On Monday, July 18, 2022 a ruling was issued in UK courts declaring that the UK Secretary of State’s Net-Zero Strategy failed to include vital information required by law. The decision comes from the Queen’s Bench Division of the High Court of Justice. This is somewhat analogous to a Federal Appeals Court for those of us in the US. Under the UK Climate Change Act (CCA) – passed in 2008 – the UK was required to reduce its net carbon emissions to below 80% of its 1990 levels by 2050. However, after the Paris Climate Agreement, the CCA was amended to require net emissions reductions of 100% of the 1990 baseline by 2050. This change came into effect in June 2019.
Background of the Law and Claim
The CCA requires the Secretary to set the carbon budget for the country over a series of five-year periods leading to 2050. This breaks down into nine budgeted segments referred to as Carbon Budget 1-9 (CB 1-9). CB targets are set twelve years before the CB period begins. This case concerned CB-6 covering the years 2033-2037. CB targets must be reviewed by the Prime Minister and approved by Parliament. As such, the Secretary is required to generate a report (called the “Net Zero Strategy” or NZS) outlining the strategy for the CB period and that report was the primary subject of this litigation.
The NZS outlines sector-specific policies and programs used to reach the CB goal. The NZS for CB-6 stated that it could meet 95% of the CB goal through quantitative policy analysis. However, the other 5% of the goal remained nebulous. The Secretary insisted that the policies accounting for the missing 5% were “unquantifiable” and that “planned policy work to identify further options over the coming years [will] deliver 100% of the emissions reductions required for CB-6.” Additionally, the NZS failed to show exactly what percentage of emissions reductions were coming from specific programs. This lack of specific data was a departure from the Secretary’s previous reports in 2009 and 2011 and could have been due to increased time pressure caused by the more stringent goals introduced in 2019.
Legal Action
The Claimants in this case were Friends of the Earth Limited, Client Earth, and Good Law Project, who took issue with vague figures provided by the NZS for CB-6 and brought a case against the Secretary on several different legal theories. The Claimants argued that 100% of the goal should be quantifiably provable as opposed to 95%, and that the Secretary needed to include specifics on the total percentage of the goal contributed by each policy.
The Court sided with the Claimants in part, finding that the missing 5% of the goal didn’t have to be proven quantitatively, but the Secretary did have to report on why it couldn’t be proven quantitatively. Instead of discussing the restrictions around these data and offering reasons for why a more qualitative approach was necessary for the remaining 5%, the strategy taken in the NZS was to gloss over this point. Additionally, the Court found that the Secretary did have to include the specifics on how the emissions reductions created by each policy factored into the overall goal. The Court’s rationale was that Parliament relies on this report to determine whether to approve the CB goal – and if the report contains insufficient information, then Parliament can’t make an informed decision.
What this Means
The Secretary will need to publish a more complete and detailed report. However, I think that there is a lesson here not only for the Secretary, but for governments and companies in and outside of the UK. That lesson is that data plays a critical role in the development and execution of net zero pledges and emissions reductions. The Court makes an excellent point that incomplete data inherently harms the ability to make informed decisions. In addition, clarity, specificity and transparency of assumptions – and limitations – in climate plans are necessary. This applies to any jurisdiction or use of climate information.
On PESG we often talk about how climate programs should be based on data and facts, rather than aspirational statements. Data gathering and analysis are paramount, but as this case shows, getting the relevant data in front of decision-makers and making certain that the data is complete is equally important to ensure the success of climate programs. In addition, anything less than candor and clarity when disclosing climate risk management plans is no longer acceptable anywhere
