Failure of Energy Charter Treaty talks will lock in £9.4bn risk to UK climate policies
Date: 24 June 2022
“The UK government claims to have reduced the risk for British taxpayers from the dangerous Energy Charter Treaty, but in reality is trying to lock the country in to the risk of exposure to £9.4bn in legal claims from fossil fuel countries over climate policy.
“The deal on the table will keep fossil fuel projects protected for at least a decade. Even the International Energy Agency says fossil fuel projects need to be being cancelled now. That means that either the projects will be cancelled within those ten years, so the corporations will sue. Or the governments delay cancelling, backing out of taking the climate action that desperately needs to be taken – a chilling effect that the IPCC has warned of from the Energy Charter Treaty.
“Even these weak proposals are on a take it or leave it basis – if countries don’t want to sign up to them, they don’t have to. That also means that big polluters based in the UK can continue to sue other governments over climate policy to their hearts content. This at a time when the Energy Charter Treaty is trying to inveigle many developing countries to join it – countries that would be extremely vulnerable to the threat of legal claims in the billions.
“This is not a success. This is asking countries to recommit to a climate-wrecking treaty in full knowledge of the damage it can do. Instead, countries need to exit the Energy Charter Treaty now, as part of a coordinated withdrawal, to safeguard climate goals.”
The Energy Charter Treaty (ECT) is an investment agreement between 50 countries specifically for the energy sector. It dates back to the mid 1990s, from a time when the focus was on access to oil and gas reserves in countries of the former Soviet Union, and levels of climate ambition were not high.
A process to ‘modernise’ the deal began five years ago in 2017 and over the past two years fifteen rounds of talks have been held.
Photo: Activists protest outside of Energy Charter Treaty talks. Credit: Brieuc Van Elst