ENERGY CHARTER TREATY

 

The ECT – The Energy Charter Treaty – is a little-known international trade deal that was signed in 1994 by 53 countries. The deal gives foreign investors in the energy sector the power to sue states over government actions that seem to damage or threaten their energy investments. But in practice, the ECT it increasingly being used by companies to block and profit from climate action, putting it at odds with our climate commitments.  

What started as a trade deal to protect investments particularly in post-Soviet countries, has unfortunately turned into a tool for blocking and profiting from climate action. Over the last years, the number of arbitration cases has significantly increased, the majority of which involve fossil fuel corporations suing states over green transition policies. The claims often result in governments paying settlements to companies in amounts that often go beyond the actual value of the investments. 

WHAT'S THE DEAL WITH THE ENERGY CHARTER TREATY?

NEGATIVE IMPACT ON CLIMATE ACTION

THE ECT NEGATIVELY IMPACTS CLIMATE ACTION IN TWO WAYS:

1.

The threat of these billion-euro claims can cause governments to rescind policy or reconsider fossil fuel infrastructure permitting.

2.

Even where governments pass green policy, the companies winning the claims benefit from massive pay-outs - money that should be used to fund a Just Transition and benefit communities.

WHAT’S HAPPENING NOW?

The ECT is increasingly being picked up by the public agenda. Activists, governments and institutions, as well as our Green family are calling to modernize or withdraw from the treaty.

These voices are being heard which resonated in the EU Commission currently leading the push to renegotiate, or modernize the ECT. This will be a significant challenge for multiple reasons, but particularly because the treaty requires unanimity among signatories to make any changes. 

Conversely, a withdrawal from the treaty, will be no easier as the ECT includes a provision for a 20 year sunset clause that would allow companies to continuing suing signatories even after they leave the treaty. It is therefore clear that a strategic approach is needed between Green parties, Greens in government and civil society.  

With people power, we can put an end to this damaging treaty. AND YOU CAN HELP!

ACTION ALERT – #NOECT

This week, EU Ministers responsible for energy issues are meeting to discuss the ECT. Join our friends at Tilt and send a letter to your minister to let them know that you and over a million other people, are saying NO to the toxic Energy Charter Treaty!

SEND A LETTER