The European Energy Charter

Jay OwenReforming Global Finance

The treaty grants energy-corporations enormous power over states and their energy systems, as it includes the ability to sue governments and to obstruct the transition from climate-wrecking fossil fuels towards renewable energy.

The long arm of the energy regimeTackling the energy regime is bound to face resistance from the status quo. Even state actors have found themselves limited in their capacity to act. Trade agreements often make it difficult for them to respond to climate change as sovereign powers. The Energy Charter Treaty, in particular, is one such restrictive trade agreement that applies in nearly 50 countries, stretching from Western Europe through Central Asia to Japan.

The treaty grants energy-corporations enormous power over states and their energy systems, as it includes the ability to sue governments and to obstruct the transition from climate-wrecking fossil fuels towards renewable energy. Companies can be awarded dizzying sums in compensation for government actions that have allegedly damaged their investments.

Also, attempts to mitigate the impacts of climate change have often led to an expansion in corporate influence. A recent example is Puerto Rico’s energy sector, which was considered the island’s first public industry, and was privatised in January 2018.

This came four months after hurricanes Irma and Maria, which devastated the archipelago leaving thousands of people homeless or dead, and over 40 percent of the population without access to electricity and running water.

The 2017 hurricane season saw multiple category five hurricanes develop, of which both Irma and Maria hit Puerto Rico. As Naomi Klein pointed out in her book The Shock Doctrine economic interests never waste a good crisis.