The Strategist

Eco-activists win in milestone case over Shell

05/27/2021 - 03:56

Climate activists have won a landmark court victory over Anglo-Dutch Shell, effectively forcing the company to accelerate its plans to cut carbon emissions and reduce them by 45% as early as 2030.

Open Grid Scheduler via flickr
Open Grid Scheduler via flickr
On May 26 a Dutch court ordered Shell, one of the largest oil and gas companies and the largest trader of oil and gas in the world, to accelerate its plans to cut emissions. According to the court order, Shell is now obliged to reduce its carbon emissions by 45% by 2030 compared to 2019 levels. While Shell still has a chance to challenge the court ruling, it could set an important precedent: similar lawsuits from eco-activists could begin to be filed against other major European energy companies.

The People v Shell lawsuit was filed in 2019 by seven organisations, including Greenpeace and Friends of the Earth Netherlands, as well as 17,000 Dutch citizens.

According to the plaintiffs, Shell threatens human rights by continuing to invest in fossil fuel production.

Shell's own strategy was to reduce CO2 emissions (including those from the fuels it sells) from 2016 levels by 6% by 2023, 20% by 2030, 45% by 2035 and full carbon neutrality by 2050. As part of this strategy, Shell was already prepared in the first phase to reduce oil production by 1-2% per year, which essentially meant abandoning new projects in oil. Now the Anglo-Dutch company will have to accelerate its exit from carbon-intensive projects around the world.

The company's priorities now are to develop its gas business, as it is less carbon-intensive, and to keep its highest-margin projects in its portfolio.