ClientEarth Litigation Summary: October - December 2018

The closing months of 2018 were busy for ClientEarth’s litigators. We brought cases in 7 countries across Europe, as well as at EU level and at the UN’s committee on access to justice. We also saw judgements and other significant developments in a series of cases.

Our cases in the last months of 2018 spanned air quality, climate action, energy and access to justice.

Air quality

• In October we launched our first legal action in Budapest – challenging the failure to tackle air quality in the city and raising the profile of the problem across Hungary amongst national decision makers and the public. This challenge follows on our successful line of litigation to enforce the limits enshrined in the EU’s Ambient Air Quality Limit and specifically our successful cases in the Central Europe region (Czech and Slovakia).
• In Lombardy, Italy, the regional government had agreed to prepare a new air quality plan after we filed our first case in 2017. In August, it issued its new plan, without having published any draft plan for public consultation. Despite some improvement on the first, the new plan remains inadequate. We are bringing a new court challenge in consequence.
• A Belgian court has ordered the Flemish regional government to produce an air quality plan within the year following legal action taken by Greenpeace Belgium to address illegal levels of air pollution in Flanders. We provided strategic advice on the legal arguments in this case.
• Following rulings against Dusseldorf and Stuttgart last year, Bonn and Cologne became the latest cities for which a court has mandated authorities to introduce diesel bans. In addition, a court in Berlin ordered that the movement of diesel vehicles is restricted in the German capital in a case brought by Deutsche Umwelthilfe (DUH) with ClientEarth’s strategic input.
• Meanwhile, the German federal government announced a disappointing plan to ‘solve’ the diesel crisis through hardware retrofits and scrappage schemes. By responding to that announcement in our public communications, we continue to mount the pressure on the government.
• Our first clean air challenge in Slovakia concerning the Air Quality Plan of the capital city Bratislava resulted in a victory with the District Court of Bratislava finding that the Plan breaches both national and EU law. As a result of the ruling, the Bratislava District Authority will have to draft a new plan that includes effective measures to improve air quality in the city in the shortest possible time.
• The UN Committee on the Rights of the Child has asked Poland to “provide information about the measures taken to reduce the pollution from extracting and burning coal, including from coal-fired power plants, and to increase awareness about the harm to children’s health and the adverse impact on the climate.” This follows a submission on these issues to the committee prepared jointly by our lawyers and the Centre for International Environmental Law (CIEL). A recommendation by the committee on these issues very likely. Poland is required to respond in writing.

Climate accountability and climate finance

• We took two related actions concerning two Polish energy companies’ failure to disclose information concerning the economic viability of proceeding with construction of the controversial €1.2bn, 1GW Ostrołęka C coal power plant in north-east Poland.Enea and Energa, have all the necessary environmental and legal permits to proceed with construction and are not seeking the necessary corporate approvals before issuing a notice to proceed with construction. We consider that the actions of Enea’s and Energa’s management and supervisory boards in relation to Ostrołęka C breach their duties of due diligence and to act in the best interests of the companies and their shareholders. As a minority shareholder, ClientEarth commenced a challenge on the basis that the project poses an “indefensible” financial risk to investors due to rising carbon prices, increased competition from renewables and the impact of EU energy reforms on state subsidies for coal power under the Polish capacity market.
• We submitted our objection to Drax Power’s new large-scale gas power project in the UK, on the grounds that it breaches the government’s planning and climate change recommendations. We have highlighted that the adverse impacts of the project – including the significant adverse environmental impacts – would outweigh the project’s benefits and recommended that development consent be denied.
• At the end of last year, Sir John Kingman's review of the Financial Reporting Council (FRC) published its report, identifying serious structural deficiencies in the FRC and recommending that it be replaced with a new regulator to oversee corporate governance, reporting and audit in the UK. In a related report, the Competition and Market Authority (CMA) has found significant issues with the UK audit market and proposed deep reforms - including a review of the purpose of audit itself.Building on our own experience of trying to leverage the powers of the FRC to ensure climate change-related risks are properly considered and working with other NGO groups and investor contacts, we have been at the forefront of organisations calling for a full-scale reform of the FRC, and a comprehensive review of the purpose and role of audit in the UK.

  Coal and energy markets

  • In October, we added two new challenges to our anti-coal efforts in Greece. Together with WWF and Greenpeace Greece, we launched two actions for annulment against the recently updated/amended environmental permit of the existing lignite-fired power plant of Meliti I and the future Meliti II.Both power plants are or will be situated on the Northern Greek border, just 5 miles away from the nearest village in Macedonia. The pollution emitted from the power plants will have a significant impact in Macedonia, Bulgaria and Albania, or even further due to the prevailing meteorological conditions of the area.
  • In December, we brought the Bulgarian ‘cold reserve’ to the attention of the European Commission through a State aid complaint. Our analysis shows that the cold reserve acts as a capacity mechanism in the form of a strategic reserve, giving payment to certain plants to ensure they are ready to provide power in times of peak demand. However, in practice, the aging Bulgarian coal fleet benefit from these payments despite failing to deliver energy when needed, while alternative power sources and those from other countries are excluded. To the best of our knowledge, the reserve was never notified to the Commission and is therefore unlawful.
  • In October, we received a disappointing judgment in our first human rights-based claim targeting illegal mining in Bulgaria, which ClientEarth supported. The claim concerned the right to property of a home owner in Pernik and the local authorities’ failure to prevent illegal mining activities which led to damage to her property. The court concluded that the Municipality is not under a legal obligation to control illegal mining as the claimant`s property is in a concession area. The conclusion of the court is overall unclear, so we have launched an appeal against this finding.
  • In Bulgaria, despite securing a court ruling ordering public access to information on the derogations requested by coal plants, the government is pushing ahead with a public consultation on whether to allow coal power plant Maritsa East II, a derogation from the pollution limits set by the IED. The ruling by the Sofia City Administrative Court requiring the Environment Agency to release any cost-benefit analysis that justifies a coal plant being made exempt from new pollution rules was immediately appealed by the other side. We will defend this appeal in the court and in the media.
  • In Poland, following 7 years of our legal interventions, the procedure to approve free greenhouse gas (GHG) allowances under the Emissions Trading Scheme for the Kozienice power plant was re-opened in December 2018, following our intervention exposing the lack of public participation in the first run of the procedure. We are appealing the decision to approve these allowances to the Ministry of Environment.

  • Access to Justice

    • We prepared a complaint to the Aarhus Convention Compliance Committee over new laws in Bulgaria that would systematically restrict people, public institutions and environmental groups’ ability to go to court and raise environmental issues. The President of Bulgaria, Rumen Radev, has also tried to block the laws, citing breaches of multiple international rights agreements. Za Zemiata’s action comes after Bulgaria’s parliament overruled Radev’s presidential veto, which meant the laws could enter into force.
    • Our second case in Bulgaria, a challenge to the air quality plan of the second largest city Plovdiv, was ruled inadmissible in October. Our test case in Sofia was also dismissed for lack of standing and the national government has since passed new legislation that may have the effect of restricting access to the courts in environmental matters, including in relation to the operation of coal plants. Access to justice remains the major barrier to litigation on air quality issues in Bulgaria. We are deploying a strategy to overcome this challenge.