Sweeping changes for wind energy projects under new NSW planning framework

The new Renewable Energy Planning Framework aims to accelerate the assessment and approval of State significant renewable energy development and infrastructure in NSW. After years of slow approval timeframes for wind energy projects, we explore whether the new Wind Energy Guideline will deliver for applicants, communities and the State.

Snapshot

• The policy framework that guides the State significant planning and assessment processes was updated earlier last month for key aspects of the renewable energy sector in NSW, including onshore wind projects. 
• The new policy framework has practical and wide-ranging implications for major wind energy projects under assessment or to be assessed in NSW.
• Key positive changes and clarifications under the Wind Energy Guideline relate to smoother pathways for critical State significant infrastructure (CSSI) declarations, assessment of development rights (also known as dwelling entitlements), benefit sharing requirements and private agreements to manage impacts.
• The new guidance provides a much-needed reset of the NSW policy position and desired outcomes for assessing wind energy projects. However, there is still an opportunity to pursue further changes to accelerate the State significant assessment process for renewable energy projects, including refining scoping report requirements and limiting requests for information to reduce material assessment delays. 

Wind energy a key focus under new planning guidance that commenced with immediate effect

The NSW Department of Planning, Housing and Infrastructure (DPHI) has released its Renewable Energy Planning Framework (Framework) for the assessment of State significant renewable energy development and infrastructure in NSW under the Environmental Planning and Assessment Act 1979 (NSW) (EP&A Act).

Our previous blog post provides an overview of the Framework.

In this update, we take a deeper dive into the Wind Energy Guideline, including the associated visual and noise impact assessment technical supplements and decommissioning calculator (together, the Wind Energy Guideline).

All wind energy proponents should review the Framework and transitional arrangements

The Wind Energy Guideline generally applies immediately to a development application (DA) for an onshore wind energy project that is declared State significant development (SSD) or CSSI whether within or outside a renewable energy zone (REZ) unless:

• Secretary’s environmental assessment requirements (SEARs) were issued before 12 November 2024 and an environmental impact statement (EIS) was lodged before 30 April 2025; or
• an applicant already lodged an EIS prior to 12 November 2024.

Guidance in respect of assessing and considering impacts on neighbouring land, including the development potential and rights of that land (known as ‘development rights’) is subject to specific transitional arrangements and applies immediately to all wind energy projects unless an EIS was lodged before 12 November 2024. SEARs that were already issued at the commencement of the Framework will be supplemented to require assessment of impacts to development rights (discussed below).

An applicant may choose to apply the Framework immediately by requesting an amendment to SEARs to reflect the new guidance.

In our experience, proponents of major wind energy projects have previously experienced uncertainty when interacting with the NSW planning approval process as to whether planning guidelines apply (including draft and interim guidelines). The new Framework and clear supporting transitional arrangements will give comfort to industry and proponents as to the applicability of the guidelines to DAs under assessment or to be lodged.

Extensive policy changes address almost every aspect of assessing a wind energy project

The Wind Energy Guideline introduces a range of new guidance in respect of the assessment of major wind energy projects.

In our view, the following updated guidance on key assessment issues will have a material impact on seeking to deliver major wind energy projects in NSW.

We review the key changes under the Wind Energy Guideline below.

CSSI Pathway encouraged for project with significant storage systems

Although the Minister’s discretion under section 5.13 of the EP&A Act to declare State significant infrastructure to be CSSI is unchanged, the Wind Energy Guideline confirms that the Minister will consider a request to declare major wind energy development as CSSI if it includes a significant energy storage system.

It will be a matter for proponents to demonstrate the significance of the energy storage systems to be co-located with a wind energy project and that the project as a whole is essential to the State for economic, environmental or social reasons. Although the Wind Energy Guideline indicates that a battery energy storage system (BESS) with 750 MW power capacity and 1,500 MWh or more of useable energy storage capacity would satisfy this threshold requirement, this is not an automatic trigger for a CSSI declaration and proponents will still need to carefully consider the existing Declaration of SSI and CSSI Guide and present strong reasons as to why their project meets the requirements of CSSI. The Minister has historically been reluctant to grant CSSI status to wind energy projects.

