Both sides claim win in Peru-Germany climate ruling

In 2015, a Peruvian farmer sued one of Europe’s largest utility companies, arguing its carbon emissions were melting the glacier that looms above his hometown. Nearly a decade later, the court’s decision delivered mixed messages—and headlines across continents.

(CN) — A landmark German lawsuit in which a Peruvian mountain farmer sought to hold an energy giant accountable for climate-related risks to his home ended Wednesday with a mixed ruling, and both sides claiming victory.

With the backing of Germanwatch, a German non-profit climate group, climate activists and lawyers, Saúl Luciano Lliuya, a Peruvian farmer in the Andes, filed a suit in 2015 against RWE, a major German power supplier, arguing the company should be forced to protect his town from a glacier melting due to a hotter climate.

Lliuya argued that his farm in Huaraz was at risk due to rising water levels in Lake Palcacocha, which is held back by a dam and fed by a melting glacier. His lawyers claimed RWE was partly responsible, citing research that linked 0.47% of global emissions to the company’s power plants.

The suit was seen as an international test case to hold the world's biggest polluters accountable for climate change. Since 2015, similar suits have popped up in Europe, the United States and other international courts.

On Wednesday, the Higher Regional Court of Hamm dismissed Lliuya’s plea for compensation, finding his home was not in imminent danger from a flood. The ruling left the company claiming victory.

Still, the court found Lliuya’s legal claims to be valid in principle and permitted the collection of extensive evidence as part of its examination. These aspects of the case led climate activists to hail the ruling as a win.

The ruling was read aloud in court Wednesday by Presiding Judge Rolf Meyer. No written copy was made available.

In a news release, Meyer found that Lliuya “might have a claim” under German civil law, but that his case was dismissed because “the evidence showed that there was no concrete danger to his property” from the glacier.

“It's both a legal and symbolic victory for Saúl and a practical victory of not paying for RWE,” said Joana Setzer, a climate law expert at the Grantham Research Institute on Climate Change and the Environment at the London School of Economics. She spoke with Courthouse News by telephone. The Grantham institute has followed Lliuya’s case closely for several years.

She added that climate advocates scored a win with the court allowing so-called “attribution science” to be used as evidence. Attribution science is a new field of climate science that seeks to measure how much climate change contributes to making droughts, storms, hurricanes, wildfires and other extreme events even worse.

The court, however, rejected evidence from Lliuya’s team that included a “climate factor” showing an increased risk of flooding to his property.

Setzer said “in a narrow sense, RWE can claim victory because they're walking away without having to pay any financial penalty.”

But she added that Lliuya's case succeeded in “pushing the boundaries of climate law.”

Lliuya wanted RWE to pay its share of the cost to safeguard against a catastrophic flood, which he estimated to be around $20,000. He also requested approximately $7,000 as reimbursement for flood defense work he had done on his land.

In 2016, the regional court in Essen dismissed the suit due to a lack of “legal causality.” The court ruled that climate change was so complex that it was impossible to clearly say RWE’s carbon emissions were the cause of glacier melting in the Andes.

However, the Higher Regional Court of Hamm, an appellate court, decided to examine the case further and, in November 2017, agreed to allow evidence to be presented. The proceedings included a visit to Peru in 2022 and two days of expert hearings in Hamm this March. Climate litigation experts called the court's willingness to assess scientific evidence a major turning point.

RWE argued that Lliuya’s case should not have been admitted under German civil law. The company said that if it were held liable, the court would open the floodgates for claims against any entity that emits carbon dioxide, even taxi drivers. However, the company claimed it was reducing its greenhouse gas emissions and doing its part to stop global warming.

Meyer, the presiding judge, disagreed with RWE’s claim that the suit was inadmissible due to “the great distance between the defendant's power plants and the plaintiff's residence in Peru,” the court news release said.

Meyer rejected RWE’s argument that “every individual citizen could be prosecuted in the future” if the company was held liable for climate damage. The judge said that logic was flawed because only major emitters could be found liable. He also rejected RWE’s claim that it could not be held responsible for damage to Lliuya's home in faraway Peru because it was carrying out its obligation to supply energy in Germany.

“If there is a threat of adverse effects, the polluter of CO₂ emissions may be obligated to take preventive measures,” Meyer said. “If the polluter definitively refuses to do so, it could be determined, even before actual costs are incurred, that the polluter must bear the costs in proportion to their share of the emissions — as the plaintiff demands.”

Nonetheless, RWE hailed the higher court ruling as a major win for German industry.

In a statement, RWE said there “would have unforeseeable consequences” for German companies had the court held it liable for climate change.

“It would ultimately allow claims for climate-related damages to be asserted against any German company anywhere in the world,” the company said.

RWE stated that court-appointed experts determined Lliuya's property was not at serious risk from a flood caused by the glacier, estimating the probability of flooding at 1% over the next 30 years.

“From the court's perspective, there is therefore no reason to even consider the question of a causal connection between RWE's CO₂ emissions and the alleged threat to the plaintiff's property,” the company added.

It said the ruling meant Germanwatch's suit failed “to create a precedent for holding individual companies responsible for the effects of climate change worldwide under German law.”

It added that companies cannot be held liable for climate damage when they are complying with the rules and laws in the countries where they operate.

“It would be an irreconcilable contradiction if the state permitted CO₂ emissions, regulated them in detail by law, and even required them in individual cases, but at the same time retroactively imposed civil liability for them,” the company argued.

Lliuya's lawyers saw the ruling very differently.

“For the first time in history, a higher court in Europe has ruled that large emitters can be held responsible for the consequences of their greenhouse gas emissions,” said Roda Verheyen, a lawyer for Lliuya, in a statement. “German civil law is applicable in the context of the climate crisis.”

“This sets a legal precedent with far-reaching implications,” Germanwatch said.

The nonprofit noted that the ruling could influence similar cases in Switzerland, Belgium, the United Kingdom, the Netherlands, the United States and Japan.

“Despite the fact that the court did not follow the scientific assessments presented by the plaintiff, the decision shifts the dial for climate litigation and the rights of those affected by the climate crisis,” the organization added.

In a statement, Lliuya also presented the ruling as a win.

“My case has shifted the global conversation about what justice means in an era of the climate crisis, and that makes me proud,” he said. “This ruling shows that the big polluters driving the climate can finally be held legally responsible for the harm they have caused.”

He expressed disagreement with the court-appointed experts who determined his property was not at risk from a flood, saying they “reached a different conclusion from the glacier scientists who have studied this region for decades and believe my home is at risk.”

The higher court said the ruling was final and that an appeal was denied.

Courthouse News reporter Cain Burdeau is based in the European Union.

Follow @cainburdeau

Categories / Appeals, Business, Energy, Environment, International, Law, Politics, Science

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Both sides claim win in Peru-Germany climate ruling

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