Publication details
EU’s Energy Transition: A Coal Phase-out in the Context of International Obligations Arising from the Energy Charter Treaty.
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| Year of publication | 2022 |
| Type | Appeared in Conference without Proceedings |
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| Description | Climate change is the biggest environmental crisis of our time. Especially in recent years, our planet has been exposed to environmental challenges caused or exacerbated by climate change. The effects of climate change include heatwaves, droughts, more frequent and powerful tropical cyclones, heavier monsoon rains, accelerated sea level rise or biodiversity loss. Recognizing that climate change represents an urgent and potentially irreversible threat to human societies and the planet, 197 countries agreed to hold global average temperature increase to well below 2°C and to pursue efforts to limit it to 1.5°C (Article 2 of the Paris Agreement). The UN climate-related goals cannot be achieved in the absence of an effective implementation mechanism. An appropriate and effective mix of policy, regulatory and legal frameworks affecting all sectors will have to be adopted and put in place. Nonetheless, the energy sector is central to efforts to combat climate change. It is worth mentioning that coal-fired electricity generation accounted for 30% of global CO2 emissions. A pathway toward transformation of the global energy sector from fossil-based to zero-carbon is referred to as an energy transition. According to the IRENA (International Renewable Energy Agency), the reduction of energy-related CO2 emissions (decarbonisation of the energy sector) should be achieved by an adoption of integrated approach that includes policies to increase the uptake of renewables, decrease energy use by making energy efficiency mandatory, and accelerate the phase out of fossil fuels. Multiple countries have set coal phase-out deadlines, including the UK, France, Canada and Germany. Governments, businesses and organisations united in taking action to accelerate clean growth and climate protection through the rapid phase-out of traditional coal power joined the Powering Past Coal Alliance. Investment law has been recognized as a core policy tool to promote investments. The key objective of investment law is to provide for investment protection and mitigate risks inherent in a future intervention of the host state. Subsequent flow of capital is supposed to enhance economic development of concerned countries. The source of contemporary investment law is bilateral investment treaties (BITs), investment chapters of free trade agreements (FTA) or regional treaties (such as the Energy Charter Treaty referred to as “the ECT”). Most of the international investment agreements contain a unique investor-state dispute mechanism (ISDS). The paper seeks to discuss whether international obligations arising from the Energy Charter Treaty can lead to regulatory chill and how this chill can be addressed. In this context the research project analyses an ongoing debate on the need for reform of the Energy Charter Treaty to ensure that it works for all stakeholders, it is better suited for today’s policy challenges and safeguards the right to regulate for pursuing sustainable development objectives. |