Good news on climate
“I see a huge and growing gap between the rhetoric and the reality,” said Fatih Birol, head of the International Energy Agency, two weeks ago, but he despaired a bit too soon.
Last Wednesday a Dutch court ruled that Royal Dutch Shell, one of the world’s biggest oil companies, must cut its global carbon dioxide emissions by 45 per cent by 2030.
Judge Larisa Alwin’s ruling in the Hague district court was “not so much a shot across the bow as a direct hit to the hull of Big Oil,” said Mark Lewis, chief sustainability strategist at BNP Parisbas Asset Management. “No amount of patching up the hole will do. Shareholders and society want the vessel completely overhauled.”
The Dutch court said that Shell’s declared plan for reducing its carbon emissions was vague, inadequate and non-binding, and ordered it to cut its total emissions by almost half in the next nine and a half years. That includes the emissions from all the oil and gas Shell sells, not just its own operational emissions.
The judge based her decision on the fact that Shell is violating Dutch law and the European Convention on Human Rights that guarantee the “right to life.” The company is recklessly making emissions that endanger human life by causing global heating.
She linked her verdict directly to the Paris Climate Agreement of 2015, which clearly states that keeping the increase in average global temperature below 1.5 C requires 45 per cent emissions cuts by 2030.
Shell’s vague promise to make 20 per cent cuts by then simply didn’t meet the requirement, she said, and its non-binding promises of bigger cuts between 2030 and 2050 would come too late to matter. (The World Meteorological Organization said last week that there is a 40 per cent chance of the world temporarily crossing the plus 1.5 C threshold at least once in the next five years.)
It was Friends of the Earth (and 17,000 co-plaintiffs) that brought the case in the Hague, but other activists are planning similar cases in half a dozen other countries. Even faster moving, perhaps, are the shareholder revolts that are forcing oil companies to take their emissions seriously.
Again it was Shell that took the first hit. The Dutch activist group Follow This has been co-ordinating shareholders rebellions at Shell’s annual general meetings (AGM) since 2016, when it only got 2.8 per cent support for a resolution calling on the company to cut CO2 emissions. This month it got 30 per cent of the votes, including those of some big institutional investors.
On the same day the U.S. oil giant Exxonmobil was forced to accept the election of two proclimate activists on its 12-person board (the vote was organized by the small environmentalist hedge fund Engine No. 1). And Follow This got a 61 per cent majority for a resolution at Chevro’’s Thursday AGM, forcing the company to reduce its carbon emissions.
It was always going to be nip and tuck. The time needed to persuade the climate doubters and mobilize the apathetic was always going to leave very little time for actually getting emissions down before we hit tipping points and lose control of the outcome entirely.
At the moment, we can still control the outcome because it’s our own emissions that are causing the problems. Once the natural feedback kicks in — and that’s what the recommended plus 1.5 C limit and the absolute plus 2 C limit are meant to prevent — we would have no recourse left except adapting to the disaster and/ or geoengineering.