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Powerhouse Parramatta: heritage activists lose legal battle but pin hopes on green ban

One day after the announcement of a $500m reinvention of the Ultimo site of Sydney’s Powerhouse Museum, the New South Wales government has jumped a legal hurdle in the second phase of its Powerhouse plan: an expansion to Parramatta.

But with two of the state’s largest unions renewing a green ban to protect a vital area of the proposed site, the state government’s troubles are far from over.

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On Wednesday, the NSW land and environment court dismissed action taken by a Parramatta residents’ action group, who have challenged the validity of Infrastructure NSW’s environmental impact statement (EIS) for the Powerhouse Parramatta project.

The action group argued that heritage considerations had not been adequately accounted for in the selection of the site and the design of the museum, which will necessitate the removal of the 140-year-old mansion Willow Grove, currently protected by a green ban.

Willow Grove sits smack in the middle of the proposed $800m project’s site on Parramatta’s Phillip Street. The NSW government plans to relocate it, brick by brick, to an alternative undisclosed site.

In his ruling, Justice Tim Moore said there was no obligation imposed on the government to investigate alternative sites for Powerhouse Parramatta, and even if this decision was debatable, there appeared to be no feasible alternative site.

Consequently, the removal of Willow Grove was unavoidable, he ruled. He also found that the government’s EIS had complied with all relevant requirements.

The legal challenge was launched after the NSW arm of the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) and the NSW Nurses and Midwives’ Association placed the green ban on Willow Grove late last year, effectively preventing its demolition.

That green ban was re-endorsed three weeks ago by 200 union delegates.

Outside the court on Wednesday, spokeswoman for the North Parramatta Residents Action Group, Suzette Meade, said an appeal of the decision had not been ruled out, but the NSW government had indicated it would not proceed with any construction on the site until 21 June.

“The legal proceedings were always our plan B,” she said. “Plan A has always been the passion and the power of the community and unions working together.

Related: NSW arts minister defends Powerhouse Parramatta museum days after giving it the green light

“In the spirit of Jack Mundey a CFMEU green ban will save this site and Willow Grove will remain on Phillip Street Parramatta, forever.”

Any government attempt to break the ban could potentially lead to widespread industrial action from unions across the state, the NSW secretary of the CFMEU, Darren Greenfield, warned on Wednesday, with 24-hour surveillance of the site continuing to ensure construction does not proceed.

“[Today’s decision] doesn’t change our position,” he said. “We will use whatever political means we can. Our green ban and our members will save Willow Grove.”

The green ban was also partly made in support of the local Dharug people of western Sydney, who told the Guardian last October they had been cut out of consultation over the museum’s Parramatta site, and feared that the removal of Willow Grove could unearth ancient Indigenous artefacts and the bodies of their ancestors.

The residents’ action group, the unions and the Dharug Strategic Management Group do not object to the construction of a museum in Parramatta; they object to the government’s site selection, which continues to threaten Willow Grove and a nearby row of Victorian terraces.

Concerns have also been raised over potential flooding, given the site’s location on the banks of the Parramatta River. A statement issued by the Museum of Applied Arts and Sciences in August said that these concerns were unfounded.

But Meade said: “The people of Parramatta shouldn’t have to choose our heritage or cultural funding – we deserve to have both, and the community will continue to fight for this.”

The Guardian has sought comment from the NSW arts minister, Don Harwin.