Sun. Jul 14th, 2024

Brussels, 24 November 2022

CAN Europe welcomes the plenary resolution passed by the European Parliament today with a big margin of 303 votes in favour, supporting the Parliament’s conclusion that the reformed ECT is not aligned with the Paris Agreement or the EU Climate Law.1 This gives the signal to the Commission to immediately initiate the process towards a coordinated exit of the EU from the ECT. Both the Council and Parliament should now be in a position to support the EU’s exit from the ECT when requested to consent to it.

“The Parliament couldn’t have spelled it out any clearer: Energy Charter Treaty reform is a failure, withdrawal is the only remaining option. This is what Civil Society organisations have been tirelessly calling on for years. Eight EU member states, representing over 70% of the EU population, have also decided to leave the ECT because they see it as an obstacle to climate action, even after reform. The European Commission shouldn’t delay another day to propose a coordinated exit from this anti-climate treaty.” said Cornelia Maarfield, Trade and Investment Policy Expert at Climate Action Network (CAN) Europe.

The ECT is a controversial international agreement that foresees extensive protection of foreign investments in the energy sector. It has come under intense criticism because fossil fuel investors have started using it to sue for compensation when their business models are being impacted by state actions. Most recent examples of legal action taken by energy corporations are Uniper and RWE v the Netherlands, challenging the Dutch decision to phase out coal; Rockhopper v. Italy, in which an investor was compensated for not receiving an oil drilling licence; and Ascent Resources v. Slovenia, in which a fracking moratorium is being challenged.

Spain, France, Germany, Poland, the Netherlands, Luxembourg and Slovenia already announced they would withdraw from the ECT after assessing the outcomes of a reform that ended in June and concluding that it was insufficient to align the treaty with the Paris Agreement.2 Italy already withdrew in 2016. Last week, it became clear that the Energy Council would not give the Commission a mandate to adopt ECT reform outcomes at the Energy Charter Conference on Tuesday.

Pressure from both civil society and EU institutions is now on the European Commission to take stock of the sentiments echoed in both the Council and European Parliament and determine whether to continue to push for the reform or indeed propose a coordinated withdrawal from the pact as the European Parliament and some member states are demanding.

1 Important extracts from the plenary resolution:

“5. Underlines that the final text of the modernised ECT integrates elements of the negotiating mandate given to the Commission, is not aligned with the Paris Agreement, the EU Climate Law or the objectives of the European Green Deal”

  1. “urges 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”.
  2. “takes the position that Parliament will support the EU’s exit from the ECT when requested to consent to it.”

2 The French High Council on Climate (a scientific body advising the government) assessed ECT reform outcomes and concluded that the ECT, “even in a modernised form, is not compatible with the pace of decarbonisation of the energy sector and the intensity of emissions reduction efforts needed by 2030, as reiterated by the IEA and assessed by the IPCC”. In our own assessment of the reform outcomes, we come to a similar conclusion: fossil fuel assets continue to be protected for too long, investor rights remain very broad and the controversial Investor-State Dispute Settlement (ISDS) remains unchanged.

Source – CAN Europe – Email




Forward to your friends