On the Fourth Day of Christmas...the scope of environmental assessments

On the Fourth Day of Christmas…today Victoria Crozier from Irwin Mitchell’s Commercial Dispute Resolution team examines the success of not four calling birds but one: Finch, in the Supreme Court case of R (Finch) -v- Surrey County Council [2024] UKSC 20. 

In June 2024, the Supreme Court handed down its landmark judgment in R (on the application of Finch on behalf of the Weald Action Group) (Appellant) v Surrey County Council and others (Respondents) (“Finch”), a decision that expanded the scope of environmental assessments and which is likely to continue to have a considerable impact on new projects in 2025 and beyond.  

Factual Background

In Finch, the Supreme Court were tasked with deciding whether it was unlawful for Surrey County Council to grant planning permission to a developer, Horse Hill Developments Ltd, for a commercial crude oil extraction project, where the Environmental Impact Assessment (“EIA”) did not extend to emissions arising as a result of the project, such as from the inevitable combustion of the oil. 

The Town and Country Planning (Environmental Impact Assessment) Regulations 2017 (“Regulations”) implemented European Union Directive 92/11/EU (“Directive”), requiring an EIA to “identify, describe and assess in an appropriate manner […], the direct and indirect significant effects of the proposed development” including but not limited to the impact on the climate, biodiversity and human health. The aim of the EIA is to protect the environment by compelling planning authorities to consider the potential impact of a project to the environment before granting planning permission, though it should be noted that the legislation is not an automatic barrier preventing an application from succeeding where a project is likely to cause significant harm. 

Surrey County Council initially adopted a scoping opinion under the Regulations, detailing the assessment required, which was later narrowed and restricted to “the direct releases of greenhouse gases ("GHG") from within the well site boundary resulting from the site’s construction, production, decommissioning and subsequent restoration over the lifetime of the proposed development.” 

Local resident Sarah Finch, on behalf of Weald Action Group, applied for judicial review of Surrey County Council’s decision on the basis that the scope of the EIA did not extend to emissions produced as a consequence of the project, as required by the legislation. 

Decisions of the Lower Courts

The High Court rejected the claim, with Holgate J finding that it was impossible to say where the oil produced would be refined or used, and whether this would be in the United Kingdom or abroad. The judge did however find that it was “inevitable that oil produced from the site will be refined and, as an end product, will eventually undergo combustion, and that that combustion will produce GHG emissions.”

The Court of Appeal later refused the appeal, affirming the judgment of Holgate J on the basis of his alternative reasoning. In their view, it was for the council to evaluate whether there was a “sufficient casual connection” when considering whether the combustion emissions are indirect effects of the extraction of the oil which therefore had to be assessed. 

Supreme Court Judgment 

In a majority 3-2 judgment handed down by Lord Leggatt, the Supreme Court allowed the appeal on the grounds that the emissions that will occur upon combustion of the oil were within the scope of the EIA, consequently finding the decision of the council to be unlawful. The Court held that the Directive and Regulations included an “express requirement” to consider the indirect as well as direct effects of the project and that “the fact that the combustion emissions would emanate from activities beyond the well site boundary which were not themselves part of the project was not a valid reason to exclude them.” It was further held that “…the effect of the combustion emissions on the climate does not depend on when or where the combustion takes place. Those factors are irrelevant to the size and significance of the environmental impact.”

2024 Impact and a View to the Future 

The impact of Finch establishing that an EIA must assess downstream GHG emissions has already been felt throughout 2024. The ruling was at the heart of a decision by Holgate J which rejected proposals for an underground coal mine at Whitehaven in Cumbria, which would have been the UK’s first deep coal mine in more than 30 years (Friends of the Earth and another -v- Secretary of State for Levelling Up, Housing and Communities and others [2024] EWHC 2349). 

It is evident that any new projects proposed that require an EIA must be particularly alert to the requirements established in Finch and we can expect to continue to see the effects throughout 2025.