Time to shake UK free of ‘shackles’ of the Energy Charter Treaty, say NFLAs

The Nuclear Free Local Authorities have added their voice in support of a recent call by 110 of Britain’s leading academics that the UK should leave the Energy Charter Treaty.

Energy Charter Treaty tribunals have awarded fossil fuel companies $100 billion in reparations from member states for seeking to curtail their production of ‘dirty’ energy as part of their international obligations under the Paris Agreement to tackle climate change.

The NFLA believes that it is simply wrong that these companies should be able to take legal action against signatory states to access even more taxpayers’ money at a time when they are reporting huge profits from activities which are destroying our environment.

Councillor Lawrence O’Neill, Chair of the NFLA Steering Committee, explained why: “We are now in the middle of an energy ‘crisis’, a crisis in which fossil fuel companies are imposing wallet-busting charges upon financially stretched customers whilst shamefully reporting obscene levels of profits from business activities that are destroying our world. What possible justification can there be to continue to offer them a route to sequester any more public money?”

The NFLA wants the UK Government ministers to follow the lead shown by their European counterparts in Germany, the Netherlands, Poland, Slovenia and Spain which have recently withdrawn from the treaty.

“The Energy Charter Treaty represents a financial headache and a legal hindrance to the UK moving towards becoming a net zero state”, added Councillor O’Neill. “Although normally the NFLA would favour engagement with international bodies, in this case we would support the UK, which left the EU citing it wished to be free of the political interference of Brussels, also shaking itself free of the shackles of the ECT”.

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Notes to Editors

Please direct enquiries to Richard Outram, NFLA Secretary, by email to richard.outram@manchester.gov.uk

The letter sent on 13 February by the NFLA to the Rt. Hon. Grant Shapps MP reads:

The Rt. Hon. Grant Shapps MP,
Secretary of State for Energy Security and Net Zero

C/o cnrdcorrespondence@beis.gov.uk

Dear Secretary of State,

The UK / Ireland Nuclear Free Local Authorities wish to lend their support to the 110 leading academics in the fields of economics, environmental protection, law and politics who last week called upon the UK Government to withdraw from the Energy Charter Treaty.

This legal instrument clearly acts as a mechanism by which fossil fuel operators can recover substantial monetary damages from member governments who are responsibly implementing their obligations under the Paris Agreement to take active measures to reduce carbon omissions as part of the drive to mitigate climate change.

It is a means for producers of dirty energy to sue the ‘pants off’ states parties for to date, oil, gas and coal companies have been awarded $100 billion through Energy Charter Treaty tribunals.

We are now in the middle of an energy ‘crisis’, a crisis in which these same companies impose wallet-busting charges upon financially stretched customers whilst shamefully reporting obscene levels of profits from business activities that are destroying our world. What possible justification can there be to continue to offer them a route to sequester any more public money?

Secretary of State, the NFLA believes that, for as long as we remain a states’ party, the European Charter Treaty represents both a financial headache and a legal hindrance to the successful discharge of your duties in the pursuit of Net Zero as the leading UK Minister.

Germany, the Netherlands, Poland, Slovenia and Spain have all recently withdrawn from the Energy Charter Treaty.
Secretary of State, is it then not time for the UK Government, which exited the European Union stating that it wished to be free of the political interference of Brussels, to finally shake itself free of the shackles of the ECT?

We would welcome your comments in response to this letter. Please reply by email to NFLA Secretary richard.outram@manchester.gov.uk

Thank you. Yours sincerely,

Councillor Lawrence O’Neill,
Chair, UK / Ireland NFLA Steering Committee

The letter sent on 9 February by 110 academics to the Secretary of State (with the list of signatories) reads:

Academic Letter urging UK Government to exit Treaty that threatens climate action
110 UK academics have today (9 February 2023) signed the letter below to energy secretary Grant Shapps, urging him to exit the Energy Charter Treaty (ECT) – a little-known legal pact that could hamper climate the UK’s climate ambitions.

