Source: http://www.legislation.nsw.gov.au/fullhtml/inforce/subordleg+856+2002+cd+0+N
Timestamp: 2013-05-24 09:05:06
Document Index: 375464447

Matched Legal Cases: ['art 2', 'art 3', 'art 4', 'art 5', 'art 6', 'art 7', 'art 1', 'arts 2', 'art\n4', 'art 5', 'art 2', 'art\n6', 'art 3', 'art 5', 'arts 4', 'art 5', 'art 5', 'art 5', 'art 7', 'art 4', 'art 7', 'art 5', 'art\n3', 'art 3', 'art 8', 'art 6', 'art 7', 'art 8', 'art 7', 'art 3', 'art 9', 'art 10', 'art 1', 'art 2', 'art 3', 'art 2', 'art 5', 'art 3', 'art 5', 'art 3', 'art 3', 'art 7', 'art 3', 'art 3']

[2002-856]
Current version for 13 February 2009 to date (accessed 24 May 2013 at 19:05).
File last modified 13 February 2009.
3 Establishment of scheme and objects
5 Participants in scheme
6 Discharge licence
7 Hunter River catchment
Part 2 General workings of scheme
Division 1 Classification of river flow
9 Division of Hunter River flow into blocks
10 Classification of river blocks
11 Flow ranges
12 Classification of block—upper sector
13 Classification of block—middle sector
14 Classification of block—lower sector
Division 2 River Register
15 River Register
16 Entry of information in River Register
Part 3 Discharge rules
17 Salinity targets
Division 2 Principal rules about discharges
19 No discharges except from authorised discharge
20 No discharges except during site discharge
21 Services Co-ordinator to determine site discharge
22 Maximum discharge during site discharge period
Division 3 Volume discharge limit—high flow
23 High flow block—determination of volume discharge
24 Sector credit discount factor—high flow
25 Total allowable discharge of salt
Division 4 Volume discharge limit—flood flow
26 Flood flow block
Division 5 Trading rules order
27 Imposition of trading rules by EPA
28 Effect of trading rules order
29 Effect of order—determination of volume discharge
30 Sector credit discount factor
31 Total allowable discharge of salt
Division 6 Other rules relating to discharges
32 Saline water to be discharged at a regular rate
33 Record keeping requirements
Division 7 Emergency dilution arrangements
35 Defence—emergency dilution arrangements
Part 4 Credits in scheme
36 Creation of credits
37 Authority conferred by credit
38 Lifespan of credit
39 Who may hold credit
Division 2 Initial allocation of credits
40 First issue credits
41 Allocation of first issue credits to relevant licence
Division 3 Allocation of residual first issue
42 Residual first issue credits
43 Notice of intention to allocate residual first issue
44 Eligibility criteria
45 Number of credits to be allocated
Division 4 Creation and sale of new credits
46 New credits to be created every 2 years
47 Sale of new credits by auction
48 Sale of new credits by private treaty
49 Sale of residual first issue credits
Part 5 Trading in credits
Division 1 Trading in credits
50 Trading in credits
51 Trading facility to be established
52 Registration of credit traders
53 Use of credit trading facility
54 Transfers to be effected by registered traders by means of
55 Transfers may be made for consideration
Division 2 Trading rules
56 General rules as to transfers
57 To whom credits may be transferred
58 Retrospective transfers not permitted
59 Credits valid for single use only
60 Effect of sector credit discount factor on
61 Offence for contravention of trading rules
62 Effect of contravention of trading rules on volume
Division 3 Credit Register
63 Credit Register
64 Transfers to be entered in Register
65 Correction of Credit Register
Part 6 Administration of scheme
Division 1 Services Co-ordinator
66 Services Co-ordinator
67 Engagement of contractors to carry out
68 Functions of EPA
Division 2 Registrar
69 Registrar
Division 3 Operations Committee
70 Appointment of Operations Committee
71 Functions of Operations Committee
72 Failure by Operations Committee to perform
Part 7 Cost recovery
Division 1 Contribution payable by participants towards costs
73 Participants required to contribute toward costs of
74 Calculation of contribution
75 Contribution on credit holdings
76 Contribution on licence
77 Contributions on forfeited credits
Division 2 Calculating total contributions amount
78 Total contributions amount
79 Costs of Services Co-ordinator
80 Costs of Registrar
81 Costs of EPA
Division 3 Adjustments to total cost
82 Functions of EPA
83 Reconciliation at end of scheme year
84 Auction and sale proceeds
85 Adjustments to contributions
86 General enforcement power of EPA
87 Confirmation of enforcement order
88 Forfeiture of credits
89 Notice of reasons for making forfeiture order
90 Effect of forfeiture order
91 Offence of providing false information
92 Suspension of scheme
93 Review of Regulation—timetable
94 Amendment of Protection of the Environment Operations (Penalty
95 Regulation supersedes pilot scheme
96 Services Co-ordinator
97 First scheme year
98 Discharge licences issued under pilot scheme
Schedule 1 Allocation of first issue credits
Schedule 2 Constitution and procedure of Operations
Part 1 Preliminary1 Name of RegulationThis Regulation is the Protection of the Environment Operations (Hunter
River Salinity Trading Scheme) Regulation
2002.2 CommencementThis Regulation commences on 1 December
2002.3 Establishment of scheme and objects(1) There is established by this Regulation a tradeable emission
scheme, to be known as the Hunter River Salinity Trading Scheme, to provide
for the management of discharges of saline water into the Hunter River
catchment.(2) The objects of the scheme are:(a) to minimise the impact of discharges of saline water on
irrigation, other water uses and on aquatic ecosystems in the Hunter River
catchment:(i) at the lowest overall cost to the community,
(ii) in a way that provides ongoing financial incentives to reduce
(b) to facilitate sustainable water management by industry in the
Hunter River catchment.
Note. Overview of schemeUnder the scheme provided for by this Regulation, discharges of
saline water into the Hunter River catchment are permitted only during periods
when the Hunter River is considered to be in high flow or flood flow, and only
by persons who hold licences that authorise such discharges (discharge
licences).During high flow periods, a discharge licence holder will be
entitled to discharge saline water only if the licence holder holds one or
more credits in the scheme. During flood flow periods, the amount of saline
water that may be discharged by a discharge licence holder is unlimited,
subject to the salinity targets and any overriding limit that may be applied
by the EPA as a condition of the licence. However, the EPA is authorised in
certain circumstances to require discharges to be made in accordance with
credit holdings, even during flood flow periods. The rules relating to
discharges are set out in Parts 2 and 3.Credits in the scheme are created by the EPA. Initially credits
will be allocated to certain licence holders, most of whom were participants
in the pilot scheme which has been conducted by the EPA, in conjunction with
the Department of Land and Water Conservation, since 1995. Provision is also
made for the allocation of credits to new entrants to the scheme. A credit
will have a limited lifespan of not more than 10 years. The EPA will be able
to create and sell new credits as existing credits expire. Provisions relating
to the creation, allocation and sale of credits are set out in Part
4.A credit entitles a person who holds a discharge licence to
discharge 0.1% of the total allowable discharge of salt for the Hunter River
catchment. The total allowable discharge is determined on a day-to-day basis,
by reference to the salinity targets for the Hunter River catchment. The more
credits the licence holder holds, the more saline water the licence holder is
entitled to discharge. However, the timing of any discharge is subject to very
specific rules.A credit is transferable in accordance with this Regulation.
Initially credits will be transferable only between persons who are allocated
those credits by the EPA. However, after the first auction of credits is held,
any person will be able to buy, hold and trade in credits. A credit does not
confer any authority on the holder to discharge saline water unless the person
also holds a licence that authorises such discharges. Provisions relating to
trading of credits are set out in Part 5.The remaining parts of this Regulation set out other provisions
relating to the scheme, including administration, cost recovery and
enforcement provisions.4 DefinitionsExpressions used in this Regulation have the meanings set out in
the Dictionary at the end of this Regulation.5 Participants in scheme(1) For the purposes of this Regulation, participant in the scheme has
the meaning given by section 295A of the Act.(2) For the purposes of paragraph (b) of the definition of participant in that section,
the scheme applies to discharge licences.6 Discharge licenceFor the purposes of this Regulation, a discharge licence means a
licence that authorises the discharge of saline water into the Hunter River
catchment from an authorised discharge point or points.Note. Licence is
defined in the Act to mean an environment protection
licence.7 Hunter River catchmentFor the purposes of this Regulation, the Hunter River catchment
means the catchment of the Hunter River and its tributaries upstream of
Singleton, excluding:(a) the Goulburn River upstream of Kerrabee, and
(b) any tributary that drains into Lake St Clair,
(c) any tributary that drains into Lake
Glenbawn.
8 NotesNotes included in this Regulation do not form part of this
Regulation.Part 2 General workings of schemeDivision 1 Classification of river flow9 Division of Hunter River flow into blocks(1) For the purposes of the scheme, the flow of the Hunter River is
taken to be divided into notional blocks.(2) A block is a body of water that flows down the Hunter River and
that is predicted to pass through the lower sector reference point in a
24-hour period (starting at midnight on one day and ending immediately before
midnight on the following day).Note. Lower sector
reference point is defined in the Dictionary.(3) Blocks are to be identified in the River Register by the Services
Co-ordinator by means of a unique identification
number.Note. There will be the same number of blocks as there are days in a
year. Each block represents an opportunity for a discharge licence holder to
discharge saline water, depending on its classification. This is explained
further below.10 Classification of river blocks(1) The Services Co-ordinator is to classify the rate of flow of each
block of the Hunter River in accordance with this
Part.(2) A block is to be classified, in relation to each sector that it
passes through, as:(a) low flow, or
(b) high flow, or
(c) flood flow.
