Shale gas: increasing intervention by local authorities

In most countries, unconventional gas production (as is the case with most natural resources) is of national interest. The production of shale gas, tight gas and coal seam gas through hydraulic fracturing is considered an important source of revenue and an important element in the nation’s energy policy. The big national interests at stake with unconventional gas production put local governments under pressure. Local governments usually are concerned with protecting the local environment for the benefit of present and future generations. Often, these concerns have a legal basis, either in the constitution, in the public trust doctrine, or in domestic legislation in the field of land use and planning and/or environmental protection.

In several shale gas rich countries around the world, we see attempts by local governments to challenge hydraulic fracturing (fracking) using various legal pathways.  Examples are popping up everywhere, now almost on a monthly basis. In the US, in December 2013, the Pennsylvania Supreme Court declared an Act that sought to eliminate zoning authority from municipalities over shale gas extraction, unconstitutional because it infringes the municipalities’ duty under the state’s constitution (Environmental Rights Amendment), to act as a trustee of natural resources. In 2014, the shale gas richest province in the south of the Netherlands and several of the municipalities in this province, banned exploration and production of shale gas altogether, using various legal instruments in the field of environmental law and land use planning law.

Although local authorities do not have competences in the field of mining law, they do have responsibilities and associated powers under planning law. Local zoning and planning is always done at the local level, and hence, municipal authorities may set restrictions or conditions to any new activity so as to fit in this activity within the existing land use. These powers can be very far-reaching, even rendering the use of a production permission entirely impossible. Should, for instance, a local zoning plan prohibit mining activities at a certain location, or prohibit the issuing of a construction license to mining constructions on that location, then no mining can take place there, even after the competent authority for the mining operations granted all necessary permits.

Both in the Netherlands and the United States, however, central governments have legislated in order to have the regulatory tools to intervene in local decision-making when needed to ascertain that mining activities go ahead. In the case of shale gas, local governments and local communities increasingly pursue legal pathways to block or at least hinder shale gas operations. In the example of Pennsylvania,  the state authorities used their legislative power to overrule local decision-making. Courts, however, seem to be willing to limit or even block such intervention because it infringes on the constitutional right to a clean environment and the public trust doctrine, also laid down in the constitution, according to which governments have to protect the environment for present and future generations.  

In the Netherlands, instruments to overrule local decision-making in the field of environmental protection and spatial planning are in place, but have not been applied yet. The debate on the constitutionality of such intervention has not arisen yet. Should intervention take place, it is likely to be argued that this is unconstitutional, not just because of the alleged infringement of the right to a healthy environment (somewhat similar to Pennsylvania, laid down in the Dutch constitution in the form of a basic duty for the government), but also because of the principle of decentralized governance that forms the basis of the Dutch public governance system.  It remains to be seen whether such reasoning is going to be successful, as the Netherlands does not have constitutional courts, nor the possibility to have legislative acts of the national legislature tested against the constitution.  Even without these opportunities, however, it is clear that Parliament will scrutinize any attempt by the Cabinet to overrule local rules and regulations as this will be considered to undermine future collaborations with local authorities on which the central government in almost every policy field depends for the execution of their policies. In a previous attempt in the Netherlands, to impose national decision-making upon an unwilling municipality (the selection of a location for an onshore carbon capture and storage demonstration project), huge public uprising occurred, ultimately leading to the abandonment of the project. 

In Germany and France, by contrast, public protests, mainly at a local level, have strongly influenced decision-making at the national level, more or less by-passing local governments. This probably is due to the fact that in these countries, local authorities have little power to stop or regulate shale gas exploration and production. Hence, protesters –with much success– aimed at national political institutions rather than at local authorities. In France, opposition was especially fierce because of the lack of public consultation. Both countries imposed a moratorium on the exploration and production of shale gas through hydrofracking with the use of chemicals.

