we explain why the Energy Charter Treaty is compared to a “collective suicide”

He concentrates them reviews, these last daysare scientists, young victims of global warming, or certain elected officials such as Pascal Canfin, LREM MEP. The Energy Charter Treaty (ECT), an international agreement which is to be the subject of a final negotiation meeting between European countries on Friday June 24, has been targeted since Tuesday June 21 by a complaint from five young Europeans* close to the climate movement before the European Court of Human Rights, and by an open letter* (PDF) of 78 scientists, including climatologists Valérie Masson-Delmotte and Christophe Cassou.

All urging the countries of the European Union to withdraw from this treaty, presented as a threat to the fight against global warming and the Paris agreement. Why is this text, which dates from 1994, so criticized? Explanations.

This treaty serves to protect foreign investment in energy

The TCE is a relic of the fall of the USSR, initiated by the countries of Western Europe to secure their investments in the energy sector in the unstable countries of the former communist bloc. Officially*, it serves to “promote energy security through more open and competitive market operations, while respecting the principles of sustainable development and sovereignty over energy resources”.

Behind this formula is a mechanism to protect the investments of foreign energy companies in the countries where they operate. It gives them the assurance of being compensated as well as local companies and allows them to claim financial compensation if a new local law has a negative impact on their activity.

These compensations can be claimed in a classic court. But also before a private arbitration tribunal, a much more opaque system. “Today, we know that there are 150 arbitration cases that invoke this treaty. But there may be many more, there is no obligation of transparency”regrets Yamina Saheb, author of the Intergovernmental Panel on Climate Change (IPCC) and signatory of the open letter.

He is accused of preventing states from taking action against global warming

The climate is warming because human beings have been using fossil fuels since the industrial revolution – oil, petroleum, gas – to move, build, manufacture and feed themselves. To limit damage, the Paris agreement, signed in 2015 during COP21, provides for an organized reduction in greenhouse gas (GHG) emissions from States, until carbon neutrality is achieved by 2050. This energy revolution requires ambitious climate policies. The latest IPCC report shows “that the scenarios that give us a chance of limiting current warming to 1.5°C by the end of this century [l’un des objectifs de l’accord de Paris] premature closure of used or existing fossil fuel infrastructure”adapted the scientists in their open letter.

This is where the Energy Charter Treaty comes in. In 2018, when Minister Nicolas Hulot worked to end the exploitation of hydrocarbons in France, the Canadian company Vermillon threatened. “The measure violates France’s international commitments as a member of the 1994 Energy Charter Treaty which provides for the protection of investments in the energy sector”can we read in a letter to the Council of State obtained by the association Les Amis de la terre (PDF). The text of the French government will subsequently be largely emptied of its substance, allowing ongoing projects to continue. But it prohibits the launch of new projects. In Germany, the executive, which voted to phase out coal, paid 4.35 billion euros to operators of coal-fired power plants to avoid prosecution under the Energy Charter. In the Netherlands, the company Uniper is attacking the government* for its plan to phase out coal.

So many examples that worry the scientists of the IPCC. In its last report* (PDF, page 78), the group of experts finds “a high level of investor protections against much-needed climate action, exemplified by the part of plaintiff complaints in favor of foreign investors under the Energy Charter Treaty”. For Yamina Saheb, “this treaty prevents States from acting [en faveur du climat]. When you are a signatory, you lose your sovereignty over climate policies.” The energy policy expert sweeps away the argument of supporters of the treaty, who point out that many disputes concern renewable energies. This is particularly the case in Spain, where the State is being attacked by companies who feel aggrieved by the reduction in subsidies to the sector. “The treaty protects subsidies that no longer make any economic sense because the prices of these energies have fallen”, Judge Yamina Saheb.

The compromise adopted by the EU is deemed insufficient by scientists

Climate concerns have impacted the process of modernizing this treaty launched two years ago. The matter is made complex by the need to obtain the unanimity of the Member States, among which we find countries that produce fossil fuels such as Kazakhstan or Tajikistan. The EU has put a compromise on the table, valid only for European countries, and must make it official on June 24.

If passed, it will exclude new investment in fossil fuels from the agreement, but will protect past investments in oil and coal until 2030 and in gas until 2040. With this device, “EU countries will have a choice between keeping existing fossil fuel infrastructure until the end of its lifespan or facing new arbitration procedures. Both of these options jeopardize the carbon neutrality objectives of the EU and the Green New Deal”signatories of the open letter.

Charged a few years ago by the secretariat of the treaty with studying how to align it with the Paris agreement, Yamina Saheb believes that there is only one solution: the collective exit from this treaty of the countries of the EU, without respecting the clause which provides that a Member State continues to apply it for twenty years after its departure. In 2020, France asked the European Commission to study this option. The expert regrets that the French presidency of the EU, which will end on June 30, has not made it one of its priorities. She fears the decision of June 24 and warns: “It will either be a collective withdrawal or a collective suicide.”

* Links followed by an asterisk are in English.

Leave a Comment