First, a Dutch court ruled that Shell isn’t doing enough to protect human rights from climate change and the company isn’t living up to the Paris climate agreement. The judge ordered Shell to cut its greenhouse gas emissions by 45 per cent over the next nine years. And the judge didn’t mean just cuts from Shell’s operations, but also from the oil and gas it sells into the world.

By itself, that court decision would have made for a landmark day, but Wednesday wasn’t nearly over. The next shock hit Chevron. Sixty per cent of its shareholders voted against management and supported a resolution to cut the company’s climate pollution. This time it was shareholders specifying the cuts were to include the company’s products as well as its own operations.

Back at Exxon’s shareholder meeting, CEO Darren Woods was losing board members. An upstart hedge fund called Engine No. 1 had convinced big players like BlackRock and the New York state retirement fund that Exxon faced an existential threat by refusing to take the clean energy transition seriously and it was time to start replacing directors.

Exxon had been fighting back. In the runup to the shareholder meeting it spent more than $35 million trying to rally investors against the insurgents. Woods personally campaigned for the company's favoured candidates. Engine No. 1 spent about $30 million, and ultimately won over enough shareholders to take at least two board seats (possibly more, the votes are still being counted).

“What we’re saying is: plan for a world where maybe the world doesn’t need your (oil) barrels,” Engine No. 1’s Charlie Penner told the Financial Times.

We’ve come a long way since the days of shareholder meetings where social activists, often an order of nuns, would table a polite, non-binding resolution asking for management to produce a report. They’d count it a significant “message” to bring along 20 per cent of the vote.

Climate advocates celebrated Wednesday as a landmark day after years of movement pressure against fossil fuels.

The Wall Street Journal described Wednesday’s events as “crushing defeats,” under the headline “Oil Giants are Dealt Major Defeats on Climate Change as Pressures Intensify.”

Ironically, it was exactly two years ago this week that Alberta Premier Jason Kenney dismissed investor concerns about climate change as a “flavour of the month.”

It was a very bad day following a tough run for Big Oil. Those shareholder fights at Exxon and Chevron were just the ones on Wednesday. Earlier this month, majorities of both ConocoPhillips and Phillips 66 shareholders voted against management and supported carbon-cutting resolutions.

Last week, the International Energy Agency said investment had to end in new oil, gas or coal if the world is going to tackle climate breakdown. Last year Exxon was booted off the Dow Jones Industrial Average after nearly a century.

The ruling against Shell and the shareholder insurrections highlight two nerdy ideas that we’ll all have to get our heads around in an era where clashes over climate change are echoing even down Wall Street.

Absolute targets vs. intensity targets

One is the squirrely concept of “carbon intensity.” The Dutch court rebuked Shell for using intensity targets in its planning, and that’s how most Canadian oil and gas companies operate as well. Companies promise to reduce the pollution it takes to get a barrel of oil. It can sound good, but if the amount of oil production goes up, the amount of climate pollution does, too.

You often find companies making long-term promises about getting to net zero by mid-century, but when you look more closely, their actual plans are designed around intensity targets. That’s why the court ordered Shell to cut its absolute carbon emissions by 45 per cent over the next nine years.

Scope 3 emissions

This has nothing to do with mouthwash but it does clear up greenwash. It’s the notion that a company is responsible for the impact of its products, not just the way it runs its factories. Your products are Scope 3, your factory is Scope 1 (we’ll leave Scope 2 for another time).

For fossil fuel companies, Scope 3 is really the whole point. Up to 90 per cent of the climate pollution comes from burning oil or gas or coal, not from digging it up.

The shareholder resolutions and the Dutch court decision all zero in on this point. The judge was clear about the “need for companies to genuinely take responsibility for Scope 3 emissions.”

“This need is more keenly felt where these emissions form the majority of a company’s CO2 emissions, as is the case for companies that produce and sell fossil fuels. In the case of the Shell group, approximately 85% of its emissions are Scope 3 emissions.”