The above brief assessment of the role of local governments in the hydrofracking debate shows that the local level plays an important role indeed. Simply ignoring or legislating local governments and local communities out of the picture will be counterproductive, as the local level has legal and political cards to play out, and, constitutionally, perhaps even has to play out these legal cards to protect the environment for present and future generations. It seems, therefore, that local communities determine the success of unconventional gas development and should be taken seriously by central governments that plan to support hydrofracking. Transparency and meaningful involvement of local communities should be pursued, allowing for any kind of outcome, including the outcome of a moratorium or ban. It can be expected that at the EU level, where legislation is currently being prepared, focus will be on such important procedural issues.

Where is the legal framework for Climate Smart Agriculture?

Between now and 2050, there will be a sharp increase in the demand for agricultural products. This is caused by an increase of the world’s population from 7 billion today (2012) to 9 billion, the rise in global calorie intake by 60% due to greater affluence, particularly in countries like China and India, and the production of bio-fuels (Meridian Institute 2011). The increase in agricultural production is likely to be accompanied by an increase in the emission of greenhouse gasses. Agriculture is responsible for 30% of total global greenhouse emissions, mainly through land-use change (particularly deforestation driven by agricultural expansion, also affecting biodiversity), methane and nitrous oxide emissions (from livestock and the use of fertilizers). The Meridian Institute, in its 2011 report ‘Agriculture and Climate Change: a Scoping Report’ shows that agriculture is not only a major cause of climate change but in many regions of the world, it is also seriously impacted by climate change. It is expected that by 2050, 56% of crops in Sub-Saharan Africa and 21% of crops in Asia will be negatively affected by the consequences of climate change, for instance because of shifts in water availability, temperature shifts, and changes in the occurrence of pests. This often has direct effects on the availability of food. In other regions, such as Europe, it seems that at least in the short term, climate change can be beneficial to agricultural production, allowing, for example for an additional yield per year or the opportunity to grow a more profitable crop. Europe, though, ultimately will be affected by these developments as well: food shortages are expected due to demand in other markets, particularly the emerging economies, even when taking into account the decline of Europe’s population (European Commission 2012).

Limiting food security risks under climate change requires new climate-smart agriculture policies to be implemented. Around the world, a wide variety of adaptation and mitigation projects are being trialed in the agricultural sector under such headings as ‘carbon farming’ or ‘climate smart agriculture’ (hereafter: CSA). The FAO website on climate smart agriculture has a list of more than 150 projects around the globe. Examples of these are the application of low water use technologies, crop changes, tillage and residue management, land-use change, agroforestry, enhancement of agro-biodiversity, etc.  So far, these, mostly experimental, projects have not or only barely been brought under the existing legal framework on climate change adaptation and mitigation.

With the varieties in effects of agriculture on climate change and in the effects of climate change per region, it is a challenge to come up with an overarching legal framework that allows for both climate change mitigation and adaptation, while maintaining or even improving food security as well as providing benefits to as many people as possible. Although food security has been acknowledged as an important issue under the UN Framework Convention on Climate Change, bringing adaptation and mitigation in the agricultural sector under the UNFCCC and the Kyoto Protocol is only happening at a slow pace. Emissions from land use change and agriculture are included in the Protocol accounting mechanisms, but only when measurable as verifiable changes in carbon stocks. In addition, Parties could elect additional human-induced activities related to LULUCF (Land-Use, Land-Use Change and Forestry), specifically, forest management, cropland management, grazing land management and revegetation, to be included in its accounting for the first commitment period. Only four countries elected for this option in that commitment period, hence strongly limiting the possibilities under the Clean Development Mechanism (CDM) as well. Furthermore, methodological questions have led to restrictive limits. Soil sequestration, for example, has been excluded from the CDM, and land use change can only account for 1% of all CDM credits. Some support to developing countries in the field of agriculture is provided for by the Adaptation Fund and the Green Climate Fund.

In general, it must be concluded that the instruments aimed at reducing greenhouse gas emissions only apply to agriculture to a very limited extend. The relationship between agriculture and climate change is considered to be too complex to be included in current negotiations. There are seemingly insurmountable practical difficulties in integrating agricultural emissions in an emissions trading scheme.

