Climate change causes compensation conundrum

Following recent hurricanes, should fossil fuel companies pay for their role in causing climate change?

Caribbean islands and US states are still counting the cost of hurricanes Harvey, Irma and Maria. At least 138 people have been killed by the high winds and floodwaters. And while it is still early days in terms of assessing damage to homes and businesses, the insurance industry currently estimates costs of US$20-35 billion for Harvey and US$30-40 billion for Irma.

These are big numbers. But they also underestimate the real costs because they are calculated by insurance companies. Many people in the developing world are uninsured, so their costs go uncounted. Instead, they depend on aid money and charities to help them rebuild their lives.

However, advances in the science of attribution mean that finance to help victims of extreme weather made worse by climate change could in future come from another source.

Recent studies have looked at how scientific evidence could help apportion responsibility for climate damages, by modelling the “real” world with a “counterfactual” world, where human activity has not caused greenhouse gas emissions to rise.

Scientists can then isolate and analyse the influence of human actions, and calculate the extent to which they have altered the probability or intensity of a particular weather event.

This report demonstrates the growing precision with which major carbon producers’ responsibility for climate change and climate impacts can be quantified, allocated and, ultimately, litigated.

Carroll Muffett, president, Center for International Environmental Law 

The data exists to link the emissions traced to products sold by a fossil fuel company to a specific share of changes in temperature and sea level rise.

According to a peer-reviewed paper published in September in the journal Climatic Change, nearly 30 per cent of the rise in global sea level between 1880 and 2010 resulted from emissions traced to the 90 largest carbon producers.

Emissions traced to 20 fossil fuel companies contributed 10 per cent of global sea level rise over the same period. More than 6 per cent of the rise in global sea level resulted from emissions traced to ExxonMobil, Chevron and BP, the three largest contributors.

“This report demonstrates the growing precision with which major carbon producers’ responsibility for climate change and climate impacts can be quantified, allocated and, ultimately, litigated,” said Carroll Muffett, president of the Center for International Environmental Law and board member of the US-based Climate Accountability Institute.

Meanwhile, a paper published in Nature Geoscience in September, argued that litigation could play a key role in spurring states and businesses to mitigate or adapt to risks associated with greenhouse gas emissions.

The paper notes that courts are increasingly being called on to address responsibility for risk reduction, or to apportion responsibility for loss and damage resulting from climate change, and that improved attribution science can and will be used in climate litigation.

Sophie Marjanac, co-author of the paper and climate accountability lawyer at campaign group ClientEarth, said that probabilistic evidence, which is what the science of attribution produces, is already commonly used in law.

Medical negligence cases, for example, can be determined according to the increased risk a patient had of contracting a particular illness.

Climate change is already the subject of legal cases worldwide. Some cases involve campaign groups and citizens taking their governments to court for inadequate policy on climate change, but several are targeted specifically at fossil fuel companies.

In the US, three counties on the coast of California have launched a lawsuit against 20 of the world’s largest fossil fuel producers, seeking damages for their contribution to expected damages from sea-level rise. The suit claims that the companies obscured the harm cause by their products, violating protection of both consumers and property.

In Germany, RWE was taken to court by a Peruvian farmer, who sought damages to offset the costs of protecting his town from melting glaciers, for which he alleged the utility was partly responsible. He was not successful. The court ruled that it was not possible to pin all of the flood risk faced by his town to one emitter.

However, the authors of these papers are not necessarily encouraging groups to launch legal action. Rather, they believe that the risk that this could happen should boost action to tackle climate change.

Myles Allen, professor of Geosystem Science at the University of Oxford, who co-wrote the paper in Climatic Change, acknowledges that using the courts to impose costs to pay for damage caused by climate change would be expensive and time consuming, and not the most efficient way of channelling resources from users of fossil fuels to those impacted by climate change.

“I’m not specifically calling for litigation. You could argue that private sector liability for the impacts of GHGs is almost a nuclear option, you’d rather it wasn’t used, but it needs to be there in order to focus minds. At the moment, there is no downside risk to selling or using fossil fuels with respect to climate change,” he said.

Marjanac explained: “Attribution science doesn’t mean that all fossil fuel majors are going to be sued next week.”

Instead, she believes that local and central governments, utilities, infrastructure engineers and companies should be looking at climate science, and fully integrating it into decisions in order to avoid court cases that could be brought using attribution science.

Tom Burke, chair of environmental think tank E3G, said that it was over simplistic both politically and legally to use attribution science to apportion blame to fossil fuel companies. “Going to law in this area is pretty difficult, the chain of liability is so extensive,” he said.

Fossil fuels cause damage by being burned, but lots of people are responsible for this, including manufacturers of products that rely on fossil fuels, governments that encourage them and consumers who buy them, he pointed out.

Talking about lawsuits distracts from the real issue, which is how countries responsible for emitting most greenhouse gases should compensate those responsible for the fewest, he said.

However, Marjanac believes that legal cases on this issue will continue to rise. “Legal cases are inevitable because losses will continue to accumulate and the science will continue to get better. I can only hope that companies will mitigate their emissions in time to stop dangerous climate change, and to avoid protracted litigation in the future.”

This story was originally published by Chinadialogue under a Creative Commons’ License and was republished with permission.

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