Earlier this month, a years-long legal attempt by community and environmental groups to challenge a new oil project in Horse Hill, Surrey resulted in victory – with implications for all new fossil fuel projects in the UK.
On 20 June, the Supreme Court, the highest court for civil cases in the UK, issued a majority judgment ruling that Surrey County Council acted unlawfully by granting planning permission for the project, because councillors did not consider the climate impact from burning the fuel.
It came after an “incredibly finely balanced” legal battle, which saw multiple courts reject the arguments made by environmental groups – and judges in the Supreme Court take nearly a year to come to their own conclusion.
The judgment, which will now lead to changes in how the environmental impact of new fossil fuel projects is assessed, has been described as “landmark”, “watershed” and “tide-turning” by environmental groups, while right-leaning media warned it could “kill off the oil industry” completely.
Below, Carbon Brief speaks to environmental lawyers to unpack what happened in the Horse Hill case, what it actually means for UK fossil fuel production and how it could affect the policies of the next UK government.
- What happened in the Horse Hill case?
- What does the judgment mean for other fossil fuel projects in the UK?
- Could it affect other carbon-intensive projects, such as airport and road expansion?
- What could the judgment mean for the next UK government?
What happened in the Horse Hill case?
The story began back in 2012 when Surrey County Council granted planning permission for Horse Hill Developments Ltd to dig an exploratory oil well at Horse Hill, a site close to the town of Horley in Surrey and 3.5km north of Gatwick Airport.
In 2017, the council granted permission for a second borehole, a sidetrack well and for testing to commence.
In 2019, the council granted permission for the project to start drilling for oil – just two months after it had passed a motion declaring a climate emergency. The project was to include six oil wells, which would produce 3m tonnes of oil over a 20-year period.
In 2020, Sarah Finch, a freelance editor representing the Weald Action Group, a network of organisations opposing oil and gas in southern England, decided to challenge the council’s decision to grant planning permission in the High Court, with charity Friends of the Earth acting as the legal intervener.
(There is a clear scientific consensus that new fossil fuel projects are incompatible with meeting the Paris Agreement’s ambition of keeping global temperatures at 1.5C.)
Finch and her representatives argued that the decision to permit the oil development was unlawful because the council did not take into account the climate impact of burning the fossil fuels produced by the project.
Under an EU directive that has been incorporated into UK law, any development that is likely to have a significant effect on the environment must carry out an environmental impact assessment (EIA). This assessment must be considered by the decision makers responsible for permitting the project.
The legal challenge argued that the EIA for the Horse Hill drilling project only considered the climate impact from the process of dredging up the oil from the ground, rather than from burning the oil.
As with any fossil fuel project, the emissions from burning the fuel are far larger than those from simply setting up operations, Katie de Kauwe, the lead in-house lawyer at Friends of the Earth, explains to Carbon Brief:
“In the Finch case, the developer assessed that the operational emissions were around 114,000 tonnes of [carbon dioxide] equivalent (CO2e). But then during the hearing, it was recorded that the end use emissions from burning the oil were over 10m tonnes. So they really are dwarfed. And the decision maker had no information on that whatsoever when they granted permission for the oil drilling in Surrey.”
But, in December 2020, the High Court ruled that the council had acted lawfully, with the judge concluding that it would have been “impossible” for the council to have considered the emissions from burning the oil.
Finch appealed the decision. In November 2021, a Court of Appeal hearing before three judges resulted in an “unusual” split decision, with two judges upholding that the council acted lawfully and the third producing a strong dissenting judgment that it had not.
In contrast to the High Court judgment, the Court of Appeal judgment said that decision makers for fossil fuel projects are not prohibited from considering the emissions from burning the fuels.
However, in practical terms, it left it up to the decision makers themselves as to whether they will consider these emissions or not.
Finch appealed again, leading to a hearing before the Supreme Court, the highest court in the UK for civil cases, in June 2023. This took place before five judges.
In this hearing, legal interventions were made by Friends of the Earth, Greenpeace, the Office for Environmental Protection and representatives of the company behind a new coal mine in Whitehaven, Cumbria, which itself is facing a legal challenge from environmental groups (more on this below).
The Office for Environment Protection was set up post-Brexit to act as an independent environmental watchdog, pursuing the enforcement of environmental law and the introduction of new protections. It was the first time this office had intervened in a court case.
