EFTA Court: end-use emissions must be assessed in an EIA before fossil fuel project approvals
The EFTA Court held in a recent advisory opinion that end-use emissions from the consumption of the extracted oil and gas are to be considered effects of the extraction project. Guan Schaiko and Sofie Ulrix analyse the advisory opinion (E-18/24) and assess the legal obligation to include end-use (Scope 3) emissions in environmental impact assessments under the EIA Directive.
EFTA Court’s advisory opinion of 21 May 2025, E-18/24
On 21 May 2025, the EFTA Court1 delivered a landmark advisory opinion in Norwegian State v. Greenpeace and Nature and Youth Norway (Case E-18/24), resolving a key question in environmental law concerning externalities. The Court held that greenhouse gas (GHG) emissions resulting from the eventual combustion of fossil fuels, so-called scope 3 emissions, – extracted and sold to third parties for consumption as part of an extraction project for which a permit is sought – constitute “effects” of the extraction project within the meaning of Article 3(1) of the EIA Directive2 (2011/92/EU) and must be assessed before development consent is granted. By requiring the inclusion of these end-use emissions in the environmental impact assessment (EIA) of the extraction project, the Court closed a contested accountability gap in fossil fuel permitting and affirmed that negative externalities must therefore be internalised at the approval stage of the extraction stage, rather than compartmentalised or deferred.
Factual and legal background
The dispute involves the approval decisions by the Norwegian Ministry of Energy of three oil and gas extraction projects in the North Sea (Breidablikk, Tyrving and Yggdrasil). The EIAs carried out did not assess the impact on the climate from GHG emissions arising from the later combustion of the extracted resources (para. 30). The case was originally heard in the Oslo District Court, which decided in favour of the applicants and quashed the approval decisions. The State appealed to the Borgarting Court of Appeal, which then referred several questions on the interpretation of the EIA Directive to the EFTA Court.
End-use emissions (scope 3 emissions) are an “effect” of fossil fuel extraction within the meaning of Article 3(1) of the EIA Directive
In interpreting the EIA Directive, the Court first reaffirmed that, in accordance with Article 3(1) of the EIA Directive, a prior assessment of both the direct and indirect likely significant effects of a project must be carried out at the earliest possible stage in all the technical planning and decision-making processes (paras. 47-56), and that such examination must be carried out in full, and in a comprehensive manner (para. 65).
To this regard, the Court agreed with the respondents, Greenpeace and Nature and Youth Norway, that the release of GHG emissions is a foreseeable consequence of fossil fuel extraction. It noted the causal relationship in the sense that“[i]f not for the project, the embedded GHGs would stay below ground” (para. 69), concluding that emissions from the eventual combustion of extracted and sold fossil fuels, i.e., end-use emissions, are likely significant effects of a fossil fuel extraction project that must be included in the EIA.
The Norwegian government raised three objections, all of which were rejected:
- double counting: the Norwegian government argued that end-use emissions would be assessed under separate EIAs, raising concerns of “double counting”. The Court dismissed this, clarifying that the aim of the EIA Directive is to provide a comprehensive understanding of the project’s impact, not to assign responsibility for the identified environmental effects. Whether future EIAs may also consider such effects is irrelevant to the obligation to assess them at the extraction stage (para. 72). The Court further noted that environmental effects need not be geographically or temporally proximate to the project (para 83) and emphasised that the EIA process is the final opportunity for authorities to determine whether such fossil fuel – and associated emissions – should be authorised (para. 77). Providing full information on climate impacts at the stage of extraction is therefore of particular significance (para 80);
- uncertainty about end use: the Norwegian government contented that not all extracted fossil fuels are combusted. The Court acknowledged that emissions may vary depending on end use but nonetheless held that this uncertainty does not exempt such emissions from the assessment (para. 87). The Court determined that likely uses and associated emissions can be reasonably estimated using statistical data, and referenced the precautionary principle (paras. 88-90);
- net effects: the Norwegian government argued that the net climate impact of extraction is difficult to assess, as fossil fuels may displace more carbon-intensive alternatives like coal, potentially resulting in lower overall emissions. The Court rejected this line of reasoning, emphasising that the EIA Directive requires an assessment of the likely significant effects of the project itself, not speculative knock-on effects (paras. 94-96). It stressed that excluding combustion emissions based on net analyses would undermine transparency and public participation (para. 97).