In our view, NSW’s energy transition would benefit from a reduction in the threshold at which the Minister will consider CSSI requests and greater guarantees that wind energy projects are CSSI due to their economic, environmental and social significance to NSW. However, there is nothing prohibiting a wind energy project with a co-located BESS smaller than 750 MW from requesting a CSSI declaration, if the merits of the project support such an application. Further, there is scope for proponents to propose alternate options that demonstrate why the project is essential for NSW for economic, environmental or social reasons.

Based on the historical delays to securing approvals under the SSD pathway for wind energy projects, we expect that a CSSI declaration will be an attractive option for wind energy proponents who may wish to access the faster planning approval pathway with lower appeal risks. Nonetheless, there remains an opportunity to increase the use of CSSI declarations to promote timely and more certain approvals.

Assessment of transmission must be carefully considered

The Wind Energy Guideline states that applicants should assess connections to the electricity transmission network or distribution grid as part of their DA.

This guidance requires an EIS to assess the impacts of network connections and ensures that a DA allows for a consent authority to properly consider all aspects of the project. The Wind Energy Guideline states that this approach streamlines stakeholder engagement and that engagement with network service providers should occur early in the project planning process.

Wind energy applicants will only have to engage with the separate Transmission Guideline if it is an expressly stated in the SEARs for the project.

Last month, we reported on when transmission infrastructure may be considered part of a single project in light of recent caselaw and the legislative reforms (see our blog post here).  

More recently, amendments to the EP&A Act set out in the Environmental Planning and Assessment Amendment (State Significant Development) Bill 2024 which passed Parliament on 21 November 2024 and are awaiting assent, propose to permit the Planning Secretary to determine that a particular enabling or ancillary development, such as transmission infrastructure related to a wind energy project, is not part of a ‘single proposed development’ (i.e. the related wind energy project) for the purposes of s 4.38 of the EP&A Act. In our view, this reform is not contrary to the Wind Energy Guideline – a wind energy project must still assess the impacts of network connections in circumstances where approval for the connection does not form part of the DA.

We will analyse the new guidance for standalone transmission projects in a later blog post.

Certain development rights on neighbouring land have a reduced assessment impact

After extensive consultation on this issue, the Wind Energy Guideline provides clear guidance on how ‘development rights’ (also known as ‘dwelling entitlements’) should be assessed.

Applicants of wind energy projects are required to consider whether a proposed wind energy development would unduly impact the potential of neighboring landholders to develop vacant land for residential accommodation, tourist and visitor accommodation, or an eco-tourist facility. Appendix B of the Wind Energy Guideline helpfully provides an example development rights impact assessment.

An assessment of impacts on development rights should only be undertaken if:

• the land is vacant prior to SEARs being issued (or 12 November 2024, where a supplementary SEAR has been issued); and
• the vacant land would, at that time:
  • be partly or wholly within the visual impact assessment setback of 9 degrees of a person’s vertical field of view i.e. 1.5 km for a 240 m turbine;
  • experience exceedances of the relevant noise criteria (the greater of 35dB(A), or 5 dB(A) above background noise levels, for residential receivers); or
  • be subject to significant risk from blade throw, ice throw or other risks.

The assessment of development rights will differ depending on the condition of the vacant land at the time SEARs are issued:

• If, as at the date SEARs are issued (or 12 November 2023 if supplementary SEARs are required), the vacant land was:
  • subject to a lodged but not yet determined DA; and/or
  • had been granted development consent or issued a complying development certificate but development had not yet physically commenced, 
    
    the wind energy applicant should consider methods to mitigate the impacts on development rights. Mitigation methods include providing screening, or helping affected landholders to modify an existing development consent or to seek a new development consent to minimise impacts.
    
    These approvals no longer need be treated as existing dwellings for the purpose of visual and noise impact assessments.

