TotalEnergies must address climate risks linked to its products, French court rules (updated)

TotalEnergies SE

Yesterday 16:14

Court rules 'duty of vigilance law' applies to climate risks
Judges stop short of imposing binding business measures
Prosecutors had said law should not apply to climate change
Total will comply but is considering its legal options
Updates to include Total comment in paragraphs 8-9
By America Hernandez

    PARIS, June 25 (Reuters) - French oil major TotalEnergies TTEF.PA must disclose the climate risks linked to emissions from its oil and gas products and set out plans to mitigate them, a Paris court ruled on Thursday.
The ruling is a partial victory for climate change NGOs seeking to apply France's 2017 corporate duty of vigilance law to climate change. However, the court stopped short of ordering specific measures such as limiting overseas exploration and production or setting binding emissions reduction targets.
Climate litigation against oil majors has produced mixed results in recent years. A landmark Dutch ruling ordering Shell SHEL.L to cut emissions was later overturned on appeal and is under review by the Netherlands Supreme Court.
     
TOTAL MUST PROVIDE AN UPDATED PLAN
The Paris Judicial Court said in a press release summarising the ruling that the climate risks related to company activity were within the scope of the duty of vigilance law.
"The law does not mean to render companies responsible for those risks, which result from all human activity on the planet since the industrial revolution, but asks them to act according to their situation," it said.
"Extracting, refining and marketing of a barrel of oil inevitably leads to its combustion," the court added in detailing why Total played a role in clients' emissions.
TotalEnergies must present an updated vigilance plan to the court for review in six months. If judges find its measures insufficient to reduce Scope 3 emissions — those emitted when clients use its fuel products — it could order Total to take additional steps.
The company said it was examining its legal options, and would comply with the ruling by adding to its vigilance plan information largely contained in its separate sustainability report — including ways it already helps its clients lower their emissions by switching to biofuels or selling them renewable electricity.
"TotalEnergies notes with satisfaction that today's court decision did not uphold the claims made by the NGOs and the city of Paris seeking to bar Total from pursuing new oil and gas projects or compel it to reduce its production ... confirming that it is not for the court to fix the targets for Total to meet," it said in a statement.
A coalition of NGOs, including Association SHERPA, Notre Affaire à Tous, France Nature Environnement, as well as the city of Paris filed the case in 2020, arguing TotalEnergies' oil and gas business conflicts with climate goals and breaches its duty to identify and avoid environmental harm. 
In a statement, the coalition said the ruling was a victory.
"While TotalEnergies argued that Scope 3 emissions are those of its consumers, the court recognised that the company has leverage to cut these emissions," it said. "We will continue the fight to make sure this happens."
The suit was initially declared inadmissible in 2023, but that decision was overturned on appeal. French prosecutors, acting as an interested party, had argued the duty of vigilance law was not intended to cover climate change. 

 (Reporting by America Hernandez in Paris. Editing by Inti Landauro, Mark Potter, Barbara Lewis and Aurora Ellis)
 ((america.hernandez@thomsonreuters.com; +33623014155))