

ECoCeQ also argued it was legally irrational for the Minister to use data about coal use and global emissions from 2019 to decide that total emissions from the mines would make a very small contribution to climate change, in circumstances where the overall amount of global emissions in the future cannot be known.

Chief Justice Mortimer and Justice Colvin also dismissed this ground of appeal, finding that the Minister’s reliance on this information was a reasonable approach to her task in deciding whether she was satisfied that the mines’ emissions would be a substantial cause of climate harms, even if that information was based on some assumptions about what would happen.

In their conclusion, their Honours noted:

Notwithstanding [the] conclusions on the grounds of appeal, the arguments on this appeal do underscore the ill-suitedness of the present legislative scheme of the EPBC Act to the assessment of environmental threats such as climate change and global warming and their impacts on [matters of national environmental significance] in Australia.

Justice Horan’s judgment

Justice Horan also decided that the appeals should be dismissed, but for slightly different reasons.

His Honour accepted that the Minister was required to identify the direct and indirect consequences of the mines going ahead, and not to hypothesise what might happen in a future in which these mines do not go ahead.

However, His Honour found that the Minister was able to have regard to the many uncertainties and ‘variables’ relevant to what those consequences might be. Contrary to ECoCeQ’s arguments, His Honour found that it was legally permissible for the Minister to conclude that the variables affecting the potential contribution of the mines’ emissions to climate harms meant she could not be satisfied these emissions would be a ‘substantial cause’ of impacts to the species and places protected by the law.

Justice Horan also agreed with Chief Justice Mortimer and Justice Colvin’s comments about the ill-suitedness of the national environmental laws to assessing the impacts of climate change on Australia’s protected places, species and ecosystems.

ECoCeQ's grounds for appeal - summary

15 February 2024

The Living Wonders cases are a ‘judicial review’ – which means they involve a judge (or multiple judges) reviewing whether the Minister’s made a decision properly, in accordance with the law (rather than whether it was the right decision). This means the litigation can often focus on specific, technical parts of a decision, and highly nuanced legal argument.

First ground: Market substitution approach

In their first ground, ECoCeQ argued the Environment Minister’s use of market substitution reasoning to refuse to reassess two huge new coal mines for their climate harm was unlawful.

Market substitution reasoning – also called the ‘drug dealer’s defence’ – in its most basic form, argues that if these two companies don’t go ahead and dig up this coal, other companies will dig up other coal – and the same amount of greenhouse gas emissions will occur anyway.

Fossil fuel companies often use this argument to deflect responsibility for the harm that coal and gas is doing to our environment.

ECoCeQ argues that using ‘market substitution reasoning’ is not a legally permissible way for the Environment Minister to approach that task.

Second ground: ‘Likely’ harm

In their second ground, ECoCeQ argued the Minister asked herself the wrong question when she considered the impacts of the coal mines.

They argued the Minister, because of how the current law is written, needed to consider whether it was ‘likely’ the mines would cause climate harm. Instead, she asked whether climate harm ‘will’ be caused by the emissions from these mines.

ECoCeQ argues this distinction between ‘will’ and ‘likely’ is critical in light of the evidence in this case. While climate harms are already being felt across Australia, the global scientific community is clear the decisions our governments are yet to make will determine the severity of future climate harm on our living wonders.

With all that is at stake, ECoCeQ argued ignoring the risk of ‘likely’ harm in favour of certain harm is inappropriate.

Third ground: Legal irrationality

For their third ground, ECoCeQ argued the Minister’s decision was legally irrational when she found there would be no ‘net increase’ in emissions from the mines because, following the market substitution argument, other coal would be dug up elsewhere if not here.

In climate science, there are many different versions of the future that could feasibly happen – but it’s impossible to know exactly what will happen in the future.

Therefore, according to ECoCeQ, the Minister’s finding was irrational because she simply cannot assume with certainty the same amount of coal and emissions would be created elsewhere if not through these two projects.

