Energy giants RWE and Uniper have lost the first round of their legal bid to force the Dutch government to pay them damages for introducing a ban on coal-fired power stations by 2030.

District court judges in The Hague have ruled that the ban on coal does not unlawfully infringe on property rights and said the owners of the power plants should have foreseen that change was coming.

RWE has filed a damages claim of €1.4bn and Uniper €1billion for the closure of their plants in Rotterdam and Eemshaven, which were opened in 2015 and 2016. They argue they relied on being allowed to produce electricity from coal until the end of the plants’ lifetime, in around 40 years.

The court ruled that the measures taken by the Dutch government, outlined in legislation in 2019, were proportionate and that the interests of the owners had been taken sufficiently into account.

‘This ruling is an important victory for the climate and phase-out of fossil fuels,’ said Bart-Jan Verbeek, a research at the multinationals’ monitoring group Somo. ‘The ruling prevents polluting companies that knowingly invest in climate disrupting activities from evading responsibility.’

ECT

RWE has also taken the case to the International Centre for Settlement of Investment Disputes in Washington, saying the ban violates the Energy Charter Treaty. The Dutch government said in October it was joining a growing list of countries pulling out of the treaty because it conflicts with Paris climate accord commitments

Leaving the ECT will not put an end to potential law suits because of a ‘sunset clause’ which allows energy firms to make claims for investments made up to 20 years ago.

Both RWE and Uniper said they were disappointed by the ruling and were considering an appeal.