Image: Shell

A Dutch court has ordered Shell to reduce its carbon emissions across the group by 45% below 2019 levels by 2030.

The ruling is the outcome of a court case initiated in 2019 by Milieudefensie, the Dutch branch of the Friends of the Earth organisation, and joined by a group of other NGOs and several thousand Dutch citizens.

In her ruling in the Hague the judge Larisa Alwin was quoted as saying the ruling is required to be implemented by means of “corporate policy” and would have “far reaching consequences” for the global energy player.

Whether the effect of the ruling, which covers the Shell Group as well as the suppliers and customers of the group, extends beyond the Netherlands remains to be seen. But its impact is likely to be significant and open the way for cases elsewhere against the oil majors and other industries deemed by activists to not be moving fast enough towards the Paris Agreement goals.

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In February Shell set out a strategy to achieve net zero by 2050, with interim targets of 6-8% emissions reduction below the 2016 baseline by 2023, 20% by 2030 and 45% by 2035.

The company also expects that its total carbon emissions peaked at 1.7Gt/year in 2018.

However, the judge deemed the Hague headquartered multinational’s climate policy to be “not concrete and is full of conditions” and thus “not enough”, according to Reuters.

Milieudefensie’s website records the decision as “Won! Tears of happiness” and director Donald Pols describes it as “a huge win, for us and for anyone affected by climate change”.

“It is historic, it is the first time a court has decided that a major polluter has to cut its emissions,” Pols told Reuters.

In response, Shell’s Projects & Technology Director Harry Brekelmans expressed disappointment in the decision and said the company expects to appeal it.

“Urgent action is needed on climate change, which is why we have accelerated our efforts to become a net-zero emissions energy company by 2050, in step with society, with short term targets to track our progress.

“We are investing billions of dollars in low carbon energy, including electric vehicle charging, hydrogen, renewables and biofuels. We want to grow demand for these products and scale up our new energy businesses even more quickly.”

While the energy transition is demanding a large scale shift away from fossil fuels towards renewables, the oil and gas industry is set to be a key player in the energy sector into the foreseeable future. In addition to the new low carbon energy activities embarked upon by Shell and others, fossil fuels will continue as part of the energy mix, constituting slightly over one-fifth of total energy supply in 2050 in the IEA’s pathway to net zero.