Fourth ground: Expert report

ECoCeQ’s fourth ground was about an expert report that was ruled irrelevant to their arguments by the first Federal Court judge last year.

The report was about climate science and modelling future scenarios. ECoCeQ argued it is relevant to their third ground, because it sets out why it is impossible to know which possible future emissions and climate scenarios are more likely than others.

Fifth ground: ‘Substantial’ harm

In their fifth and final ground, ECoCeQ argued the Minister applied the law incorrectly when she decided the climate harm from the proposed mines would not cause ‘substantial’ harm to protected animals, plants and places.

The Minister compared the emissions that would be produced by each mine to total global emissions at a single point in the past, and in this context concluded the emissions from the mines would be ‘very small.’

ECoCeQ argues this approach was irrational because it does not consider future scenarios where global emissions are reduced significantly. Were the emissions of these mines compared to total global emissions at a point in the future, in a context where emissions have significantly lowered, these two mines would then make a significant contribution to the climates harm impacting protected species and places.

Living Wonders appeals in the Full Federal Court – Day 2 recap

13 February 2024

The appeals in the Living Wonders climate cases continued today in the Full Federal Court of Australia, before their Honours Chief Justice Mortimer, Justice Horan and Justice Colvin.

In the morning, Michael Izzo SC made oral submissions on behalf of the Second Respondents, MACH Energy Pty Ltd (the proponent of the Mount Pleasant Optimisation coal project) and Narrabri Coal Operations Pty Ltd (the proponent of the Narrabri Underground Stage 3 Extension coal project).

The Second Respondents responded to each of ECoCeQ’s grounds of appeal, arguing the Minister’s decision to refuse to change the risk assessment decisions following ECoCeQ’s reconsideration requests for the two coal mines was in line with what the national environmental law required her to do.

One of the submissions Mr Izzo SC made on behalf of the Second Respondents is that ECoCeQ’s arguments mischaracterised the Minister’s reasons for her decision. Mr Izzo said the Minister had not made a positive finding that if the mines did not proceed, the coal (and emissions) they would have produced would be created by other mines anyway (the ‘market substitution’ reasoning which was a key aspect of ECoCeQ’s case).

Rather, the Second Respondents argued, the Minister identified this possibility as one of many variables influencing the potential contribution the mines would make to global warming, and then decided that because of these many variables, she could not be satisfied the information provided to her by ECoCeQ showed the mines would have an ‘impact’ on the species and places protected by the national environment law. The Second Respondents argued that this means ECoCeQ’s submissions about it being unlawful for the Minister to use substitution reasoning to ‘net off’ or negate the potential impacts of proposed projects were incorrect.

After lunch, Stephen Lloyd SC made arguments against ECoCeQ’s case on behalf of Minister Plibersek.

Mr Lloyd took the Court to relevant sections of the national environment law, and then to parts of the Minister’s reasons that, Mr Lloyd submitted, illustrated that Minister Plibersek accepts that climate change is occurring. Mr Lloyd submitted that the Minister accepted each coal project would lead to indirect consequences from climate change for species and places protected by the national environment law, but that she found that each mine would not be a substantial cause of the adverse effects of climate change on these species and places.

Mr Lloyd argued that, contrary to ECoCeQ’s arguments, the way the Minister made these findings was a correct application of the law.

In the afternoon, Mr Nevkapil SC closed the hearing with submissions in reply on ECoCeQ’s behalf.

Mr Nevkapil disputed some aspects of how the First and Second Respondents had characterised the Minister’s reasons, and responded to how Mr Lloyd argued the test for whether something is an ‘impact’ under the national environmental law should be interpreted.

Their Honours reserved their decision, with judgment to be delivered at a later date.

Living Wonders appeals in the Full Federal Court – Day 1 recap

12 February 2024

The appeals for the Living Wonders climate cases began today in the Full Court of the Federal Court of Australia, before their Honours Chief Justice Mortimer and Justices Colvin and Horan.

The appeals are against Justice McElwaine’s decisions in Environment Council of Central Queensland v Minister for the Environment (No 2) [2023] FCA 1208.