The Supreme Court took almost a year to deliver its judgment, which finally came on 20 June 2024.
It delivered a majority decision from three of the five judges that Surrey County Council had acted unlawfully in permitting the oil project, with the other judges giving a dissenting judgment.
Delivering the majority judgment, Lord Leggatt ruled that the decision to grant planning permission for the oil project was unlawful as the project’s EIA failed to assess the climate impact of burning the oil, and the reasons for disregarding this were “demonstrably flawed”.
Rejecting the arguments made by the council, the developer and the government that the emissions from burning the oil were not within their control, Lord Leggatt said:
“The combustion emissions are manifestly not outwith the control of the site operators. They are entirely within their control. If no oil is extracted, no combustion emissions will occur. Conversely, any extraction of oil by the site operators will in due course result in greenhouse gas emissions upon its inevitable combustion.”
The Supreme Court said any suggestion that local planning authorities are unable to consider climate change when making planning decisions is “misguided”.
It also rejected the Court of the Appeal’s ruling that it should be up to the decision maker to decide whether to consider emissions from burning the fuels produced by new fossil-fuel projects, with Lord Leggatt saying this “would be a recipe for unpredictable, inconsistent and arbitrary decision-making”.
It is the first time in UK legislative history that a judgment has ruled that decision-makers should consider the emissions from burning fossil fuels – also known as scope 3 emissions – and not just those from the project’s operations.
It follows on from a similar ruling in Norway in January of this year.
In a statement, environmental charity ClientEarth lawyer Sophie Marjanac said the two judgments indicated that the world is “reaching a tipping point where countries and companies are going to have to comprehensively account for the impact of every fossil fuel project on the climate”.
Speaking to Carbon Brief, Angus Walker, an infrastructure planning solicitor, noted that, from the very start, the Finch case proved highly divisive among the court judges:
“It was incredibly finely balanced all the way from the very first stage…It’s interesting that the dissenting judgment is as long as the leading judgment, that also shows how finely balanced it was. And it took them a year to produce it, which I think is unusually long even for the Supreme Court. Does that mean they were agonising over it? I don’t know.”
What does the judgment mean for other fossil fuel projects in the UK?
Much of the coverage of the judgment focused on what it could mean for the UK’s fossil-fuel industry.
Environmental groups described the ruling as “landmark”, “watershed” and “tide-turning”, while right-wing media warned it could “kill off the oil industry” completely.
Lawyers explain to Carbon Brief that the judgment will have consequences for new fossil fuel projects in the UK. However, it does not amount to a “ban” or “block” on Horse Hill or other similar projects.
Rather, the judgment makes it clear that, when an EIA is produced for a new fossil-fuel project, this should include information on the emissions associated with burning the coal, oil or gas produced – and not just the much smaller emissions from the project’s operations. Walker explains:
“It’s just assessing and reporting. The decision makers can still grant [an oil project planning permission], but it’s just about knowing what the impacts are. The judgment is careful to point out this is only information for the decision maker, it is not a factor that itself bans these projects from going ahead.”
Tessa Khan, an environmental lawyer and founder of Uplift, a group supporting actions on ending new oil and gas production, adds:
“It’s groundbreaking because, until now, when an EIA was done for an oil and gas project, you didn’t even need to know what the scope 3 emissions would be before you said that the environmental impacts were compatible with the decision to approve the project.
“What Horse Hill does is say that information has to be on the desk of the decision maker. But that doesn’t mean that that’s an automatic block on the project, it’s just one factor in the mix of different factors.”
The kinds of developments that are required to produce EIAs when looking to obtain development consent in the UK include onshore oil and gas, offshore oil and gas in the North Sea and coal mining projects.
When it comes to North Sea oil and gas projects, developers must first obtain a licence for fossil fuel exploration from the regulator, the North Sea Transition Authority (NSTA).
After this, developers will apply for development consent, which is granted by the NSTA and the secretary of state for energy infrastructure, which would currently be the secretary of state for energy security and net-zero, Claire Coutinho.
It is at this stage that project developers will have to produce an EIA containing information on emissions from burning the fossil fuels.
That means that oil and gas projects that have been awarded a licence for exploration, but have not yet obtained development consent, will be affected by the Horse Hill judgment.
Previous Carbon Brief analysis shows there are dozens of such projects looking to obtain development consent sometime between now and 2025.
North Sea oil and gas projects that have already received development consent, such as the Rosebank oil field, will not be automatically affected.
However, the judgment will offer new arms to legal challenges against such projects.
Khan, who is contributing to a legal challenge against Rosebank that is due to be held in the next few months, says:
“Our legal challenge against Rosebank, if we succeed, would mean that the decision has to be remade around the development consent. And so in making that decision, the government and the regulator would then have to consider the scope 3 emissions.”
Rosebank contains around 325m barrels of oil equivalent. Previous Carbon Brief analysis found that, when burnt, this would produce around 150m tonnes of CO2e – roughly the same as produced each year by 90 of the world’s lowest-emitting countries.
Coal mining is another activity that is likely to be affected by the judgment.
This likely explains why representatives from the company behind a new coal mine in Whitehaven, Cumbria, were moved to intervene in the Supreme Court case on Horse Hill, experts tell Carbon Brief.
The controversial project was permitted by communities secretary Michael Gove in 2022 and would be the UK’s first new deep coal mine in 30 years.
It plans to produce coking coal to be exported for global steel production, rather than for power production.
De Kauwe, who with Friends of the Earth is mounting a legal challenge against the coal mine to be held in the High Court on 16-18 July, said the reasoning used in the Horse Hill judgment is likely to hold true for the mining project:
“Coal’s role in all of this is to be burned as part of that steelmaking process. So it doesn’t matter that it’s not being used in power generation, it’s still the burning of fossil fuel.”
As with Rosebank, an overturning of the development consent given to the Cumbria mine by Gove would lead to the project having to produce a new EIA including information on emissions from burning the coal produced.
Could it affect other carbon-intensive projects, such as airport and road expansion?
While it is clear that the judgment will have implications for fossil fuel projects in the UK, it is unlikely to have consequences for other carbon-intensive infrastructure projects, such as airport and road expansion, experts tell Carbon Brief.
The judgment makes it clear that the ruling only applies to fossil-fuel projects, de Kauwe says:
“I think Lord Leggatt is very clear that in requiring the assessment of downstream emissions for fossil fuel projects, this is not opening up the floodgates, that was something that had clearly bothered both the High Court judge and the Court of Appeal.”
The judgment specifically says that fossil fuel projects are unique when compared to other types of carbon-intensive infrastructure, such as aeroplane manufacturing, she adds:
“[Lord Leggatt] said that the difference with fossil fuels, these have an inevitable use. They’ve only got one use. It’s for combustion.”
Walker adds that both road and airport expansion projects already consider the additional emissions from creating more car traffic or flights.
What could the judgment mean for the next UK government?
The judgment comes just days before a general election in the UK.
Carbon Brief has assessed where each party stands on fossil fuels. For example, the Conservatives have pledged to continue issuing new North Sea oil and gas licences, while Reform has promised to “fast-track” them.
Polls suggest that the Labour party is likely to win the election.
Labour’s manifesto says it “will not issue new licences” for oil and gas exploration, but that it “will not revoke existing licences”, leaving vagueness around whether it will grant development consent to new projects that have an exploration licence already.
Outside of the manifesto, representatives of Labour have previously pledged to put a stop to Rosebank and Cambo, two of the largest new oil and gas projects.
In light of the judgment, it is probable that the new energy secretary, which is likely to be the shadow energy and net-zero secretary Ed Miliband, will be faced with deciding whether to grant development consent to new North Sea oil and gas projects – with, for the first time, full knowledge of the emissions that will be caused by burning the fuels produced.
Commenting on the likely impact of the judgment on decision makers, Walker says:
“It makes the negatives appear greater, I would have thought, when weighing up whether to give consent.”
The post Q&A: What does the ‘landmark’ Horse Hill judgment mean for UK fossil fuels? appeared first on Carbon Brief.
Q&A: What does the ‘landmark’ Horse Hill judgment mean for UK fossil fuels?
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Amid reports that the government could weaken the UK’s electric vehicle (EV) targets, Carbon Brief analysis reveals the nation’s EV drivers are saving more than £1,100 a year in fuel costs, compared with running a petrol car.
Battery EVs (BEVs) are roughly four times more efficient than combustion-engine cars, making them far cheaper to run – particularly since the Iran crisis caused a spike in fossil-fuel prices.
The savings from driving BEVs are also more than three times higher than for “plug-in” hybrids (PHEVs), which evidence shows are mostly driven with their combustion engines.
In total, the more than 2m BEVs, 1m PHEVs and 100,000 electric vans on UK roads are saving drivers around £3bn a year, Carbon Brief’s analysis shows, as illustrated in the figure below.
In addition, these EVs are avoiding the need for nearly 2.5bn litres of fuel and cutting carbon dioxide (CO2) emissions by nearly 7m tonnes each year.
Despite recent news that EVs are now cheaper to buy than petrol cars, as well as having far lower running costs, BBC News says the government is “set to water down” its EV sales targets.
The broadcaster explains that the current goal, under the UK’s “zero-emissions vehicle” (ZEV) mandate, is for 80% of new car sales to be BEVs by 2030.
It says that the government is set to consult on weakening this to between 50% and 70%, following “lobbying” by carmakers and trade unions.
According to the Sunday Times, prime minister Keir Starmer “is understood to have overruled the energy secretary [Ed Miliband] after sustained pressure from industry, the Unite union and Peter Kyle, the business secretary”.
The car industry has consistently claimed there is insufficient demand for BEVs to meet the targets under the ZEV mandate, yet the government says manufacturers have “over-complied” to date. Independent analysts say the industry is on track to continue beating the ZEV mandate goals.
The industry has been able to beat its targets by using a wide range of “flexibilities”, which were introduced after a previous round of lobbying. These allow carmarkers to meet part of their EV targets by selling more efficient combustion cars, such as hybrids and plug-in hybrids.
The ZEV mandate is the single-largest part of the government’s plans to meet its legally binding climate goals over the next decade.
The advisory Climate Change Committee (CCC) previously warned that the extra flexibilities would result in a larger number of hybrids being sold, at the expense of battery EVs.
When it consulted on the ZEV mandate in 2023, the then-Conservative government noted that PHEVs do not deliver the cost and CO2 savings they are advertised with.
It pointed to “dramatic” differences between the performance of PHEVs in test cycles and what they deliver under real-world conditions.
In practice, less than a third of miles driven in PHEVs are fuelled by electricity, with petrol making up the rest. As a result, cost and CO2 savings from BEVs are three times larger than for PHEVs.
The post Analysis: UK’s EV drivers are now saving £1,100 each a year – and £3bn in total appeared first on Carbon Brief.
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Civil society groups have called for an investigation into the first carbon credits approved under a new UN mechanism, alleging the project is linked to Myanmar’s military junta – which the UN says is guilty of human rights abuses – and has “massively” overstated its climate impact.
The programme, which aims to cut emissions by distributing efficient cookstoves across Myanmar, received approval to issue around 650,000 carbon credits from the Article 6.4 Supervisory Body in February, in a landmark moment for the Paris Agreement’s carbon market. Only two projects have been given the green light by the mechanism’s regulator so far.
But two reports published last week, led by the Global Forest Coalition and Brussels-based NGO Carbon Market Watch, raised serious concerns about the project’s implementation in conflict zones where civilians have faced airstrikes and mass displacement as well as its emission-reduction calculations.
Project continued after military coup
Myanmar has been ravaged by a brutal civil war since the country’s military overthrew the democratically elected government in a coup d’état in February 2021. The military regime has attacked civilian populations, persecuted ethnic minorities and committed widespread sexual violence, among other serious human rights violations, the UN Special Rapporteur on the situation of human rights in Myanmar said in April.
The cookstove programme started in 2018 under the previous UN-run carbon offsetting scheme – the Clean Development Mechanism (CDM) – as a partnership between Myanmar’s Ministry of Natural Resources and Environmental Conservation (MONREC) and the Climate Change Center (CCC), a South Korean NGO, with investment from private South Korean firms.
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The project continued operating after the coup. For most of the period between 2021 and 2022 in which the issued credits were generated, MONREC was led by Colonel Khin Maung Yi, who was sanctioned by the European Union in 2021 for supporting the military regime, the Global Forest Coalition report said.
CCC acknowledged engaging with government authorities after the coup but said this “should not be interpreted as political endorsement” of the junta. The South Korean NGO added that abandoning the programme when political circumstances changed “would not necessarily have been the most responsible outcome for the households involved”.
