A Tidal Power Project

Full text

A tidal power project
Glen Wright, University of New South Wales
reviews how innovative technology was dealt with
Crest EnergyKaipara Ltd applied to Northland Regional
Council for a range of consents under the Resource
ManagementAct 1991 to establish an arrayof 200 tur-
bines on the seabed of the Kaipara Harbour. The array would
be connected to an electricity sub-station via two undersea
cables and would have a nameplate capacity of 200 Mega-
watts (Re Crest Energy Kaipara Ltd [2009] NZEnvC A132
(Interim Decision) at [1]).
ENVIRONMENT COURT
The Environment Court issued an Interim Decision on 22
December 2009, and its Final Decision ([2011] NZEnvC 26)
in March 2011 following court-sponsored mediation between
the parties. The main parties were: Crest; Environs Holdings
Ltd, representing Maori interests; the Director General of
Conservation; and Northland Regional Council (NRC), to
whom the resource consent application was made.
The Court was unable to grant all the consents applied for
as the New Zealand Coastal Policy Statement 1994 (NZCPS
1994) provided that certain coastal activities must be approved
by the Minister of Conservation. Between the Interim Deci-
sion and the Final Decision, the NZCPS 2010 was promul-
gated. Clause 9 of NZCPS 2010 states, “[t]he Minister of
Conservation does not require any activity to be specified as
a restricted coastal activity in a regional coastal plan”, and
cl 29 requires local authorities to give effect to this policy.
However, NZCPS 1994 continued to apply to Crest’s Project
(Final Decision at [3]).
Interim decision
The Court noted that the planning provisions themselves
were not the subject of significant debate (at [17]–[19]). The
issues that the Court considered to be within its jurisdiction
were: sustainable management; navigation; coastal planning
processes; Maori cultural issues; marine life, fish and fisher-
ies; and monitoring and adaptive management (at [34]).
The Court considered that the project constituted the
“efficient useand developmentofnaturalandphysicalresources”
under s 7(b) (at [46]) and that the reduction in carbon
dioxide emissions addressed s 7(j) (at [53]), which requires
that the “benefits to be derived from the use and develop-
ment of renewable energy” be considered when assessing a
consent application. The Court also adopted a number of
other conclusions regarding sustainable management relat-
ing to avoidance of future energy shortages and reduced
transmission losses.
Crest had not applied for exclusive occupation of the
harbour. However, the Court noted that the Harbour Master
had the power under the Local Government Act 2002 to
implement a navigation exclusion zone, and decided that the
potential effects of the project on navigation should be
addressed (at [77]) but that they would be minimal, given the
“very limited boating use of this remote and often wild part
of the harbour” (at [87]).
The effect of the project on marine fauna and fisheries was
a “particularly important feature” (at [92]). Despite Crest’s
research regarding fisheries, the Court said it was “less than
satisfied” with the evidence offered. Given that the area
supports a lucrative fishing industry, the Court reiterated the
importance of understanding the potential impacts of the
project on marine life (at [93]). In particular, while evidence
was available regarding the fisheries in the harbour, little
work had been done on fisheries outside the harbour (at
[95]). The harbour entrance was heard to be “an essential
conduit for species migrating [into] the open sea” (at [106]),
yet no information was available on this migration.
The Court decided that the issue was too important for it
to attempt to resolve the ambiguities in the evidence, and
requested further expert evidence (at [118]).
As to the noise impacts, the Court noted that the science is
“verymuchinitsinfancy”andislocationspecific(at[124]–[126]).
The Court concluded that noise monitoring must take place
as the project progresses (at [146]).
The Court looked at the effect of the project on the Maui’s
Dolphin and other marine mammals. Maui’s Dolphin is
particularly important because, due to its vanishingly small
population of about 100, the death of one dolphin could
threaten the survival of the entire species (at [165]). The
Court noted that the number of Maui’s dolphin likely to
enter the harbour would “at most be very low”, but decided
that a monitoring regime should be instituted and “fine
tuned” (at [168], [169]).
Another issue was the treatment of Maori cultural issues.
Environs Holdings was a party to the case, as its owner, Te
Uri o Hau Settlement Trust (TUOH), asserts a customary
proprietary right to the seabed. TUOH argued that granting
resource consents for the project would prejudice the claim it
had lodged in the High Court asserting their rights. Environs
also shared the concerns of the Court relating to navigation,
fishing, and other issues.
Given s 59 of the Te Uri of Hau Claims Settlement Act
2002, by which the Crown acknowledged “the particular
cultural, spiritual, historic, and traditional association of Te
Uri o Hau” with the land, the Court accepted the strength of
the claim to Maori cultural significance (at [181]). The Court
found that, while Maori issues were “strongly in the mix”,
Crest had “adequately and appropriately addressed” these
issues through “extensive, considerable and meaningful”
consultation and modification of its proposal (at [198]). The
Court noted that TUOH was still unhappy and that Crest
had “essentially stepped into the middle of this situation”,
accidently increasing tensions (at [175]).
New Zealand Law Journal September 2011
260
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[2011] NZLJ 260

