Explainer-Why is a Peruvian farmer taking Germany’s RWE to court over climate change?

By Riham Alkousaa

BERLIN (Reuters) - A Peruvian farmer is getting his day in court in a landmark climate case against German energy giant RWE that could shake up how the effects of companies' emissions are litigated.

The Higher Regional Court of Hamm will start a hearing on Monday between farmer Saul Luciano Lliuya and RWE.

Lliuya is suing RWE for some 21,000 euros, arguing the company's emissions have contributed to the melting of Andean glaciers, causing a lake above his hometown to swell to dangerous levels.

What is the case about? What is its legal foundation? And what does it mean for future climate lawsuits?

WHAT IS THE CASE ABOUT?

In 2015, Lliuya, backed by activist group Germanwatch, filed a lawsuit claiming RWE's greenhouse gas emissions have contributed to the melting of an Andean glacier which has raised the water level at Laguna Pacacocha, creating a significant flood risk to his home in the nearby town of Huaraz.

Lliuya is demanding RWE contribute some 21,000 euros to an estimated $3.5 million cost of a flood defence project. He contends the company has contributed nearly 0.5% of global manmade greenhouse gas emissions since the industrial revolution, and should pay the equivalent fraction of flood protection costs in the area.

WHY DID IT TAKE 10 YEARS TO COME TO A HEARING?

The case was first filed at a regional court in the German city of Essen, where RWE is based. The court dismissed the claims, saying there were countless emitters of carbon dioxide worldwide and any risks from potential flooding as a result of the melting of glacial ice could not stem solely from RWE.

Lliuya appealed against the decision with the higher regional court in Hamm, which admitted the case in 2017 and said it would seek evidence.

A visit by court-appointed experts to study flood risks around the glacier was delayed until 2022 due to the COVID-19 pandemic. Over a year later, a 200-page expert opinion was available, which had to be examined by the two parties.

WHAT IS THE LEGAL BASE OF THE CASE?

The case is based on section 1004 of the Civil Law Code which states that if a property is interfered with, the owner may require the disturber to remove the interference.

If the court confirms that the flood risk claimed by the plaintiff is real, it must determine in a second phase to what extent RWE's CO2 emissions have contributed to the risk of a glacial lake outburst flood.

As a first step, the upcoming hearing will focus on the assessment of experts commissioned by the court.

WHY HAS THE CASE GAINED SUCH INTEREST?

If the court finds that glacier melting poses a flood risk and holds RWE responsible for its share of climate change, it would set a precedent for holding companies legally accountable for climate change.

"The sum in dispute may be less than 20,000 euros but the precedent-setting potential is clear," according to Freshfields Bruckhaus Deringer's website, the law firm representing RWE in the case.

Roda Verheyen, Lliuya's lawyer, said even if the court does not conclude there is a flood risk, its verdict would provide a base for further cases.

WHAT DOES SCIENCE SAY ON THIS?

In 2021, scientists at the University of Oxford and the University of Washington proved that the melting of a glacier in the Peruvian Andes was being caused by man-made global warming and was raising flooding risks for nearby residents.

"As things are, there is ample proof that the science does apply in the Andes; we have absolutely no evidence to the contrary," Friederike Otto, a climate scientist at the Grantham Institute for Climate Change and the Environment.

WHAT DOES RWE SAY ON THE CASE?

RWE says Lliuya's complaint is unfounded, arguing a single emitter cannot be held responsible for global warming.

The company has been transitioning from coal-fired power but still operates 7 lignite or brown coal power plants, accounting for 26.7% of its total power generation, down from 20 plants in 2020. It also runs 21 gas power plants across Germany, the Netherlands, the UK and Turkey.

RWE’s CO2 emissions almost halved to 60.6 million tons in 2023 from 118 million tons in 2018, with further reductions expected, the company said. It aims to fully phase out lignite by 2030.

(Reporting by Riham Alkousaa; Editing by Adam Jourdan and Christina Fincher)