It’s time for a proper debate about how to dismantle fossil fuel companies
On 26 May a Dutch court ordered the oil giant Shell to reduce its global carbon emissions by 45% by 2030 in a landmark ruling. That Shell is finally being held accountable for its role in the climate crisis is a victory not only for Friends of the Earth Netherlands (Milieudefensie) and the more than 17,000 co-plaintiffs who brought the case, but for the entire global movement against the fossil fuel industry.
But despite the excitement that we at action coalition #ShellMustFall share, we want to remind the world: litigation will not be enough to stop Shell’s leaders from damaging our planet.
If Shell were to adhere to the verdict, which explicitly includes so-called ‘Scope 3 emissions’ (emissions generated from the suppliers and customers of Shell’s products), it would have to substantially cut its oil production, stop developing new oil fields and cease any marketing and lobbying that could increase the sale of its products.
While the company plans a modest reduction in oil production, it is actually planning to expand its gas capacities, which it presents as ‘clean gas’. Shell, which currently has tens of billions of dollars invested in fossil fuels, has a history of ignoring court orders. There is good reason to expect that the company’s board will continue extracting oil and gas, regardless of the ruling.
Unfortunately, the court order stipulating a 45% reduction refers to ‘net emissions’, which allows Shell to offset some of its emissions. The possibilities for offsetting, for example by planting forests or through carbon-storage projects, are extremely limited in the eight years Shell has left before the 2030 deadline. Primarily located in the Global South, these projects are moreover often associated with human rights abuses, land grabbing and fictional emission reductions. They cannot replace an actual energy transition.
The big question dangling over Shell and other fossil fuel corporations is whether it is possible for them to be part of a genuine transition and keep paying dividends to shareholders, or even make a profit, at the same time. Shell’s calculus is purely monetary: if in the immediate term there is more money to be made from wrecking the planet than from refraining to do so, there will be no incentive for it to cease harmful fossil fuel extraction and stop exploiting its workers. For companies like Shell, legal challenges are little more than ‘financial risks’ to be hedged.
We at #ShellMustFall are convinced that Shell, by its very design, will never be a fair and ecological company. It is therefore insufficient to simply put pressure on Shell to behave better. Instead, we propose a four-point plan to bring an end to Shell and the entire fossil fuel industry.
1) Dismantle Shell
This means winding down the company, closing the drilling wells and closing down fossil fuel infrastructure. Notably, this is where climate litigation has its limits. Under current law it is impossible for a judge to seize the assets and shares of a company and put it under democratic control. We need people power to do this. But it is important to realize that eventually, fossil fuel will come to an end: even CEOs cannot survive on a burning planet. We can either leave this transition in the hands of those who have caused the damage in the first place or take it into our own hands and do it in a just and orderly manner.
The exact steps needed to dismantle fossil fuel companies require further discussion, but history teaches us that it is possible. The Dutch East India Company was nationalized in 1796 and decommissioned in 1798. In 1911, Standard Oil, the world’s largest oil conglomerate at the time, was dissolved into 34 smaller businesses in a historic antitrust trial. And the banking crisis of 2008 showed that governments can buy up financial giants and reorganize them. None of these examples was without issue, and we can learn a lot from what did and didn’t work. But one thing is for sure: drastic times call for drastic measures.
2) Ensure reparations for impacted communities and ecosystems
At our last action during Shell’s annual shareholders meeting, we acted out what climate justice could look like. Dressed as construction workers, we took a wrecking ball to the Shell headquarters and informed local residents that the Shell office would be taken down to make place for an International Tribunal for Climate Justice – as called for at the 2010 World People’s Summit in Bolivia.
A Climate Justice Tribunal would hold environmental criminals to account. It would ensure reparations for communities whose members have been killed and whose livelihoods have been ruined, and help Indigenous communities to restore damaged ecosystems.
3) Provide a just transition for fossil fuel workers
Workers should not be punished for bad decisions made by their bosses. They have skills and expertise that could be used elsewhere, such as in the production of sustainable energy. We could, for example, learn from the closing of the mines in the south of the Netherlands, where new industries were created to provide jobs for the mine workers. And as the Feminist Green Deal points out, green jobs can be about more than construction and technology – care is already a low-carbon sector.
4) Build an energy democracy
This will not be as simple as nationalising Shell and putting it in the hands of the Dutch parliament – although it might be a logical first step. Nationalisation can have very different effects, depending on who controls energy production and for whose benefit. Moreover, a just energy democracy would require all affected communities – many of which are situated in the Global South – to have a say in energy production. The Southern Ecosocial Deal, for example, calls for decentralised and democratised energy systems.
Commentators in the mainstream media, and sometimes even climate defenders, still seem to be stuck in a binary vision of the future in which Shell either continues doing whatever it wants or one in which we convince Shell to be slightly less destructive.
But there is another route that is less imagined: making Shell fall.
This article is published under a Creative Commons Attribution-NonCommercial 4.0 International licence