(3) The following reference points are to be used for the purpose of
predicting the rate of flow of a block as it passes through each
sector:(a) for the upper sector—the upper sector reference
(b) for the middle sector—the middle sector reference
(c) for the lower sector—the lower sector reference
(4) The classification of a block may differ from sector to
sector.(5) The classification of a block is to be entered in the River
Register.(6) If a block is not classified, or its classification is not entered
in the River Register, in relation to any or all sectors, it is taken to be a
low flow block in the sector concerned.Note. Classification of a block of the Hunter River establishes when
discharges will be permitted. As a general rule, participants may discharge
saline water into high flow and flood flow blocks.11 Flow ranges(1) For the purposes of this Part, the low flow range, high flow range
and flood flow range for each sector is as specified next to the sector
concerned in the Table to this clause.(2) In the Table, ML means
megalitres.TableClassification of river blocks
SectorLow flow rangeHigh flow rangeFlood flow rangeUpperLess than 1,000 ML per day1,000 ML per day–4,000 ML per day (inclusive)
Exceeds 4,000 ML per dayMiddleLess than 1,800 ML per day1,800 ML per day–6,000 ML per day (inclusive)
Exceeds 6,000 ML per dayLowerLess than 2,000 ML per day2,000 ML per day–10,000 ML per day (inclusive)
Exceeds 10,000 ML per day
12 Classification of block—upper sector(1) Low flow A block is to be classified low flow in relation to the upper
sector if it is predicted that:(a) the rate of flow of the block in the upper sector will be in the
low flow range for the upper sector, or
(b) the rate of flow of the block in either the middle sector or the
lower sector (or both) will be in the low flow range for those
(2) High flow A block is to be classified high flow in relation to the upper
high flow range for the upper sector and the rate of flow of the block in the
middle sector and lower sector will be in the high flow or flood flow range
for those sectors, but will not be in the low flow range in either of those
(b) the rate of flow of the block in the upper sector will be in the
flood flow range for the upper sector, and the rate of flow of the block in
either the middle sector or the lower sector (or both) will be in the high
flow range for those sectors, but will not be in the low flow range for either
of those sectors.
(3) Flood flow A block is to be classified flood flow in relation to the upper
flood flow range for the sector, and
(b) the rate of flow of the block in both the middle sector and the
lower sector will be in the flood flow range for those
13 Classification of block—middle sector(1) Low flow A block is to be classified low flow in relation to the middle
sector if it is predicted that:(a) the rate of flow of the block in the middle sector will be in the
low flow range for the middle sector, or
(b) the rate of flow of the block in the lower sector will be in the
low flow range for the lower sector.
(2) High flow A block is to be classified high flow in relation to the middle
high flow range for the middle sector and the rate of flow of the block in the
lower sector will be in the high flow or flood flow range for the lower
(b) the rate of flow of the block in the middle sector will be in the
flood flow range for the middle sector, and the rate of flow of the block in
the lower sector will be in the high flow range for the lower
(3) Flood flow A block is to be classified flood flow in relation to the middle
flood flow range for the lower sector.
14 Classification of block—lower sector(1) Low flow A block is to be classified low flow in relation to the lower
sector if it is predicted that the rate of flow of the block in the lower
sector will be in the low flow range for the lower
sector.(2) High flow A block is to be classified high flow in relation to the lower
sector will be in the high flow range for the lower
sector.(3) Flood flow A block is to be classified flood flow in relation to the lower
sector will be in the flood flow range for the
sector.Division 2 River Register15 River Register(1) The Services Co-ordinator is to establish and maintain a River
Register.(2) The Services Co-ordinator is to enter in the River
Register:(a) such matters as are required to be included in it by this
Regulation or by the EPA, and
(b) any additional matters that the Services Co-ordinator considers
(3) The River Register may be kept wholly or partly by means of a
computer (including by means of an on-line
service).(4) The River Register is to be made available for inspection by the
public (including participants in the scheme) at an office of the Services
Co-ordinator or another person or body appointed to provide the River
Register.(5) If the River Register is kept wholly or partly by means of a
computer, subclause (4) may be complied with by providing a computer print-out
or providing access to a computer that can be used to view the River
Register.Note. The Services Co-ordinator may enter into a contract with any
person for the provision of the River Register. This is dealt with under Part
6 (Administration of scheme).16 Entry of information in River RegisterThe Services Co-ordinator is not required to classify a block, or
to make any other determination under this Regulation that is required to be
entered in the River Register, until it is satisfied that it has enough
information to do so with a reasonable degree of
accuracy.Part 3 Discharge rulesDivision 1 Preliminary17 Salinity targets(1) The object of the discharge rules is to ensure that salinity
levels in the Hunter River catchment do not, as a result of discharges of
saline water by participants in the scheme, exceed the salinity targets set
out in this clause.(2) The electrical conductivity of saline water in a high flow block
is not at any stage to exceed the following targets:(a) 600 EC in the upper sector (determined at the upper sector
reference point),
(b) 900 EC in the middle sector (determined at the middle sector
(c) 900 EC in the lower sector (determined at the lower sector
(3) The targets set out in subclause (2) are referred to in this
Regulation as the high flow salinity
targets.(4) The electrical conductivity of saline water in a flood flow block,
determined as the average salinity level of the block, is not to exceed the
following targets for each sector:(a) 900 EC in the upper sector (determined at the upper sector
(5) In addition, the electrical conductivity of saline water in a
flood flow block is not at any stage to exceed 1500 EC in any
sector.(6) The targets set out in subclauses (4) and (5) are referred to in
this Regulation as the flood flow salinity
targets.(7) The Services Co-ordinator is to have regard to this clause in
exercising its functions under this Part.(8) In this clause:EC means
electrical conductivity, measured in microSiemens per
centimetre.18 DefinitionsIn this Part:relevant
sector, in relation to the holder of a discharge licence, means the
sector into which any saline water discharged from the licence holder’s
authorised discharge point first flows.sector credit discount
factor means the sector credit discount factor for a block when it
is in an identified sector, determined by the Services Co-ordinator under this
Part and entered in the River Register.Division 2 Principal rules about discharges19 No discharges except from authorised discharge
pointIt is a condition of a discharge licence that the licence holder
does not cause or permit saline water to be discharged into the Hunter River
catchment except from the licence holder’s authorised discharge point or
points.20 No discharges except during site discharge
periodIt is a condition of a discharge licence that the licence holder
does not cause or permit saline water to be discharged from an authorised
discharge point otherwise than during a site discharge period for that
authorised discharge point.21 Services Co-ordinator to determine site discharge
period(1) The Services Co-ordinator is to determine a site discharge period
for each authorised discharge point, in relation to each high flow or flood
flow block.Note. There are no site discharge periods for low flow blocks. The
purpose of that restriction is to ensure that discharges of saline water are
made into high flow and flood flow blocks, and not into low flow
blocks.(2) The site discharge period for an authorised discharge point is the
period in which discharges of saline water are permitted from that authorised
discharge point, subject to this Part.(3) In determining the site discharge period, the Services
Co-ordinator is to ensure that any discharge of saline water that is made from
an authorised discharge point in a sector is made into a block that is a high
flow block or a flood flow block in that sector.(4) The start and finish times for the site discharge period are to be
determined by the Services Co-ordinator based on an estimate of the time it
will take a discharge from an authorised discharge point to reach and mix with
a block as it passes through the sector in which the authorised discharge
point is located.(5) In determining the site discharge period, the Services
Co-ordinator may make such adjustments as the Services Co-ordinator thinks fit
to optimise water quality. For example, the Services Co-ordinator may adjust
the start and finish times so as to ensure discharges mix with the higher
flows of the block.(6) The start and finish times for each site discharge period, in
relation to a particular high flow or flood flow block, are to be entered in
the River Register.22 Maximum discharge during site discharge period(1) The maximum volume of saline water that may be discharged by the
holder of a discharge licence into the Hunter River catchment during a site
discharge period for the holder’s authorised discharge point is:(a) the licence holder’s volume discharge limit for the block to
which the site discharge period relates, determined in accordance with this
(b) the licence holder’s tributary protection limit (if
whichever is the lower.Note. The tributary protection limit (if any) for saline water
discharges is specified in the discharge licence.(2) If a discharge licence has more than one authorised discharge
point, the total volume of all discharges of saline water from those points
during the site discharge period for those points must not exceed the maximum
volume of saline water that may discharged by the holder of the licence under
subclause (1).(3) It is a condition of a discharge licence that the licence holder
does not cause or permit saline water to be discharged in contravention of
this clause.Note. Under the Act, the maximum penalty for a contravention of a
licence condition is $250,000 (in the case of a corporation) or $120,000 (in
the case of an individual). Further penalties apply to continuing
offences.Division 3 Volume discharge limit—high flow
blockNote. This Division sets out the method for calculating a licence
holder’s volume discharge limit in relation to a high flow block. This
Division does not apply if a trading rules order is in force. In that case,
the total allowable discharge of salt, and volume discharge limits, are to be
determined as provided for by Division 5.23 High flow block—determination of volume discharge
limit(1) A licence holder’s volume discharge limit, in relation to a
block that is a high flow block in the licence holder’s relevant sector,
is to be determined in accordance with the following steps:Step 1: Determine the
number of credits the licence holder can use for the high flow
blockThe number of credits that a licence holder may use for a high
flow block is to be determined as follows:Where:E is the number of
credits that a licence holder may use for a high flow block.Cr is the number of
credits held by the licence holder in respect of the block at the time at
which the discharge takes place (as entered in the Credit Register), being
credits that are in force, and excluding any credits forfeited under this
Regulation or that are excluded under Part 5.Note. Parts 4 and 5 explain credit holdings and trading in credits.