In making its overall assessment, the Court proceeded
tentatively, recognising the uncertainties identified and the
need for further evidence. The Court stated that there were
indicators “pointing powerfully in the direction of consent
being granted”, but cautioned that the issue of potential
impacts on fisheries could result in rejection if not addressed
to the Court’s satisfaction (at [206], [211]).
The Court stated that the question of whether to grant
consent turned on whether an Environmental Management
Plan (EMP) could be developed to address the outstanding
uncertainties regarding environmental impacts. The Court
stated that “adaptive management”, a concept expounded
by a number of previous cases, was at the heart of the issue
(at [223], [224]). Adaptive management refers to the adap-
tation of projects over time as environmental impacts become
clearer. Adaptive management involves: collecting baseline
data; setting objectives; planning for management of the
resource; monitoring results; and changing the EMP to reflect
new knowledge about impacts (at [226]). The Court noted
that the objectives for adaptive management must be “rea-
sonably certain and enforceable” (at [227] and Lower Waitaki
River Management Society Inc v Canterbury Regional Coun-
cil [C80/2009]), but cannot require Crest to have carried out
all research in advance (Director General of Conservation v
Marlborough District Council [C113/2004]).
Mediation
Following the Interim Decision, the parties worked through-
out 2010 to resolve the outstanding issues, a process which
“occupied a timeframe that normally would be uncomfort-
ably long for the Court” (Final Decision at [11]). The parties
reached agreement in a number of areas, but thirteen issues
remained unresolved. Court-sponsored mediation reduced
this number to seven. The parties agreed that they wished to
finally resolve the application by filing one further statement
of evidence (on behalf of NRC) and legal submissions before
seeking the Court’s determination (at [13]).
Final decision
The first outstanding issue to be determined by in the Final
Decision was the minimum timeframes for monitoring in
between implementation of stages of theproject. Crest accepted
that three years initial monitoring was appropriate, but
argued that the period should not be so long for the imple-
mentation of the latter stages of its project, as sufficient data
would then be available to make a realistic evaluation of the
likely impacts of the next stage.
The second issue was whether the EMP should state that
effects of the Project should be “less than minor” or “no
more than minor”, the former being a phrase discussed by
the Court in the Interim Decision as not being contained in
the RMA and more conservative than the alternative (at
[19.4]). Crest sought “no more than minor”, but accepted
that the more conservative test may be necessary in the early
stages of the project. The Court agreed and chose to tie the
test to the adaptive management requirements, holding that
“less than minor” should be the test in the first stage and “no
more than minor” in the later stages.
Crest had requested that the EMP contain a copyright
statement to limit the use of the final EMP by other parties (at
[19.3]). This is understandable given that Crest is the “first
mover” in this emerging industry and has expended consid-
erable time and resources in obtaining consents. Crest may
be concerned that other companies seeking similar consents
would be able to make use of their efforts for their own
projects. The Court nonetheless felt it inappropriate to limit
access to consent documents, as many parties have access
rights to such documentation. The availability of the EMP
will undoubtedly provide some useful insights to future tidal
and wave energy project proponents.
A final issue of disagreement was the consent period.
Crest sought a term of 35 years, the maximum under s 123(c)
of the RMA, whereas Environs argued for a 10 year consent.
Crest expressed its concern that the project would not be
commercially viable if a 35 year term was not granted.
Environscited MangakahiaMaori Komiti v NorthlandRegional
Council [1996] NZRMA 193 at 217 as authority for the
proposition that commercial viability is not relevant to the
decision to grant a resource consent (at [19.10]).
The Court noted its disappointment that this case had
been cited, given the more recent and authoritative statement
in Ngati Rangi Trust v Genesis Power Ltd [2009] NZCA
222. In that case, the clear inference was that commercial
viability is a consideration: William Young P stated, “I
cannot see a credible basis for concluding that an appropriate
duration for consent was only 10 years … it is inconceivable
that the Environment Court consider that the [power station
in question] should cease operating at the expiry of 10 years”
(Final Decision at [44]).
PVL Proteins Ltd v Auckland Regional Council [2001]
NZEnvC A061 also discussed by the Court (at [19.10]), was
perhaps more explicit, stating, “an applicant’s need (to pro-
tect investment) for as much security as is consistent with
sustainable management, indicates a longer term”. Noting
that no basis had been provided in the evidence for only
granting a 10 year consent, and that investment security is
“not unimportant”, the Court granted Crest the maximum
term of 35 years.
CONCLUSION
The Environment Court concluded that a resource consent
cannot be denied simply because a proposal is novel and
there are no comparable projects in existence (Final Deci-
sion, at [21]). The Court acknowledged the “extensive and
constructive input” on the part of Crest, NRC and the
Director General of Conservation, and the “interesting and
important” nature of Crest’s project (at [24]). The Court
granted consents and recommended to the Minister of Con-
servation that he grant those consents requiring his approval.
The case suggests that the Court will take a pragmatic
view, mindful of scientific uncertainty and the need for
adaptive management, while also sympathetic to the appli-
cant’s need for investment security and aware of the broader
benefits that marine energy projects can bring to the commu-
nity. The case also provides some lessons for future appli-
cants,suchastheneedforgenuineandcomprehensiveconsultation,
a detailed EMP, and a cooperative, rather than adversarial,
approach to the application process.
With growing interest in wave and tidal energy projects in
New Zealand, the question of how such novel resource
consent applications are likely to be dealt with by the Envi-
ronment Court will be of importance. Crest Energy provides
an optimistic indication of the willingness of the Court to
facilitate the granting of consents for marine energy projects
and some insight for marine energy companies into how best
to approach the resource consent process. r
New Zealand Law Journal September 2011 261
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