Environmental Liabilities Community of Practice

Environmental Liabilities Community of Practice 

Chair: Joanne Stuart, NSW Environment Protection Authority

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Environmental Liabilities CoP Collaboration Page

The Environmental Liabilities Community of Practice was re-established in 2019. The group seeks to share information on how environmental liabilities are currently managed across jurisdictions and, where possible, explore opportunities for inter-jurisdictional collaboration and national approaches to environmental liabilities. Discussions are largely focused on the use of financial assurances and environmental insurance to manage environmental liabilities.

The first meeting was held on 26 February 2019 and meetings are held every two months. All jurisdictions are represented, including non-EPA agencies (or their equivalents) such as the Queensland Treasury Corporation; the NSW Department of Planning, Industry and Environment; and the SA Department of Energy and Mining.

What are environmental liabilities?

Environmental liabilities are the real or potential costs and expenses related to damage or potential damage to the environment. They can be either known or unknown.

  • Known environmental liabilities are the costs or estimated costs of identifiable environmental risk. For example: the costs to remediate or rehabilitate contaminated or disturbed land from historical or recent activities of a company. As the extent of the environmental risk and the actions needed to manage the risk can be sufficiently identified and scoped, the costs of managing known environmental liabilities can be estimated. Financial assurances or security deposits are the financial instruments used to secure funding to cover the costs of actions required under a statutory licence, permit or order.
  • Unknown environmental liabilities are the costs of environmental damage from accidental or unforeseen events. For example from fire or equipment failure leading to unexpected release of contaminants. The potential costs to manage these unknown environmental liabilities are difficult to calculate and cannot be sufficiently identified and scoped until after the incident has happened. Generally these types of liabilities are managed by environmental insurance.

 

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