Under Part 5, a credit that is transferred in contravention of the Regulation
cannot be counted toward the holder’s volume discharge
limit.D is the sector credit
discount factor for the block in the licence holder’s relevant sector at
the start of the discharge.Step 2: Determine the
licence holder’s individual salt discharge limitThe licence holder’s salt discharge limit is to be
determined as follows:Where:L is the licence
holder’s salt discharge limit (in tonnes).T is the total
allowable discharge for the block (in tonnes) at the start of the
discharge.E is the number of
credits that a licence holder may use for a high flow block, being the amount
determined in step 1 rounded down to the nearest whole
number.Step 3: Calculate the
salt concentration of the water to be dischargedThe salt concentration of the water to be discharged is to be
calculated as follows:Where:C is the salt
concentration of the water to be discharged by the licence holder, measured in
tonnes per megalitre.EC is the mean
electrical conductivity of the water discharged by the licence holder,
measured in microSiemens per centimetre, calculated in accordance with
subclause (2).F is the conversion
factor set out in the discharge licence.Step 4: Determine the
volume discharge limitThe volume discharge limit of the licence holder is to be
determined as follows:Where:V is the licence
holder’s volume discharge limit for the block (in
megalitres).L is the licence
holder’s salt discharge limit for the block (calculated in step
2).C is the salt
concentration in the saline water to be discharged (calculated in step
3).(2) The mean electrical conductivity of the water discharged is to be
estimated before the discharge takes place, and monitored throughout the
period of the discharge, in accordance with the conditions of the discharge
licence. If the mean electrical conductivity of the water discharged differs
from any estimate made before the discharge is completed, the volume discharge
limit must be re-calculated using the actual figures (and the amount of saline
water discharged must be reduced if necessary).24 Sector credit discount factor—high flow
block(1) The Services Co-ordinator may, for the purpose of ensuring that
the full exercise of credit entitlements does not result in a high flow
salinity target for any sector being exceeded, determine a sector credit
discount factor that is to be applied in relation to a high flow block while
it is in a particular sector.(2) The sector credit discount factor is to be one or a fraction of
one.(3) The sector credit discount factor is to be entered in the River
Register.25 Total allowable discharge of salt(1) The Services Co-ordinator is to determine a total allowable
discharge of salt in relation to each block that is a high flow
block.(2) The total allowable discharge of salt is to be determined by
calculating the maximum amount of salt that may be discharged in the sector or
sectors in which the block is a high flow block so that, taking into account
the river flow and background salinity levels, the salinity target for the
high flow sector that is the farthest downstream is not
exceeded.(3) The following are examples of the operation of subclause
(2):(a) Example 1: Block is high flow in all sectorsThe total allowable discharge will be determined by calculating
the maximum amount of salt that may be discharged in all sectors so that the
high flow salinity target for the lower sector (900 EC) is not
(b) Example 2: Block is high flow in the upper and middle
sectors, and flood flow in the lower sectorThe total allowable discharge will be determined by calculating
the maximum amount of salt that may be discharged in the upper and middle
sectors so that the high flow salinity target for the middle sector (900 EC)
(c) Example 3: Block is high flow in the upper sector, and
flood flow in the middle and lower sectorsThe total allowable discharge will be determined by calculating
the maximum amount of salt that may be discharged in the upper sector so that
the high flow salinity target for the upper sector (600 EC) is not
(4) The total allowable discharge is to be expressed in tonnes (or
fractions of tonnes).(5) The total allowable discharge of salt for each block that is a
high flow block is to be entered in the River
Register.Division 4 Volume discharge limit—flood flow
blocks26 Flood flow block(1) There is no volume discharge limit in relation to a block that is
a flood flow block in the licence holder’s relevant
sector.Note. A block will not be classified flood flow in the upper or middle
sector unless it is also predicted to be in the flood flow range in all
downstream sectors.(2) Accordingly, during a site discharge period for a block that is a
flood flow block in the licence holder’s relevant sector, the maximum
volume of saline water that the licence holder may cause or permit to be
discharged is the licence holder’s tributary protection limit (if
any).Note. This Division does not apply if a trading rules order is in force.
In that case, the volume discharge limit is to be determined as provided for
by Division 5.Division 5 Trading rules order27 Imposition of trading rules by EPA(1) If at any time it appears that the flood flow salinity targets
have been exceeded, the EPA may conduct an investigation to determine whether
the flood flow salinity targets were exceeded as a result of discharges of
saline water by participants in the scheme.(2) Following that investigation, if the EPA is satisfied that the
flood flow salinity targets were exceeded as a result of discharges of saline
water by participants in the scheme, the EPA may, by order published in the
Gazette, direct that the trading rules be used during flood
flows.(3) Any such order is called a trading rules
order.(4) A trading rules order takes effect on the publication of the order
in the Gazette or on a later date specified in the
order.(5) A trading rules order remains in force for the period (not
exceeding 5 years) specified in the order.28 Effect of trading rules order(1) Divisions 3 and 4 do not apply in respect of any period during
which a trading rules order is in force.(2) This Division applies to the calculation of a licence
holder’s volume discharge limit in relation to a block that is a high
flow block or a flood flow block in the licence holder’s relevant sector
in respect of any period in which a trading rules order is in
force.29 Effect of order—determination of volume discharge
block that is a high flow block or flood flow block in the licence
holder’s relevant sector, is to be determined in accordance with the
following steps:Step 1: Determine the
number of credits the licence holder can use for the blockThe number of credits that a licence holder may use for a high
flow block or flood flow block is to be determined as follows:Where:E is the number of
credits that a licence holder may use for a high flow block or flood flow
block.Cr is the number of
Regulation or that are excluded under Part 5.Note. Under Part 5, a credit that is transferred in contravention of the
Regulation cannot be counted toward the holder’s volume discharge
block, being the amount determined in step 1 rounded down to the nearest whole
water discharged must be reduced if necessary).30 Sector credit discount factor(1) The Services Co-ordinator may, for the purpose of ensuring that
salinity target or flood flow salinity target for any sector being exceeded,
determine a sector credit discount factor that is to be applied in relation to
a high flow or flood flow block while it is in a particular
sector.(2) The sector credit discount factor is to be one or a fraction of
Register.31 Total allowable discharge of salt(1) The Services Co-ordinator is to determine a total allowable
discharge of salt in relation to each block that is a flood flow or high flow
sectors in which the block is a flood flow or high flow block so that, taking
into account the river flow and background salinity levels, the salinity
target for the lower sector is not exceeded.(3) The total allowable discharge is to be expressed in tonnes (or
fractions of tonnes).(4) The total allowable discharge of salt for each block that is a
flood flow or high flow block is to be entered in the River
Register.Division 6 Other rules relating to discharges32 Saline water to be discharged at a regular rate(1) Saline water is to be discharged from an authorised discharge
point in such a manner as to ensure that, as far as is reasonably practicable,
saline water is discharged at approximately the same rate throughout the site
discharge period.Note. The object of this clause is to prevent salinity
“spikes” in the Hunter River.(2) It is a condition of a discharge licence that the licence holder
this clause.33 Record keeping requirements(1) A holder of a discharge licence who causes or permits saline water
to be discharged into the Hunter River catchment must make a record of the
following:(a) the date and time at which the discharge started and
(b) the total volume (in megalitres) of saline water discharged during
that discharge period,
(c) the quantity of salt (in tonnes) discharged during that discharge
(d) the mean electrical conductivity of water discharged during that
discharge period,
(e) the unique identification number of the block to which the
relevant site discharge period relates, as entered in the River
(f) the total allowable discharge for that block, as entered in the
River Register at the date and time at which the discharge
(g) the number of credits held by the licence holder, as entered in
the Credit Register, as at the date and time at which the discharge
(h) any other matters relating to the discharge that the EPA, by
notice in writing to the holder of the discharge licence, requires the holder
to include in the record.
