The Government has confirmed its withdrawal from the Energy Charter Treaty (ECT) after efforts to agree modernisation failed.

The agreement made in the post-Cold War environment was seen as needing change to align it to net-zero goals, but European countries have been unable to reach agreement and the UK has joined France, Spain and the Netherlands in withdrawing from the Treaty.

Signed in 1994, the Energy Charter Treaty was designed to promote international investment in the energy sector, historically providing protections for investors in fossil fuels. Proposals to modernise the ECT better to support cleaner technologies have been subject to months of talks between European countries, resulting in a stalemate.

Energy Security and Net Zero Minister Graham Stuart announced in September 2023 that the UK would be reviewing its membership of the ECT if plans to update it were not adopted.

After considering the views of businesses, industry and civil society, ministers will now instigate the UK’s withdrawal, which will take effect after one year, removing protections for new investments after this period.  

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