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Focus: The evolving landscape for Victorian wind farms

30 August 2011

In brief: An amendment yesterday to all Victorian Planning Schemes further implements the government policy to restrict the locations for development of wind farm projects in Victoria. Amendment VC82, like VC78 in March this year, has the potential to limit development of further wind farms in Victoria and will also impact on already approved wind farms if changes are required to plans or permit conditions. Partner Chris Schulz (view CV) and Senior Associate Meg Lee report.

• Background
• What does VC82 do?
• What does this mean for approved wind farms yet to be commenced?
• What is still to come?

Background

In March this year, we reported on Amendment VC78 which implemented part of the Baillieu Government's pre-election policy on wind farms including:

• additional application requirements, including a requirement to show dwellings within two kilometres of all turbines;
• to return decision-making for new wind farms to local councils; and
• to replace all references to the New Zealand Standard NZ6808:1998 Acoustics – The Assessment and Measurement of Sound from Wind Turbine Generators (the 1998 Standard) with references to the NZS6808:2010 Acoustics: Wind Farm Noise (the 2010 Standard), including a requirement to assess whether the area is a 'high amenity area' under the 2010 Standard.

The policy package also included the following elements that were not given effect to by the March amendments:

• that the placement of turbines will be no less than two kilometres from the nearest home, unless a contract between the resident and wind farm developer is agreed;
• the establishment of no-go zones for wind farms at places such as Wilson's Promontory, the Mornington and Bellarine peninsulas, the Surf Coast and Great Ocean Road regions and sections of the Bass Coast; and
• the establishment of a shared payment system for land owners whose properties are within one kilometre of the nearest turbine, as a compensation mechanism for adjacent landholders.

Planning Scheme Amendment VC82, gazetted on 29 August 2011, makes changes to the Victoria Planning Provisions and to all Planning Schemes in Victoria to give effect to the two of these three remaining pre-election policy promises. It doesn't, however, deliver on the promise of a shared payment system. Advisory Note 36 has been issued by the Minister to outline the changes made by Amendment VC82.

What does VC82 do?

VC82 makes the following key changes to all Victorian Planning Schemes.

First, it implements a prohibition on wind farms in certain areas listed in the table at clause 52.32-2 and in the new schedules to 52.32 for each planning scheme. The prohibited locations include:

• land in the Urban Growth Zone (by amending clause 37.07);
• land where any turbine that forms part of the wind energy facility is located within two kilometres of an existing dwelling, unless there is evidence of a written consent of any owner of the dwelling in accordance with Clause 52.32-3. The prohibition does not apply to a facility that is integrated as part of the development of the land in a residential zone, industrial zone, business zone or special purpose zone such as the ANZ six-star Docklands headquarters;
• land described in a schedule to the National Parks Act 1975, with a condition that the prohibition does not apply to a wind energy facility principally used to supply electricity to a facility used in conjunction with conservation, recreation, administration or accommodation use of the land;
• land declared a Ramsar wetland as defined under section 17 of the Environment Protection and Biodiversity Conservation Act 1999 (Cth); and
• land listed in a schedule to Clause 52.32 in the relevant planning scheme, including:
  • all land covered by the Mornington Peninsula and Yarra Ranges planning schemes;
  • most of the Bellarine Peninsula,
  • the Great Ocean Road region;
  • land in the Macedon and McHarg ranges; and
  • land within five kilometres of the high water mark of the coast in the Bass Coast planning scheme and South Gippsland planning scheme west of Wilson's Promontory
• land within five kilometres of major regional cities and regional centres specified in the Regional Victoria Settlement Framework in the State Planning Policy Framework (namely, Mildura, Swan Hill, Echuca, Shepparton, Benalla, Wangaratta, Wodonga, Horsham, Ararat, Ballarat, Greater Bendigo, Hamilton, Portland, Warrnambool, Colac, Geelong, Moe, Morwell, Traralgon, Sale and Bairnsdale). It is important to note that the prohibition in these locations does not apply to a wind energy facility integrated as part of the development of the land where the land is in a residential zone, industrial zone, business zone or special purpose zone.

Second, the Amendment introduces an additional application requirement for evidence of written consent of any owner of an existing dwelling located within two kilometres of a proposed turbine that forms part of the wind energy facility.

Third, the Amendment introduces a new provision in Clause 52.32-6 that specifies that a permit may be granted for use and to develop land for the purpose of wind measurement by an anemometer for a period of more than three years. This change clarifies an anomaly in the previous provisions.

Finally, the Amendment consolidates the application requirements that were previously included in both Clause 52.32 and a separate Incorporated Document – Policy and planning guidelines for development of Wind energy facilities in Victoria (March 2011) (the March 2011 Guidelines). An updated Guidelines document has also been published – the Policy and planning guidelines for development of Wind energy facilities in Victoria (August 2011) (the August 2011 Guidelines). The Amendment therefore also amends clause 81.01 (Incorporated Documents) to introduce the August 2011 Guidelines as a reference document (not an incorporated document) in all Schemes (at clause 81.01) and also to list this document in clauses 19.01 and 52.32, replacing the references to the earlier March 2011 Guidelines.