(2) The record must be made in a form and manner approved by the
EPA.(3) The record must be retained by the licence holder for at least 4
years after the discharge is completed.Note. Part 7.3 of Chapter 7 of the Act allows the EPA, or an authorised
officer, to require any person to furnish records to the EPA or authorised
officer.(4) It is a condition of a discharge licence that the licence holder
does not contravene this clause.(5) Subclause (1) (f) and (g) do not apply in respect of a discharge
that is made during a site discharge period for a flood flow block, unless a
trading rules order is in force.34 Reporting requirements(1) The EPA may, by notice in writing to the holder of a discharge
licence, require the holder to provide information to the EPA about the
licence holder’s anticipated saline water discharge
requirements.(2) A licence holder must not, without reasonable excuse, fail to
comply with any such requirement.(3) It is a condition of a discharge licence that the licence holder
does not contravene this clause.Division 7 Emergency dilution arrangements35 Defence—emergency dilution arrangements(1) If at any time the EPA is satisfied that:(a) a contravention by a licence holder of clause 20 (No discharges
except during site discharge period) or clause 22 (Maximum discharge during
site discharge period) is imminent, and
(b) the licence holder has taken all reasonable steps to avoid the
the EPA may approve the licence holder discharging saline water in
accordance with an emergency dilution arrangement.(2) An emergency dilution arrangement is an arrangement under which a
licence holder purchases or secures the release of water from the Water
Administration Ministerial Corporation (being water that is additional to any
other water that is generally purchased from or released by the Corporation),
and uses that water for the sole purpose of diluting the discharge of saline
water that is the subject of the arrangement.(3) The EPA may approve the licence holder discharging saline water in
accordance with such an arrangement only if satisfied that:(a) the discharge will not increase the overall salinity level of the
Hunter River catchment (taking into account salinity levels upstream of the
authorised discharge point of the licence holder), and
(b) the licence holder purchases or secures the release of sufficient
water to ensure that the rate of flow of the Hunter River catchment, at the
time and point of the discharge, achieves a target rate determined by the EPA,
(c) the arrangement is consistent with the water sharing provisions of
any management plan under the Water
Management Act 2000 that has effect in relation to the area
(4) An approval given by the EPA under this clause:(a) is to be in writing, and
(b) is subject to such conditions as may be specified by the EPA in
(5) It is a defence to a prosecution for an offence arising from an
alleged contravention of clause 20 or 22 that the licence holder discharged
the saline water concerned in accordance with such an
approval.(6) An approval under this clause must not authorise a licence holder
to exceed the licence holder’s tributary protection
limit.Part 4 Credits in schemeDivision 1 General36 Creation of credits(1) Credits in the scheme are to be created by the
EPA.(2) Credits are to be in a form approved by the
EPA.37 Authority conferred by credit(1) A credit, when held by the holder of a discharge licence, confers
authority on the holder to discharge 0.1% of the total allowable discharge for
a high flow block, subject to the discharge rules, during the period in which
the credit remains in force.(2) If a trading rules order is in force, a credit also confers
a flood flow block, subject to the discharge rules, during the period in which
the credit remains in force.(3) A credit does not confer any authority on a person to discharge
saline water unless the person also holds a discharge
licence.38 Lifespan of credit(1) A credit remains in force for the period specified in relation to
the credit in the Credit Register, expressed by reference to a number of
sequential blocks, and expires at the end of that
period.(2) A credit ceases to be in force during any period in which it is
suspended under this Regulation.39 Who may hold credit(1) Any person may hold a credit.(2) (Repealed)Division 2 Initial allocation of credits40 First issue credits(1) On the commencement of this Regulation, the EPA is to create 1,000
credits in the scheme (first issue
credits).(2) Those first issue credits are to have a lifespan that commences on
the commencement of this Regulation.(3) Of those first issue credits:(a) 200 are to have a lifespan ending on 30 June 2004,
(b) 200 are to have a lifespan ending on 30 June 2006,
(c) 200 are to have a lifespan ending on 30 June 2008,
(d) 200 are to have a lifespan ending on 30 June 2010,
(e) 200 are to have a lifespan ending on 30 June
holders(1) On the commencement of this Regulation, the first issue credits
are to be issued to the persons referred to in Schedule 1, in accordance with
that Schedule.(2) Each person who is allocated first issue credits is to be
allocated an equal number of first issue credits of each possible lifespan.
For example, if a person is eligible for 15 first issue credits, the
participant should be allocated 3 credits with a lifespan ending in 2004, 3
credits with a lifespan ending in 2006, 3 credits with a lifespan ending in
2008, 3 credits with a lifespan ending in 2010 and 3 credits with a lifespan
ending in 2012.(3) The first issue credits are to be allocated free of charge. This
subclause does not affect any liability for a contribution in respect of the
credit under Part 7.Division 3 Allocation of residual first issue
credits42 Residual first issue credits(1) Any first issue credits that are allocated to the EPA under
Schedule 1 (the residual first
issue credits) may be retained by the
EPA.(2) The EPA may allocate all or any of the residual first issue
credits to any other person as provided for by this
Division.(3) Any residual first issue credits that are not allocated by the EPA
by the time the first auction of credits is held are to be sold at that first
auction.43 Notice of intention to allocate residual first issue
credits(1) If the EPA proposes to allocate any residual first issue credits
it must:(a) cause a notice to be published in the Gazette and in a newspaper
circulating throughout the State or in the locality in which the scheme
operates inviting eligible persons to apply for the allocation of residual
first issue credits, and
(b) allow a period of not less than 21 days for the making of those
applications to the EPA.
(2) An application for an allocation of residual first issue credits
must be made to the EPA:(a) in a form and manner approved by the EPA, and
(b) before the end of the period specified in the notice as being the
period in which those applications may be made.
(3) A person may apply for the allocation of residual first issue
credits whether or not the person holds a discharge
licence.(4) However, if the person does not hold a discharge licence, any
undertaking by the EPA to allocate residual credits to the person:(a) is conditional on the person applying for, and being issued with,
a discharge licence within such period as may be specified by the EPA,
(b) is taken to be revoked if the EPA refuses to issue a discharge
licence to the person.
44 Eligibility criteria(1) Residual first issue credits may be allocated by the EPA to
persons who are eligible for the allocation of residual first issue credits,
and who apply for an allocation in accordance with clause
43.(2) A person is eligible for the allocation of residual first issue
credits if the person carries out or proposes to carry out any new or expanded
activity that:(a) results or is likely to result in discharges of saline water in
the Hunter River catchment, and
(b) cannot be carried out unless authorised by a discharge licence or
a variation of a discharge licence.
(3) An activity is a new activity for the
purposes of this clause if the EPA is satisfied that it was not being carried
out, or was not being regulated by a discharge licence, at the commencement of
this Regulation.(4) An activity is an expanded activity
for the purposes of this clause if the activity is not a new activity but the
EPA is satisfied that the scale of the activity, or the nature of the
activity, has been, or is proposed to be, changed so as to require a variation
of the discharge licence, being a variation that will authorise a significant
increase in the environmental impact of the activity authorised by the
licence.Note. If the EPA proposes to vary a licence in such a manner and the
proposed variation has not been the subject of an environmental assessment and
public consultation under the Environmental
Planning and Assessment Act 1979, the EPA is required to
invite and consider public submissions before it varies the licence under
section 58 (6) of the Act.45 Number of credits to be allocated(1) Residual first issue credits are to be allocated in multiples of
5.(2) In determining the number of residual first issue credits to be
allocated to an eligible person, the EPA is to have regard to the
following:(a) the number of residual first issue credits available for
(b) the number of applicants who are eligible for allocation of
residual first issue credits,
(c) the criteria used to allocate pilot scheme credits to participants
in that scheme and the need to maintain equity between those participants and
new entrants to the scheme,
(d) the type of activity for which the credits are sought and any
relevant difference between that activity and the types of activities for
which pilot scheme credits were allocated,
(e) whether any first issue credits have already been allocated to the
person and, if so, how many,
(f) in the case of expanded activities, the scale of the activities
relative to the scale of the activities before the expansion and the impact of
the expansion on the need to discharge saline water,
(g) the period remaining before the first auction of
Division 4 Creation and sale of new credits46 New credits to be created every 2 years(1) After the creation of the first 1,000 credits in the scheme, the
EPA is to create 200 new credits in the scheme every 2 years, for the purpose
of replacing the 200 credits that expire every 2
years.(2) The credits are to have a lifespan of 10
years.(3) The 10-year lifespan of the credits so created must not start
until the end of the lifespan of the credits that they replace, so that at no
stage will there be more than 1,000 credits in
force.(4) However, a credit may be sold by the EPA before its lifespan
starts.47 Sale of new credits by auction(1) The EPA is to make arrangements for the sale of credits created as
provided for by this Division from time to time by
auction.(2) At least one auction is to be held in every 2-year
period.(3) An auction is to be conducted in a manner determined by the EPA,
in accordance with such rules (if any) as the EPA may make from time to time
in connection with the conduct of auctions.(4) Without limiting subclause (3), the rules made by the EPA in
connection with the conduct of an auction may include:(a) a limit on the number of credits that may be purchased by any one
(b) a requirement that the successful bidder provide to the EPA
evidence to the satisfaction of the EPA that the bidder has complied with the
other rules of the auction.
