Peter Gray & Naomi Hodgson v Macquarie Generation

March 2010 and December 2011

On behalf of Peter Gray and Naomi Hodgson, EDO NSW commenced civil enforcement proceedings in the Land and Environment Court against Macquarie Generation. The proceedings sought a declaration that the State-owned company has been wilfully or negligently disposing of waste at their Bayswater Power Station by emitting carbon dioxide into the atmosphere in a manner that has harmed or is likely to harm the environment in contravention of the Protection of the Environment Operations Act 1997 (NSW).

Mr Gray and Ms Hodgson also sought an injunction requiring Macquarie Generation to immediately cease disposing of waste through the emission of carbon dioxide into the atmosphere. 

In carrying out its electricity generation activities, Macquarie Generation has been issued with an environment protection licence which licences the company to emit certain waste but not carbon dioxide. 

Bayswater Power Station, located in the Upper Hunter Valley, has the highest carbon dioxide emissions of all power stations in NSW.

Macquarie Generation filed a motion to have the matter dismissed. Justice Pain found that the Applicants' argument that Macquarie Generation is not authorised to emit any carbon dioxide at all was unlikely to succeed and dismissed that part of their case.

However, Justice Pain did not dismiss the Applicants' secondary argument. This was that even if Macquarie Generation has an implied authority to emit some amount of carbon dioxide in generating electricity, that authority is limited to an amount which has reasonable regard and care for people and the environment. This part of the Applicants' case was permitted to proceed to trial.

In 2011 Macquarie Generation appealed to the NSW Court Appeal arguing that Justice Pain was wrong in finding that Macquarie Generation’s licence to pollute contains an implied limitation on how much carbon dioxide can be released.

The matter was heard by the Court of Appeal on 13 September 2011. Sadly, Peter Gray passed away before the hearing could take place. The Court of Appeal ordered that Ms Hodgson could continue the proceedings in her name alone.

Judgment was handed down on 22 December 2011.

The Court of Appeal held that Macquarie Generation’s licence to pollute did not contain the implied (or common law) limitation on the amount of carbon dioxide that could be released. The licence was therefore a complete defence to the argument that Macquarie Generation were wilfully or negligently disposing of waste, and they therefore found that the case had no reasonable prospects of success.

The Court also found that the licence didn’t contain a limit on how much coal could be consumed at the power station.

EDO NSW is grateful to barristers Ian Lloyd QC and Mr Ashley Stafford who appeared before the Court of Appeal on behalf of Mr Gray and Ms Hodgson, and barristers Craig Lenehan and Lisa Doust who assisted with the earlier cases.

Judgment - Costs

Judgment - Amended points of claim

Further Amended Summons

ABC TV Lateline  

Sydney Morning Herald

Amended Points of Claim Judgment Appeal