Dear Secretary of State,

We are writing to you to urge you to consider joining France, Germany, the Netherlands and other key allies in withdrawing from the Energy Charter Treaty (ECT). It is our view that continued membership of the ECT will harm our prospects of limiting global warming to 1.5 degrees because it will prolong the UK’s dependence on fossil fuels and impede the transition to renewable energy.

The 2022 IPCC report was clear that the ECT risks blocking the phase out of fossil fuels. Investors have already brought cases against countries for phasing out coal fired power stations, banning the exploitation of oil and gas near their coastline, and requiring environmental impact assessments.

The ECT can significantly increase the cost of climate action by allowing cases to be brought which compensate investors (including in fossil fuels) for the loss of hypothetical future profits and providing significantly larger amounts of compensation than would be available through domestic courts. There is also evidence that countries are shying away from introducing new legislation for fear of being challenged in claims under the ECT.

The ECT does nothing to help the UK achieve increased energy security. The UK’s major oil and gas suppliers are not members: Norway, which provides half of the UK’s imports of crude oil, is listed on the ECT website but has never ratified the treaty; Russia withdrew from the treaty in 2018. Other major suppliers of oil and gas including the US, Saudi Arabia, and the United Arab Emirates are not members and eight European countries have recently announced their intention to withdraw.

Current modernisation proposals extend protection under the ECT’s investor-to-state dispute settlement (ISDS) mechanism for existing foreign investment in all fossil fuels until at least 2033 and in gas until 2043. This means that investors will be able to continue to use the treaty to challenge the phase out of fossil fuels at precisely the time when the world urgently needs to rapidly reduce its use. The French High Council for Climate has stated that the ECT modernisation plans are at odds with EU net zero targets, it is likely this would apply to the UK’s own plans.

The ECT was created almost 30 years ago, in the context of the end of the Cold War and when there was less understanding of and consensus around the human drivers of climate change. The context has changed significantly: we have a very limited time to undertake a drastic reduction in greenhouse gas emissions.

The conclusion of COP27, the recent end to the UK’s COP26 presidency and the ECT modernisation meeting proposed for early April make this a key moment for the UK to withdraw. We urge you to take this opportunity to announce that the UK will withdraw and work with other partners to ensure sunset clauses do not apply.