(5) A copy of the rules (if any) that apply to an auction is to be
made available for public inspection on the website of the EPA before the
auction is conducted.(6) The EPA may charge a fee to any person who buys a credit at
auction in order to recover the costs incurred by or on behalf of the EPA in
connection with the auction.48 Sale of new credits by private treatyThe EPA may sell any credit that is not sold at auction by private
treaty or otherwise.49 Sale of residual first issue creditsAny first issue credits that are not allocated by the EPA as
provided for by Divisions 2 and 3 may also be sold in the manner provided for
by this Division.Part 5 Trading in creditsDivision 1 Trading in credits50 Trading in credits(1) Credits are tradeable only as provided by this
Part.(2) A credit may be transferred in accordance with this
Part.(3) A credit cannot be assigned or mortgaged, charged, leased or
otherwise encumbered.51 Trading facility to be established(1) The EPA is to make arrangements for the provision of a service to
facilitate the trading of credits (a credit trading
facility).(2) The credit trading facility is to be an on-line service provided
by the Registrar.(3) The credit trading facility may be used only by registered credit
traders.(4) The EPA may approve the trading of credits by alternative means to
the credit trading facility if the on-line service is not available, or in any
other circumstances in which the EPA considers it
appropriate.52 Registration of credit traders(1) The Registrar may, on application by an eligible person, register
the person as a credit trader.(2) Any person is eligible to be registered as a credit
trader.(3) However, until the first auction of credits (not being first issue
credits) is held, only the following persons are eligible to be registered as
credit traders:(a) persons who hold a relevant licence,
(b) the EPA.
Note. Until the first auction of credits, only holders of a relevant
licence and the EPA may hold credits in the scheme.(4) An application for registration as a credit trader is to be made
to the Registrar in a form approved by the
Registrar.(5) The Registrar may require the applicant, in or in connection with
the application, to supply to the Registrar such information as the Registrar
may reasonably require in connection with the trading of credits by the
applicant or the use of the credit trading
facility.(6) The Registrar may refuse any application for registration as a
credit trader that is not made in accordance with this
clause.(7) The Registrar may cancel the registration of a person as a credit
trader on request of the person.(8) Until the first auction of credits (not being first issue credits)
is held, the Registrar may cancel the registration of a person as a credit
trader if the person ceases to hold a relevant
licence.53 Use of credit trading facility(1) Use of the credit trading facility is subject to such conditions
as may be imposed by the Registrar from time to
time.(2) If access to the credit trading facility is conditional on the use
of a password, and a person accesses the credit trading facility by means of
the password associated with a registered credit trader, the Registrar is
entitled to assume that the person is the registered credit trader or is
acting with the authority of the registered credit
trader.54 Transfers to be effected by registered traders by means of
facilityA transfer of a credit does not have effect unless:(a) it is effected by means of the credit trading facility, or by
alternative means approved by the EPA, and
(b) the parties to the transfer are registered credit
55 Transfers may be made for considerationA transfer of a credit may be made for consideration or
otherwise.Division 2 Trading rules56 General rules as to transfersA credit may be transferred as follows:(a) as it relates to a particular block, or
(b) as it relates to a particular series of blocks, being blocks that
occur in a sequential order, or
(c) as it relates to all remaining blocks in the lifespan of the
57 To whom credits may be transferred(1) A credit may be transferred to any person, but only if the person
is a registered credit trader.(2) (Repealed)58 Retrospective transfers not permitted(1) A retrospective transfer of a credit is not
permitted.(2) For the purposes of this clause, a transfer of a credit, in
respect of a block, is retrospective if, when the transfer takes effect, the
site discharge period for that block in relation to the transferee’s
authorised discharge point has already ended.59 Credits valid for single use only(1) A credit may be utilised only:(a) once in relation to a block, and
(b) by one discharge licence holder in relation to a
(2) A part of a credit, as it relates to a particular block, is not
transferable.(3) Accordingly, a person must not transfer a credit in respect of a
block to any other person after having purported to include that credit in the
calculation of the volume discharge limit of the
transferor.Note. It is permissible for a credit holder who does not want to make a
discharge into a particular river block to transfer the authority conferred by
the credit in respect of that block to a licence holder who does wish to
discharge into that block. This clause prevents a licence holder from
“splitting” one credit with another licence holder by agreeing to
share the authority conferred by the credit between the two of them or from
using the credit and then transferring it to a discharge licence holder
further downstream.60 Effect of sector credit discount factor on
transfers(1) If a sector credit discount factor of less than one in relation to
a particular block and sector is entered in the River Register, a person must
not transfer any credit in respect of that block to a licence holder whose
authorised discharge point is in that sector, unless the transferor’s
authorised discharge point is in the same sector.(2) In this clause:sector credit
discount factor has the meaning given by Part
3.Note. The purpose of applying a sector credit discount factor of less
than one is to ensure that the salinity target in a particular sector is not
exceeded. As a result of this clause and clause 59, a licence holder cannot
transfer any part of a credit that the person is disqualified from using as a
result of the application of a sector credit discount factor. The licence
holder can transfer the whole credit, but only to a licence holder whose
authorised discharge point is in a sector to which a sector credit discount
factor of less than one does not apply. In addition, once a sector credit
discount factor of less than one has been entered in the River Register,
licence holders whose authorised discharge points are in the sector to which
the sector credit discount factor applies are not permitted to acquire more
credits to authorise a particular discharge.61 Offence for contravention of trading rulesA person who transfers, or purports to transfer, a credit in
contravention of the provisions of this Division is guilty of an
offence.Maximum penalty:(a) in the case of a corporation—400 penalty units,
discharge limit(1) A person who proposes to accept the transfer of a credit is under
a duty to ensure that the credit is transferred in accordance with this
Division.(2) If a credit is transferred, in respect of a block, to a discharge
licence holder in contravention of this Division, the credit is to be excluded
from the calculation of the volume discharge limit of the discharge licence
holder in respect of that block under Part 3.(3) Subclause (2) applies even if the transfer of the credit is
entered in the Credit Register.Note. A contravention of the provisions of this Regulation may also
result in an enforcement or forfeiture order being made against a person under
Part 8.Division 3 Credit Register63 Credit Register(1) The Registrar is to establish and maintain a Credit
Register.(2) The following information is to be entered in the Credit Register
in relation to each credit that is created in the scheme:(a) the name of the person who holds each credit with respect to each
(b) the lifespan of the credit,
(c) such other particulars as the Registrar considers
(3) The Credit Register:(a) is to be in a form determined by the EPA, and
(b) may be established and maintained wholly or partly by means of a
computer (including by means of an on-line service), and
(c) is to be made available for inspection by members of the public at
an office of the Registrar in a manner approved by the
64 Transfers to be entered in Register(1) A transfer of a credit does not take effect until it is entered in
the Credit Register, in accordance with such arrangements for the entry of
transactions as may be approved by the EPA from time to
time.(2) After a transfer of a credit is entered in the Credit
Register:(a) the transferee becomes the holder of the credit, in respect of the
block or blocks concerned, and
(b) the transferor ceases to be the holder of the credit, in respect
of the block or blocks concerned.
(3) The following information, in relation to a credit transfer, is to
be entered in the Credit Register (in accordance with the arrangements
referred to in subclause (1)):(a) the names of the transferor and the
(b) the date and time at which the transfer
(c) the number of credits transferred and the blocks to which the
transfer applies.
65 Correction of Credit RegisterThe Registrar may correct any error or mistake in the Credit
Register.Part 6 Administration of schemeDivision 1 Services Co-ordinator66 Services Co-ordinator(1) There is to be a Services Co-ordinator for the
scheme.(2) The Services Co-ordinator is to be the EPA or a person or body
appointed by the EPA as Services Co-ordinator.(3) The Services Co-ordinator has the following functions:(a) to monitor and gauge the flow of the Hunter River, for the purpose
of carrying out its functions under this Regulation,
(b) to establish and maintain the River Register,
(c) to make the contents of the River Register available to the
(d) such other functions as are conferred or imposed on it by this
Regulation or, if the Services Co-ordinator is appointed by the EPA, by the
functions(1) The Services Co-ordinator may enter into a contract with any
person (referred to in this Part as a sub-contractor) under
which the person agrees to carry out any of the functions of the Services
Co-ordinator.(2) If the Services Co-ordinator is not the EPA, such a contract may
be entered into only with the approval of the EPA.68 Functions of EPA(1) The EPA is to ensure that any contract or other arrangement under
which the Services Co-ordinator (if it is not the EPA) is appointed, or under
which a sub-contractor is appointed, includes such provisions as the EPA
considers appropriate:(a) to ensure that the objects and aims of the scheme are attained,
(b) to ensure that the Services Co-ordinator or sub-contractor is
accountable for its performance in connection with the
(2) Without limiting subclause (1), the contract or arrangement may
require the Services Co-ordinator or sub-contractor:(a) to make and keep records in connection with the exercise of its
functions under this Regulation and the contract, and
(b) to retain those records for at least 4 years after they are made,
(c) to make those records available to the EPA on request,
(d) to establish and maintain suitable monitoring stations for the
purpose of detecting contraventions of this Regulation,
(e) to advise the EPA of any suspected contravention of this
(f) to provide the EPA with copies of the River
(3) The EPA is to ensure that the contract or arrangement requires the
Services Co-ordinator to report to the EPA on the performance of its functions
under the contract or arrangement on an annual basis and to make that report
available for public inspection.Division 2 Registrar69 Registrar(1) There is to be a Registrar for the
scheme.(2) The Registrar is to be the EPA or a person or body appointed as
Registrar by the EPA.(3) The Registrar has the functions conferred or imposed on the
Registrar by this Regulation.Division 3 Operations Committee70 Appointment of Operations Committee(1) There is constituted by this Regulation a body corporate to be
called the Hunter River Salinity Trading Scheme Operations
Committee.(2) The Operations Committee is to consist of the following members,
each of whom is to be appointed by the EPA:(a) 1 person who is a member of the board of the Hunter-Central Rivers
Catchment Management Authority or a person nominated by that
(b) 4 persons appointed to represent the interests of licence
(c) 1 person appointed to represent the interests of persons who use
water from the Hunter River catchment for irrigation,
(d) 1 person appointed to represent environmental
(e) 1 person who is a member of a committee or other organisation
concerned in the management of the Hunter River or of any other river in the
Hunter River catchment (who may be a member of the board of the Hunter-Central
Rivers Catchment Authority, or a person nominated by that Authority, who is
additional to the member or person referred to in paragraph
(f) 1 person who is an officer or employee of the Department of
Natural Resources, appointed on the nomination of the head of that
(3) Each person appointed by the EPA as a member of the Operations
Committee is to be a person who, in the opinion of the EPA, has sufficient
skills and experience to be a member of the Operations
Committee.(4) If the EPA declines to appoint a person nominated as a member of
the Operations Committee by a person or body as referred to in subclause (2),
the EPA may invite the person or body to nominate another person as member of
the Operations Committee.(5) The member referred to in subclause (2) (a) is to be Chairperson
of the Operations Committee.(6) Schedule 2 has effect.71 Functions of Operations Committee(1) The Operations Committee has the following functions:(a) to advise the EPA on such matters as are referred to it by the EPA
in connection with the operation of the scheme,
(b) such other functions as may be conferred or imposed on it by this
Regulation or by the EPA in connection with the
(2) The EPA may appoint the Operations Committee as Services
Co-ordinator.72 Failure by Operations Committee to perform
functions(1) If the EPA is not satisfied with the performance of the Operations
Committee under this Regulation, the EPA may:(a) suspend the Operations Committee from performing its functions
under this Regulation, and
(b) remove any or all of the members of the Committee from office (as
provided by Schedule 2).
