A court in the Netherlands just handed down a landmark ruling, ordering Shell to slash its carbon pollution 45% by 2030. It’s hard to overstate how radical the ruling is and the far-ranging impacts it could have not just for the Dutch oil giant but oil companies around the world.
Milieudefensie, the Dutch chapter of Friends of the Earth, sued Shell in the name of what eventually rose to 17,000 co-plaintiffs in May 2018. The case was finally heard in December with the ruling coming down on Wednesday.
The suit had a fairly straightforward ask: If Shell could please stop destroying the planet and bring its emissions in line with the Paris Agreement, that’d be swell. While Shell has talked a big game about reaching net zero emissions by 2050, that far-off timeline and assumptions about relying on unproven carbon capture technology mean the company will continue to pollute in the interim. An analysis of its climate plan by Oil Change International found that on eight out of 10 facets, the plan was “grossly insufficient.” The other two were merely “insufficient.” The Dutch court ruling will now require the oil giant to actually reduce its emissions rather than making vague promises.
“The Shell decision is a watershed for the oil and gas industry,” Carroll Muffett, the CEO and president of the Centre for International Environmental law, said in an emailed statement. “The court recognised the growing international consensus that the world must strive to keep warming below 1.5 degrees Celsius [2.7 degrees Fahrenheit]. … The court has made clear that Shell and similarly situated actors must take responsibility for reducing not only the direct emissions that arise from its own operations.”
While Shell could challenge the ruling, its enforceable in the interim. It’s the second monster climate ruling in less than two years from courts in the Netherlands. In late 2019, courts ruled in favour of environmental group Urgenda, which sued the government for failing to address climate change and set much more expedient climate targets for the country.
“Like Urgenda, it’s absolutely historic,” Harro van Asselt, a law professor at the University of East Finland, said in an email, referring to the Shell case.
Just as that case had ripple effects in courtrooms in other countries, so could the Shell ruling. Roger Cox, one of the lawyers on the case, told Dutch news site NU that “a Dutch judge can impose a judgment that should be enforced in the eighty countries where Shell is active.” He also noted that it could follow in the footsteps of the Urgenda, setting a precedent that could lead to more suits like it around the world. “These kinds of cases can create momentum of their own,” he said.
It’s an interesting development to see two path-setting climate cases decided in Dutch courtrooms in such a short period.
“Perhaps one unique aspect is the Dutch duty of care obligation, which can and has been interpreted in unexpected ways, first in the initial Urgenda ruling and now in the Shell case,” van Asselt said. “In addition, Dutch courts have commonly applied international human rights law at the national level, which helped in the more recent Urgenda rulings. The difference in the Shell case, however, is that human rights law creating obligations for enterprises — rather than governments — is much less established. The fact that also this body of law was of direct influence in the Shell case is, again, groundbreaking.”
If ever there was a need for climate momentum that centres human rights, now is the time. The world has a narrowing window of opportunity to reduce carbon emissions, and that starts with ending fossil fuel production. Just last week, the International Energy Agency released a major report showing that the world must stop new fossil fuel development next year to have a decent shot of meeting the Paris Agreement target of limiting global heating to 1.5 degrees Celsius. van Asselt noted that the case IEA report coming in quick succession “reinforces the message that companies and governments need to wind down fossil fuel production to achieve climate goals.”
Shell’s CEO also recently claimed the world would need oil companies despite this growing preponderance of evidence to the contrary. The company is hardly alone as an oil company trying to preserve itself with platitudes and half-baked climate plans. But the Dutch ruling means that other companies from Exxon to Chevron could soon see legal challenges to clean up their acts, too.
Update, 5/26/21, 11:25 a.m. ET: This post has been updated with comment from Harro van Asselt as well as more context on Shell’s climate plan and recent statements by its CEO.
Update, 5/26/21, 11:37 a.m. ET: This post has been updated with comment from Caroll Muffett.