Advisory Committee recommends use of ESOs to manage the risks of major hazard facilities

Wednesday, 12 April 2017

Almost nine months after its completion in July 2016, the Report of the Major Hazard Facilities Advisory Committee (Committee) was released in March 2017. The Committee reviewed Victoria's land use planning framework for areas surrounding Major Hazard Facilities (MHFs), and has made recommendations intended to better protect MHFs from encroachment by more sensitive uses such as residential development. Some examples of registered MHFs include oil refineries, LPG facilities, large fuel and chemical storage sites, and chemical plants.

The Committee's key recommendations are that the current role of Worksafe Victoria should continue and that Environmental Significance Overlays (ESOs) should be used to manage development around MHFs. The Andrews Government is yet to provide a formal response to the recommendations.

Planning for risk around MHFs

The Committee identified that the current land use planning system has shortcomings and inconsistencies in the way that it addresses risk and safety issues in areas in close proximity to MHFs and made a number of recommendations to address these.

State Planning Policy Framework (SPPF)

The Committee concluded that State planning policy needs to better recognise MHFs and safety risks to surrounding land. However, it did not support a policy change that would favour one land use over another, but rather it supported the use of a combination of prioritised mapping by WorkSafe along with State planning policy that recognises the risks of MHFs. The Committee considered that the draft Hazardous Facilities policy produced as part of the SPPF review should be included in the SPPF. The objective of this draft policy is to limit adverse human health impacts from incidents at hazardous facilities.

Risk mapping by WorkSafe

One of the key issues considered by the Committee was the appropriate role for WorkSafe in relation to land use planning for MHFs. WorkSafe's current role includes determining whether a site is a MHF, issuing MHF licences, and assessing the risks posed by MHFs to surrounding areas. In particular, for MHFs Worksafe currently identifies an Inner Planning Advisory Area (IPAA) - the area where there is a risk of fatality from potential foreseeable incidents at the relevant MHF - and an Outer Planning Advisory Area (OPAA) - the area where a credible incident is not likely to result in fatalities but people present may suffer adverse effects or experience difficulty responding to an emergency.

The Committee considered that despite a lack of resources and expertise to oversee land use planning decisions around MHFs, WorkSafe is the most appropriate government agency to undertake risk assessments for land development in areas surrounding MHFs. It also supported the continued use of IPAAs and OPAAs to identify where development should be limited due to safety concerns. Development of further guidance notes was also recommended together with use of a standardised methodology based on the Environment Protection Authority's (EPA) air emissions assessment framework.

Zones and Overlays

The Committee concluded that ESOs are the most appropriate tool to manage development in areas adjacent to MHFs and did not support the use of zoning to manage MHF risks. The Committee recommended that an ESO be developed for each MHF with separate schedules incorporating WorkSafe's IPAAs and OPAAs, and the development of a Ministerial Direction and associated Planning Practice Note to guide local policy and the application of ESOs to areas around MHFs. The Committee's Report includes a prioritised list of MHFs to assist development of specific ESOs.

Referrals

The current lack of a formal role for WorkSafe and the EPA in land use planning around MHFs was noted as a significant gap in the planning system. In response, the Committee recommended that for planning permit applications in IPAAs, WorkSafe should be a determining referral authority and the EPA should be a recommending referral authority. If the permit relates to an OPAA, the Committee recommended that WorkSafe and the EPA both be recommending referral authorities. A determining referral authority has the power to refuse the granting of a permit, or to impose conditions on the permit. A recommending referral authority, on the other hand, only has the power to make recommendations in relation to the application.

Protection of amenity around MHFs

In addition to making recommendations on how the planning system should address the risks of MHFs, the Committee also considered the use of buffers to protect the amenity of sensitive surrounding uses. The Committee rejected the broad adoption of the "agent of change" principle, which provides that the entity responsible for the change should be responsible for managing its impact. Instead, the Committee considered that in instances of competing land use the "net community benefit" test should be used, for example to balance the interests of on-going industry (often of State significance) with access to affordable residential land and the protection of human health and safety.

The Committee recommended that the Minister for Planning, in consultation with the EPA and relevant stakeholders, commission a comprehensive review of Clause 52.10 (Uses with Adverse Amenity Potential) to better recognise MHFs and "reverse amenity" situations. The Committee also supported updating references in the SPPF to include the revised Recommended Separation Distances for Industrial Residual Air Emissions (2013) (IRAE Guidelines) and Noise from Industry in Regional Victoria Guidelines (2011), together with further consideration of a single instrument to combine Clause 52.10 with the IRAE Guidelines. Development of a Ministerial Direction requiring amendments to allow sensitive uses to explicitly consider the Types of Production, Use or Storage in Clause 52.10 was also recommended.

High-pressure pipelines

The Committee also considered high-pressure hydrocarbon transmission pipelines.These pipelines are not MHFs and were not in the original terms of reference. Due to the amount of public concern, the Committee considered submissions on this topic and recommended that the current voluntary Land Development Around Pipelines Working Group (Working Group) be formalised to advise on improving planning around high-pressure pipelines.

The Committee identified a range of issues that the Working Group should consider. It recommended that the Working Group consider the use of ESOs to protect pipelines from inappropriate encroaching development and nomination of 'essential' pipelines which would be recognised as being of State significance in the SPPF.

The Committee also recommended that the Working Group consider whether Energy Safe Victoria should replace the relevant gas authority as the determining referral authority for proposals to subdivide land crossed by a gas transmission pipeline or easement, and for low risk pipelines, whether a referral to the pipeline owner and operator should be included.

Implications for businesses

  • Developers with plans to develop in areas surrounding MHFs should consider how their plans could be impacted by the changes proposed, particularly where this would involve encroachment of a sensitive use;
  • Owners of MHFs and high-pressure pipelines should consider how the proposed changes may assist them to protect ongoing operations or expansion of facilities; and
  • Potentially affected parties should follow the government's response to the recommendations.

How can we help?

HWL Ebsworth has advised extensively on strategic planning issues, and high-pressure gas pipelines, including strategic structure planning and localised development applications.

To discuss the potential impact of the Committee's findings, please do not hesitate to contact us.

This article was written by Meredith Gibbs, Partner and Tushka Sridharan, Trainee Solicitor.

For further information please contact:

Partner | Melbourne
P +61 3 8644 3712
Partner | Melbourne
P +61 3 8644 3539
Special Counsel | Melbourne
P +61 3 8644 3414

For information on our Planning and Environment Group please click here.

Important disclaimer: The material contained in this publication is of a general nature only and is based on the law as at 12 April 2017. It is not, nor is intended to be, legal advice. If you wish to take any action based on the content of this publication we recommend that you seek professional advice.