The UK will leave the Energy Charter Treaty ECT, a 1994 pact that allows oil and gas companies to sue governments over their climate policies for compensation for lost profits. The Energy Charter Treaty was originally designed to promote international investment in the energy sector and has historically provided protections for investors in fossil fuels.
The UK is not the only European country quitting the treaty—France, Spain, the Netherlands, and six other EU member states have announced similar moves. According to the UK, proposals to modernize the treaty to support cleaner technologies have been subject to months of talks between European countries, resulting in a stalemate. The UK government believes that the decision to leave the treaty “will support the UK’s transition to net zero and strengthen its energy security.