A request to raise the Warragamba Dam wall higher than originally proposed has been accepted by the federal government, sparking fears a larger area of the Blue Mountains National Park will be at risk.
WaterNSW wrote to the Department of Agriculture, Water and Environment in June asking for approval to vary the proposal to raise the dam wall 17 metres instead of the 14m originally proposed and made public.
The department's Environment Approvals and Wildlife Trade Branch accepted the variation on July 29.
The project's environmental impact statement is due to be released for public comment in 2020 and will then be subject to federal government approval.
In its request, WaterNSW notes modelling has shown the dam crest would need to be raised by 17m by 2090 as a result of increased flood risk due to climate change.
WaterNSW says by raising the dam wall 17m, it will allow the spillway to also be raised in the future if needed but this will be subject to further assessment and approval.
The NSW government wants to raise the wall to allow additional floodwater to be captured and temporarily held back, giving residents on the Hawkesbury-Nepean Valley floodplain extra time to evacuate before a controlled release.
WaterNSW insists the three-metre increase will not change upstream and downstream temporary inundation levels, durations and impacts.
But Australian National University water expert Jamie Pittock says the extra three metres will flood a larger part of the heritage-listed Blue Mountains.
"There's a huge number of river kilometres that would be flooded and these are the most ecologically sensitive areas," Professor Pittock told AAP on Wednesday.
He argues WaterNSW is following "bad practice" as it is dividing the project into "small chunks" to expedite environmental approvals.
"Yes, the climate is changing but there are much better ways to deal with it than raising this dam wall," Prof Pittock said.
AAP last year revealed the Berejiklian government was secretly planning to raise parts of the wall by 17m so it could easily be modified in the future to hold back additional water.
The NSW government has always insisted the wall will only be raised 14m, with Western Sydney Minister Stuart Ayres telling a state parliamentary committee in September 2018 the business case was looking only at a 14m raising.
"We are very conscious of the environmental impacts that would occur upstream were we to raise it by more than that," he told the hearing.
"Fourteen metres is what we are preparing a business case and an environmental impact statement for."
Mr Ayres on Wednesday said each side of the dam - the abutments - and the road deck would be raised 17m. These sections don't play a role in storing water, he added.
"There is not a secret plan to change the flood mitigation capacity of the current proposal to raise Warragamba Dam," he told AAP in a statement.
NSW Labor water spokesman Clayton Barr said raising the wall 17m was an "incredible slap in the face" for those against the proposal.
"The supposed outcome here to protect people from flooding still hasn't been dealt with in any way, shape or form," he told AAP.
"Going to 17m is such an incredible insult to everyone."
A spokesman for Federal Environment Minister Sussan Ley said no approval has been granted for any wall raising to go ahead, rather the department accepted a request to vary the application proposing a 17m increase instead of 14m.
He added that the variation does not include any change to the spillway.
Australian Associated Press