(AU AFR) ASIC Targets Fossil Fuel Companies Over Climate Change

 AFR - Michael Roddan

A $700 million oil and gas exploration group chaired by Future Fund guardian John Poynton and National COVID-19 Commission boss Nev Power was one of five fossil fuel firms warned by the corporate regulator they risked breaking the law because of non-disclosure of climate change risks.

The intervention by the Australian Securities and Investments Commission in mid-2020 was among the regulator’s first forays into the market as it ramps up its regulation of climate-related disclosures for shareholders.

National COVID-19 Commission chairman Nev Power is the deputy chairman of Strike Energy.  Alex Ellinghausen

Letters sent to companies, obtained under Freedom of Information laws, reveal ASIC fired off the missives to Strike Energy and its auditor Deloitte, the $400 million Carnarvon Petroleum and EY, Africa-focused Pancontinental Oil & Gas, Perth-based Whitebark Energy and KPMG, and the $200 million Leigh Creek Energy and auditor Grant Thornton.

The warnings were all triggered by complaints received by ASIC that alleged the companies’ operating reviews and directors’ reports failed to disclose risks posed to the businesses by climate change. While auditors do not audit directors’ reports in the annual reports, they are required to ensure any information in a director’s report is consistent with the audited operating and financial review.

Top lawyers say company directors could be liable for failing to understand and disclose climate risks, could be sued for failing to act on those risks once known, and may be liable for “misleading or deceptive conduct” for selectively disclosing exposures to climate change or declaring green goals while lacking credible plans to achieve them.

The arguments have gained the backing of the Reserve Bank of Australia, ASIC, the Australian Prudential Regulation Authority, the ASX corporate governance committee and the Australian Accounting Standards Board. The Taskforce on Climate-related Financial Disclosures (TCFD) is now seen as the global standard for informing shareholders of the climate-related risks faced by companies.

ASIC issued lengthy a guidance for companies in 2018 and considers it potentially misleading conduct to discuss a company’s prospects without also referring to potential downside risks.

In his letters, ASIC senior manager Ben Phillips warned Strike Energy, Carnarvon Petroleum, Pancontinental, Whitebark and Leigh Creek that the companies’ 2019 annual reports were “inconsistent and out of step” with other energy companies “without any clearly discernible explanation as to why this might be the case”.

The Taskforce on Climate-related Financial Disclosures is now seen as the global standard for notifying shareholders of the climate-related risks faced by companies. AP

Mr Phillips said that while ASIC had not conducted a “detailed review” of the non-disclosures in question, it nonetheless reminded the directors and auditors of the requirements under section 299A of the Corporations Act, which requires full disclosure, and warned it would be monitoring disclosures in 2020 annual reports.

Mr Poynton’s 2019 annual report for Strike made no mention of climate change or the risk posed by fossil fuel transitions, but his chairman’s letter noted that: “Strike sees the role of gas in the energy system increasing in importance as an immediate and effective way of reducing Australia’s carbon intensity.”

After ASIC’s intervention, Strike’s 2020 disclosures noted the “potential risks and opportunities posed to our business, and the broader sector, as a result of climate change and the anticipated global transition towards a lower carbon economy”, and disclosed the board was considering using the TCFD disclosure template in future periods.

Strike managing director Stuart Nicholls told The Australian Financial Review the company would recommend to a new ESG (environmental, social and governance)-related board sub-committee, chaired by Mary Hackett and including Mr Power, that TCFD be adopted for this year’s annual report.

An oil rig owned by Carnarvon Petroleum. Supplied

The company in May announced a commitment to reach net zero emissions by 2030, while planning to fully offset its Scope 3 emissions (from its energy customers) with a development of a geothermal project that could supply low-cost, zero-carbon energy into WA for more than 50 years.

“These things are being taken very seriously at Strike,” Mr Nicholls said.

Mr Nicholls said ASIC was doing its job ensuring good governance and disclosure, and that in the absence of a market mechanism or policy framework from the federal government for carbon pricing, capital markets and corporations were now adopting more rigorous standards. “There is value in adapting,” he said.

