The United Kingdom’s Supreme Court has issued a new ruling in a planning law case concerning the climate impact considerations for new oil wells. In a 100-page ruling in R (on the application of Finch on behalf of the Weald Action Group) v Surrey County Council and others (Finch), a three-to-two majority held that Surrey County Council had acted unlawfully by not accounting for downstream greenhouse gas emissions when approving a new oil development project.
This article provides an overview of the background in Finch, the legal issues, the lower court decisions, the Supreme Court’s judgment and finally the ruling’s implications.
References to paragraphs below are references to the full Supreme Court judgment, which can be found here.
Background
Finch involved Horse Hill Developments Ltd., which had applied to Surrey County Council for the development of four new oil wells and expansion of oil production from an existing oil well at Horse Hill in Surrey. The application involved a 25-year project, during which an estimated 3.3 million tonnes of oil could be produced.
Under applicable law in the United Kingdom, the Town and Country Planning (Environmental Impact Assessment) Regulations 2017 (the 2017 Regulations), an environmental impact assessment is required to obtain approval for new development projects. The 2017 Regulations transposed Directive 2011/92/EU of the European Parliament and of the Council, as amended by Directive 2014/52/EU into United Kingdom law (EIA Directive). More specifically, an environmental impact assessment must “identify, describe, and assess in an appropriate manner … the direct and indirect significant effects of the proposed development” on various factors, including climate.
Yet, in Finch, the environmental impact assessment for the project considered the environmental impact of the site’s construction, production, decommissioning and restoration over the project’s lifetime, focusing solely on the production process and on-site activities. However, it did not assess the greenhouse gas emissions from refining and using the extracted oil elsewhere (downstream or ‘Scope 3’ emissions). Surrey County Council accepted this limited assessment and approved the project. Sarah Finch challenged this decision, arguing that the downstream emissions should have been considered in the project’s impact assessment.
Both the High Court and the Court of Appeal initially upheld Surrey County Council’s decision, although the Court of Appeal did so with reservations. The Court of Appeal disagreed with the High Court’s reasoning, noting that while downstream impacts were not legally excluded from consideration, the degree of connection between the development and its effects should be judged on a case-by-case basis by the planning authority.
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