Bishop Nicholas succeeds the bishop of London and will work with the Mission and Public Affairs department of the Archbishops' Council as well as with the Cathedral and Church Buildings Division (CCB) on the Church of England's Shrinking the Footprint campaign.
Part of his role will also include chairing the new Working Group on the Environment, established by General Synod in February.
Speaking about his appointment, he said: "There is an urgency about environmental issues.
"They press hard on all of us, but the poorest of the earth are the most vulnerable. Faith communities are taking this seriously.
"Christianity is about our turning to a way, which is life-giving. The environmental challenges facing us can seem insurmountable, but our deepest resources can renew the hope that we will act to sustain and renew the life of the earth.
"My hope as I take on this new role is that this work will energise the Church of England and everyone who cares for creation."
Bishop Nicholas has been bishop of Salisbury since 2011.