These cases are about whether the environmental risk assessment for two large coal projects, the Mount Pleasant Optimisation and the Narrabri Underground Stage 3 Extension, made under Australia’s national environmental law should have included scrutiny of the impacts of fossil fuel-driven climate change on the nationally protected species, ecosystems and places protected.

For a full recap of the initial hearings in September last year, read more here.

In court today

Today in court, ECoCeQ’s barrister Emrys Nekvapil SC set out the grounds of ECoCeQ’s appeals against Justice McElwaine’s decisions.

Ground 1: the Minister’s task under the national environmental law is to consider the likely consequences of the actual action that is being proposed, and not what might happen in another, hypothetical world.

When the Minister refused ECoCeQ’s reconsideration requests for the Mount Pleasant and Narrabri coal projects last year, she reasoned that if the two coal projects do not go ahead, other companies will dig up other coal and the same amount of greenhouse gas emissions will occur anyway. It follows that approving these two coal mines would not cause a ‘net’ increase in global emissions and would not, therefore, have an ‘impact’ on protected species and places. This is known as ‘market substitution reasoning’.

ECoCeQ argues that using ‘market substitution reasoning’ is not a legally permissible way for the Minister to approach that task.

Mr Nekvapil gave the Court a hypothetical example about chemicals factories around a lake to explain why the approach the Minister took can’t be in line with what the law requires.

According to the example, two competing companies, A and B, propose building a factory that will release cyanide into a nearby lake. There are already several factories releasing cyanide pollution into the lake, and the accumulation of cyanide in the lake is harming a threatened fish species. If the Minister’s approach was correct, then neither company A nor company B’s factory would have any ‘impact’ on the threatened fish because if company A didn’t build its factory, company B would, and vice versa – either way, additional cyanide would be released into the lake. The problem with this, ECoCeQ argues, is that harm from cyanide poisoning would, in fact, occur to the fish if either of the factories was actually built. Therefore, this ‘market substitution’ approach can’t be allowed under a law designed to protect the environment.

Ground 2: the Minister asked herself the wrong question when she considered the impacts of the coal mines.

The Minister asked whether effects of climate change on threatened species and protected places ‘will’ be caused by emissions from the mines. Instead, because of how the law is written, she was also supposed to ask herself whether it was ‘likely’ that the mines would cause these climate harms – which, ECoCeQ says, the evidence demonstrates is the case.

Ground 3: the Minister’s finding that there would be no ‘net increase’ in emissions from the mines was legally irrational.

According to climate science, although there are many different future scenarios that are feasibly possible, it is impossible to know with certainty what will happen in the future. ECoCeQ argues it was therefore irrational for the Minister to assume with certainty that if the relevant coal project didn’t go ahead, equivalent quantities of coal and emissions would be produced anyway – in the process ruling out the many better possible futures where there is no long-running global market for thermal coal.

Ground 4: Justice McElwaine was incorrect to find an expert report about climate science and the modelling of future scenarios was not relevant to ECoCeQ’s arguments and therefore not admissible. ECoCeQ argues that the report is relevant because it sets out why it is impossible to know which possible future emissions and climate scenarios are more likely than others.

Ground 5: the Minister applied the law incorrectly when she concluded that any contribution made by the coal mines to global climate change would not be a ‘substantial’ cause of climate harms to protected species and places.

In her reasons, the Minister compared the volume of emissions resulting from each mine to total global emissions at a single point in the past , and concluded the emissions from the mines were ‘very small’ in that context.

But, in future scenarios where the world succeeds in reducing emissions, total global emissions will drop sharply and, in those better future scenarios, the emissions from the mines would actually make a significant contribution to the seriousness of the impacts of climate change on protected species and places. ECoCeQ argues it was irrational for the Minister to assume global emissions would stay the same in future decades, and to conclude that the emissions from these coal mines are therefore not a ‘substantial’ cause of climate harms to protected species and places.