In a speech in February this year, ASIC commissioner Cathie Armour noted that the regulator had written to “several companies that had come to our attention as potential ‘laggards’ in this area to remind them of their statutory obligations”.

Carnarvon Petroleum, which did not mention climate change in its 2019 annual report apart from noting the company was “cognisant of the need to achieve an appropriate balance, over time, in relation to ... the environment, social licence and corporate governance”, produced its first sustainability report in October 2020 after receiving the ASIC correspondence.

A spokesman for Carnarvon said the company had also aligned its climate change-related disclosures with the TCFD model. “We have also made a deliberate move to create a new stream of reporting on our commercial and operational risk register, enhancing the focus on ‘climate risk’ in mid-2020,” the company said.

Carnarvon’s 2020 annual report noted climate change might affect oil and gas markets, more extreme weather events could affect its operations, while government policy may have an “adverse impact” on the business.

Pancontinental Oil & Gas, which did not mention climate change in its 2019 annual report, did not respond to questions, but its subsequent annual report noted “the developing interest of our stakeholders in climate change and the potential risks that may arise”, and disclosed it would use the TCFD model in the future.

“Going forward it will be important for climate change risk to be considered in all business decisions particularly during the due diligence stages of new ventures,” Pancontinental’s latest annual report said.

Whitebark Energy, which omitted any reference to climate change in its 2019 annual report, warned investors in its subsequent report that climate change risks included the “transition to a low carbon economy” and policy changes that “may result in increasing regulation and costs which could have a material impact on the company’s operations”.

Leigh Creek Energy also did not mention climate change in its 2019 report, but in its 2020 annual report told investors it would “act to reduce our emissions in all areas of our operations”, pursue new technologies to minimise its impact on the climate and “work towards our objective of becoming carbon neutral by 2030″.

Links

• ASIC - Climate Change
• 13 fossil fuel companies named in climate risk complaint
• Fossil fuel gaslighting: accept climate change but undermine action
• ASIC issues updated guidance for directors seeking to avoid climate lawsuits
• Climate-related risk a key director responsibility: ASIC
• Rising heat in the Boardroom: Directors’ duties in the face of climate risks
• International Energy Agency warns against new fossil fuel projects. Guess what Australia did next?

(UK St Andrews Uni) Earth's History Sends Climate Warning

University of St Andrews

Chemical fingerprints of past CO2 levels are preserved in microscopic fossil shells such as this foraminifera. Credit: University of St Andrews

A new study of historical carbon dioxide levels stresses urgent action is needed to avoid prehistoric levels of climate change.

The international team of scientists, led by the University of St Andrews, collected data spanning the last 66 million years to provide new insights into the kinds of climates we can ultimately expect if CO₂ levels continue to rise at the current rate.

The projected rise would result in prehistoric levels of warmth that have never been experienced by humans.

The study, published in the scientific journal Annual Review of Earth and Planetary Sciences (Monday 31 May 2021) provides the most complete history to date of how CO₂ has changed over the last 66 million years, the time since dinosaurs last roamed the planet. The data collected shows more clearly than ever before the link between CO₂ and climate.

Working with colleagues from Texas A&M University, the University of Southampton and the Swiss University ETH Zürich, the international team pulled together data collected over the last 15 years using high-tech laboratory techniques.

Samples were taken from cores of mud from the deep-sea floor, where microscopic fossils and ancient molecules accumulate, preserving a story of what CO₂ and the climate looked like at the time.

By firing these ancient atoms through super sensitive instruments, scientists can detect the chemical fingerprints of past changes in CO₂, which can be compared with present day changes. For example, the study explains, through fossil fuel burning and deforestation, how humans have now driven CO₂ back to levels not seen since around three million years ago.


The history of atmospheric CO2 levels and global average temperature over the last 60 million years: the CO2 scale shows CO2 in terms of doublings, as this is the key control on climate. Credit: University of St Andrews.

Dr. James Rae, from the University of St Andrews School of Earth and Environmental Sciences, who led the international team explained: "For instance, the last time CO₂ was as high as it is today enough ice melted to raise sea level by 20 metres and it was warm enough for beech trees to grow on Antarctica.

