Renewable energy

On Friday the 14th of November, the Borgarting Court of Appeal delivered its judgment and ruling in the lawsuit brought by Greenpeace and Nature and Youth against the State, represented by the Ministry of Energy, concerning inadequate impact assessment in connection with the approvals granted for the plan for development and operationof three petroleum fields in the North Sea.

As in the District Court, the question was whether the decisions approving the PDOs (plans for development and operation) for the three fields/areas Breidablikk, Tyrving and Yggdrasil are valid. An important difference since the District Court’s judgment was that the State had carried out new assessments of the PDO approvals after receiving supplementary information from the operators, including what the State claimed was a sufficient impact assessment of combustion emissions from the fields. The question before the Court of Appeal was whether the Ministry’s decision not to reverse the original PDO decisions was valid.

The Court of Appeal found that both the supplementary assessments and the Ministry’s evaluations were inadequate, and that there were therefore procedural errors. The assessments did not address the total scope 3 emissions from the Norwegian continental shelf, they did not compare the scope 3 emissions with the remaining carbon budgets, and no sufficient assessment of global effects had been carried out. The Ministry’s assessment of the environmental impacts was also inadequate. The Court emphasized that it was unclear whether the assessments were based on gross emissions, that no consideration had been given to the cumulative scope 3 emissions from Norwegian petroleum activities, and that the Ministry had not fulfilled its duty to make an overall, overarching assessment of relevant considerations. The Court of Appeal found that there was a chance that the procedural errors could have influenced the decision. On this basis, the Court of Appeal declared the Ministry’s decisions not to reverse the PDO approvals for the three fields invalid.

The Court of Appeal’s assessment is in part based on the EFTA Court’s advisory opinion on the interpretation of the Environmental Impact Assessment Directive (EIA) (E-18/24). The EFTA Court held that scope 3 emissions must also be subject to an impact assessment, even though this deviates from the understanding that has so far been applied in the EU. After the ECtHR delivered its judgment in late October in the first climate case (Case of Greenpeace Nordic and Others v. Norway, 34068/21), there remains little doubt that combustion emissions must be included in the assessment under Norwegian law, EEA law and the ECHR, and that this requirement must be fulfilled at the latest at the time of PDO approval.

Although the environmental organisations succeeded on the substantive claim, the Court of Appeal did not grant their request for an interim injunction to suspend the effect of the PDO approvals. The Court agreed that the development of and production from the fields in question would represent “significant harm” and thus satisfy the statutory requirement for a basis for security, but that suspension would conflict with considerations of proportionality. Considerable weight was placed on the fact that the invalidity is based on a procedural error in the form of inadequate assessment and evaluation, and not on a material error, and that the main rule for procedural errors is that the case must then be reconsidered. The Court of Appeal also referred to the need for predictability in the exercise of public authority, including considerations relating to employment, local communities and confidence in Norway as a supplier of oil and gas.

The Court of Appeal did however issue a ruling ordering the State to reassess the applications for PDO approval so that new decisions can be made within six months, or within two months after a final judgment on the validity of the decisions. The judgment also provides guidance on what is required of the assessments in a new round of consideration.


With respect to the relationship to EEA law and the obligation to eliminate breaches of EEA rules, there has been considerable discussion as to whether the Norwegian administration may rely on the principles set out in Section 41 of the Public Administration Act, the so-called doctrine of impact on the decision (nw: “Innvirkningslæren”). In its advisory opinion, the EFTA Court stated that if “the EEA States have failed to carry out the environmental impact assessment of a project required under the EIA Directive, they are accordingly obliged to eliminate the unlawful consequences of that omission, for example by revoking or suspending the development consent.” This position appears to imply that invalidity should follow even without the application of any impact doctrine. The Court of Appeal, however, assumed that the error could in any event have had an impact, and that the decisions should therefore be declared invalid also under the Norwegian doctrine of impact on the decision.The issue of conformity therefore did not arise directly in this judgement.

It remains uncertain whether the State will appeal the judgment and rulings to the Supreme Court, though an appeal appears likely.

Climate Litigation II – Judgment from the Borgarting Court of Appeal

Victoria specialises primarily in energy law, with a particular focus on petroleum law, renewable energy, grid connection and related issues within contract law, company law and tax law. She has experience of a wide range of projects and transactions in the energy sector, as well as advising on regulatory matters and dispute resolution.

Through her role as working group leader (lecturer) at the University of Bergen, Victoria has gained a solid understanding of and interest in several key areas of law, as well as experience in explaining complex legal issues in a clear and structured manner. Victoria is also an external examiner in the law of obligations and legal methodology for the Law programme at BI Norwegian Business School.

She also has expertise in property law and security interests, and wrote her master’s thesis in this field, entitled ‘The legal position of a chargee in respect of assets being incorporated into a general security interest – From what point in time will an asset being incorporated into a stock or business equipment security interest be covered by the security interest?’.

 is a semi-closed production tank with capacity for around 3,120 tonnes of salmon. With a sealed roof and walls extending down to 20 metres, the aim is to reduce sea-lice and disease pressure, prevent escapes and enable operations in an area which, due to strong currents, is not suitable for traditional open net-pens.

The project marks an important step in Nordlaks’ commitment to technology and more sustainable aquaculture, and it supports local value creation, jobs and the further development of the supply industry.

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Contact information

+47 463 17 991

avf@arntzen.no

+47 23 89 40 00

Areas of expertise

Renewable energy

Anna Victoria Fredriksen

Contact information

+47 463 17 991

avf@arntzen.no

+47 23 89 40 00

Arntzen Grette

Lawyer

Arntzen Grette

Associate

Arntzen de Besche

Associate

Arntzen de Besche

Scholarship holder

Various law firms

Trainee

University of Bergen

Teaching Assistant

Education

University of Bergen

Master of Law

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Climate Litigation II – Judgment from the Borgarting Court of Appeal

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