The Comhlamh Trade Justice Group and nearly 30 Irish and international climate and development organisations are calling on the Taoiseach to support a withdrawal of Ireland from the Energy Charter Treaty.

The Energy Charter Treaty (ECT) is an investment agreement between 50 countries specifically for the energy sector. It dates back to the mid 1990s, from a time when the focus was on access to oil and gas reserves in countries of the former Soviet Union, and levels of climate ambition were not high.

At the core of the ECT is the contentious investor-state dispute settlement (ISDS) mechanism. This allows foreign companies to sue governments outside of the national legal system in secretive tribunals. The amounts at stake can be in the billions. The ECT has already generated at least 135 claims, making it the world’s most litigated ISDS agreement.

The Treaty has been subject to reform efforts in recent years, but these ground to a halt in November 2022 after a number of EU countries have declared that even the reformed treaty would be incompatible with their climate goals. Eight EU countries – Germany, France, Spain, Italy, Luxembourg, Slovenia, Poland and the Netherlands have already left or announced their intention to leave the treaty. Ireland should take the decision to leave the Energy Charter Treaty, ideally as part of a coordinated withdrawal. It is the most effective way to protect taxpayers, the planet and our future from this damaging treaty.

Open letter to the Taoiseach on the Energy Charter Treaty

Taoiseach Leo Varadkar

Department of the Taoiseach,

Government Buildings,

Merrion Street Upper,

Dublin 2

 

cc:

Minister for Enterprise, Trade and Employment, Simon Coveney

Minister for the Environment, Climate, Communications and Transport Eamon Ryan

 

6 March 2023

 

A Thaoisigh,

We are writing to you about Ireland’s membership of the Energy Charter Treaty (ECT), and to call on you to support a coordinated withdrawal of the EU, Ireland and other EU member states from the Treaty as soon as possible.

The Energy Charter Treaty is a barrier to the energy transition, is incompatible with EU law[1] and undermines the European Green Deal. The UN’s Intergovernmental Panel on Climate Change (IPCC) has concluded that the ECT is blocking countries’ ability to accelerate the energy transition. The French High Council for Climate[2], as well as the German[3] and Dutch[4] Governments have all agreed that even the reformed ECT remains inconsistent with the Paris Agreement. It is also an obstacle for sovereign energy policies taken in response to the current crisis, such as windfall profit taxes[5]. Germany, France, and Poland have officially notified their withdrawal from the Treaty. The Netherlands, Spain, Slovenia, and Luxembourg have committed to do so this year. The European Parliament recently voted in favour of a coordinated EU withdrawal, and the Commission also now supports this option. Reforming the Energy Charter Treaty is not a viable option, and the European Commission has concluded an EU withdrawal is “unavoidable”[6]. Please see the accompanying briefing paper for more information[7].

Ireland should support a full and coordinated EU withdrawal. This approach is the safest and most comprehensive solution to the ECT impasse. EU Member States need to recover their full regulatory space to deal with the ongoing energy crisis and manage a swift and just transition away from fossil fuels.  Ahead of the next discussions at the Energy Working Party of the EU Council, Ireland can demonstrate climate leadership by taking steps to support a coordinated EU withdrawal from the Treaty.

We would be happy to meet with you to discuss this topic further.

 

Le Meas,

  1. Comhlámh Trade Justice Group
  2. Leah Sullivan, Coordinator, Seattle to Brussels/European Trade Justice Coalition
  3. Thomas Mc Donagh, Director, Financial Justice Ireland
  4. Caroline Murphy, CEO, Comhlámh
  5. Oisin Coghlan, Director, Friends of the Earth Ireland
  6. Caoimhe de Barra, CEO, Trócaire
  7. Karol Balfe, ActionAid Ireland
  8. Brian Cuthbert,Campaigns Director, Uplift
  9. Jim Clarken, CEO, Oxfam Ireland
  10. Angela Deegan, Not Here Not Anywhere
  11. Stephen McCloskey, Director, Centre for Global Education
  12. Slí Eile
  13. Eoin O Leidhin, Gluaiseacht
  14. Attracta Uí Bhroin, Vice Chair, An Claíomh Glas
  15. Extinction Rebellion Ireland
  16. Dr Ciara Brennan,  Director, Environmental Justice Network Ireland
  17. James Gilmartin, Treasure Leitrim
  18. CAIM – Communities Against the Injustice of Mining
  19. Declan Owens, CEO, Ecojustice Ireland
  20. Clodagh Daly, Climate Case Ireland
  21. Jagoda Munic, Director, Friends of the Earth Europe
  22. Tine Laufer, Director, PowerShift
  23. Veblen Institute, Mathilde Dupré, co director
  24. Renaud Vivien, Coordinator of the political service, Entraide et Fraternité
  25. Fiona Dove, Director, Transnational Institute
  26. Anaïs Berthier, Head of Client Earth Brussels Office and EU Affairs, Client Earth
  27. Audrey Gaughran, Director, SOMO
  28. Luis Rico, Coordinator, Ecologistas en Acción
  29. Chiara Martinelli, Director, CAN Europe
  30. Patrick ten Brink, EEB Secretary General, European Environmental Bureau, EEB
  31. Fernanda Otero, Chair, LASC – Latin American Solidarity Center

 

DOWNLOAD THE LETTER IN PDF

READ THE BRIEFING PAPER: WHY IRELAND MUST LEAVE THE ECT

 

[1] ClientEarth (2022), Energy Charter Treaty fundamentally incompatible with EU law, study finds

[2] Financial Times (2022) France withdraws from Energy Charter Treaty

[3] Reuters (2022) German cabinet approves exit from Energy Charter Treaty

[4] Euractiv (2022) Netherlands follows Spain in quitting Energy Charter Treaty

[5] Lisa Bohmer (2022), Refining company reportedly threatens arbitration claim against Slovakia.

[6] Euractiv (2023), LEAK: Exit from Energy Charter Treaty ‘unavoidable’, EU Commission says

[7] Briefing Paper: https://caneurope.org/content/uploads/2023/02/ECT-briefing_ways-forward_CAN-Europe_Feb-2023-1.pdf