The hearing will recommence tomorrow, with arguments on behalf of the coal companies in the morning, followed by arguments from the Minister’s representatives.

Watch the Federal Court Living Wonders livestream

The Living Wonders Full Federal Court appeals will commence at 10am on Monday 12 February, and are scheduled to run until 4pm on Tuesday 13 February.

Click this link to go to the Federal Court’s Youtube page.

The Court requests:

  • Recording of Court proceedings is prohibited.  
  • You must ensure your microphone is muted and your video is off for the entire duration of the hearing, if applicable.
  • Members of the public are not permitted to actively participate or interrupt Court proceedings. You may be removed from the hearing if you interrupt the proceedings.
  • You must comply with any direction the Court may make with respect to public access to the hearing, which may include removing yourself from the livestream.

Minister agrees not to approve new coal or gas plans before Living Wonders appeals decided

ECoCeQ is challenging the Minister’s risk assessment decisions in relation to the Narrabri and Mount Pleasant proposals, marking the first court challenges to a coal or gas decision made by Australia’s current Environment Minister.

Currently, five coal and gas projects subject to the Living Wonders intervention have been either withdrawn by proponents or effectively shelved, and 11 reconsideration requests remain before the Minister awaiting her decision:

  • North West Shelf Extension – Woodside Energy – Pilbara, WA
  • Alpha North Coal Mine Project – Waratah Coal – Galilee Basin, western Qld
  • Gas Supply Security Project, Australia Pacific LNG – Surat and Bowen Basins, central and south-west Qld
  • Baralaba South Coal Project – Mount Ramsay Coal Company – Bowen Basin, central Qld
  • Moorlands open cut coal mining project – Cuesta Coal – Bowen Basin, central Qld
  • Saraji East coal mining project – BHP Billiton Mitsubishi BM Alliance – central Qld
  • Winchester South coal mine project – Whitehaven – central Qld
  • Lake Vermont Meadowbrook Coal Mine Project – Bowen Basin Coal – central Qld
  • Boggabri coal mine expansion – Idemitsu – northern NSW
  • Meandu Mine King 2 East Project – TEC Coal (Stanwell) – south east Qld
  • Caval Ridge Mine Horse Pit Extension – BHP Mitsubishi Alliance – Bowen Basin, central Qld

As they prepare for their upcoming appeal hearing, ECoCeQ has received written assurance from the Minister that neither the Minister nor her delegate will make any decision to approve either Narrabri, Mount Pleasant or these other 11 pending coal and gas proposals currently before the Minister for reconsideration, until the appeals have been heard and determined.

Some of the proposals subject to the reconsideration requests have recently cleared further hurdles towards approval: Caval Ridge Mine Horse Pit Extension (Qld), Boggabri Coal Mine (NSW) and Winchester South Coal Mine (Qld) and have recently received approval by State Governments.

However none of these proposals can go ahead without the Federal Environment Minister’s final approval.

Further, in line with published departmental policy, the Minister must deal with ECoCeQ’s reconsideration requests before moving to approve any of these proposed projects.

Living Wonders climate cases appealed to the Full Federal Court

The Environment Council of Central Queensland (ECoCeQ), represented by Environmental Justice Australia, has filed two appeals to the full bench of the Federal Court, challenging the Australian Environment Minister’s refusal to scrutinise new coal and gas projects for their climate harm.

The appeals come after Federal Court Judge Justice Shaun McElwaine dismissed the Living Wonders climate cases in early October.

However ECoCeQ, with the greatest respect, believes the Federal Court Judge made the wrong decision.

ECoCeQ argues that, in her decision-making not to change the risk assessment of these mines to account for their asserted climate impacts, Australia’s Environment Minister has not fulfilled her legal role or complied with her obligations under the law. They argue that her approach is irrational and illogical and unlawful.

These are critically important and complex legal questions which the full bench of the Federal Court is now being asked to determine.

ECoCeQ is also calling on the Minister to make an undertaking not to approve these coal mines before these court cases are determined.