UK: High Court rules approval of government’s Carbon Budget Delivery Plan was unlawful, in sequel to 2022 decision

On 3 May 2024, the English High Court found, for a second time, that the process by which the government’s climate change plans were adopted was unlawful in Friends of the Earth, ClientEarth, Good Law Project v Secretary of State for Energy Security and Net Zero [2024] EWHC 995 (Admin) (“Friends of the Earth (No. 2)”).

The Court held the Secretary of State’s (“SoS”) decision to approve the government’s Carbon Budget Delivery Plan (“CBDP”) was irrational, because he assumed all proposals and policies it contained would be delivered in full (which was not justified by the evidence). Alternatively, if the SoS considered not all proposals and policies would be delivered in full, he was not provided sufficient information to assess which policies might not be delivered in full.

Key takeaways

• The Court has requested further submissions on remedy before making an order.  The Court may direct the current SoS to re-make the decision with the benefit of revised advice on the risks of non-delivery of policies. That could potentially result in the government revising the content of its net zero policies in the CBDP.
• These successful challenges in respect of the government’s climate change plans stand in contrast to the deference the Courts have shown government in other recent climate-related judicial reviews (see our previous blog posts on Bristol Airport’s expansion, gas storage, and oil and gas licensing). Notwithstanding the two judgments on the CBDP / Net Zero Strategy, the Courts have generally emphasised that measures to address climate change are primarily a policy matter to be dealt with by the executive and legislature. 
• The Court stated that it adopted a low intensity standard of review, acknowledging the SoS’s decision involved an evaluative, predictive judgement. However, in this context where the SoS is statutorily required to engage in long-term planning against a fixed target, the Court has shown it will intervene to ensure the decision maker has rigorous advice sufficient to assess (and where appropriate, quantify) the complex predictions and risks involved.
• This case is part of a broader international trend of challenges seeking to ensure that governments take effective, practical steps to implement their (otherwise abstract) emissions reduction targets (see, for example, decisions of the courts in Germany and France and the ECtHR’s recent decision relating to Switzerland). 

Background

This decision is the sequel to the High Court’s 2022 decision in favour of the same NGO claimants (“Friends of the Earth (No. 1)”), which found that the SoS had failed to take into account material considerations when formulating policies in its 2021 Net Zero Strategy (see our previous blog post).

To recap, the Climate Change Act 2008 (“CCA”) requires the UK to reduce its greenhouse gas (“GHG”) emissions to net zero by 2050. Under the CCA, the government sets a carbon budget for each five-year period, with the aim of meeting the 2050 net zero target. Once set, the government is required to prepare proposals and policies for meeting the carbon budget (s. 13, CCA).  To promote transparency, the SoS must lay before the Parliament a report setting out such proposals and policies (s. 14, CCA). 

In October 2021, the SoS approved proposals and policies which he considered would enable Carbon Budget 6 (“CB6” for 2033-2037) to be met.  He also laid the Net Zero Strategy (which contains those proposals and policies) before Parliament as his report under section 14 of the CCA (see our previous blog post). 

In July 2022, in Friends of the Earth (No. 1), the High Court held that the SoS had failed to take into account the following when determining that the policies in the Net Zero Strategy would enable CB6 to be met: 

(i) the contributions which each quantifiable policy would make to meeting CB6; and 

(ii) which policies would make up the 5% shortfall beyond policies with a quantifiable effect (which would only achieve 95% of CB6) and in what ways. 

The Court ordered the government to lay before Parliament a new report that included policy-specific quantitative analyses by 31 March 2023. 

The SoS did so on 31 March 2023 in the form of the CBDP which provides an update to the 2021 Net Zero Strategy.

The High Court’s decision

The March 2023, the CBDP was promptly challenged in a judicial review brought by the same NGOs as in Friends of the Earth (No. 1). 

They advanced five grounds of challenge, four of which succeeded:

1)  The SoS failed to take into account mandatory material considerations when purporting to comply with section 13 of the CCA;

2) The SoS proceeded on the basis of an assumption that all of the quantified proposals and policies would be delivered in full, and this assumption was not supported by the information as to risk to delivery with which the Secretary of State was provided;

3) The SoS’s conclusion that the proposals and policies will enable the carbon budgets to be met was irrational;

4) The SoS applied the wrong legal test to section 13(3) of the CCA (“sustainable development”);

5) The SoS failed to include in the CBDP information that he was required to include.

Grounds 1-3, which overlapped and focused on risks of non-delivery to individual policies, succeeded.  The Court held there was no prescribed way in which information about risk had to be presented, but it did need to enable the SoS to carry out the statutory evaluation lawfully. Following argument about the meaning of certain advice from officials, the Court found that the SoS was advised that each of the proposals and policies in the Plan would be fully delivered and the SoS assumed that to be the case (see [119]-[125]). 

The Court held that the SoS’ assumption was based on a mistaken understanding of the true factual position. The government’s own evidence showed that delivery risks in respect of a number of policies were unstated or said to be “uncertain” (see [63]-[64]). The Court also cited a witness statement from Lord Deben, the former Chair of the Climate Change Commission, whose evidence the Court summarised as follows (see [65]): “the first assumption in the CBDP is that everything will go exactly as planned, and no contingency had been built in. The CBDP depends upon significant improvements in technology being realised, and yet it is not right to assume that such improvements will always be achieved within the necessary timeframe for achieving net zero targets or indeed achieved at all.” The Court found the SoS’ decision was based on reasoning not justified by the evidence and was irrational (see [125]-[128]). 

Under section 31(2A) of the Senior Courts Act 1981, the decision could have been saved if the SoS would have been “highly likely” to make the same decision if he had not made this incorrect assumption. The Court held it could not make such a finding because the SoS lacked sufficient information to evaluate whether the required emissions savings would be achieved even if not all policies were achieved in full (see [129]-[131]). Alternatively, if the SoS had considered not all proposals and policies would be delivered in full, he was again not provided sufficient information to assess which individual policies might not be delivered in full (see [132]).

Ground 4 also succeeded because the SoS applied the wrong test under s13(3) of the CCA, which requires the policies as a whole “to contribute to sustainable development”. The SoS decided the policies were “likely to be”, rather “will” be, positive for sustainable development. We do not expect it will be difficult for the SoS to remedy this error in future.

Ground 5 failed. The Court rejected the argument that the SoS had to include more information about delivery risk in the CBDP (see [161]) and found that level of explanation was not necessary to achieve the degree of transparency required by section 14 of the CCA.

As for remedy, the Court has requested further submissions before making its final order. 

It is possible that the Court will direct the SoS to re-make his decision with the benefit of revised advice on the risks of non-delivery of policies.