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Sustainable Business

Dutch court to rule on case targeting Shell's climate strategy

3 minute read

A Shell logo is seen at a gas station in Buenos Aires, Argentina, March 12, 2018. REUTERS/Marcos Brindicci

LONDON/AMSTERDAM, May 26 (Reuters) - A Dutch court will rule on Wednesday in a landmark case in which climate activists seek to force Royal Dutch Shell (RDSa.L) to speed its cuts to greenhouse gas emissions.

Filed by seven activist groups including Greenpeace and Friends of the Earth Netherlands, the lawsuit marks a first in which environmental groups have turned to the courts to try to force a major energy firm to change strategy.

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.

The case was heard in a court in The Hague, where Shell's headquarters are based.

The groups have said they feel encouraged by the so-called "Urgenda" case, in which the Dutch High Court in 2019 ordered the government to step up its fight against climate change, as it said a lack of action was putting Dutch citizens in danger.

They are demanding that Shell cut its carbon emissions by 45% by 2030, a much steeper reduction than the company's current goal of reducing the carbon intensity of the products it sells by 20% over the next decade.

A rapid reduction would effectively force the Anglo-Dutch firm to quickly move away from oil and gas.

Shell, which plans to achieve net zero carbon emissions by 2050 or sooner, has said court action will not accelerate the world's transition away from fossil fuels.

The world's top oil and gas trader, Shell has said its carbon emissions peaked in 2018, but intensity-based reduction targets allow it in theory to expand its oil and gas output.

The plaintiffs claim that Shell's climate strategy is not in line with the U.N.-backed 2015 Paris climate agreement to limit global warming to 1.5 degrees Celsius above pre-industrial levels.

Shell says its 2050 net zero target is aligned with the Paris agreement and that it will move "in step" with society's progress in the energy transition.

It said in a statement it agrees "that action is needed now on climate change. What will accelerate the energy transition is effective policy, investment in technology and changing customer behaviour. None of which will be achieved with this court action."

In February Shell updated its plan to tackle climate change, saying it planned to curb its emissions through rapid growth of its low-carbon businesses, including biofuels and hydrogen. read more

Although the company said its oil output peaked in 2019, its spending will remain tilted towards oil and gas in the near future.

Reporting by Ron Bousso and Bart Meijer; editing by Jason Neely

Our Standards: The Thomson Reuters Trust Principles.

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