The UK to modernise the Energy Charter Treaty

Article posted

27th Jun 2022

Read time

2-3 min read


Mollie Pinnington

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The Energy Charter Treaty (ECT) is set in place to limit legal challenges from fossil fuel investors in the country.  The UK is set to modernise the ECT as some European countries have faced legal challenges due to reducing their reliance on fossil fuels and boosting renewables. For example, the Netherlands are currently facing high costs to their taxpayers due to a coal phase out.

The new treaty id due to be signed in November 2022, ensuring investments in new fossil fuel projects are not legally protected. Leaving for a much stronger focus to be on promoting clean and affordable energy. This will protect the UK’s right to change its own energy systems, allowing us to reach the targets set out in the Paris climate agreement.

This will give protection for overseas investments into UK green technologies including renewable energy systems. This new treaty should also give investors an increased confidence to invest in new technologies that will support the UK’s net zero goals.

However, the UK is not planning to completely abandon other energy investments such as gas stations, including carbon capture technologies. The UK are also committed to supporting the North Sea as this plays a huge role in our energy security strategy. Although the UK needs to transition to cleaner energy this has to be a seamless transmission to ensure the government do not overwhelm consumers with prices.    

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