These March 2011 Guidelines were previously introduced as a result of Amendment VC78 and were an update of the earlier version produced by the previous Victorian Government. In our March article, we outlined the significant changes made to the guidelines at that time. The latest changes to the August 2011 Guidelines are not as substantial. They are:

• a new section setting out what evidence is required to be provided to a responsible authority of the consent of an owner of a dwelling for a turbine proposed to be located within two kilometres of a dwelling, including an example consent form;
• new site analysis requirements to show the location of any land in the vicinity of the project which is land on which wind farms are now prohibited by clause 52.32-2 and the schedules to that clause;
• a more detailed section on biodiversity assessments, including requirements to consider the cumulative effects of other wind farms in the area;
• the inclusion of the model wind farm permit conditions in Appendix B (previously published as a separate document on the Department's website); and
• some changes to the section on Responsible Authority, attempting to clarify whether Councils or the Minister are responsible for wind farms.

We are aware that there has been some confusion since VC78 amended clause 61 of the Schemes about whether the relevant Council or the Minister is the Responsible Authority for permits previously issued by the Minister under Division 6, Part 4 of the Planning and Environment Act 1987 (Vic) (the P&E Act), particularly in relation to entering into section 173 Agreements as required by these permits. The commentary in part 6 of the August 2011 Guidelines starts with the proposition that the municipal council is the responsible authority for administration of a planning scheme unless a scheme provides to the contrary (section 13(a) of the P&E Act). Part 6.3 also states that the Minister remains responsible for extending, correcting or amending a permit issued by the Minister under Division 6 and will also be responsible for any conditions within the permit (including entering section 173 Agreements) that expressly require matters to be done to the Minister's satisfaction.

In our view, s97H is determinative. It provides that, once a permit is issued under Division 6, the 'first responsible authority' becomes the responsible authority for the administration and enforcement of the Act and the Scheme in respect to the permit. The 'first responsible authority' is defined as the authority who referred the planning permit application to the Minister under s97B or s97C. At the relevant time for all of the Division 6 wind farms, pre-Amendment VC78, the Minister was the responsible authority for wind farms over 30 MW and therefore was effectively the 'first responsible authority'. Amendment VC78, while altering the responsible authority for all future wind farm applications, does not effect existing permits issued by the Minister before Amendment VC78.

What does this mean for approved wind farms yet to be commenced?

The 'no-go zones' cannot be applied retrospectively. Therefore, any wind farm permit that might have been issued previously in relation to an area where wind farms are now prohibited, will have the benefit of existing use rights under clause 63 of the Schemes. However, the provisions of clause 63 will apply to any of those permits so that the use must commence before the permit expires or the existing use rights will be lost. Further, there are restrictions in clause 63.05 that will limit the ability of wind farms in these areas to expand or carry out additional buildings and works.

Amendment VC78 introduced transitional arrangements into clause 52.32. The arrangements have been preserved by Amendment VC82 and are now located in 52.32-7.

In summary, the effect of those provisions is that any planning permit for a wind energy facility issued before 15 March 2011 remains valid. If the permit needs to be extended under section 69 of the P&E Act, then so long as the application is made before 15 March 2012, then the wind farm does not need to comply with the new provisions forming part of the amendment and the application for amendment will be assessed against the provisions as they were before 15 March 2011. Any applications made after this time will be assessed against the new, post-VC82 planning framework. Further, clause 52.32-7 specifically states that any extension of time granted under the transitional arrangements cannot specify a date later than 15 March 2012 as the date by which development must commence, which leaves a very narrow window within which to commence development, particularly given the long lead time on turbine supply contracts.

If a permit needs to be amended, then the transitional provisions provide that a permit amendment application under Division 1A of the P&E Act will be assessed against the pre-15 March 2011 framework.  However, most wind farm permits have been issued by the Minister under Division 6 of the P&E Act or at the direction of the Tribunal. Such permits are not amended under Division 1A, but rather sections 97I and 87A respectively and therefore do not have the benefit of the transitional provisions.  In assessing such applications for amendment, the Minister (or the Tribunal) will assess the application against the new provisions. This may, depending upon the amendment sought, mean that turbines within two kilometres of a dwelling that has not provided written consent will be required to be deleted as a condition of the amendment.  Wind farm operators with permits issued under Division 6 should therefore carefully consider and review their need to amend their permits to minimise the risks of such a scenario.

What is still to come?

One of the elements of the pre-election policy that has not been addressed through either Amendment VC78 or Amendment VC82 is the proposed 'shared payment system' for land owners whose properties are within one kilometre of the nearest turbine. Indeed, this is not a matter that can easily be addressed in a planning scheme amendment and may require legislation. It remains to be seen whether the Government will follow through with this pre-election promise.

For further information, please contact:

• Chris SchulzPartner, Melbourne
  Ph: +61 3 9613 8772
  Chris.Schulz@allens.com.au
• Meg LeeSpecial Counsel, Melbourne
  Ph: +61 3 9613 8154
  Meg.Lee@allens.com.au