If you have read the previous article, you now understand that the ECT acts as a burden to the tax-payer, a barrier to climate neutrality and a blockade for the Energy Transition.. Currently, it only benefits a few: fossil fuels industries, and investment funds.

You may ask yourself – ‘There must be something good about the ECT?’. There was, maybe once.

The ECT was signed by 54 countries and the European Union in 1994, a short while after the fall of the Berlin Wall. Western European countries needed gas – Eastern European countries were willing to sell it to them. However, given the recent events in this region, Western investors were not so confident. They wanted a guarantee that they would not be expropriated somehow after having contributed to the construction of fossil fuels infrastructures – and this is how the ECT was born.

At the time, Governments were not aware of the urgency of the situation regarding the environment, as well as the absolute need to phase out fossil fuels from our energy mix. It is important to note that this is not the only reason that renders the ECT obsolete. In 2009, Russia left the ECT – removing the main reason the ECT was enacted. 

Time to reform? Well, you’ll see in the next article this process is not a smooth one so far.

If you have been passionate about this article and would like to dig deeper in the subject and find more resources, go have a read of our two articles “The ECT, an obstacle to the Energy Transition: how did we get there?” and “The ECT, an obstacle to the Energy Transition: the way forward”

Written by Zaraï De Pelsmacker, Alexandra Aldou and Alix Dardennes