Germany to withdraw from Energy Charter Treaty

Germany will follow in the footsteps of France, Spain and the Netherlands and pull out of the 30-year-old Energy Charter Treaty, which has been accused of hampering climate ambitions, the German government announced on Friday. quoted by Le Figaro.

“We are systematically orienting our business policy towards climate protection and are therefore withdrawing from the Energy Charter Treaty,” said State Secretary Franziska Brantner of the Ministry of Economics and Climate Protection. “This is an important signal for the UN climate conference, COP 27, which is currently being held in Sharm el-Sheikh (Egypt),” she added.

The parliamentary groups of the parties in the government coalition, the Social Democrats, the Greens and the Liberals, gave the green light on Friday to this exit, proposed by the government. At the same time, they gave their approval for the ratification of the CETA trade agreement with Canada. The Energy Charter Treaty (ECT) was signed in 1994 at the end of the Cold War to provide guarantees for investors in Eastern Europe and the former Soviet Union.

This initiative, which brings together the EU and around 50 countries, allows companies to seek redress from a State before a private arbitration tribunal if its decisions and its regulatory environment affect the return on their investments, even when pro-climate policies are involved. A concrete example: after adopting a Dutch law banning coal by 2030, the German energy company RWE asked The Hague for 1.4 billion euros to compensate for its losses in a thermal power plant.

In September, Italy was ordered to pay 180 million euros in damages to the British oil company Rockhopper for refusing to grant it an offshore drilling permit. The German company Encavis AG has also taken legal action against France following changes to the feed-in tariffs for PV electricity in 2020.

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