"If we allow fossil fuel burning to continue to grow, our grandchildren may experience CO₂ levels that haven't been seen on Earth for around 50 million years, a time when crocodiles roamed the Arctic."

Dr. Rae added: "CO₂ has transformed the face of our planet before, and unless we cut emissions as quickly as possible, it will do it again."

At COP26 in Glasgow this November, politicians will work on international agreements to lower CO₂ emissions to net-zero levels, and prevent CO₂ rising further. 

Links

• Coral time machines reveal ancient carbon dioxide burps
• Atmospheric CO2 over the Past 66 Million Years from Marine Archives
• By 2025, carbon dioxide levels in Earth's atmosphere will be higher than at any time in the last 3.3 million years
• Antarctic Ocean carbon dioxide helped end the Ice Age
• Dire future etched in the past: CO2 at 3-million year-old levels
• Heat-trapping carbon dioxide in air hits new record high

(USA Salon) Humans Are Causing Mass Extinction At A Rate Not Seen Since The Last Major Extinction Event

Salon - Matthew Rozsa

A new study suggests that we are entering a period of mass extinction comparable to the one 66 million years ago

Bleached coral on the Great Barrier Reef outside Cairns Australia during a mass bleaching event, thought to have been caused by heat stress due to warmer water temperatures as a result of global climate change. (Getty Images/Brett Monroe Garner)

Author Matthew Rozsa is a staff writer for Salon. He holds an MA in History from Rutgers University-Newark and is studying for a PhD  in History.

Roughly 66 million years ago, an asteroid or comet struck the planet and wiped out three-quarters of every animal and plant species alive.

Known as the Cretaceous–Paleogene extinction event (K–Pg), it has been immortalized in popular culture because of its association with the end of the dinosaurs' reign on Earth.

That is why scientists are hopeful that a new study regarding the rate of extinction nowadays may hammer home the urgency of our pollution problems.

In an international study led by the Justus Liebig University Giessen that included geologists, paleontologists, evolutionary biologists and many others, researchers found that in some cases, man-made factors are causing an extinction rate that surpasses that of the Cretaceous–Paleogene extinction event.

The study, which was published last month in the journal Communications Earth & Environment, closely analyzed past extinction rates for freshwater animals and plants, then used that information to extrapolate likely future extinction rates.

They discovered that the average predicated rate for freshwater animals and plants today is three orders of magnitude higher than it was during the Cretaceous–Paleogene extinction event. If current trends continue unabated, one-third of all freshwater species alive today may be forever gone by 2120.

If that happens, we can expect that the damage to our freshwater ecosystem — which, inevitably, has an impact on ecosystems everywhere else on the planet — will be effectively permanent.

"Our results indicate that, unless substantial conservation effort is directed to freshwater ecosystems, the present extinction crisis will have a severe impact to freshwater biota for millions of years to come," the authors write.

Even after the extinction event itself abated, the extinction rate remained high for 5.4 million years; the ecological recovery period required another 6.9 million years. Hence, the authors believe that our current situation might be comparable. Even if the man-made impact on life on Earth "ceases immediately, the already triggered phase of extinction might still involve several million years," they write. 

Speaking to the Naturalis Biodiversity Center, the study's lead author Dr. Thomas A. Neubauer explained that "losing species entails changes in species communities and, in the long run, this affects entire ecosystems. We rely on functioning freshwater environments to sustain human health, nutrition and fresh water supply." He added that "despite our short existence on Earth, we have assured that the effects of our actions will outlast us by millions of years."

In the study itself, the authors explained that the extinction crisis "has consequences on many levels," noting that smaller changes compound into larger ones that eventually have devastating consequences.

"Radical changes in ecosystem functioning, in turn, may have severe implications on ecosystem services for humanity, such as food provision, disease resistance or economic benefits," the authors write. "Thus, if we continue to lose species at the fast pace our analysis suggests, we will continue to impair ecosystem services to our own disadvantage."

The new study is one of many red flags being thrown up by the planet about a number of pollution issues that threaten our survival. A February report by the World Wide Fund for Nature (WWF) and Global Wildlife Conservation revealed that roughly one-third of the world's 18,075 freshwater fish species face possible extinction.

