Shots fired—that is how observers described the landmark legal decision in late May in a case brought by a Peruvian farmer against a German coal giant, that ruled fossil fuel producers could be held accountable under German law for the climate harms they have caused around the world. It was a groundbreaking moment, a decade in the making, that began in 2015 when Saul Lucian Lliuya realized he had a problem: the constant threat of catastrophic flooding he and the other 120,000 residents of his hometown, Huaraz, faced. Above Huaraz sits Lake Palcacocha, one of several glacier lakes that supplies the city’s drinking water. Over decades, water levels have occasionally risen, but as global average temperatures have increased, the surrounding glaciers have shrunk, pushing the lake to capacity and the point where a catastrophic flood is now inevitable.
None of this happened by chance. Pointing to the science that climate change was being driven by fossil fuel production, the Peruvian farmer from a city in the foothills of the Andes set out to do something ambitious: sue German coal-fired power producer RWE for its part in helping to drive catastrophic climate change. Few thought the case would last as long as it did, and when the court issued its historic ruling in May, headlines in major international papers reported it as a loss. What they missed is that Lliuya had succeeded in laying a blueprint for others looking to take fossil fuel companies to court.
The story of Huaraz is a familiar one to many communities in the Global South. A lack of action by governments and international institutions has meant there are precious few avenues available to find the money and resources needed for adaptation and mitigation. Some estimates put the level of compensation owed by developed economies to Global South countries for their role in driving catastrophic climate change at US$192 trillion. At the COP in Baku, Azerbaijan last year, the annual UN climate summit, governments pledged $300bn, a fraction of what is needed, and the latest in a string of pledges that have remained unfulfilled.
Suing those directly responsible offers a way to both hold companies to account and to secure the resources needed to mitigate emissions, and adapt to climate harms as they develop. These legal efforts have been aided by the development of rapid and more advanced attribution science that makes it possible to link individual fossil fuel producers to specific climate harms.
But then, Lliuya’s claim was never really about the money. At heart was a demand RWE pay 0.47% of the cost of a new dam for his city, a figure estimated at USD$4m and a sum that came to roughly USD$20,000 for RWE’s contribution – a rounding error on the company’s balance sheet.
Both Lliuya and RWE’s lawyers, however, understood there was something bigger at stake. When asked by the court if RWE would be willing to settle, the company’s lawyers refused.
“This is a matter of precedent,” they said.
When the court’s decision was handed down on 28 May 2025, while the judges didn’t require RWE to pay up for the dam, they did side with Lliuya on all the key questions of law. The ruling held that German courts do have authority to hear civil claims for climate harms arising from impacts from climate change. A Peruvian could, in fact, sue in German courts under the law of nuisance if it could be shown a German had caused harm to his property – even if said property was on the other side of the world. This was partly due to provisions within German law that require neighbors to consider how their actions affect each other, ruling “the plaintiff is not obliged to tolerate” a disturbance to his property. It also rejected any suggestion Lliuya was “co-responsible” for potential harm simply by living in an at-risk area.
In other words, says Petra Minnerop, a professor of international law at Durham university, the decision means that someone in Tuvalu whose home is affected by sea level rise, or a person in Pakistan whose home is destroyed in a catastrophic flood could potentially sue for climate harms – within certain limits.