• If, at the date SEARs are issued (or 12 November 2023 if supplementary SEARs are required), development has physically commenced on the land, the development should be treated as an existing dwelling for the purpose of visual and noise impact assessments.

The Wind Energy Guideline provides a clearer methodology for assessing impacts relating to development rights / dwelling entitlements and defining the period within which a development right can be enlivened, providing greater certainty to applicants when assessing impacts on neighbouring land.

Visual impact assessments to adopt a new approach

Unless landholders have accepted the visual impacts of a project, applicants must prepare a visual impact assessment.

Significantly, the Wind Energy Guideline states that:

• a visual impact assessment must consider both the magnitude of visibility and visual sensitivity;
• within a scoping report, applicants must include a visual impact analysis that identifies viewpoints and receives that require assessment. The study area is determined by a sliding scale based on turbine height – for a 250 m turbine, this is 7.2 km for all viewpoints (compared to 7.2 km for private receivers and 9.6 km for public viewpoints within the draft guidelines);
• turbines that are likely to have a dominant appearance are to have a visual setback equivalent to 9 degrees of a person’s vertical field of view from sensitive receivers. In particular, the guideline states that a 240 m turbine generally has a ‘dominant’ appearance if located within 1.5 km of a sensitive receiver and completely visible;
• projects should be designed to avoid visually dominant turbines and shadow flicker of more than 30 hours per year at or within 50 m of an affected dwelling or sensitive land use; and
• applicants should use ‘best efforts’ to access land to conduct visual impact assessments for private receivers by adopting the new guidance on engaging with landholders. However, certain photomontage alternatives are acceptable if access is not granted or possible.

The impact of the new approach to visual impact assessment in practice will need to be analysed over time. The Wind Energy Guideline does seek to guide applicants on the level of assessment required for a scoping report and EIS. However, it appears that applicants are still required to front-load a significant amount of technical analysis at an early project stage when preparing a scoping report. Sophisticated impact assessment should be reserved for the EIS and be conducted in accordance with the new guidelines, including the proportionable assessment approach that allows for simple, intermediate or detailed assessments to be conducted based on the likely impacts.

Guideline addresses other key assessment issues and requirements

The Wind Energy Guideline also provides new guidance on key assessment considerations for wind energy projects, including:

• Noise: Noise impact assessments must be prepared in accordance with the noise impact assessment technical supplement unless landholders have accepted the noise impacts through private agreements. Wind turbine noise must not exceed 35 dB(A), or 5 dB(A) above existing background noise levels (whichever is higher); and noise levels must not exceed Leq 50 dB(A) at designated passive recreation areas within national parks when in use.
• Aviation safety and lighting: Aviation impact assessments are required for all wind projects. In circumstances where structures (including turbines) are greater than 150m above ground level, the most critical structures (i.e. turbines at the highest elevations or around the project’s perimeter) must have aviation obstacle lighting installed. Applicants should also consider measures to mitigate negative impacts on visual amenity from such lighting.
• Birds and bat impact assessment: Applicants must undertake a biodiversity assessment in accordance with the Biodiversity Conservation Act 2016 (NSW) (BC Act). The BC Act is itself subject to amendment through a bill which passed Parliament on 22 November 2024 and is awaiting assent, which we have previously written about here.
• Traffic and transport: Cumulative impacts on the local and classified road network caused by a wind energy project and other major developments must be assessed. If the road network cannot accommodate traffic from wind energy development, applicants must propose upgrades to be undertaken as part of the relevant project.
• Decommissioning and rehabilitation: Conditions will be imposed on all wind energy projects to make sure infrastructure is decommissioned. Decommissioning costs may be determined using the new Wind Decommissioning Calculator tool, which estimates the cost of decommissioning to be around $480,000 per turbine.
• Waste management and circular design: Construction waste must be minimised and comprise as much reusable and recyclable material as possible. Recycling of turbines should be prioritised as far as possible, and applicants should monitor and give preference to the most efficient and cost effective recycling and recovery methods over the life of the project.

