Big energy sues Netherlands for €1.4 billion over coal phase out
The world needs to stop burning fossil fuels to limit the devastating effects of climate change.
The Netherlands has legislated to shut down all coal-fired power plants by 2030.
But now a German energy company is suing the Dutch government for 1.4 billion euros over that decision.
The company RWE is using a secretive international agreement to claim compensation from the Netherlands.
This case is possible because of the Energy Charter Treaty. This international agreement allows energy investors to sue governments for their lost assets and potential profits, resulting from regulatory changes.
The cases take place in closed-door hearings at a private tribunal in Washington DC. So far ECT cases have resulted in payments of more than $50 billion dollars to investors. And that’s just the judgements we know about – most remain secret.
When the ECT was created in 1991, it was promoted as a way of giving companies security when investing in countries without reliable legal systems. But it’s increasingly used within the European Union – something many EU governments deem to be unlawful.
Climate activists say this treaty is now a major blockage to addressing climate change.