I wrote earlier this week about the US Supreme Court declining to require scope 3 analysis under NEPA. However, a European court recently made the opposite decision. The European Free Trade Association (EFTA) Court ruled that scope 3 emissions from fossil fuel developments must be considered in a project’s Environmental Impact Assessment (EIA) and projects omitting this information are invalid. Columbia Law School’s Sabin Center for Climate Change Law summarizes the decision:
“With respect to the effects of GHG emissions from the combustion of fossil fuels extracted and sold to third parties, the Court looked at the objectives in the EEA Agreement relating to the environment… and prior case law recognizing the risk of irreversibility and severity of climate change… The Court found that GHG emissions from the combustion of fossil fuels must be assessed in EIAs before oil and gas extraction projects are approved, since these emissions are among the likely significant effects of such projects. GHG emissions from the combustion of oil and gas are considered “indirect effects” of extraction projects within the meaning of Article 3(1) of the EIA Directive. This includes emissions from end-consumption, even if the fuels are refined and burned abroad. The EIA must assess all likely significant climate impacts, including those downstream impacts, because they are objectively a foreseeable result of extraction.”
EFTA governs economic activity in the European Economic Area (EEA), which covers the EU and three countries that have integrated trade with the EU despite not being full members. Iceland, N0rway and Liechtenstein all participate in EU markets governed by EFTA courts and are subject to the advisory opinion. This ruling could have significant impacts, especially in Norway which is a major fossil fuels producer.
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