What a Dutch Court Ruling Means for Shell and Big Oil

Climate lawyers are preparing to take on more fossil-fuel companies after a Dutch court ordered Royal Dutch Shell Plc to cut its emissions faster than planned, on the grounds that the oil giant is violating human rights by contributing to global warming. It was a turning point for climate court cases, which boomed after the Paris Agreement on global warming was reached in 2015. Initially, many cases challenged governments’ plans, but litigators are increasingly targeting companies.

A Dutch court ruled on May 26 that Shell should slash its greenhouse gas emissions 45% by 2030 compared with 2019 levels, forcing the company to make some hard choices. The oil giant expects to appeal. While the ruling puts pressure on Shell, it’s hard to compare the target with its existing pledge to cut the intensity of its greenhouse gas emissions 20% by 2030, but from 2016 levels. Intensity is a measure of energy needed to produce one unit of something; in Shell’s case the cuts were expressed as grams of carbon dioxide equivalent per megajoule. Such pledges are questioned by nonprofits like Carbon Tracker because even if emissions per unit of energy fall, a large production increase could result in higher overall emissions.