UK to leave Energy Charter Treaty

The UK will leave the Energy Charter Treaty (ECT) after the failure of efforts to align it with net zero, the government has announced.

Originally signed in 1994, the Treaty was designed to promote international investment in the energy sector, providing protections for investors in fossil fuels.

But proposals to modernise the ECT better to support cleaner technologies have been subject to months of talks between European countries, resulting in a stalemate. 

Energy Security and Net Zero Minister Graham Stuart announced in September 2023 that the UK would be reviewing its membership of the ECT if plans to update it were not adopted. 

The UK joins nine EU member states, including France, Spain and the Netherlands, in withdrawing from the treaty in order to support the UK’s transition to net zero and strengthen its energy security. 

Minister of State for Energy Security and Net Zero, Graham Stuart, said: ”The Energy Charter Treaty is outdated and in urgent need of reform but talks have stalled and sensible renewal looks increasingly unlikely. 

“Remaining a member would not support our transition to cleaner, cheaper energy, and could even penalise us for our world-leading efforts to deliver net zero. 

“With £30 billion invested in the energy sector just since September, we continue to lead the world in cutting emissions, attracting international investment and providing the strongest legal protections for those who invest here.” 

After two years of negotiations in 2022, the UK helped broker a landmark agreement to modernise the ECT that would have supported the transition to cleaner energy by extending protections to renewables like carbon capture, utilisation, and storage (CCUS) and hydrogen.  

But this was rejected.

Shaun Spiers, Executive Director, Green Alliance said: “Civil society organisations and parliamentarians from all political parties have been clear that the Energy Charter Treaty is an out-of-date agreement and undermines our efforts to tackle climate change. We welcome the UK’s decision to leave, which will strengthen global efforts to roll out cheap, clean renewable energy.”

Image from Shutterstock

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