The reasons for this include climate change, the introduction of invasive species, habitat destructions, pollution, and overly aggressive draining and damming. 

In September a report by the World Wildlife Fund (WWF) found that overall population sizes of "mammals, birds, amphibians, reptiles and fish" have dropped by 68 percent since 1970, indicating that the planet "is being destroyed by us at a rate unprecedented in history."

Some scholars have already coined a term, Anthropocene, to describe the geological epoch brought about by climate change and marked by the proliferation of mass extinctions. We are already in the midst of what scientists refer to as the Holocene extinction, or the sixth known mass extinction event in the Earth's history, this one due to human activity.

Links

• Biodiversity devastation: Human-driven decline requires millions of years of recovery 
• Current extinction rate in European freshwater gastropods greatly exceeds that of the late Cretaceous mass extinction
• Fishpocalypse? One-third of freshwater fishes are threatened with extinction, study says
• Humans are destroying wildlife at an "unprecedented" rate, World Wildlife Fund report warns
• Top scientists warn of 'ghastly future of mass extinction' and climate disruption
• Biodiversity loss puts our food supplies and medical care at risk. It must be stopped
• UN Report: Nature’s Dangerous Decline ‘Unprecedented’; Species Extinction Rates ‘Accelerating’
• Living Planet Report 2020

(Big Think) Hey, Methane Leakers: Now We Know Where You Live

Big Think - Frank Jacobs

A European start-up uses satellite data to pinpoint individual sources of abnormal methane concentration.

World map of abnormal methane emissions, thanks to a tech start-up and satellite data. Image: Kayrros

Summary

• Just 100 sources of methane emit 20 megatons each year.
• Thanks to satellite data, individual culprits can now be found.
• The new tech could be used to police 'abnormal' methane emissions.

Significant contributor to global warming

Nodding donkey in Midland, Texas. The oil and gas industry is a major emitter of methane. Image: Eric Kounce TexasRaiser, public domain

Methane is the second most important greenhouse gas (after CO2), and its concentration in the atmosphere is increasing at around 1% each year.

Because it absorbs the sun's heat even more efficiently than CO2, it's a significant contributor to global warming.

 The first step to fight the rise in methane emissions is to track who's doing it. That's just become a lot easier. Paris-based tech start-up Kayrros can now find individual sources of abnormal methane emissions, all across the world.

That's a first, and it's made possible by data from the Copernicus Sentinel-5P satellite.

Developed by the European Space Agency (ESA) and launched in 2017, the British-built Sentinel-5 Precursor (Sentinel-5P) is the first satellite of the Copernicus program dedicated to monitoring air pollution, thanks to a spectrometer called Tropomi (short for Tropospheric Monitoring Instrument).

With a resolution of about 50 km², this Dutch-built instrument can monitor atmospheric levels of aerosols, sulphur dioxide (SO₂), nitrogen dioxide (NO₂), carbon monoxide (CO), formaldehyde (CH₂O), ozone (O₃) and methane (CH₄).

High-volume methane leaks

Abnormal methane concentrations in 2019 – often found in regions of the world producing or processing oil and gas. Data provided by the Copernicus program, processed by Kayrros. Image: Kayrros

You may not have heard of Tropomi yet, but it's likely you've already seen its work. Earlier this year, Copernicus Sentinel-5P produced the images that showed substantially reduced NO₂ levels across China, due to the coronavirus lockdown.

Tropomi also offers the most detailed monitoring of methane emissions presently available.

Combining that data with other input from older-model Copernicus satellites Sentinel-1 and Sentinel-2, and from other sources (including ground sensors, position tracking and even social media), Kayrros scientists can identify the size, potency, and location of abnormal methane leaks around the world.

According to Kayrros, there are around 100 high-volume methane leaks active around the world at any given time.

Together, they release about 20 megatons of methane per year. About half of that volume is associated with mining for oil, gas or coal, or other heavy industries.

Together, that amount of methane per annum is equivalent to CO₂ emissions of France and Germany combined.

So, how precise is the Kayrros method? Here's a recent case study.

