On 16 November 2023, the Hydrogen and Renewable Energy Bill 2023 (“the Bill”) passed through both houses of the South Australian Parliament with minor amendments. The Bill is now awaiting royal assent. It is anticipated that it will come into effect as the Hydrogen and Renewable Energy Act 2023 (SA) (“HRE Act”) following the preparation of supporting regulations, marking the nation’s first legislative framework designed specifically for hydrogen and renewable energy industries.
The terms of the Bill currently awaiting assent have largely the same operational effect as those in the Bill that was received by the House of Assembly in September, as no substantive amendments were made during the committee stages. The Bill in its form as passed by both houses of Parliament is available here.
Overview
Once in effect, the HRE Act provides a hydrogen and renewable energy infrastructure licensing regime by imposing a licence requirement for “regulated activities”, which include:
- generating hydrogen for a commercial purpose;
- exploring for a renewable energy resource;
- exploiting a renewable energy resource;
- an infrastructure activity;
- an associated infrastructure activity; and
- an activity of a kind prescribed by the regulations.
While the licensing regime for hydrogen facilities is new, the HRE Act provisions will replace the existing development approval regime for renewable energy facilities and the (limited) provisions of the Pastoral Land Management and Conservation Act 1989 that provided for access to pastoral land for wind and solar energy facilities.
A key feature of the HRE Act is that for renewable energy infrastructure it draws a distinction between licence areas situated over “designated land”, which includes pastoral land, state waters and gazetted crown land, and licence areas that are situated over “other land”, which includes freehold land.
Where a renewable energy licence is granted over “other land”, the licence is only a statutory authority, meaning that a separate land access agreement (i.e. a lease) must be obtained. Where a licence is granted over “designated land”, the licence operates as a statutory authority and also grants access to the land.
All hydrogen licences require separate land tenure regardless of whether the licence area is situated on designated land or other land.
Key Features
The licensing regime encompasses various distinct categories of licences, the main categories can be summarised as follows:
Hydrogen Generation Licence:
- Required for all types of land.
- For construction, installation, operation, maintaining and decommissioning a hydrogen generation facility for the purpose of hydrogen generation.
- Only operates as a statutory authorisation, meaning the licence holder must obtain separate land tenure.
- Authorised activities excluded from operation of the Planning, Development & Infrastructure Act 2016 (SA) (“PDI Act”) (i.e. no development approval required).
Renewable Energy Feasibility Licence – Designated Land:
- For exploration activities, including installation of equipment (e.g. met masts).
- Provides both a statutory authorisation and a grant of land access.
- Authorised activities excluded from operation of the PDI Act (i.e., no development approval required).
- Only available over “release areas” (as declared by the Minister) and only to the winner of a competitive tender process.
Renewable Energy Infrastructure Licence – Designated Land:
- For renewable energy generation activities.
- Provides both a statutory authorisation and a grant of land access. Authorised activities excluded from operation of PDI Act (i.e., no development approval required).
- Must only be granted where applicant already holds, or has held, a renewable energy feasibility licence in respect of that area.
- Associated Infrastructure Licence is separately available for road / transmission / battery etc).
Renewable Energy Research Licence – Designated Land:
- For exploration and exploitation of a renewable energy for the purpose of research.
- Provides both a statutory authorisation and a grant of land access.
- Authorised activities excluded from operation of PDI Act (i.e., no development approval required).
Renewable Energy Feasibility Permit – Other Land (Freehold):
- For installation of equipment (e.g. met masts).
- Statutory authorisation only – must obtain separate land access agreement with landowner.
- Authorised activities excluded from operation of PDI Act (i.e., no development approval required).
- Permit not required for activities that do not involve the installation of equipment (for instance, flora and fauna studies, surveys, use of vehicle mounted equipment).
Renewable Energy Infrastructure Licence – Other Land (Freehold):
- For renewable energy generation activities.
- Statutory authorisation only – must obtain separate land access agreement with landowner.
- Authorised activities excluded from operation of PDI Act (i.e., no development approval required).
- Associated Infrastructure Licence is separately available for road / transmission / battery etc).
Notably, there are several key differences between how the HRE Act will regulate renewable energy facilities on “other land” (freehold) by way of a Renewable Energy Infrastructure Licence, , when compared with the existing development approval regime under the PDI Act. These include:
- Introduction of an annual licence fee and reporting.
- Licence does not ‘go with the land’ – the licence must be transferred to the project purchaser (which will be a ‘dealing’ in the licence that requires the Minister’s consent).
- Change of control of licence-holder’s shareholding of 20% or more requires Minister’s consent.
- The Minister can cancel licences and impose conditions.
Renewable Energy Research Licence – Other Land (Freehold):
- For exploration and exploitation of a renewable energy for the purpose of research.
- Statutory authorisation only – must obtain separate land access agreement with landowner.
- Authorised activities excluded from operation of PDI Act (i.e., no development approval required).
Next steps
We will continue to provide updates on the roll-out and practical implications of the HRE Act, including the accompanying regulations (which are yet to be released). If you would like to discuss how the HRE Act may affect your renewable energy or hydrogen project in South Australia, please contact our team:
