This is a landmark case in clarifying the meaning of the “indirect effects” of a hydrocarbons project on the global climate in the context of the UK’s planning process. The judgment means that ‘downstream’ GHG emissions should be included in any environmental statements that a local planning authority must consider when deciding whether or not to grant planning permission to new hydrocarbon production projects in the UK.
While the EIA in question for Horse Hill fell within the Town and Country Planning (Environmental Impact Assessment) Regulations 2017 (applicable to the onshore oil and gas regime), the decision raises questions as to whether approvals of offshore projects will be subject to the same approach to interpreting the equivalent legislation in the offshore oil and gas regime. The requirements for EIAs in both the onshore and offshore planning regimes derive from the same EU EIA Directive and largely mirror each other. Close attention will be paid to the ongoing legal challenges of OPRED’s approvals of new projects on the UK Continental Shelf including the Rosebank field.
It is important to note that this decision does not prohibit a competent authority from granting consent to a project with significant emissions or environmental harm. What it does is emphasise the importance of EIAs in providing the public and the local planning authority with full and complete information about the potential impacts of a project (it was noted in the majority judgment that “you can only care about what you know about”). To that extent, the decision simply accords with well-established public law principles that a public body must not misdirect itself on law and must consider all relevant factors.
Interestingly, in the initial High Court decision, the judge was concerned about the wider ramifications of accepting that combustion emissions are environmental effects of oil production. One example given was of raw materials mined and then used in industrial processes such as the production of steel for use in motor vehicles or aircraft, which would result in emissions when the vehicles were driven or flown. The Supreme Court rejected these concerns, commenting that oil is “a very different commodity from, say, iron or steel” and that recognising combustion emissions are effects of producing crude oil would not open the floodgates in the way the trial judge imagined. However, the use of a product is just one example of indirect GHG emissions falling into the Downstream Scope 3 Emissions category under The Greenhouse Gas Protocol developed by the World Resources Institute and the World Business Council for Sustainable Development. It remains to be seen to what extent environmental campaigners may seek to extend the principle in this case to challenge approvals of projects beyond oil and gas production with high ‘downstream’ GHG emissions.