Plume over the Permian Basin

Image: Kayrros

In December last year, Kayrros used data from Copernicus-5P to identify the source of a methane plume over the Permian Basin, which covers western Texas and southeastern New Mexico.

Sitting on top of a part of the Mid-Continent Oil Field, the Basin's surface is dotted with hundreds of oil wells. Yet with a little help from Sentinel-1 and Sentinel-2, Copernicus-5P managed to find the exact location, and the individual culprit.

For the first time, Kayrros tech and Copernicus-5P data make it possible to detect abnormal methane emissions in real time.

Not only will this increase the precision of methane emission estimates, it will also allow regulators to find and fine the exact culprits, and if necessary, shut down their operations.

Found: the culprit

Image: Kayrros

Links

• (AU) Methane Released In Gas Production Means Australia's Emissions May Be 10% Higher Than Reported
• (NY Times) Halting The Vast Release Of Methane Is Critical For Climate, U.N. Says
• NASA Just Released The First Direct Evidence That Humans Are Causing Climate Change
• (USA New Yorker) It’s Time To Kick Gas
• Land In Russia’s Arctic Blows ‘Like a Bottle Of Champagne’
• Gridded maps of geological methane emissions and their isotopic signature
• Artificial photosynthesis produces 'green methane'
• European Space Agency: Mapping methane emissions on a global scale

(AU SMH) Climate Change Blamed For More Than A Third Of Heat-Related Deaths

Sydney Morning Herald - Peter Hannam

Human-caused global warming was responsible for thousands of heat-related deaths in recent decades, a fraction of the numbers expected in the future even if nations adopt ambitious emissions-cutting efforts.

Research of 30 million deaths, spanning almost three decades in 732 locations in 42 countries, found 37 per cent of heat-related mortality could be attributed to climate change.

For Brisbane, Melbourne and Sydney, there were almost 3000 extra deaths, the international study, published on Tuesday in Nature Climate Change journal, found.

Climate change has been blamed for almost four in 10 of the heat-related deaths recorded across 43 nations over three decades. Credit: Via Weatherzone

The authors, including two based at Australian universities, applied the latest epidemiological and climate models to assess warm-season changes. The result was the largest such study of the health impacts of a hotter world to date, they said.

“We have demonstrated that health burdens from anthropogenic climate change are occurring, are geographically widespread and are non-trivial,” the paper concluded. “In many locations, the attributable mortality is already in the order of dozens to hundreds of deaths each year.”

---

Proportion of heat-related mortality
attributed to human-induced climate change (%)

Source: Nature Climate Change

---

Yuming Guo, head of Monash University’s Climate, air quality research unit, said warm-season heat-related deaths in Australia amounted to about 1.8 per cent of the total, of which about one-third can be attributed to climate change. That ratio is in line with the rest of the world, he said.

“Australians are still sensitive to heat, particularly extreme heat,” Professor Guo said. Even though residents could expect to access more air-conditioning and other relief from high temperatures, an ageing population brought extra deaths in line with other parts of the world.

Indians sit on the edge of a pond near the India Gate monument on a hot day in New Delhi when the mercury climbed to 45 degrees in May 2018. Credit: AP

For the 1991-2018 period, there were 2968 deaths in the three Australian cities that could be attributed to climate change, Professor Guo told the Herald and The Age. Sydney had the highest toll at 1484, with Melbourne at 924 and Brisbane suffering 560 extra deaths.

The fatalities would likely be proportionally higher in other parts of the country. “Normally low socio-economic areas have a higher mortality,” Professor Guo said.

---

Extreme weather

‘Not just dropping off a twig’: How climate impacts may be underestimated

Still, the additional deaths are occurring when average global temperatures have only increased about 1 degree since 1900.

“That rise is lower than even the strictest climate targets outlined in the Paris Agreement [to limit warming to 1.5–2 degrees] and a fraction of what may occur if emissions are left unchecked”, the researchers said.

While accounting for about 0.6 per cent of total warm-season deaths in the countries studied, the authors cautioned against extrapolating that figure globally to mean an extra 100,000 fatalities a year because many regions such as in Africa or South Asia were excluded.