Yours sincerely

1. Elizabeth Ackerley, Research Associate, School of Geography, University of Manchester
2. Samer Abdelnour, Senior Lecturer in Strategic Management, University of Edinburgh Business School
3. Sam Adelman, School of Law, University of Warwick
4. Toyin Agbetu, Lecturer in Social and Political Anthropology, University College London
5. Gabriella Alberti, Associate Professor in Work and Employment Relations, University of Leeds
6. Anneli Albi, Professor of Law, University of Kent
7. Nicola Ansell, Professor of Human Geography, Brunel University London
8. Donatella Alessandrini, Professor of Law, Kent Law School, University of Kent
9. Nicola Ansell, Professor of Human Geography, Brunel University London
10. Yutaka Arai, Professor of International Human Rights Law, University of Kent
11. Alex Archibald, Professor of Atmospheric Chemistry, University of Cambridge
12. Lucy Baker, Senior Research Fellow, Science Policy Research Unit, University of Sussex
13. Prof Rick Battarbee FRS, Emeritus Professor of Environmental Change, University College London
14. Simon Batterbury, Visiting Professor, Lancaster Environment Centre, University of Lancaster
15. Mareike Beck, Leverhulme Early Career Fellow at the Department of European and International Studies, King’s College London
16. Andreas Bieler, Professor of Political Economy, University of Nottingham
17. Peter Brett, Senior Lecturer in International Politics, Queen Mary University of London
18. Andrea Brock, Lecturer in International Relations, School of Global Studies, University of Sussex
19. Sally Brooks, Honorary Fellow, School of Business and Society, University of York
20. Dr Emma Boland, Research Scientist, Polar Oceans Team, British Antarctic Survey
21. Jean Boucher, Senior Researcher in Environmental Sociology, The James Hutton Institute
22. Marie Claire Brisbois, Senior Lecturer in Energy Policy, University of Sussex
23. Pamela Buchan, Research Fellow, Geography, University of Exeter
24. Peter Buckley, Teaching Fellow in English for Academic Purposes, University of Edinburgh
25. Judith Bueno de Mesquita, Senior Lecturer, Essex Law School and Human Rights Centre, University of Essex
26. Liam Campling, Associate Dean for Research and Professor of International Business and Development, School of Business and Management, Queen Mary University of London
27. Fabio Carvalho G da Silva, Senior Research Associate, Lancaster Environment Centre, University of Lancaster
28. Luke Cooper, Associate Professorial Research Fellow in International Relations, LSE IDEAS, London School of Economics and Political Science
29. Paul Copeland, Reader in Public Policy, Queen Mary University of London
30. Glen Cousquer, Lecturer in One Health and Conservation Medicine, University of Edinburgh
31. Gareth Dale, Reader in Political Economy, Brunel University London
32. Izabela Delabre, Lecturer in Environmental Geography, Birkbeck College, University of London
33. Pauline Destree, Assistant Professor, Department of Anthropology, University of Durham
34. Sital Dhillon OBE, Head of Dept of Law & Criminology & Director of the Helena Kennedy Centre, Sheffield Hallam University
35. Luis Eslava, Reader in International Law, Kent Law School, University of Kent
36. Paul Ekins OBE, Professor of Resources and Environmental Policy, University College London
37. Imad El-Anis, Associate Professor in International Relations, School of Social Sciences, Nottingham Trent University
38. Brian Garvey, Senior Lecturer in Work, Employment and Organisation, University of Strathclyde Business School
39. Paul Robert Gilbert, Senior Lecturer in International Development, University of Sussex
40. Dr Chiara Giorio, Assistant Professor of Atmospheric Chemistry, University of Cambridge
41. Henning Grosse Ruse-Khan, Professor of Law, University of Cambridge
42. Dr Edward Guntrip, Senior Lecturer in International Law, University of Sussex
43. Keith Halfacree, Reader in Human Geography, University of Swansea
44. Daniel Hammett, Senior Lecturer, Department of Geography, University of Sheffield
45. Regina Hansda, Lecturer in Development and Justice, University of Edinburgh
46. John Harrington, Professor of Global Health Law, School of Law and Politics, University of Cardiff
47. James Harrison, Professor of Law, School of Law, University of Warwick
48. Tessa Holland, Research Associate, Faculty of Medical Sciences, University of Newcastle
49. Stephen Hurt, Reader in International Relations, Oxford Brookes University
50. Chris Inglehearn, Professor of Molecular Medicine, School of Medicine, University of Leeds
51. Emily Jones, Associate Professor in Public Policy, University of Oxford
52. Srinivasan Keshav, Professor of Computer Science, University of Cambridge
53. Paul Kinnersley, Emeritus Professor, School of Medicine, Cardiff University
54. Tor Krever, Lecturer, School of Law, University of Warwick