At the international level, it is not just international climate law under the UNFCCC, but also international trade law under the WTO that is relevant when researching the legal framework for CSA. On the one hand, current income support for farmers may constrain CSA, for instance when support schemes do not ‘reward’ farmers for switching to agricultural practices that are aimed at climate change mitigation and adaptation. Under the WTO, reducing market distortions caused by income support to farmers have been discussed for years now, albeit without significant progress towards the liberalization of trade in agricultural products. On the other hand, the WTO’s intellectual property rights law (TRIPS agreement) seems to favour access to climate smart agricultural technologies and practices, as the TRIPS agreement protects IPRs while at the same time favouring technology transfer to developing countries, although the latter –in practice- still is problematic.

At the domestic level, only in very few countries attempts are made to introduce financial benefits to farmers for their mitigation efforts. Probably the best example is Australia that, in 2011, enacted legislation that allows farmers to (voluntarily) generate carbon credits that can be sold on the domestic and international carbon market: the Carbon Farming Initiative (CFI). Thanks to this initiative, Australia is the country with the most far-reaching example of active legislation aimed at facilitating and stimulating CSA. Farmers earn credits through agricultural emissions avoidance projects (projects that avoid emissions of methane from the digestive tract of livestock, methane or nitrous oxide from the decomposition of livestock urine or dung, methane from rice fields or rice plants, methane or nitrous oxide from the burning of savannahs or grasslands, methane or nitrous oxide from the burning of crop stubble in fields, crop residues in fields or sugar cane before harvest, and methane or nitrous oxide from soil), as well as through sequestration offsets projects.

In the EU, CSA is still very much in the research phase and the regulatory framework is largely absent. Farming is excluded from the EU ETS, but included in the Effort Sharing Decision.  The Effort Sharing Decision establishes binding annual greenhouse gas emission targets for Member States for the period 2013–2020. Member States have to develop their own policies in order to achieve their targets and therefore, may put more emphasis on some sectors than on others. For agriculture, emission reductions could for instance be achieved through more efficient farming practices and conversion of animal waste to biogas. Other than in Australia, LULUCF projects are explicitly excluded from the Effort Sharing Decision, so important measures like cropland and grazing land management and revegetation are not covered. The second route towards addressing emissions from agriculture is through the EU Common Agricultural Policy (CAP) reform in 2013. Here mitigation and adaptation policies meet, as the CAP is also the primary means for promoting climate resilient agriculture. In the initial proposals, the European Commission suggested to earmark 30% of the direct payments for farmers who apply agricultural practices beneficial to climate change and the environment (through crop diversification, maintenance of permanent pasture, the preservation of environmental reservoirs and landscapes, etc.). In addition, it was proposed to give increased financial support to agri-environment-climate projects and organic farming under the EU´s rural development policy. In the final stages of the negotiations, however, these proposals have been watered down to a considerable extent.

First binding international law on climate engineering

In October 2013, the Parties to the London Dumping Convention (to be more precise: the 1996 Protocol to the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter) adopted amendments aimed at regulating marine geo-engineering. This is the first time the international community adopted binding legal rules on climate engineering. Climate engineering, or geo-engineering, is the deliberate interference with the Earth’s climate to achieve a cooling effect, thus mitigating global warming. A range of very different techniques are being researched at the moment, usually divided into two groups: solar radiation management (SRM) and carbon dioxide removal (CDR). SRM techniques are for instance the injection of sulphur aerosols in the stratosphere to block the sun light, thus mimicking volcanic ashes in the stratosphere after a volcanic eruption (stratospheric aerosol injection, SAI), and the injection of fine sea water particles in clouds to increase the reflective capacity of clouds (marine cloud brightening, MCB, sometimes also referred to as cloud seeding). CDR techniques are for instance the emission of fertilizers such as iron into the ocean to stimulate a bloom of phytoplankton, which are responsible for a large share of the carbon take up (ocean iron fertilization, OIF), large scale afforestation, and direct air capture of greenhouse gasses (DAC).