Spectators try to keep cool at a sizzling day at the Australian Open in early 2019. Credit: AP

“One could expect, if warming is larger in these regions, that this percentage would be higher,” said Ana Vicedo-Cabrera, a researcher at Switzerland’s University of Bern, and the paper’s lead author.

---

Extreme weather

Trend towards worsening heatwaves is accelerating, new research finds

The research focused on trends rather than specific heatwaves because of data availability.

“The gap between the two scenarios [of averages and extremes] is increasing exponentially, and current adaptation may not be enough to counteract the effect of warming,” Dr Vicedo-Cabrera said.

“These findings ratify statements of scientific community that climate change is affecting human health already, it is not a matter of future generations only.

“Governments now have more reasons for urgently implementing ambitious mitigation targets and designing more efficient adaptation strategies” particularly in urban planning.

Sarah Perkins-Kirkpatrick of the University of NSW in Canberra said the results were as she expected, and there will be a lot more studies linking climate change to human health in the future.

As temperatures rise and extremes increase “more people will get sick and more people will die”, she said. “It will happen pretty much everywhere.”

Links

• More Than a Third of Heat Deaths Are Tied to Climate Change, Study Says
• World Health Organization: Heatwaves
• We know that heat kills; accurately measuring these deaths will help us assess the impacts of climate change
• The burden of heat-related mortality attributable to recent human-induced climate change
• (UK The Guardian) Climate Crisis Inflicting Huge ‘Hidden Costs’ On Mental Health
• (AU Climate Council) Kicking The Gas Habit: How Gas Is Harming Our Health
• The Climate Crisis Will Cause Once-Dormant Viruses To Reemerge
• (AU) Experts Urge Governments To Follow Health Advice On Climate, As They Did With Covid
• (AU) Former Health Chiefs Turn Focus To Climate

(USA Axios) Southwest's New Climate Peril

Axios - Andrew Freedman

Illustration: Annelise Capossela/Axios

One of the fastest-warming regions of the U.S. is the Southwest — and that region, plus the broader West, is stuck in its most expansive and intense drought of the 21st century.

Why it matters

Studies show that a warming climate is exacerbating the drought, and in some ways may be triggering it in the first place. That means the Southwest is drying out — and California's large wildfires could start as soon as next month.

• And one climate researcher says California's Sierra Nevada Mountains saw one of the fastest snow melt-outs in history this year.
• The drought situation is particularly severe in the Colorado River Basin and northern California. Scientists and public officials are warning that the California wildfire season is likely to be severe, due to the combination of dry vegetation and above-average temperatures.
• This one comes on the heels of the worst fire season in state history, which turned the skies above San Francisco a "Blade Runner" orange last year.

The big picture

Some parts of the world are already getting close to, or have slipped beyond, the Paris agreement's temperature limit that scientists warned about in a report last week.

• As Earth's temperatures tick upwards, closer to the Paris guardrail of 1.5°C (2.7°F) above preindustrial levels, some parts of the world are already warming by much greater amounts, from the Southwestern U.S. to the Arctic. These areas are seeing destructive impacts that are mounting.

Details

California's Sierra Nevada Mountains show what climate change can do as it worsens. The mountain snowpack, which provides 30% of the state's water supply annually, has vanished about two months ahead of schedule.

• Water runoff from snow melt has been paltry, and major reservoirs like Lake Oroville are running even lower than they did during the record drought from 2012-2016.
• Climate change is playing a key role in the drought, by boosting temperatures and increasing the loss of water to the atmosphere. Much of the snow went directly from frozen form back into the air, rather than melting into runoff.
• Warming is also thought to be leading to increasing chances of dry fall seasons in the Golden State and shortened rainy seasons, according to Daniel Swain, a climate researcher at UCLA and the Nature Conservancy.

Craig Clements, who studies wildfires at San Jose State University, warns that large wildfires typically not seen until late summer in California could occur this year as early as June. Vegetation is at near record dry levels for this time of year, he said.

• "We are starting off in a more dire situation than we typically would for June," Clements told Axios.

