In a resolution adopted on Thursday, MEPs believe this to be the best option to prevent the treaty from putting the EU’s climate and energy security ambitions in further jeopardy
Parliament will support the EU’s exit from the Energy Charter Treaty (ECT) when requested to consent to it, MEPs said in a resolution. They urge the Commission to initiate immediately the process towards a coordinated exit of the EU from the ECT and calls on the Council to support such a proposal.
MEPs believe this to be the best option for the EU to achieve legal certainty, and prevent the ECT from putting the EU’s climate and energy security ambitions in further jeopardy. They consider the current ECT an outdated instrument which no longer serves the interest of the European Union, especially with regard to the objective to become climate neutral by 2050.
While MEPs commend the Commission’s negotiation efforts to modernise the ECT, they recall that the EU can only ratify the modernised ECT with the final consent of Parliament, and that Parliament will consider its previous positions and the shortcomings of the modernisation if requested to consent to it.
MEPs regret that, under the modernised ECT, most contracting parties have decided to maintain the protection of fossil fuel investors indefinitely. They also worry that the 20-year sunset clause in case of exit remains unchanged in the modernised text.
They underline the need to act in a coordinated manner in order to be stronger in the withdrawal negotiations and to limit the negative effects of the sunset clause and to effectively prevent intra-EU disputes.
Members also welcome the announcement by the Polish, Spanish, Dutch, French, Slovenian, German and Luxembourgish governments of their intention to withdraw from the ECT.
Next steps
The non-binding resolution was adopted with 303 votes to 209, with 63 abstentions. Parliament would have to give its consent to the ECT modernisation before the EU could start provisionally applying the modernised treaty, in accordance with Commission’s political guidelines. Parliament would also have to consent to the EU exiting the ECT.
Background
The ECT is an international agreement. The treaty was signed in December 1994 and came into effect in April 1998 There are 53 signatories and contracting parties to the ECT, including the European Union, and Euratom and all its member states except for Italy, which withdrew in 2016.
The initial aim of the ECT was to create a forum for East-West policy cooperation in the fields of energy, investment protection, trade and transit. The Treaty’s investment protection provisions have not been updated since the 1990s and are outdated in comparison to the new standards established by the EU’s reformed approach on investment policy. Moreover, there was no attempt to integrate the urgency of mitigating climate change and phasing out fossil fuel investments until 2018.
Source – EU Parliament
EP demands immediate EU exit from the Energy Charter Treaty, as S&Ds requested
Strasbourg, 24 November 2022
As proposed by the Socialists and Democrats, the European Parliament today urged the Commission to proceed immediately with the coordinated exit of the EU from the ECT and called on member states to support such a proposal. This is the best option to prevent the ECT from putting the EU’s climate and energy security ambitions in jeopardy.
Last Tuesday, the Energy Charter Conference was meant to approve the modernised ECT, but the Council failed to reach a qualified majority in favour of the modernisation. The proposed reform was thus removed from the agenda of the Conference.
Despite the Commission’s negotiation efforts, the proposal for a modernised ECT is not fully aligned with the Paris Agreement nor EU climate goals. It leaves fossil fuel investments protected for over a decade, and fails to substantially modify the controversial ISDS mechanism*.
Inmaculada Rodríguez-Piñero, S&D spokesperson on trade, said:
“The S&D Group has been calling for an EU coordinated exit from the Energy Charter Treaty given the shortcomings of the modernised treaty and the recent developments in the Council. Today, this has translated into a common, clear demand made by the European Parliament.
“Despite the reform, the ECT is a barrier for climate actions and efforts to get rid of fossil fuels. In particular, the core of the old dangerous private arbitration system remains unchanged, leaving the door open to costly private arbitration cases.
Source – S&Ds Group Press – Email
A big win for climate: Parliament demands EU’s exit from Energy Charter Treaty
Brussels, 24 November 2022
The European Parliament just voted to call on the European Union to exit the Energy Charter Treaty (ECT). This is big news, and has been a Green demand for years. Via the ECT, fossil fuel investors can thwart governments’ climate action and sue states for billions of euros if their fossil fuel investments are impacted by climate laws. It’s a treaty that belongs to the past. And it’s time to exit for a climate-safe future.
We as the European Parliament now officially ask the Commission to immediately set the EU’s exit into motion and to support a coordinated exit by Member States.
This is a huge climate victory. With this vote, the European Parliament says no to a treaty that protects the fossil fuel industry and yes to protecting the climate.
Source – The Greens/EFA – Email