The New South Wales government will continue to green-light coalmine expansions, effectively rejecting a warning from its climate agency that approving new developments would be inconsistent with the state’s legislated emissions targets. Releasing a statement on the coal industry’s future, the Labor government said it would no longer consider proposals for “standalone greenfield coalmines” on undeveloped sites.

But it would continue to allow expansions and time extensions at existing mines. It said this balanced “energy security, jobs and regional development with the need to reduce emissions and meet NSW’s net zero targets”.

The NSW Minerals Council said the announcement was “very positive”, acknowledging it had been several years since a greenfield mine had been proposed through the state’s planning system. The state’s natural resources minister, Courtney Houssos, said the strategy meant NSW would remain a reliable coal supplier “where market demand exists”.

“Coal has powered NSW for more than a century, and it will continue to support our economy for decades to come,” she said. “We are providing workers and communities confidence about the road ahead, supported by new opportunities as global markets evolve.” In December, the NSW Net Zero Commission said the government should consider the climate impact when making coalmine planning decisions, including the “scope 3” emissions released after the coal was exported and burned overseas.

It concluded new expansions were not consistent with the state’s legislative emissions reductions commitments – a 50% cut by 2030 and a 70% cut by 2035 compared with 2005 levels, and reaching net zero by 2050. Georgina Woods, the head of research and investigations at the Lock the Gate Alliance, said the 18 coal projects in NSW’s planning pipeline were all expansions and extensions.