Context

The worsening drought and potentially devastating wildfire season is not an isolated occurrence for California and other Southwestern states.

• Climate studies have consistently shown that as the world continues to warm, the Southwest will become drier and hotter. This is worrisome, given the likelihood of increased stress on water resources amid a population boom in states such as Arizona and Nevada.
• Although it's interspersed with short intervals of wetter years, parts of the West, including California, are suffering through an emerging, human-caused "megadrought" that began in 2000.
• Studies show this drought, measured using soil moisture data and tree rings, is the second-worst in the past 1,200 years.

What they're saying

"This current drought has quickly accelerated, and is now on par (if not worse) than the extreme and in some cases record-breaking drought that occurred just 5 years ago in California," Swain said.

What's next

If the world does not steeply reduce greenhouse gas emissions starting in this decade, more areas will warm to near or above the Paris limits, until the global average arrives at that level as well.

• This threatens to unleash catastrophic impacts, such as the melting of parts of the Antarctic Ice Sheet.
• For now, the drought and likely severe wildfire season in the West offer an unfortunate preview of what may come next.

Links

• Severe Drought, Worsened by Climate Change, Ravages the American West
• A very, very, very dry future for the U.S. West
• Drought stokes fears of severe fire season in West
• Drought Is the U.S. West’s Next Big Climate Disaster
• Large contribution from anthropogenic warming to an emerging North American megadrought
• Western U.S. may be entering its most severe drought in modern history
• Creeping toward Permanent Drought
• Megadrought emerging in western U.S. could be the worst in 1,200 years, study finds
• ‘Megadrought’ persists in western U.S., as another extremely dry year develops
• The megadrought parching 77 percent of the Western US, explained
• Earth may temporarily hit Paris climate limit in next 5 years

(AU The Conversation) Four seismic climate wins show Big Oil, Gas and Coal are running out of places to hide

The Conversation - Jacqueline Peel | Ben Neville | Rebekkah Markey-Towler

Peter Dejong/AP

Authors Jacqueline Peel is Professor of Environmental and Climate Law, The University of Melbourne Ben Neville is Senior Lecturer and Program Director of the Master of Commerce, The University of Melbourne Rebekkah Markey-Towler is Research fellow, Melbourne Climate Futures, The University of Melbourne

Three global fossil fuel giants have just suffered embarrassing rebukes over their inadequate action on climate change. Collectively, the developments show how courts, and frustrated investors, are increasingly willing to force companies to reduce their carbon dioxide pollution quickly.

A Dutch court ordered Royal Dutch Shell to slash its greenhouse emissions, and 61% of Chevron shareholders backed a resolution to force that company to do the same. And in an upset at Exxon Mobil, an activist hedge fund won two seats on the company’s board.

The string of wins was followed in Australia on Thursday by a court ruling that the federal environment minister, when deciding whether or not to approve a new coal mine, owes a duty of care to young people to avoid causing them personal injury from climate change.

The court rulings are particularly significant. Courts have often been reluctant to interfere in what is viewed as an issue best left to policymakers. These recent judgements, and others, suggest courts are more prepared to scrutinise emissions reduction by businesses and - in the case of the Dutch court - order them to do more.

The wins for climate action put big polluters on notice. AP

Court warns of ‘irreversible consequences’

 In a world-first ruling, a Hague court ordered oil and gas giant Shell to reduce CO₂ emissions by 45% by 2030, relative to 2019 levels. The court noted Shell had no emissions-reduction targets to 2030, and its policies to 2050 were “rather intangible, undefined and non-binding”.

The case was brought by climate activist and human rights groups. The court found climate change due to CO₂ emissions “has serious and irreversible consequences” and threatened the human “right to life”. It also found Shell was responsible for so-called “Scope 3” emissions generated by its customers and suppliers.

The Chevron upset involved an investor revolt. Some 61% of shareholders supported a resolution calling for Chevron to substantially reduce Scope 3 emissions generated by the use of its oil and gas.

And last week, shareholders of ExxonMobil, one of the world’s biggest corporate greenhouse gas emitters, forced a dramatic management shakeup. An activist hedge fund, Engine No. 1, won two, and potentially three, places on the company’s 12-person board.