We’ve seen these two concepts in action here in Canada this week. Suncor became the first big Canadian oil and gas company to pledge absolute emissions cuts — it plans to cut them by a third this decade.

But while Suncor is planning absolute cuts, not just intensity-based ones, they only apply to its own operations, not its Scope 3 products. Suncor’s CEO says the cuts will come from “emissions produced in running our facilities, including those we have a working interest in.”

Which means the company could still grow production, sell even more oil and increase its impact on the climate, as one of Canada’s Net-Zero Advisory Body members points out:

Before we move on, there are a couple of important things to note about Big Oil’s bad day.

The Dutch decision was by a lower court, so it’s not the final word since Shell can appeal. But the momentum is building: judges are agreeing that climate change is an existential threat (as Canada’s Supreme Court did) and siding with arguments based on human rights and responsibilities to younger generations. Just this Thursday, a court in Australia ruled that the government has a “duty of care” to protect young people from climate breakdown.

The real breakthrough in the Netherlands may be that a company was ordered to align its policies with the Paris climate accords. That’s a first. The knock against Paris has always been that the agreement is voluntary between governments and not legally binding.

Now, let’s get caught up on some other news.

The Roundup

Canada’s oldest oil and gas association rebrands

In a sign of the times, the Canadian Association of Oilwell Drilling Contractors has renamed itself the Canadian Association of Energy Contractors and changed its mandate to include geothermal and hydrogen.

From the department of circular firing squads

A stark metaphor for the lunacy of our time:

Six Nations, one very big battery

You might remember that just a few years ago, Tesla made a big splash installing the world’s biggest battery on a power grid in Australia. Elon Musk famously won a bet that the company could get it up and running in 100 days. It was 129 megawatt-hours (MWh) in size.

The Six Nations of the Grand River is developing one in southwestern Ontario that will be 1,000 MWh. The First Nations community has partnered with a Canadian company called NRStor and just landed a $170-million investment from the Canada Infrastructure Bank.

The Oneida Energy Storage project is part of an impressive list of Indigenous clean energy projects.

“Indigenous communities have been significantly involved in 197 clean energy projects in Canada. They are the largest clear energy asset owners, apart from the Crown and private utilities,” according to Terri Lynn Morrison and Shawn McCarthy in Corporate Knights.

No more coal plants in Indonesia

Indonesia announced it won’t allow any new coal-fired power plants, will switch its current fleet of 5,200 diesel power stations to renewables and plans to bring in a carbon pricing system. Indonesia’s state-owned power company aims to retire all existing coal plants by 2056.

G7 to stop financing overseas coal

The club of the world’s richest countries (which includes Canada) promised to stop funding new coal power overseas at its annual meeting.

The G7 countries were notably silent about their own mining and exports of coal.

Canada’s dirty pensions

Reuters ran the numbers and found that Canada's five largest pension funds increased their oilsands investments by 147 per cent over the past year.

“We have a big problem with pension funds saying we believe in engagement, not divestment, but there’s no sign of this engagement,” said Adam Scott, a director of Shift, a group working on the climate impacts of Canadian pension funds.

Ford Lightning

We took a look at the Ford F-150 Lightning last week. Ford says it’s gotten over 70,000 pre-orders. It will now spend $20 billion over the next four years on electric vehicle development and expects 40 per cent of its global sales to be zero emission by 2030.

More electric school buses

Kids in Quebec will get 260 all-electric school buses built by Lion Electric, based near Montreal. It’s the biggest order ever for Lion and the second biggest school bus order in North America so far. Public schools in Maryland ordered 326 in February.

I’ll leave you with this lengthy profile of 14-year-old Sophia Mathur from Sudbury. So good to see Maclean’s dedicating this kind of space to an inspiring climate activist.

That’s all for this week. Thank you for reading Zero Carbon. If you have any comments or suggestions, please feel free to email me at [email protected].