(2) If the EPA appoints the Operations Committee as Services
Co-ordinator, and is not satisfied with the performance of the Operations
Committee as Services Co-ordinator, the EPA may do any of the
following:(a) terminate the appointment of the Operations Committee as Services
(b) suspend the Operations Committee from performing any of the
functions of Services Co-ordinator (in which case the EPA is to carry out
those functions during the suspension period),
(c) remove any or all of the members of the Committee from office (as
Part 7 Cost recoveryDivision 1 Contribution payable by participants towards costs
of scheme73 Participants required to contribute toward costs of
scheme(1) A person who, at the start of a scheme year, is a participant in
the scheme is required to pay to the EPA a contribution as referred to in
section 295H of the Act, calculated in accordance with this
Part.(2) The EPA is to inform each person who is required to pay a
contribution under this clause of the amount that the person is required to
pay, by notice in writing given to the person.(3) The contribution must be paid within 30 days after the notice is
given by the EPA, or by such later date as may be specified by the EPA in the
notice.(4) The contribution may be paid in instalments, in accordance with
arrangements specified by the EPA in the notice.Note. Section 295H (4) of the Act provides that if an instalment is not
paid by the due date, the balance then becomes due and
payable.(5) If a contribution (or an instalment) is not paid by the due date
for its payment, the contribution (or balance payable) is to be increased by
the amount of simple interest calculated at the rate of 25 per cent per annum
on the amount of the contribution unpaid for each day that elapses after the
due date and before the date of payment.(6) For avoidance of doubt, a person remains liable for a contribution
under this Part even if the person ceases to be a participant in the scheme
during the scheme year.Note. The EPA is not required to pay a contribution under this Part (see
section 295H (6) of the Act).74 Calculation of contributionThe contribution payable by a person under this Part is calculated
as follows:Where:C is the
contribution payable by the person.H is the
contribution payable by the person on the person’s credit holdings (if
any) at the start of the scheme year, calculated in accordance with this
Part.DL is the
contribution payable by the person on the discharge licence (if any) held by
the person at the start of the scheme year, calculated in accordance with this
Part.Note. The calculation of the contribution payable by a participant in
the scheme is based on their credit holdings at the start of the scheme year
and their licence. If the participant held a discharge licence but did not
hold any credits at the start of the scheme year, the participant will only be
liable for a contribution on the participant’s discharge licence
(DL in the formula
above). If the participant held credits but not a discharge licence, the
participant will only be liable for a contribution on the participant’s
credit holdings at the start of the scheme year (H in the formula above). If the
participant held credits and a discharge licence, the participant will be
liable for a contribution in respect of both.75 Contribution on credit holdingsFor the purposes of this Part, the contribution payable by a
person on the person’s credit holdings at the start of a scheme year is
calculated as follows:Where:H is the
contribution payable by a person on the person’s credit holdings at the
start of the scheme year.TCA is the total
contributions amount (calculated under Division 2).Note. TCA is multiplied by 0.5
in the formula because half of the total contributions amount is paid by
participants in the scheme who are credit holders and the other half is paid
by participants in the scheme who are discharge licence holders. Participants
who hold both credits and a discharge licence will be liable to contribute
both as credit holders and licence holders.CH is the number
of credits held by the person at the start of the scheme year.TCH is 1000,
minus the number of credits (if any) held by the EPA at the start of the
scheme year.76 Contribution on licence(1) For the purposes of this Part, the contribution payable by a
person on a discharge licence held by the person at the start of the scheme
year is calculated as follows:Where:DL is the
contribution payable by the person on a discharge licence held by the person
at the start of the scheme year.TCA is the
total contributions amount (calculated under Division 2).Note. TCA is multiplied
by 0.5 in the formula because half of the total contributions amount is paid
by participants in the scheme who are credit holders and the other half is
paid by participants in the scheme who are discharge licence holders.
Participants who hold both credits and a discharge licence will be liable to
contribute both as credit holders and licence holders.TL is the
total number of discharge licences held by participants in the scheme at the
start of the scheme year.(2) For avoidance of doubt, if more that one discharge licence is held
by a person, a contribution is payable under this clause in respect of each of
those discharge licences.77 Contributions on forfeited credits(1) For the purposes of this Part, a person is taken to continue to
hold a credit that is forfeited to the EPA under this Regulation until the EPA
sells the credit.(2) Any such credit is not to be considered to be held by the EPA for
the purposes of a calculation made under this Part.Note. The object of this clause is to ensure that participants who
forfeit credits remain liable to make a contribution under this Part in
respect of the credit until the EPA sells the credit.Division 2 Calculating total contributions amount78 Total contributions amount(1) For the purposes of this Part, the total contributions
amount for a scheme year is the total cost of the scheme for the
scheme year estimated in accordance with this Division, and adjusted by the
EPA (if required) in accordance with Division 3.(2) The total cost of the scheme for the scheme year is the total of
the following costs:(a) the costs of the Services Co-ordinator in connection with the
scheme for the scheme year, as estimated by the Services Co-ordinator under
(b) the costs of the Registrar in connection with the scheme for the
scheme year, as estimated by the Registrar under this
(c) the costs of the EPA in connection with the scheme for the scheme
year, as estimated by the EPA under this Division.
79 Costs of Services Co-ordinator(1) For the purposes of this Part, the costs of the Services
Co-ordinator in connection with the scheme for a scheme year consists of the
costs incurred by the Services Co-ordinator (including any sub-contractor of
the Services Co-ordinator), being costs of a kind referred to in section 295H
(1) of the Act, in exercising its functions under this Regulation during the
scheme year.(2) For the purposes of determining contributions payable in respect
of a scheme year, the Services Co-ordinator must, before the start of each
scheme year, prepare and adopt an estimate of the costs of the Services
Co-ordinator in connection with the scheme for the scheme
year.(3) If the Services Co-ordinator is not the EPA, the estimate may be
adopted by the Services Co-ordinator only with the concurrence of the
EPA.80 Costs of Registrar(1) For the purposes of this Part, the costs of the Registrar in
connection with the scheme for a scheme year consists of the costs incurred by
the Registrar, being costs of a kind referred to in section 295H (1) of the
Act, in exercising its functions under this
Regulation.(2) For the purpose of determining the contributions payable in
respect of a scheme year, the Registrar must, before the start of each scheme
year, prepare and adopt an estimate of the costs of the Registrar in
connection with the scheme for the scheme year.(3) If the Registrar is not the EPA, the estimate may be adopted by
the Registrar only with the concurrence of the EPA.81 Costs of EPA(1) For the purposes of this Part, the costs of the EPA in connection
with the scheme for a scheme year consists of the costs incurred by the EPA,
being costs of a kind referred to in section 295H (1) of the Act, not
including those costs that are included in the costs of the Services
Co-ordinator or the Registrar in connection with the scheme
year.(2) The EPA must, before the start of each scheme year, prepare and
adopt an estimate of the costs of the EPA in connection with the scheme for
the scheme year.Division 3 Adjustments to total cost82 Functions of EPAThe EPA is to adjust the total contributions amount for a scheme
year from time to time as required in accordance with this
Division.83 Reconciliation at end of scheme year(1) At the end of a scheme year, the EPA is to calculate the actual
cost of the scheme for that scheme year.(2) The actual cost of the scheme for the scheme year is the total of
the following:(a) the costs of the Services Co-ordinator in connection with the
scheme for the scheme year, as assessed by the Services Co-ordinator at the
end of the scheme year,
scheme year, as assessed by the Registrar at the end of the scheme
year, as assessed by the EPA at the end of the scheme
(3) The Services Co-ordinator and the Registrar are to provide the EPA
with such information as is necessary for the purpose of calculating the
actual cost of the scheme for the scheme year.(4) If the actual cost of the scheme for the scheme year exceeds the
total contributions amount in respect of that scheme year, the amount of the
difference is to be added to estimated cost of the scheme for the next scheme
year, and the total contributions amount for that year is to be increased
accordingly.(5) If the actual cost of the scheme for the scheme year is less than
the total contributions amount in respect of that scheme year, the amount of
the difference is to be deducted from the estimated cost of the scheme for the
next scheme year, and the total contributions amount for that year is to be
decreased accordingly.84 Auction and sale proceedsThe EPA is to deduct from the total cost of the scheme for a
scheme year the amount of the proceeds (if any) of any auction or other sale
of credits by the EPA under the scheme held during the previous scheme year
and the total contributions amount is to be decreased
accordingly.85 Adjustments to contributionsThe EPA may determine the arrangements for payment of any
additional contribution, or refund of contribution, that is required because
of an adjustment to the total contributions amount under this
Division.Part 8 Enforcement86 General enforcement power of EPA(1) The EPA may, by order in writing served on a person:(a) suspend any or all credits held by the person,
(b) prohibit the person from transferring or accepting the transfer of
credits, or impose conditions on any such
(2) Such an order (an enforcement order) may
be made only if the EPA is satisfied that the person:(a) has contravened a provision of this Regulation,
(b) has contravened a condition of the person’s licence, being a
condition that relates to the scheme.
