Sarah Finch, on behalf of the Weald Action Group, challenged Surrey County Council’s decision to grant permission for an oil well at Horse Hill, near Gatwick Airport. The Supreme Court stated that the Council’s decision to grant planning permission for the drilling was ‘unlawful’ because the environmental impact assessment (EIA) only accounted for emissions arising from the drill site itself (Scope 1 and Scope 2 emissions) and did not consider Scope 3 emissions from the extracted oil’s use after being sold.

The case could have significant implications for future oil and gas wells, and coal mines, across the UK by forcing local authorities to consider Scope 3 emissions when deciding whether to approve permits for new projects.

Legal firm Bracewell notes that the Supreme Court’s decision could also have an impact on the process by which approval for offshore oil and gas projects is sought. However, it adds that even in situations where Scope 3 emissions are required to be included in EIAs as part of such an approval process, the Supreme Court’s decision does not act as a bar to approval ultimately being granted.

Environmental campaign group Greenpeace UK has existing legal challenges against the Rosebank and Jackdaw offshore oil fields which had been suspended pending the outcome of this case. Greenpeace and Friends of the Earth supported Finch’s case.

The case is likely to concern oil and gas companies, many of which only have absolute emissions reductions targets for Scope 1 and Scope 2 emissions, which represent only a small fraction of the battle to decarbonise the energy sector. At present, quantifying and tackling the Scope 3 emissions created through the end use of the oil and gas produced is outside the control of oil and companies, which means that most leave Scope 3 emissions outside of their decarbonisation targets.

The Supreme Court judgement also referenced a successful legal challenge brought by Greenpeace Nordic against the Norwegian government’s approval of three new oil and gas fields in the North Sea, currently under appeal. In that case, the Oslo District Court also found Scope 3 emissions need to be taken into account in an EIA.  

Commenting on the ruling, Mel Evans, Climate Campaigner at Greenpeace UK, said: ‘This is a huge win for the climate. The courts have finally recognised that the government can’t ignore emissions released by burning fossil fuels when granting drilling licences… We now need robust government action to bring the UK’s oil and gas sector in line with our climate commitments and properly support affected workers into good, secure jobs in the renewables sector. Both campaigners and workers need clarity, not endless court cases. The government must seize the opportunities provided by the energy transition with a clear plan for the industry that places workers at its heart.’

Stephen Sanderson, Chief Executive of UK Oil and Gas (UKOG), which is behind the Horse Hill project, said the Court’s decision was ‘rather perplexing’. However, he stated that the company would now work with the Council to ‘rectify this retrospective change to EIA requirements’ as, although the project was a small part of UKOG’s portfolio, it ‘still has a role to play in both the company’s and UK’s future transitional energy mix’.

Although Sanderson went on to note that the company’s focus over the past few years had ‘shifted away from oil and gas’ towards ‘underground hydrogen storage, an essential element of the UK's future low carbon energy system’.  

Numerous experts including the International Energy Agency (IEA) have said that oil and gas must be left in the ground if the world is to have a chance of meeting its climate goals. A recent study by University College London and the International Institute for Sustainable Development found that the world has enough fossil fuel projects planned to meet global energy demand forecasts to 2050 while the IEA last week predicted a glut of oil by 2030 due to excess production.

The Robert Gordon University says 90% of jobs in the North Sea are transferable to clean energy production, findings backed by recent research commissioned by OEUK. There are currently thousands of skilled workers in the UK oil and gas sector. However, this is set to decline as production falls in the decades ahead, according to OEUK. Meanwhile, the growing UK offshore wind industry, for example, already employs 32,000 people and that number is expected to rise to over 100,000 by 2030, according to analysis from RenewableUK.