By regulations 5(2), 12(2) of the Environmental Assessment of Plans and Programmes Regulations 2004, and paragraph 6 of Schedule 2 to those Regulations, the Secretary of State was required to carry out a strategic environmental assessment (“SEA”) of his non-statutory offshore energy plan for the licensing of further offshore oil and gas exploration and production, to include a description and evaluation of the likely significant effects on the environment of its implementation and information reasonably required to understand those effects on the environment: short, medium and long-term effects, permanent and temporary effects, positive and negative effects and secondary, cumulative and synergistic effects, including on issues such as “climatic factors”. The claimants sought judicial review challenging decisions of the Secretary of State and the Oil and Gas Authority, inter alia, to approve a plan for a new (33rd) round of licensing of oil and gas extraction in the North Sea (under section 3 of the Petroleum Act 1998). The central issue was whether the Secretary of State had acted unlawfully (in breach of regulation 12(2) of the 2004 Regulations and/or irrationally) by deciding not to include in his assessment of the environmental implications of the plan any downstream (“scope 3” or “end use”) emissions of greenhouse gases, being the indirect emissions generated in the use and disposal of an organisation’s products, the overwhelming majority of which were the emissions released when the oil or gas products were burned by consumers as fuel. The failure to take such emissions into account was said to be unlawful given, in particular, the objectives of the plan, the central purpose of which was promoting energy security for consumers of oil and gas in the United Kingdom, for which purpose the use of oil and gas by UK consumers was not remote from the exploration for and extraction of oil in the UK but was an integral feature of the plan.
On the claims for judicial review—
Held, claims dismissed. Regulation 12(2) of the Environmental Assessment of Plans and Programmes Regulations 2004 did not impose an absolute obligation on the relevant “responsible authority” to assess the likely significant effects on the environment of implementing plans or programmes. The test of “likely significant effects”, which also appeared in paragraph 6 of Schedule 2 to which effect was given by regulation 12(3) of the 2004 Regulations, involved matters of evaluative judgment. While there were differences between the environmental impact assessment and the strategic environmental assessment regimes, and while the emission of greenhouse gases from the end use of the refined products was, for the purposes of the former regime, a likely significant effect of a “plan” whereas the SEA regime was concerned with “projects”, the two regimes were sufficiently analogous for the same important legal principles to apply to both. While the purpose of a policy or plan might be relevant to defining its scope and effects, that purpose could not in itself determine what the policy was, its scope or its environmental effects. For the purposes of the 2004 Regulations, the offshore energy plan only set the framework for licensing oil and gas exploration and production within the geographic area it covered and did not purport to say what was to happen to oil or gas extracted under a licence granted in a new licensing round, including how much of that material was to be consumed within the UK, nor did it put forward policies relating to refinery or storage development or for the distribution of refined products, or for land uses which could give rise to UK demand for oil or gas products. On that basis, the greenhouse gas emissions from the end use of the extracted gas were not “likely significant effects” of the plan on the environment. Accordingly, it was impossible to say that there had been any flaw in the Secretary of State’s reasoning, let alone that it had been irrational. Further, the Secretary of State had been entitled to conclude that there was an insufficient causal connection between the plan’s policy for new oil and gas licensing and greenhouse gases from end uses by consumers (paras 82, 103, 105, 111–114, 116).
James McClelland KC, Gethin Thomas and Alastair Richardson (instructed by Greenpeace Ltd) for the claimant in the first claim.
Estelle Dehon KC and Ruchi Parekh (instructed by Leigh Day) for the claimant in the second claim.
Richard Turney and Ben Fullbrook (instructed by Treasury Solicitor) for the Secretary of State.
The Oil and Gas Authority did not appear and was not represented.