Conflict prevents on the ground verification
The Global Forest Coalition report raised particular concerns about the project’s implementation in Myanmar’s central Dry Zone, including Sagaing Region, an anti-junta resistance stronghold that has been most heavily affected by the conflict and routinely targeted by airstrikes and violent attacks. The region accounts for more than a third of Myanmar’s 3.8 million internally displaced people.
The NGOs said that, in addition to ethical concerns about carbon credits being produced by the military government in an area actively affected by its attacks, this raises questions over the ability to effectively verify the climate integrity of the projects.
Before carbon credits are issued, external auditors need to validate the claims made by project developers and confirm that the emission reductions claimed are correct. This process usually includes site visits to a representative sample of households to check how the improved cookstoves are being used.
But, because of the “volatile political situation” in Myanmar, the auditing team was not able to leave the capital Yangon and could only speak to project participants remotely via Zoom, project documents show.
“Due to ongoing armed conflict on the ground, the data currently used to justify carbon credit issuance in Sagaing by the Burmese military junta is unverifiable and highly likely fraudulent,” said Zaw Tuseng, founder and president of the Myanmar Policy Institute, which contributed to the report, in a written statement. “This demands an immediate suspension of credit transfers until a neutral, conflict-sensitive audit can be conducted.”
“Exceptional circumstances”
CCC told Climate Home News that, although it recognises that on-site verification is “generally preferable, particularly in complex operating environments”, the decision to opt for remote controls was not taken “as a discretionary shortcut, but as an approved alternative under exceptional circumstances”.
The South Korean NGO added that it reviewed the feasibility of the project at community level “on an ongoing basis” and it “did not identify conflict-related incidents that directly affected project implementation activities in participating communities during the monitoring period”.
A spokesperson for the UN climate change body told Climate Home News that, when site access is not possible, the UN carbon credit mechanism allows for “alternative verification approaches while still maintaining conservative assumptions and environmental integrity safeguards”. “These provisions ensure that crediting can only proceed where evidence is reliable,” they added.
Contested methodology
Carbon markets are seen as an important channel to raise money to help low-income communities in developing countries switch to less polluting cooking methods, both reducing CO2 emissions and improving air quality. But several cookstove offsetting projects have faced criticism from researchers and campaigners who argue that climate benefits are often exaggerated and weak monitoring can undermine claims of real emission reductions.
The project in Myanmar uses a contested methodology developed under the earlier Kyoto Protocol that was rejected last year by The Integrity Council for the Voluntary Carbon Market (ICVCM), a watchdog that issues quality labels to carbon credit types, because it found it “insufficiently rigorous”.
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After transitioning from the CDM to the new mechanism, the project was required to apply “more conservative” assumptions to calculate emission reductions, which resulted in 40% fewer credits being issued, according to the UN climate change body.
“The result is consistent with environmental integrity requirements and ensures that each credited tonne genuinely represents a tonne reduced and contributes to the goals of the Paris Agreement,” Mkhuthazi Steleki, the South African chair of the Article 6.4 Supervisory Body, which oversees the mechanism, said in February.
Too many credits issued
But Carbon Market Watch claimed in a second report last week that, despite the adjustment, the project is still likely to issue seven times more credits than its real climate impact justifies, comparing its calculations with values from peer-reviewed scientific literature.
The biggest driver of the credit inflation, the group said, is the failure to account for “stacking” – the widespread practice of households using multiple stoves at the same time, including more polluting ones the project does not monitor.
Peer-reviewed science considers a stacking rate of 68% a conservative assumption, but the methodology used by the Myanmar programme makes no allowance for it at all, the report said.
CCC disputed those findings. In a written response to Climate Home News, it said the project was developed under methodologies approved within the UN climate framework and that external recalculations by researchers are not “determinative of the level of crediting achieved”.
The credits are expected to be used primarily by major South Korean polluters to meet obligations under the country’s emissions trading system – a move that will also enable the government to count those units toward emissions reduction targets in its nationally determined contribution (NDC), the UN climate body told Climate Home News.
Myanmar will use the remaining credits to achieve in part the goals of its own national climate plan under the Paris Agreement.
“Over-crediting, at any magnitude, cannot be compatible with the climate ambition of a world striving to limit global warming to 1.5ºC,” said Isa Mulder, an expert at Carbon Market Watch.
The post UN’s first Paris Agreement carbon credits face human rights and climate concerns appeared first on Climate Home News.
UN’s first Paris Agreement carbon credits face human rights and climate concerns
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