Engine No. 1 explicitly links Exxon’s patchy economic performance to a failure to invest in low-carbon technologies.

The court said Shell’s emissions reduction efforts were ‘rather intangible’. Shutterstock

Climate-savvy shareholders unite

As human activity causes Earth’s atmosphere to warm, large fossil fuel companies are under increasing pressure to act.

A mere 20 companies have contributed 493 billion tonnes of CO₂ and methane to the atmosphere, primarily from the burning of their oil, coal and gas. This equates to 35% of all global greenhouse gas emissions since 1965.

Shareholders – many concerned by the financial risks of climate change – are leading the corporate accountability push. The Climate Action 100+ initiative is a leading example.

It involves more than 400 investors with more than A$35 trillion in assets under management, who work with companies to reduce emissions, and improve governance and climate-related financial disclosures. Similar movements are emerging worldwide.

Shareholders in Australia are also stepping up engagement with companies over climate change.

Last year, shareholder resolutions on climate change were put to Santos and Woodside. While neither resolution achieved the 75% support needed to pass, both received unprecedented levels of support – 43.39% and 50.16% of the vote, respectively.

And in May 2021, Rio Tinto became the first Australian board to publicly back shareholder resolutions on climate change, which subsequently passed with 99% support.

The Rio Tinto board backed a shareholder resolution on climate change. Brendan Esposito/AAP

The litigation trend

To date, the question of whether corporate polluters can be legally forced to reduce greenhouse emissions has remained unanswered. While fossil fuel companies have faced a string of climate lawsuits in the United States and Europe, courts have often dismissed the claims on procedural grounds.

Cases brought against governments have been more successful. In 2019, for example, the Dutch Supreme Court affirmed the government has a legal duty to prevent dangerous climate change.

The decision against Shell is significant, and sends a clear signal that corporations can be held legally responsible for greenhouse pollution.

Shell has previously argued it can only reduce its absolute emissions by shrinking its business. The recent case highlights how such companies may have to quickly find new forms of revenue, or face legal liability.

It’s unlikely we’ll see identical litigation in Australia, because our laws are different to those in the Netherlands. But the Shell case is emblematic of a broader trend of climate litigation being brought to challenge corporate polluters.

This includes the case decided on Thursday involving young people opposed to a company’s coal mine expansion, and Australian cases arguing for greater disclosure of climate risk by corporations, banks and super funds.

The case brought against the Australian government by a group of teenagers is part of a growing trend towards climate litigation. Supplied

Change is nigh

Oil and gas companies often argue Scope 3 emissions are not their responsibility, because they don’t control how customers use their products. The Shell finding and shareholder action against Chevron suggest this claim may hold little sway with courts or shareholders in future.

The Shell case may also set off a global avalanche of copycat litigation. In Australia, legal experts have noted the turning tide, and warned is it’s only a matter of time before directors who fail to act on climate change face litigation.

Clearly, a seismic shift is looming, in which corporations will be forced to take greater responsibility for climate harms. These recent developments should act as a wake-up call for oil, gas and coal companies, in Australia and around the world.

Links

• Wondering if your energy company takes climate change seriously? A new report reveals the answer
• In a landmark judgment, the Federal Court found the environment minister has a duty of care to young people
• (USA NYT) Big Setbacks Propel Oil Giants Toward A ‘Tipping Point’
• (The Guardian) ‘Black Wednesday’ For Big Oil As Courtrooms And Boardrooms Turn On Industry
• (AU Editorial) The Guardian View On Climate Change Lawsuits: Big Oil Is In The Dock
• (AU The Conversation) Climate Change Will Cost A Young Australian Up To $245,000 Over Their Lifetime, Court Case Reveals
• (AU The Guardian) Australian Court Finds Government Has Duty To Protect Young People From Climate Crisis
• (BBC Europe) Shell: Netherlands Court Orders Oil Giant To Cut Emissions
• (USA New Yorker) Big Oil’s Bad, Bad Day
• (AU ABC) Australian Conservation Foundation Wins Federal Court Challenge Against Adani And Environment Minister