Clear guidance for proponents, councils and communities on benefit sharing contributions

The Benefit Sharing Guideline provides practical information on benefit sharing and planning agreements for SSD or CSSI wind projects.

To set a baseline for expected contributions in connection with State significant wind energy projects, the Benefit Sharing Guideline prescribes $1,050 per megawatt per annum (indexed to the Consumer Price Index) as the benefit sharing rate.

The guideline also provides a clear framework for a consent authority when assessing the merits of a project, which includes:

• considering the relative benefits of the project, including the benefit sharing proposal;
• determining whether any conditions of consent may be appropriate to implement the benefit sharing proposal; and
• not imposing any additional conditions requiring other contributions under sections 7.11 or 7.12 of the EP&A Act unless they are specifically required to address direct impacts on services and infrastructure.

We expect that this new guidance will assist applicants and councils to reach negotiated contribution outcomes faster, meet community benefit sharing expectations, result in more consistent conditioning of contributions, and enhance an applicant’s social licence to build and operate major renewable energy projects.

Private agreements should continue to be tailored on a case-by-case basis

The Private Agreement Guideline also provides guidance for landowners who are entering into commercial agreements with developers because they are either hosting, or are directly impacted by, SSD or CSSI wind energy projects.

Compared to the draft version, the guideline does not include a detailed template agreement. Rather, it explains the different types of agreements (e.g. licence, option, land purchase, landholder, and neighbour agreements) relevant to the management of the impacts of a project and provides some key model clauses.

In particular, the new guideline sets out that:

• agreements should be tailored to the specific landholder and project;
• any agreement should be fair, reasonable, written in plain language, and legally enforceable;
• applicants should pay for all reasonable costs to enable the landholder to obtain independent legal advice and understand the implications of any private agreement; and
• landholders should have a right to participate in the planning process despite signing a private agreement and the applicant should provide them with key information about the project.

Further opportunities for future reform exist beyond the new Framework

The Wind Energy Guideline provides welcome guidance on key assessment issues for wind energy projects. Following this reform, there remain opportunities to provide greater certainty to the timely delivery of major wind energy projects in NSW.

These opportunities include:

• Reduce delays relating to informal processes: The Wind Energy Guideline provides no guidance in respect of DPHI’s practice of requiring informal soft lodgement of proposed development documents before obtaining SEARs. To reduce the cost and time implications of this informal process and changing expectations, the Wind Energy Guideline should expressly prohibit this process to reduce timeframes before obtaining SEARs.
• Greater clarity on RFI processes: While the Wind Energy Guideline notes that the DPHI will “use [its] best endeavours to limit major information requests… to once per stage of the assessment process”, there remains a risk that requests for information (RFIs) by DPHI and other agencies will continue to cause approval delays and costly re-assessment requirements at late stages of the approval process. DPHI should restrict the number of RFIs and the period for RFIs during the assessment process.

Key takeaways

The Wind Energy Guideline will have practical implications for applicants who are currently assessing the environmental impacts of proposed major wind energy projects, including positive changes and clarification in relation to pathways to CSSI declarations, assessment of development rights, benefit sharing requirements and private agreements to manage impacts.

Proponents of wind energy projects should carefully review the Wind Energy Guideline and assess the practical implications of the refreshed policy framework, including any opportunities to streamline the approval process and engage with communities on the new assessment expectations.

To achieve net zero targets, the wind energy industry must continue to be supported through regulatory reform to ensure that these critical projects are delivered quicker in NSW.    

If you would like to explore what the Wind Energy Guideline will mean for your project, please contact us.

Our next update will bring you insights into the new guidelines for large-scale solar energy projects and what they mean for proponents and other stakeholders.

The full suite of Framework documents is available on DPHI’s website here.

By Peter Briggs (Partner), Tom Dougherty (Senior Associate), Andrew Mahler (Solicitor), Rainer Gaunt (Solicitor), and Samantha Urquhart (Solicitor).