Skip to main content

Statement by the Secretary General of the Energy Charter Secretariat on the draft Council Decision proposing the withdrawal of the European Union from the Energy Charter Treaty

I would like to express my profound regret regarding the draft Council Decisions proposing the withdrawal of the European Union (EU) and EURATOM from the Energy Charter Treaty (ECT), published by the European Commission on 7 July 2023, and the Commission withdrawing, on the same date,  its previous draft Council Decisions to modernise the ECT.

A solid and reliable legal environment is a prerequisite for mobilising much-needed private sector investments in clean energy sources. In this context, adopting the modernised ECT text could play a pivotal role in de-risking EU investments while allowing countries to reach their energy transition objectives. In particular, small and medium-sized enterprises in renewable electricity generation and the energy efficiency sector would have gained the most since they are key to achieving the energy transition and rely on the investment protection the ECT offers.

As noted by the European Commission in its recent press release, the Contracting Parties of the ECT came together and, in good faith, negotiated for more than three years to modernise its text. I applaud the high professionalism, commitment and efforts of the entire constituency that allowed us to reach a successful "agreement in principle" in June 2022.

Regrettably, due to the abstention of its four Member States, the European Council did not reach the qualified majority needed for a common EU position to approve the modernised ECT's text. This is despite the fact that the "agreement in principle" fulfilled the negotiation mandate given by the European Council.

That said, I want to draw attention to the fact that the decision of the Energy Charter Conference to modernise the ECT is not linked to a potential EU decision on its withdrawal from it. These decisions are not incompatible, and the European Council could adopt both: one, a decision to withdraw the EU/EURATOM from the ECT and the second, a non-objection to modernise the ECT.

While the European Commission's proposal for the EU to leave the ECT is disappointing, there is still significant hope that the modernised text of the ECT will be endorsed both by countries wishing to remain within its fold and those that have decided to withdraw from the unmodernised ECT.

I, therefore, appeal to all EU Member States that they continue to push forward with the ECT's modernisation process.

Indeed, the ECT's modernised text is unique in that it is the first coordinated multinational effort to make international investment agreements climate responsive and align them with global environmental goals.

By unequivocally supporting the modernisation process, the EU Member States will demonstrate their internal solidarity and commitment to climate action and facilitate the ECT's remaining constituency to move forward with much-needed reforms.

Their cooperation will allow countries intending to adopt the modernised ECT to avail the benefits of this multilateral legal framework compatible with the Paris Agreement and use it to thrive and develop their investment, energy, and climate goals far beyond EU borders.