Shell Wins Appeal Against Landmark Ruling That Ordered It To Slash 45% Of Its Emissions By 2030

Topline

A Dutch appeals court on Tuesday ruled in favor of oil giant Shell and overturned a landmark 2021 ruling by a lower court that ordered the company to sharply reduce its carbon emissions by the end of this decade, a major blow to activists pursuing legal measures to force companies to act on climate change.

Key Facts

Shell had filed an appeal against the 2021 ruling, which ordered the company to cut its carbon dioxide emissions by 45% compared to its 2019 levels by 2030; the ruling covered emissions both from its operations and the fossil fuels it sold.

In its verdict, the Hague Court of Appeal ruled that while Shell was obliged to reduce its carbon emissions, there is “insufficient consensus in climate science on a specific reduction percentage to which an individual company like Shell should adhere.”

The court noted the company is already working to reduce its so-called scope 1 and 2 emissions, which include emissions from its operations, but said it would be ineffective to force Shell to reduce its scope 3 emissions, which cover emissions from the fuel it sells.

The court said while Shell could, in theory, meet its Scope 3 target by ceasing or cutting trade in fossil fuels, other companies “would then take over that trade” and this “would consequently not result in a reduction in CO2 emissions.”

The court, however, acknowledged Shell has an obligation to limit its carbon emissions based on the “human right to protection against dangerous climate change.”

Tuesday’s ruling can be challenged before the Dutch Supreme Court, but it is unclear if the plaintiffs plan to do so.

Crucial Quote

Shell CEO Wael Sawan welcomed the ruling in a statement, saying: “We are pleased with the court’s decision, which we believe is the right one for the global energy transition, the Netherlands and our company…Our target to become a net-zero emissions energy business by 2050 remains at the heart of Shell’s strategy and is transforming our business. This includes continuing our work to halve emissions from our operations by 2030.”

Chief Critic

The Friends of the Earth Netherlands, the environmental activist collective that backed the case against Shell, along with 17,000 Dutch citizens, was “shocked” by the ruling. The group’s Director Donald Pols said: “We are shocked by today’s judgment. It is a setback for us, for the climate movement and for millions of people around the world who worry about their future…Large polluters are powerful. But united, we as people have the power to change them.”

Further Reading

Shell wins landmark climate case against green groups in Dutch appeal (BBC)