* Court tells Shell to cut emissions by 45% by 2030
* Ruling says Shell's current targets 'not enough'
* Shell says 'disappointed', to appeal court ruling
* FACTBOX: Big Oil's climate targets
(Adds Shell comment, graphic, updates shares)
By Bart H. Meijer, Ron Bousso and Shadia Nasralla
THE HAGUE/LONDON, May 26 (Reuters) - A Dutch court ordered
Royal Dutch Shell to drastically deepen planned greenhouse gas
emission cuts on Wednesday, in a landmark ruling that could
trigger legal action against energy companies around the world.
Shell said it was "disappointed" and plans to appeal the
ruling, which comes amid rising pressure on energy companies
from investors, activists and governments to shift away from
fossil fuels and rapidly ramp up investment in renewables.
Judge Larisa Alwin read out a ruling at a court room in The
Hague, ordering Shell to reduce its planet warming
carbon emissions by 45% by 2030 from 2019 levels.
"The court orders Royal Dutch Shell, by means of its
corporate policy, to reduce its CO2 emissions by 45% by 2030
with respect to the level of 2019 for the Shell group and the
suppliers and customers of the group," Alwin said.
Earlier this year, Shell set out one of the sector's most
ambitious climate strategies. It has a target to cut the carbon
intensity of its products by at least 6% by 2023, by 20% by
2030, by 45% by 2035 and by 100% by 2050 from 2016 levels.
But the court said that Shell's climate policy was "not
concrete and is full of conditions...that's not enough."
"The conclusion of the court is therefore that Shell is in
danger of violating its obligation to reduce. And the court will
therefore issue an order upon RDS," the judge said.
The court ordered Shell to reduce its absolute levels of
carbon emissions, while Shell's intensity-based targets could
allow the company to grow its output in theory.
Shell Chief Executive Ben van Beurden rejected absolute
reduction targets at its annual general meeting this month.
"Reducing absolute emissions at this point in time is
predominantly possible by shrinking the business," he said.
Shell said that it would appeal the court verdict and that
it has set out its plan to become a net-zero emissions energy
company by 2050.
"This is arguably the most significant climate change
related judgment yet, which emphasises that companies and not
just governments may be the target of strategic litigation which
seeks to drive changes in behaviour," said Tom Cummins, dispute
resolution partner at law firm Ashurst.
Shares in its London-traded stock closed flat, compared with
0.7% gains in the broader European energy sector.
CLIMATE LITIGATION
The lawsuit, which was filed by seven groups including
Greenpeace and Friends of the Earth Netherlands, marks a first
in which environmentalists have turned to the courts to try to
force a major energy firm to change strategy.
It was filed in April 2019 on behalf of more than 17,000
Dutch citizens who say Shell is threatening human rights as it
continues to invest billions in the production of fossil fuels.
"This is a huge win, for us and for anyone affected by
climate change", Friends of the Earth Netherlands director
Donald Pols told Reuters.
"It is historic, it is the first time a court has decided
that a major polluter has to cut its emissions," Pols added.
Michael Burger, head of the Sabin Center for Climate Change
Law at Columbia Law School said that "there is no question that
this is a significant development in global climate litigation,
and it could reverberate through courtrooms around the world."
Burger is also a lawyer representing local governments in
the United States in climate change lawsuits, including against
Shell.
Shell, which is the world's top oil and gas trader, has said
its carbon emissions peaked in 2018, while its oil output peaked
in 2019 and was set to drop by 1% to 2% per year.
While its climate targets surpass those of its U.S. rivals
such as Exxon and Chevron, which ignore
emissions from the combustion of its fuels, the Anglo-Dutch
company's spending will remain tilted towards oil and gas in the
near future.
A rapid reduction in its carbon dioxide emissions would
effectively force it to quickly move away from oil and gas.
(Reporting by Bart Meijer; Writing by Ron Bousso and Shadia
Nasralla; Editing by Elaine Hardcastle, Emelia Sithole-Matarise
and Alexander Smith)
