UK withdraws from Energy Charter Treaty amid reform stalemate
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The UK government has announced its withdrawal from the Energy Charter Treaty (ECT), citing the failure to reform the post-Cold War treaty adequately. Initially designed to safeguard investments in petroleum-rich post-Soviet states, the treaty has predominantly been utilized by energy companies to litigate against Western European governments.
Minister for Energy Security and Net Zero, Graham Stuart, emphasized the treaty’s outdated nature and the lack of progress in reform efforts, which he attributed to disagreements within Brussels. Stuart stated that continued membership in the ECT would not align with the UK’s transition to cleaner energy and could potentially penalize its efforts towards achieving net-zero emissions.
Despite the UK’s involvement in negotiating a draft agreement to modernize the ECT, efforts to reform the treaty faltered in November 2022 due to opposition from several EU member states. The UK’s decision to withdraw follows similar moves by France, Germany, Poland, and other EU nations, highlighting the growing disillusionment with the treaty within the bloc.
Belgium, holding the EU Council presidency, urged swift endorsement of an EU-level withdrawal, citing frustrations with the European Commission’s failure to propose a solution allowing member states to remain in the ECT while endorsing its modernization. However, the Commission maintains that such an arrangement would be legally unfeasible under EU single market rules.
The ECT’s propensity to enable energy companies to sue governments over climate and environmental policies has drawn criticism from climate campaigners. The UK’s withdrawal has been viewed as a significant setback for the treaty’s future, with experts suggesting that it could lead to its eventual collapse.
Eunjung Lee from the climate think tank E3G described the UK’s move as a “hammer blow” to the ECT and urged remaining countries to withdraw promptly to mitigate future litigation risks. Similarly, Friends of the Earth Europe campaigner Paul de Clerck emphasized the urgency of finalizing an EU withdrawal before upcoming elections, stressing the need for both the Commission and Parliament to approve the decision promptly.
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