(3) An enforcement order takes effect on the date notice of the order
is served on the person against whom it is made, or on a later date specified
in the order, subject to clause 87.(4) An enforcement order may be expressed to have effect for a
specified period, or until the fulfilment of specified conditions, or until
further order of the EPA.(5) An enforcement order has effect according to its tenor, despite
any other provision of this Regulation.(6) A person must not contravene the terms of an enforcement
order.Maximum penalty:(a) in the case of a corporation—400 penalty units,
(7) An enforcement order does not affect the liability of a person to
pay a contribution in respect of a licence or credit under this
Regulation.(8) This clause does not prevent any proceedings being taken for an
offence against the Act or this Regulation.87 Confirmation of enforcement order(1) An enforcement order ceases to be in force at the end of the
period of 60 days after the order takes effect, unless the EPA confirms the
making of the enforcement order before the end of that period, in accordance
with this clause.(2) The making of an enforcement order is confirmed if notice of the
confirmation is served on the person against whom the order was
made.(3) The EPA must not confirm the making of an enforcement order
unless:(a) it has given notice to the person against whom the order was made
of its reasons for making the order, and
(b) it has given the person a reasonable opportunity to make
submissions with respect to the order, and
(c) it has taken into consideration any such submissions by the
88 Forfeiture of credits(1) The EPA may, by order in writing served on a person, require the
forfeiture of any credits held by the person to the
EPA.(2) Such an order (a forfeiture order) may be
made only if the EPA is satisfied that the person:(a) has contravened a provision of this Regulation,
condition that relates to the scheme, or
(c) has failed to pay a contribution required under this Regulation by
the due date for its payment.
(3) The order is to specify the number of credits
forfeited.(4) In the case of a forfeiture order made because of a contravention
of this Regulation, the EPA may, in determining how many credits are to be
forfeited, take into account:(a) any pecuniary benefit that has been obtained by the person, or any
cost that has been avoided by the person, because of the contravention,
(5) In the case of a forfeiture order made because of a failure to pay
a contribution by the due date for its payment, the EPA may order the
forfeiture of the number of credits that, in the opinion of the EPA, would, if
sold by auction or public tender, raise an amount sufficient to meet the
following:(a) the contribution that is payable by the person, together with any
interest payable on the contribution, and
(b) the costs that are likely to be incurred by the EPA in connection
with the sale of the credits.
(6) A forfeiture order takes effect on the date notice of the order is
served on the person against whom it is made, or on a later date specified in
the order.(7) On the date that a forfeiture order takes effect, the credit or
credits specified in the order are forfeited to the
EPA.(8) This clause does not prevent any proceedings being taken:(a) for an offence against the Act or this Regulation,
(b) for the recovery of a contribution as a debt payable to the EPA,
as provided for by section 295H (3) of the Act.
Note. Under section 295H (3) of the Act, a contribution payable to the
EPA is recoverable by the EPA as a debt in a court of competent
jurisdiction.89 Notice of reasons for making forfeiture order(1) The EPA must not make a forfeiture order unless:(a) it has given notice to the person against whom the order is to be
made of its intention to do so, and
(c) it has given the person a reasonable opportunity to make
submissions with respect to the proposed order, and
(d) it has taken into consideration any such submissions by the
(2) For the purpose of preventing the trading of credits that are
proposed to be forfeited under the forfeiture order, the EPA may make an
enforcement order against the person, with effect from the date notice of its
intention to make the forfeiture order is given to the
person.90 Effect of forfeiture order(1) A forfeited credit continues in force as if it had not been
forfeited, except that the EPA becomes the holder of the
credit.(2) The EPA is to make arrangements for the sale of any credits
forfeited to the EPA by auction or public tender.(3) This clause is subject to Part 7 (which requires a person who
forfeits a credit to continue to pay to the EPA a contribution in respect of
the credit until it is sold).91 Offence of providing false informationA person who, in or in connection with an application for credits
or any other application or information provided to the EPA, the Services
Co-ordinator or the Registrar under this Regulation, provides any information,
or makes any statement, knowing that it is false or misleading in a material
particular, is guilty of an offence.Maximum penalty:(a) in the case of a corporation—200 penalty
(b) in the case of an individual—100 penalty
Note. Other enforcement powersThe Act also provides that certain offences can be dealt with by
the issue of a penalty notice (sometimes referred to as an on the spot fine)
by an authorised officer. Under the Protection of the Environment Operations (Penalty
Notices) Regulation 1999, an officer or employee of the EPA is
authorised to issue a penalty notice for the offence of contravening a licence
condition (including the licence conditions referred to in Part 3). In such a
case, the on the spot fine is $1,500 (in the case of a corporation) or $750
(in the case of an individual). If the offence is dealt with by a court, the
maximum penalty that the court can impose for the offence is $250,000 (in the
case of a corporation) or $120,000 (in the case of an
individual).Part 9 Miscellaneous92 Suspension of scheme(1) A suspension of the scheme, or part of the scheme, as provided by
section 293A of the Act, may be effected by the EPA by order published in the
Gazette.Note. The Act requires the EPA to undertake public consultation before
suspending the scheme, unless the suspension is required urgently in order to
protect the environment, public health, property, or the integrity of the
scheme, or is necessary because of an emergency.(2) The order is to specify the period during which the scheme or part
of the scheme is suspended, but that period may be extended by further order
published in the Gazette.(3) The order may specify the effect of the suspension on any rights
conferred or obligations imposed under the scheme.(4) It is a condition of a discharge licence that the holder of the
licence does not discharge saline water during any period in which the scheme
or part of the scheme is suspended by the EPA, except with the written
approval of the EPA or in accordance with the terms of any order made under
this clause.(5) Subclause (4) has effect despite the discharge
rules.93 Review of Regulation—timetableThe review referred to in section 295C of the Act is to be
undertaken by the Minister as soon as possible after the period of 10 years
from the date of commencement of this Regulation.94 Amendment of Protection of the Environment Operations (Penalty
1999 is amended by inserting at the end of Schedule 1: Protection
of the Environment Operations (Hunter River Salinity Trading Scheme)
Column 1Column 2Column 3Column 4Provision of RegulationOfficerPenalty (individuals)Penalty (corporations)Clause 6127501500Part 10 Savings and transitional provisions95 Regulation supersedes pilot scheme(1) On the commencement of this Regulation, the pilot scheme is
terminated and all pilot scheme credits cease to have
effect.(2) The provisions of this Regulation supersede the guidelines and
rulebook relating to the pilot scheme (being documents published by the EPA),
and the provisions of those guidelines and rulebook cease to have effect when
this Regulation commences.96 Services Co-ordinator(1) On the commencement of this Regulation, the Water Administration
Ministerial Corporation is taken to have been appointed by the EPA as Services
Co-ordinator.(2) This clause does not prevent the EPA from terminating the
appointment of the Water Administration Ministerial Corporation as Services
Co-ordinator or varying the terms of that
appointment.97 First scheme yearThe first scheme year of the scheme is taken to be the period
commencing on the date of commencement of this Regulation and ending on 30
June in the following year.98 Discharge licences issued under pilot scheme(1) A reference in this Regulation to a discharge licence includes a
licence that, immediately before the commencement of this Regulation,
authorises a person to discharge saline water under the pilot
scheme.(2) A reference in any such licence to the pilot scheme is taken, on
the commencement of this Regulation, to be a reference to the scheme
established by this Regulation.(3) This clause ceases to have effect 6 months after the commencement
of this Regulation.Schedule 1 Allocation of first issue credits(Clauses 4 and 41)
Credit holderLicence number (if applicable)Premises name (if applicable)Number of creditsBengalla Mining Company Pty Ltd6538Bengalla Mine35Bulga Coal Management Pty Ltd563Saxonvale Colliery Holding40Camberwell Coal Pty Ltd3390Camberwell Coal Mine Colliery
Holding15Coal and Allied Industries Ltd640Hunter Valley Operations120Coal and Allied Industries Ltd1976Mt Thorley Colliery Holding0Cumnock No 1 Colliery Pty Ltd37Cumnock No 1 Colliery15Dartbrook Coal Pty Ltd4885Dartbrook Coal Mine15Drayton Coal Pty Ltd1323Drayton Coal Mine Colliery Holding25Hunter Valley Coal Corporation Pty
