By Anders Lorenzen

In a landmark climate case, the Dutch oil and gas giant Shell has been ordered to do more to cut its emissions. The ruling argues that the energy giant is not moving fast enough.

The ruling made in a Dutch court in The Hague last week (26th of May) could trigger a wave of legal actions against energy companies around the world. Judge Larisa Alwin ordered Shell to reduce its carbon emissions by 45% by 2030 from 2019 levels. “The court orders Royal Dutch Shell, by means of its corporate policy, to reduce its CO2 emissions by 45% by 2030 with respect to the level of 2019 for the Shell group, and the suppliers and customers of the group.”.

Shell not doing enough

Naturally, Shell was disappointed with the ruling and plans to appeal, but it could backfire if they were to argue they should be less ambitious in reducing emissions, especially as last year the Anglo-Dutch company set out what they argued were ambitious climate strategies. 

However, they fell far below what competitor BP had set out in their strategy, where Shell aimed to cut the carbon intensity of its products by at least 6% by 2023, by 20% by 2030, by 45% by 2035, and by 100% by 2050 from 2016 levels.  But the court was not happy with what was being pledged by Shell, and in its ruling argued that the plan was “not concrete and is full of conditions…that’s not enough.” 

As a result, the judge stated: “the conclusion of the court is therefore that Shell is in danger of violating its obligation to reduce emissions. And the court will therefore issue an order upon Royal Dutch Shell” The court ordered Shell to reduce its absolute levels of carbon emissions because Shell’s intensity-based targets could allow the company to grow its output in theory.

The Shell ruling comes amidst the increasing pressure on energy companies from investors, activists and governments to move away from fossil fuels and ramp up investments in renewables.

At its annual general meeting held this month, Shell CEO, Ben van Beurden rejected absolute emission reductions: “Reducing absolute emissions at this point in time is predominantly possible by shrinking the business,” he said.

First of its kind

The landmark lawsuit was filed by seven groups including Greenpeace and Friends of the Earth Netherlands. It is the first case in which activists have turned to the courts to get an energy company to change course. It was filed in April 2019 on behalf of more than 17,000 Dutch citizens who say Shell is threatening human rights as it continues to invest billions in the production of fossil fuels.

Donald Pols, director of Friends of the Earth Netherlands, was delighted with the ruling: “This is a monumental victory for our planet, for our children and is a step towards a liveable future for everyone. The judge has left no room for doubt: Shell is causing dangerous climate change and must stop its destructive behaviour now.”

Roger Cox, the lawyer for the green group added: “This is a turning point in history. This case is unique because it is the first time a judge has ordered a large polluting company to comply with the Paris Climate Agreement. This ruling may also have major consequences for other big polluters.”

Experts are speculating that this ruling could have significant implications in developing global climate litigation.

While Shell has set out that they want to play their part in tackling climate change, in the near term the majority of their spending is towards fossil fuels and not renewables.