The Victorian government wants to know what the environmental impact will be if a giant old mine site in the Latrobe Valley is turned into a lake bigger than Sydney Harbour.
The owners of the former Hazelwood coal mine will have to produce an Environmental Effects Statement for their plan to turn the mine into a lake, amid concerns about water availability.
The mine, in Victoria's Latrobe Valley, is bigger than Sydney Harbour and would require 637 gigalitres (GL) of water to fill.
Sydney Harbour has a volume of 500GL.
Engie wants to use its existing entitlements to water from the nearby Latrobe River system.
In his decision, Victorian Planning Minister Richard Wynne said an EES was required because of the "potential significant environmental impact".
These include the effects on local surface and groundwater, including water availability and its proximity to the Gippsland Lakes, which are listed as internationally significant wetlands under the Ramsar convention.
Hazelwood is one of three coal mines in the Latrobe Valley, along with the Yallourn and Loy Yang mines.
The owners of the mines also want to fill them with water, which will increase demands on local water sources in the coming decades.
Stability an issue
Complicating the decision is Hazelwood's proximity to the nearby town of Morwell, with only the Princes Freeway lying between the two.
The coal-rich nature of the mine means there is very little soil leftover to be put back into the mine and the mine cannot be left as an empty void long-term because of concerns about its stability.
The mine lake plan has previously been touted as the easiest way of rehabilitating the mine in a form that provides stability.
An Engie spokesperson said the company welcomed Mr Wynne's decision.
"The EES process will allow all elements of the proposed works to be assessed and any issues, uncertainties, and risks to be identified and addressed," the spokesperson said.
"It provides opportunities for community involvement and Engie Hazelwood looks forward to continuing to engage interested parties on this important phase of rehabilitation."
The company plans to fill the mine using water rights it already holds in the Latrobe River system, as well as groundwater drawn from the aquifer under the mine which must be pumped to provide stability.
It also wants to purchase access to additional surface water when available but says it would not do this in dry or drought conditions.
Look elsewhere for water, environment groups say
Environment groups are concerned about water availability after Victorian Government reports highlighting the Latrobe River system is drying up as the climate changes.
Environment Victoria community organiser Laura Melville said environment groups were also backing the Government's decision to require an EES for the mine lake plan.
"I think an EES will explore, you know, whether or not that is actually feasible, given the amount of water in the system at the moment, but also into the future in a changing climate," Ms Melville said.
The Gippsland Lakes are really at risk if we don't get this right, as is the Latrobe River system.
"And I think it's not just about water for the environment, but also water for other industries in the region, like agriculture and renewable energy as that is built up across Gippsland and the Latrobe Valley."
