A Dutch court on Wednesday ordered Anglo-Dutch supermajor Shell to reduce its greenhouse gas emissions by 45% by 2030, against 2019 levels.
Shell currently has a target to reduce the carbon intensity of its products by at least 6% by 2023, by 45% by 2035, and by 100% by 2050 compared with 2016 levels.
The court found that Shell’s climate policy was not concrete enough, ordering the reduction in absolute emissions by 45% by 2030.
Shell said that it would appeal the court verdict and that it has set out its plan to become a net-zero emissions energy company by 2050.
The lawsuit filed in April 2019 on behalf of more than 17,000 Dutch citizens by seven groups, including Greenpeace and Friends of the Earth Netherlands, who say Shell is threatening human rights through its production of fossil fuels.
“This is a monumental victory for our planet, for our children, and is a stop towards a livable future for everyone,” said Donald Pols, director of Friends of the Earth Netherlands.
“The judge has left no room for doubt: Shell is causing dangerous climate change and must stop its destructive behaviour now.”
Liz Hypes, senior environment and climate change analyst for Verisk Maplecroft, a global risk and strategic consulting firm, believes the judgement could pave the way for legal action against energy companies.
“This case could mean open-season on heavy-emitters in the oil and gas industry, and it is not a stretch to envisage activists – or even unhappy investors – bringing similar cases against others in the industry and, potentially, their financial backers,” she told Upstream.
“And while cases like this have to date been largely limited to the US and Europe, we’ve seen a rising trend outside of these countries of climate lawsuits ruling in the claimants’ favour. So today’s case doesn’t just have consequences for operators headquartered in Europe or the US – anyone across the globe is a potential target.”
The case, in her opinion, could also bring the emissions of other industries under scrutiny.
“It also brings supporting industries or other carbon-intense sectors into the firing line: we could well see lawsuits being directed at other sectors already being targeted by regulators and civil society over their emissions, such as mining, agriculture and transport,” she said.
“What this signifies to investors and climate activists is that taking companies to court is an increasingly successful means of triggering climate action and, because of this, the number of climate cases facing carbon-heavy corporates will grow. It shows that the risks of inaction - or of what consumers, investors and the public see as ‘not enough’ action - is mounting.
"It’s no longer a brand image issue for companies – they are facing genuine legal risks from which the repercussions may be significant and it’s triggering a real discussion about what is their fiduciary duty during the climate crisis.”