EU officials said that the European Commission would propose reforms to the Energy Charter Treaty after environmental groups and some member states urged the bloc to consider quitting the treaty. The 1994 treaty has faced growing criticism for allowing investors to seek financial compensation if governments’ energy policies affect their investments negatively. For instance, in January, RWE used the treaty to seek compensation from the Dutch government after it planned to phase out coal-fuelled power by 2030.
The treaty’s 50 signatories are scheduled to meet in March to negotiate an updated term. However, some EU member states are growing impatient, after three rounds of negotiations in 2020 turned fruitless. France, Spain, and Luxembourg have urged Brussel to consider exiting the treaty because it could slow down the bloc’s progress in achieving its climate goals.
