Thread by @TropperJohannes

Politico Pro Europe @POLITICOEurope published the full text of the agreement in principle on the modernisation of the #EnergyCharterTreaty #ECT
politico.us8.list-manage.com/track/click?u=…

Most of changes already communicated by ECT press release of June 2022 (see energychartertreaty.org/modernisation-…) but some points worth noting:
1/8

I) flexibility mechanism for the fossil fuel carve out included in Annex NI, thus doesn't require follow path amendment procedure. Annex can be changed by ECT Conference decision, but for certain parts of annex NI a separate procedure for entry into force apparently foreseen 2/8

Annex NI complicated, but essentially EU and UK exclude protection for fossil fuel investments made after 15 August 2023 if Conference approves changes to Annex NI this November and for existing fossil fuel investments 10 years after entry into force of annex or latest 2040
3/8

Procedure for entry into force of part of Annex NI to trigger 10-year period for phase-out does not seem to be in agreement itself. Maybe separate document? 4/8

Switzerland & Turkey do not consent to arbitration with the EU’s and UK’s fossil fuel investors and Japan excludes applicability of investment protection standards for those investors from EU and UK and Swiss hydrogen investors (Switzerland excludes protection for hydrogen) 5/8

II) The non-derogation or conflict clause of the ECT -Article 16 ECT- is gone!!!
This may, e.g., be important for potential future inter se modifications of ECT. Current version of ECT with Art 16 still in place is IMO an obstacle to coordinated withdrawal
6/8

III) A separate provision on climate change and clean energy transition indeed made it into the final text, requiring effective implementation of the commitments under the Paris Agreement + conciliation mechanism for disputes concerning this provision
7/8

Final text seems to largely reflect EU proposal, but does not seem to cover certain procedural aspects on annex NI or provisional application.
Phase out mechanism in annex NI has potential to eliminate protection for exisiting fossil fuel investments earlier than withdrawal 8/8.