Shell Ordered to Cut Carbon Emissions

Legal analysts say the Dutch court’s landmark decision could set a precedent in other jurisdictions.

May 27, 2021

THE HAGUE—A court in The Netherlands yesterday ruled that Royal Dutch Shell must reduce its carbon emissions by 45% by 2030, reports the Wall Street Journal. The landmark ruling furthers pressure oil-and-gas companies to take even greater steps to prevent a climate crisis.

The court-ordered emissions reductions off of 2019 levels are much higher than Shell’s target of lowering emissions 20% by 2030.

Shell argued in the case brought in 2019 by seven activist groups that climate change is a broader societal issue, and that it isn’t appropriate to ask a single private party to reduce its carbon emissions. Shell is expected to appeal the court’s decision.

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

Shell said it agrees that “urgent action is needed on climate change” and points to the company’s accelerated efforts "to become a net-zero emissions energy company by 2050, in step with society, with short-term targets to track our progress."   ​

Legal analysts said the ruling could set a precedent in other Western jurisdictions, particularly in Europe, opening oil companies to a new legal jeopardy over their carbon emissions. The court didn’t stipulate how the ordered reductions should be met or how it might monitor or enforce its ruling.

Friends of the Earth Netherlands, part of a global environmental nonprofit based in Amsterdam, led the civil lawsuit, by alleging that Shell’s production of oil and natural gas contributed to climate change and violated a “duty of care” to those affected by it. The group asked the court to force Shell to reduce carbon emissions.

The court said that Shell wasn’t in breach of its obligation to reduce carbon emissions, but that there was an “imminent breach” and therefore set the reduction requirement.