Understanding the ECT
‘Pump-jack mining crude oil with the sunset’ (Burival, 2018)
In discussions about climate change, the nature of corporate power and influence is often referenced but rarely broken down and explained. This is partly by design. Oil and gas companies are experts in covering their tracks, guarding information and generally blurring the lines as to where their spheres of influence stop and start. As a result, the rules and procedures that govern their activity and permit them to do harm without consequence are especially hard to digest.
In this blog, one prong of the shadowy system will be introduced and explained: The Energy Charter Treaty. The pollen project is determined to make information about how corporations get away with causing such deep and lasting damage more easily accessible and understandable. So, consider this blog an introduction aimed to spark further conversations and expect similar posts in the future.
According to a recent post on the UK Parliament website, the Energy Charter Treaty (ECT) is “a multilateral treaty signed in 1994 to promote international investment in the energy sector” (gov.uk, 2023). The UK is one of 53 states signed onto the treaty and obliged to follow its rules. The ECT has been a vital tool for corporations allowing them to do harm without paying the price and profit from attempts to regulate fossil fuels.
Under the treaty, fossil fuel companies and foreign investors can sue governments for introducing new laws or reforms that threaten their operations and potential profits.
In a recent Guardian article Cleodie Rickard describes the ECT as “fossil fuel companies’ secret weapon against national climate laws” (Rickard, 2023). The possibility of having to compensate fossil fuel companies with millions, if not billions, in taxpayers money has a ‘chilling effect’. An incentive is created for governments to maintain the status quo and prioritise the interests of corporations over climate justice matters and steps towards ecological transition.
A few more of the challenges of the ECT are noted below
Lack of transparency - for many cases, there is no information publicly available on the exact amount of damages claimed or rewarded.
Trouble understanding - even those who dedicate years of their life to studying law often struggle to get to the bones of a treaty like this. Language which may seem innocuous can have the gravest of consequences when construed (as they often are) to favour corporate profits over planetary limits.
There have been many efforts to modernise the treaty and a number of countries have attempted to break ties by leaving it altogether. However, progress is slowed by the existence of a ‘sunset clause’ which keeps certain obligations on states in place for up to two decades after formal exit. This particular point, on modernisation, exits and related troubles, will be broken down in a specific post here soon.
For anyone wishing to further understand the ECT, this post features a number of references to useful articles and websites. These will show you to the sources from which quotations and specific facts were lifted. Additionally, click here to watch a 6 minute video in which Yamina Saheb deconstructs the ECT (InvestigateEurope, 2021). Saheb is a lead author of the IPCC and an influential figure for many in the climate action community. I saw Yamina speak at the Junior Diplomatic Institute conference around half a year ago. Her description of the way we will one day look back on inaction, delay and distraction today has stayed with me ever since.
In an article for EURACTIV (Saheb, 2021), Yamina Saheb wrote about the case invoked by the German utility company RWE against the Dutch Government using the ECT Read in full here
To join others and take concrete action against secretive corporate courts you can follow this link to the War on Want website. There, you can send a letter to your own member of parliament and find further information on the issue as a whole.
As stated at the beginning, this short post is the briefest of introductions to an issue which deserves a great deal more attention. I considered that it may not be the best idea to post something that only skims the surface of this issue but decided that it is that kind of thinking that has, for so long, prevented essential understanding of corporate power from reaching citizens everywhere. I hope this serves as a small library of resources and recommendations for further exploration - further conversation.
Just because something is ‘written in law’ does not make it rational or reasonable and it is the belief of the pollen project that we will move further, faster if we come together to demystify the laws standing in the way of a liveable planet.
By Lucy Gavaghan
references
Burival, Z. (2018). Pump-jack mining crude oil with the sunset. [NIKON CORPORATION, NIKON D5100] Available at: https://unsplash.com/photos/sunset-GrmwVnVSSdU
gov.uk (2023). UK reviewing membership of energy treaty. [online] GOV.UK. Available at: https://www.gov.uk/government/news/uk-reviewing-membership-of-energy-treaty [Accessed 20 Sep. 2023].
Rickard, C. (2023). Fossil fuel companies have a secret weapon. Here’s how Britain can help take it away from them. The Guardian. [online] 13 Sep. Available at: https://www.theguardian.com/commentisfree/2023/sep/13/fossil-fuel-companies-britain-international-charter-treaty?ref=upstract.com [Accessed 20 Sep. 2023].
Investigate Europe (2021). Whistleblower Yamina Saheb on the Energy Charter Treaty. [online] www.youtube.com. Available at: https://www.youtube.com/watch?v=w7GT_mrGX7Q [Accessed 20 Sep. 2023].
Saheb, Y. (2021). Energy Charter Treaty strikes again. [online] www.euractiv.com. Available at: https://www.euractiv.com/section/energy/opinion/energy-charter-treaty-strikes-again/ [Accessed 20 Sep. 2023].
war on want (2023). War on Want | Fighting Global Poverty. [online] secure.waronwant.org. Available at: https://secure.waronwant.org/page/108019/action/1.