Each of these techniques has its own pros and cons. Some are considered to be potentially dangerous because of the large scale at which they have to be used to be effective and the risk of unexpected negative side effects. It, for instance, has been estimated that for stratospheric aerosol injection to be effective, a more or less continuous emission of aerosols by a very large number of aircraft (perhaps as many as a thousand) is needed to keep a constant blanket of aerosols in the atmosphere. As this technique does not interfere at all with the amount of carbon in the atmosphere, generations to come have to continue applying this technique. Stopping the emission of aerosols will trigger a very sudden drastic warming effect. Other negative consequences of SAI are side effects, such as potentially drastic changes in precipitation in some regions, ongoing ocean acidification and potential harm to the ozone layer. Ocean fertilization leads to eco-system changes and may affect fish stocks. There are many reports that describe the pros and cons of the various geo-engineering techniques. In Germany, the Kiel Earth Institute published a good report in English. In the Netherlands, the Rathenau Institute published an up-to-date and very well accessible report in Dutch in December 2013.

As is often the case with the development of new techniques and technologies, the law regulating these is lagging behind. This, however, does not mean that climate engineering is completely unregulated at the moment. International law that applies to (some forms of) climate engineering, can be divided into four categories:

-        International customary law. The no harm principle limits the use of techniques that may have an irreversible negative side effect for certain states (in the 1997 Gabčíkovo-Nagymaros case, the International Court of Justice stated that in the field of environmental protection, vigilance and prevention are required on account of the often irreversible character of damage to the environment and of the limitations inherent in the very mechanism of reparation of this type of damage). An assessment of the potential negative impacts on the environment of other states is required as a consequence of this principle (as was concluded by the ICJ in the 2010 Pulp Mills case). Other international environmental law principles that are relevant here are the precautionary principle and the principle of intergenerational equity.

-        International human rights conventions may apply, although both advocates and critics of climate engineering use human rights as an argument in favour of and against the deployment of geo-engineering techniques (climate engineering is necessary to protect human rights which will be affected by climate change, or: climate engineering may negatively impact on human rights in case of unexpected failure or negative side-effects)

-        Existing treaties that more or less explicitly deal with climate engineering. The best example before the adoption of the 2013 amendments to the London Protocol is the 1976 Convention on Environmental Modifications (ENMOD convention). Although this convention is mainly aimed at environmental modifications with a hostile intend, it also sets some conditions to environmental modifications for peaceful purposes, such as climate engineering. Climate engineering is allowed under the ENMOD Convention, provided that a State does not develop and employ climate engineering on its own (international cooperation is needed), the deployment has to contribute to international economic and scientific collaboration aimed at improving the environment, and States have to take into account the needs of developing countries.

-        Existing treaties that happen to be applicable to a certain climate engineering technique, such as the 1979 Convention on long range transboundary air pollution which sets a cap on various emissions, such as sulphur emissions, thus limiting the use of sulphur for stratospheric aerosol injection.

The adoption of amendments to the London Protocol referred to in the first sentence of this blog fit within the third category, but is special because it is the first time that climate engineering has been explicitly targeted by international law. Through the amendments, a new article and two new annexes are inserted into 1996 Protocol. The new article states that “Contracting Parties shall not allow the placement of matter into the sea from vessels, aircraft, platforms or other man-made structures at sea for marine geo-engineering activities listed in Annex 4, unless the listing provides that the activity or the sub-category of an activity may be authorized under a permit”. Annex 4 then lists ocean fertilization as a prohibited activity, with the exception of legitimate scientific research. Such research has to be permitted and assessed under the criteria laid down in Annex 5. Annex 5 has extensive provisions for the permitting process at the domestic level by the parties to the protocol, on consultation, prior assessment, site selection, risk management, monitoring, scientific  peer review, etc., etc. States have to adopt legislation so as to implement these new provisions. Once ratified, these amendments will thus lead to legislative activity in all of the 44 parties to the protocol. They will serve as a benchmark for all future geo-engineering law, both at international and national level.