Ltd4460Mt Owen Coal Mine15Lemington Coal Mines Ltd1497Lemington Coal Mine Colliery Holding40Liddell Coal Operations Pty Ltd2094Liddell Colliery Holding55Macquarie Generation779Bayswater Power Station230Mt Arthur Coal Company Ltd113Bayswater Colliery25Muswellbrook Coal Company Ltd656Muswellbrook No 2 Open Cut Coal Mine10Nardell Coal Corporation Pty Ltd10337Nardell Coal Corporation Pty Ltd30New South Wales Environment Protection
Authoritynana85Ravensworth Operations Pty Ltd10860Ravensworth East Mine0Ravensworth Operations Pty Ltd2652Ravensworth Operations Narama Mine100Redbank Project Pty Ltd11262Redbank Power Station35Rix’s Creek Pty Ltd3391Rix’s Creek Colliery25United Collieries Pty Ltd3141United Colliery10Wambo Mining Corporation Pty Ltd529Wambo Mining Corporation35Warkworth Mining Ltd1376Warkworth Colliery Holding40Total credits 1,000Note. Although some of the participants referred to above are not to be
issued with first issue credits, they will be able to participate in trading
in first issue credits.Schedule 2 Constitution and procedure of Operations
Committee(Clause 70)Part 1 General1 DefinitionsIn this Schedule:Chairperson means the
Chairperson of the Operations Committee.member means
any member of the Operations Committee.Part 2 Constitution2 Terms of office of membersSubject to this Schedule, a member holds office for such period
travelling and subsistence allowances) as the EPA may from time to time
determine in respect of the member.4 Deputies(1) The EPA may, from time to time, appoint a person to be the deputy
of a member, and the EPA may revoke any such
subsistence allowances) as the EPA may from time to time determine in respect
(c) resigns the office by instrument in writing addressed to the EPA,
(d) is removed from office by the EPA under this clause,
(e) is absent from 4 consecutive meetings of the Operations Committee
of which reasonable notice has been given to the member personally or by post,
except on leave granted by the EPA or unless the member is excused by the EPA
for having been absent from those meetings, or
(2) The EPA may at any time remove a member from
to this Act, to be appointed to fill the vacancy.7 Chairperson(1) The Chairperson vacates office as Chairperson if the
person:(a) is removed from office by the EPA under this clause,
(2) The EPA may at any time remove the Chairperson from office as
Chairperson.8 Disclosure of pecuniary interests(1) If:(a) a member of the Operations Committee has a direct or indirect
pecuniary interest in a matter being considered or about to be considered at a
meeting of the Operations Committee, and
meeting of the Operations Committee.(2) A disclosure by a member at a meeting of the Operations Committee
recorded by the Operations Committee in the minutes of the meeting
concerned.(4) A member of the Operations Committee is not disqualified from
taking part in any deliberation of the matter, or in a decision with respect
to the matter, because of the member’s pecuniary
interest.(5) A contravention of this clause does not invalidate any decision of
the Operations Committee.Part 3 Procedure9 Procedures of Operations CommitteeSubject to this Schedule, the procedures of the Operations
Committee are to be determined by the EPA and, subject to any such
determination, by the Operations Committee.10 QuorumThe quorum for a meeting of the Operations Committee is a majority
of its members for the time being.11 Presiding member(1) The Chairperson is to preside at a meeting of the Operations
of the Operations Committee at which a quorum is present is the decision of
the Operations Committee.13 MinutesThe Operations Committee is required to keep minutes of
proceedings at its meetings.Dictionary(Clause 4)authorised
discharge point means a discharge point in the Hunter River
catchment that is specified in a discharge licence as a point from which
discharges of saline water by the licence holder are authorised (subject to
the scheme).block or river block means a block identified in
the River Register, as referred to in Part 2.credit means a credit in
the scheme.Credit Register
means the Credit Register required to be kept under this
Regulation.credit trading
facility means the facility for the trading of credits provided by
the Registrar, as referred to in Part 5.discharge
licence is defined in clause 6.discharge rules
means the provisions set out in Part 3.enforcement
order means an order made by the EPA under clause 86.first issue
credit means any of the first 1,000 credits created in the scheme by
the EPA.flood flow
block, in relation to a particular sector, means a block classified
as a flood flow block in relation to that sector under this Regulation, and
identified as such by an entry in the River Register.flood flow
salinity target has the meaning given by clause 17.forfeiture
order means an order made by the EPA under clause 88.high flow block,
in relation to a particular sector, means a block classified as a high flow
block in relation to that sector under this Regulation, and identified as such
by an entry in the River Register.high flow salinity
target has the meaning given by clause 17.Hunter River
catchment is defined in clause 7.lifespan of a credit
means the period (expressed in terms of sequential blocks) for which it
remains in force.low flow block, in
relation to a particular sector, means:(a) a block classified as a low flow block in relation to that sector
under this Regulation, and identified as such by an entry in the River
(b) a block in respect of which no classification is entered in the
lower sector means
that part of the Hunter River catchment downstream of the middle sector
reference point and upstream of the lower sector reference
point.lower sector
reference point means the Hunter River gauging station number 210001
at Singleton.middle sector
means that part of the Hunter River catchment downstream of the upper sector
reference point and upstream of the middle sector reference
point.middle sector
reference point means the Hunter River gauging station number 210127
immediately upstream of the confluence of the Hunter River and Glennies
Creek.on-line service
means a service provided by or through the facilities of a computer
communication system and accessed through a telecommunications network that
allows for:(a) the input, output or examination of computer data or computer
(b) the transmission of computer data from one computer to
Committee means the Hunter River Salinity Trading Scheme Operations
Committee established by the EPA under this Regulation.participant in the
scheme has the meaning given by clause 5.pilot scheme means
the pilot scheme of the same name as the scheme established by this Regulation
that was conducted by the EPA and the Department of Land and Water
Conservation before the commencement of this Regulation.pilot scheme
credit means a credit in the pilot scheme.registered credit
trader means a person who is registered by the Registrar as a credit
trader under Part 5.Registrar means the
EPA or a person or body appointed by the EPA as Registrar.relevant
licence means a discharge licence or a licence that applies to
premises referred to in Schedule 1.residual first
issue credit means any first issue credit allocated to the EPA as
provided for by Schedule 1.River Register
means the River Register required to be kept under this
Regulation.saline water means
water with an electrical conductivity of not less than 400 microSiemens per
centimetre.salinity target
means a high flow salinity target or a flood flow salinity
target.scheme means the Hunter
River Salinity Trading Scheme established by this Regulation.scheme year means
the period commencing on 1 July in any year and ending on 30 June in the
following year.sector means the upper
sector, the middle sector or the lower sector.sequential
blocks means blocks that have identification numbers that are in
sequential order.Services
Co-ordinator means the EPA or the person or body appointed by the
EPA as Services Co-ordinator.site discharge
period, in relation to an authorised discharge point, means the site
discharge period determined by the Services Co-ordinator under Part 3 for a
high flow or flood flow block and entered in the River
Register.the Act means the
Act 1997.total allowable
discharge means the total allowable discharge of salt for a block
determined by the Services Co-ordinator under Part 3 and entered in the River
Register.total
contributions amount has the meaning given by Part 7.trading rules
order—see Division 5 of Part 3.tributary
protection limit of a discharge licence holder means an amount
specified in a discharge licence as the maximum amount of saline water that
may be discharged by a licence holder from an authorised discharge point
during any specified period.upper sector means
that part of the Hunter River catchment upstream of the upper sector reference
point.upper sector
reference point means the Hunter River gauging station number 210055
upstream of the confluence of the Hunter River and the Goulburn River at
Denman.volume discharge
limit of a discharge licence holder in respect of a block means the
volume discharge limit calculated under Part 3.Historical notesThe following abbreviations are used in the Historical notes:
the Environment Operations (Hunter River Salinity Trading Scheme) Regulation
2002 published in Gazette No 225 of 22.11.2002, p 9803. This
2005(751)Protection of the Environment
Operations (Hunter River Salinity Trading Scheme) Amendment Regulation
2005. GG No 142 of 25.11.2005, p 9740.Date of commencement, on gazettal.
2009(52)Protection of the Environment
2009. GG No 37 of 13.2.2009, p 979.Date of commencement, on gazettal.
Cl 39Am 2009 (52), Sch 1 [1] [2].Cl 57Am 2009 (52), Sch 1 [3] [4].Cl 70Am 2005 (751), Sch 1
[1]–[3].DictionaryAm 2005 (751), Sch 1