MEPs Approve EU Withdrawal from Energy Charter Treaty

Members of the European Parliament (MEPs) have given their consent for the European Union to withdraw from the Energy Charter Treaty (ECT), a key agreement governing trade and investment in the energy sector.

Parliament's consent, crucial for the EU's exit from the treaty, follows the recommendation put forth by the Industry, Research, Energy, and International Trade committees. The recommendation, adopted with an mandate of 560 votes in favor, 43 against, and 27 abstentions, enables the Council to proceed with adopting the decision by a qualified majority.

The ECT, established in 1994, has been a subject of controversy, prompting calls for the EU's departure, including a resolution passed by the European Parliament in 2022. The treaty, which aimed to facilitate international cooperation and provide a framework for investment protection, trade, and dispute resolution in the energy domain, has increasingly come under scrutiny for its compatibility with climate goals.

Rapporteurs from key parliamentary committees emphasized the significance of this decision. Anna Cavazzini, Rapporteur for the Trade Committee, hailed the vote as a significant stride towards climate neutrality. "In view of the climate crisis, the EU must become a climate-neutral continent as quickly as possible. Finally the fossil dinosaur treaty is no longer standing in the way of consistent climate protection, as we no longer have to fear corporate lawsuits demanding billions of euros in compensation brought before private arbitration tribunals,” said Cavazzini.

Marc Botenga, Rapporteur for the Industry, Research, and Energy Committee, highlighted the contradiction posed by the ECT, allowing fossil fuel multinationals to challenge climate policies at the expense of taxpayers. He emphasized the urgent need for accelerated public investments in renewable energy to address the climate crisis effectively.

The Energy Charter Treaty, once hailed as a cornerstone of international energy cooperation, has faced criticism for its outdated provisions and extensive litigation. The EU's proposed withdrawal aligns with its broader climate objectives outlined in initiatives such as the European Green Deal and the Paris Agreement, signaling a departure from fossil fuel-centric investment policies.