Duty of national authorities to eliminate the unlawful consequences of a development consent based on a flawed EIA
The Court further held that where a development consent has been granted without a prior comprehensive EIA in breach of the EIA Directive, national courts are required to eliminate the unlawful consequences of that failure (paras. 100-103). This obligation, a general principle of EU law, applies regardless of whether the omission demonstrably altered the decision-making outcome (paras. 113-116). To the extent possible under national law, the national courts can revoke or suspend the permit, or exceptionally regularise the consent, provided that regularisation does not allow circumvention of EEA law and includes assessment of both past and future environmental impacts (paras. 103–110). The enforcement of these remedies must respect national procedural autonomy, provided the national rules are equivalent and effective, in line with EEA law (paras. 105–106).
Finally, the Court decided that national courts may not retroactively excuse the failure to assess environmental effects, even if it can be shown that the omission had no influence on the final decision (para. 116). To do so would undermine the preventive and participatory aims of the Directive. Courts may exceptionally maintain the effects of a flawed development consent only where overriding public interests – such as environmental protection or energy security – would otherwise be compromised, and no alternatives exist (paras. 117-118). Purely economic interests do not suffice.
Impact of the advisory opinion
Although advisory in nature, the opinion carries significant persuasive authority across both EEA and EU jurisdictions. It reinforces a growing European consensus that scope 3 emissions are integral to project-level EIAs. In this context, the UK Supreme Court already held on 20 June 2024, in R (on the application of Finch on behalf of the Weald Action Group) v. Surrey County Council and others [2024] UKSC 20, that emissions arising from the ultimate use of refined products derived from a proposed oil development should have been assessed in the EIA process. Similarly, the Scottish Court of Session ruled on 29 January 2025, in the Greenpeace Rosebank Petition [2025] CSOH 10, that the consents granted for the Jackdaw and Rosebank North Sea oil and gas projects were unlawful due to the failure to consider the environmental effects of end-use emissions.
Furthermore, the Court’s recognition that extraction permits cause end-use emissions reinforces the basis for climate-related human rights claims (see ECtHR 9 April 2024, Verein KlimaSeniorinnen Schweiz and others v. Switzerland) and raises the possibility of state responsibility under international environmental law. As the EFTA Court referenced in casu, national authorities are ‘in full control’ of whether the GHG emissions ultimately enter the atmosphere (para. 81).
With end-use emissions now expressly recognised as a necessary component of the assessment under the EIA Directive, their omission or inadequate analysis in an EIA may constitute a procedural irregularity, potentially invalidating the consent granted. This evolution in interpretation exposes operators of fossil fuel projects to increased litigation risk and may provide grounds for administrative or judicial review initiated by affected communities, NGOs or other stakeholders.
Conclusion
The EFTA Court’s advisory opinion in E-18/24 represents a pivotal clarification in the scope of EIA obligations. By affirming that end-use emissions or so-called scope 3 emissions must be included in EIAs, the Court has closed an important gap in the permitting framework and environmental decision-making. This development is expected to lead to more rigorous scrutiny of the climate consequences of extractive activities, heightening both regulatory demands and the potential for legal challenge.
- 1
The EFTA Court has jurisdiction with regard to EFTA States which are parties to the EEA Agreement (at present Iceland, Liechtenstein and Norway). The Court is mainly competent to deal with infringement actions brought by the EFTA Surveillance Authority against an EFTA State with regard to the implementation, application or interpretation of EEA law, for giving advisory opinions to courts in EFTA States on the interpretation of EEA rules and for appeals concerning decisions taken by the EFTA Surveillance Authority. Thus the jurisdiction of the EFTA Court largely corresponds to the jurisdiction of the Court of Justice of the European Union over EU States.
- 2
Directive 2011/92/EU of the European Parliament and of the Council of 13 December 2011 on the assessment of the effects of certain public and private projects on the environment, as amended.