55. Caroline Kuzemko, Reader in International Political Economy, University of Warwick
56. Kumari Lane, Associate Lecturer, Department of Law, Birkbeck College University of London
57. Jessica Lawrence, Senior Lecturer, Essex Law School, University of Essex
58. Dennis Leech, Emeritus professor of Economics, University of Warwick
59. Elena Loizidou, Reader in Law and Political Theory, Assistant Dean of Law, Birkbeck College, University of London
60. James Longhurst, Professor of Environmental Science, University of the West of England, Bristol
61. Emily Lydgate, Reader in Environmental Law, University of Sussex
62. Fiona Macmillan, Professor of Law and Corporation of London Chair in Law, Birkbeck College, University of London
63. Tomas Maltby, Reader in International Politics, King’s College London
64. Prof John Marsham, Professor of Atmospheric Science, University of Leeds
65. Toni Marzal, Senior Lecturer, School of Law, University of Glasgow
66. Mel McCree, Senior Lecturer, Early Childhood Studies and Environmental Humanities, Bath Spa University
67. Oliver Morrissey, Professor of Development Economics, University of Nottingham
68. Nithya Natarajan, Lecturer in International Development, King’s College London
69. Lucila Newell, Lecturer, Global Studies, University of Sussex
70. Peter Newell, Professor of International Relations, University of Sussex
71. Rose Parfitt, Senior Lecturer in Law, University of Kent
72. Prof Kirsty Park, Professor of Conservation Science, University of Stirling
73. Katie Parsons, Researcher in Children’s Environmental and Climate Education, University of Hull
74. Laurie Parsons, Senior Lecturer in Human Geography, Royal Holloway, University of London
75. Matthew Paterson, Director of the Sustainable Consumption Institute, University of Manchester
76. Jonathan Perraton, Senior Lecturer in Economics, University of Sheffield
77. Sol Picciotto, Emeritus Professor, Law School, University of Lancaster
78. John Pickering, Associate Tutor, Psychology Department, University of Warwick
79. Anna Pigott, Lecturer in Human Geography, University of Swansea
80. Marina Prentoulis, Associate Professor in Politics and Media, University of East Anglia.
81. Mario Prost, Senior Lecturer in International Law, University of Keele
82. Ali Raiss-Tousi, Associate Lecturer, School of Law, Birkbeck College, University of London
83. Dr Charlotte Rae, Lecturer in Psychology, University of Sussex
84. Becky Richardson, Research Fellow in Disasters and Development, Northumbria University
85. Ben Richardson, Reader in International Political Economy, University of Warwick
86. Diana Salazar, Lecturer in Ecology, Bartlett School of Architecture, University College London
87. Benjamin Selwyn, Professor of International Development, University of Sussex
88. Christine Schwöbel-Patel, Reader, School of Law, University of Warwick
89. James Scott, Senior Lecturer in International Politics, King’s College London
90. Sharifah Sekalala, Professor of Global Health Law, University of Warwick
91. Gabriel Siles-Brügge, Reader in Public Policy, University of Warwick
92. Dr Simon Shackley, Director of Postgraduate Teaching, GeoSciences, University of Edinburgh
93. Ala’a Shehabi, Senior Research Fellow, Bartlett Faculty of the Built Environment, University College London
94. Adrian Smith, Professor, Department of Management, University of Sussex Business School
95. Sam Staddon, Senior Lecturer in Environment and Development, University of Edinburgh
96. Ann Stewart, Professor of Law, School of Law, University of Warwick
97. Silke Trommer, Senior Lecturer in Politics, University of Manchester
98. James Van Alstine, Associate Professor of Environmental Policy, University of Leeds
99. Elisa Van Waeyenberge, Professor of Development Economics, SOAS University of London
100. Ersilia Verlinghieri, Senior Research Fellow, University of Oxford and University of Westminster
101. Diana Vladimirova, Postdoctoral Researcher, British Antarctic Survey
102. Julie Vullnetari, Associate Professor of Human Geography, University of Southampton
103. Gordon Walker, Professor in Environment, Risk and Justice, Lancaster Environment Centre, University of Lancaster
104. Matthew Watson, Professor of Political Economy, University of Warwick
105. Sue Willman, Assistant Director of Clinical Legal Education & Supervising Solicitor; Lecturer, King’s Legal Clinic, King’s College London
106. Kalpana Wilson, Lecturer in Geography, Birkbeck College, University of London
107. David Whyte, Professor of Climate Justice, Queen Mary University of London
108. Anil Yilmaz Vastardis, Senior Lecturer, Essex Law School, University of Essex
109. Dr Eiko Yoneki, Lecturer and Senior Researcher, Department of Computer Science and Technology, University of Cambridge
110. Asta Zokaityte, Lecturer in Commercial Law, University of Kent

It can be found at this link: https://warwick.ac.uk/fac/soc/law/research/centres/chrp/governance/energycharter/