INEOS Manufacturing Scotland Ltd. v Grangemouth Chp Ltd & Anor

INEOS Manufacturing Scotland Ltd. v Grangemouth Chp Ltd & Anor

The allowances issued under the EU emissions trading scheme do not fall within the contractual definition of 'CO2 Emissions Credits' in the ESA, and do not accrue to GCHPL as it is not the operator under the relevant regulations. GCHPL was not obliged to apply for a GGE permit, and contractual limitations and exclusions do not apply as the claim fails on substantive grounds.

Parties
Claimant: INEOS Manufacturing Scotland Limited; First Defendant: Grangemouth CHP Limited; Second Defendant: Fortum O&M (UK) Limited
Jurisdiction
England and Wales
Judgment Date
11 February 2011
Procedural Posture
Commercial / Final Judgment
Outcome
Claim dismissed
Legal Topics
Interpretation of Contract Terms, Emissions Trading Schemes, Allocation of CO2 Allowances, Operator Definition Under Regulations
Contract Law Commercial Law Environmental Law Interpretation of Contract Terms Emissions Trading Schemes Allocation of CO2 Allowances Operator Definition Under Regulations

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Parties

INEOS Manufacturing Scotland Limited

Claimant

Grangemouth CHP Limited

First Defendant

Fortum O&M (UK) Limited

Second Defendant

Procedural Posture

Commercial / Final Judgment

Legal Issues

  1. 1 Whether CO2 emissions allowances fall within the contractual definition of 'CO2 Emissions Credits' under the Electricity Supply Agreement
  2. 2 Whether such allowances accrue to Grangemouth CHP Limited
  3. 3 Whether Grangemouth CHP Limited was obliged to apply for a greenhouse gas emissions permit

Ratio Decidendi

The allowances issued under the EU emissions trading scheme do not fall within the contractual definition of 'CO2 Emissions Credits' in the ESA, and do not accrue to GCHPL as it is not the operator under the relevant regulations. GCHPL was not obliged to apply for a GGE permit, and contractual limitations and exclusions do not apply as the claim fails on substantive grounds.

Court Disposition

Claim dismissed