CYIL vol. 12 (2021)

Monika Feigerlová CYIL 12 (2021) As electrification and the replacement of coal by low-emission sources in electricity generation will play a key role in decarbonisation and achieving zero carbon emissions 1 the ECT is highly relevant for its member countries’ climate decisions. The ECT has been recently used by foreign investors for claims against some European states and their governments’ decisions to phase out of coal or close coal mines as essential sources of the emission of carbon dioxide (CO 2 ) . The newest disputes include for example, a petition filed by a German company RWE 2 and a threatening claim of a Finish company Uniper 3 against the Netherlands following the Dutch government’s plan to phase out coal power by 2030 4 or a petition of an Australian company Prairie Mining against Poland regarding licenses for development of coal mines. 5 In the last decade we have observed over fifty cases in which foreign investors invoked the ECT in relation to changes made by several states to their renewable energy regimes or incentive schemes. 6 Those cases do not explicitly discuss the fight against climate change but at the heart of the proceedings were measures that were adopted in order to achieve countries’ climate change objectives. Nowadays, a number of countries have pledged to achieve net-zero emissions in the next few decades. In the energy sector this goal will require, on the one hand, the adoption of government’s policies eliminating the use of fossil fuels, and on the other, the attraction of private capital into new infrastructure, and renewable energy sources. According to the recent special report of the International Energy Agency, 7 the energy system must be significantly transformed to reach net zero by 2050, and this will necessitate vast amounts of investments. 8 By 2050, almost 90% of electricity generation shall come from renewable sources, with wind and photovoltaics together accounting for almost 70%. Solar PV capacity shall increase 20-fold between now and 2050, and wind power 11-fold. 9 According to the above IEA’s pathway, the use of fossil fuels shall decline massively. 10 The least efficient coal plants need to be phased-out by 2030, and the remaining coal plants still in 1 See e.g., International Panel on Climate Change (IPCC): Special Report of the IPCC on Renewable Energy Sources and Climate Change Mitigation , prepared by Working Group III of IPCC (O. Edenhofer, R. Pichs-Madruga, Y. Sokona, K. Seyboth, P. Matschoss, S. Kadner, T. Zwickel, P. Eickemeier, G. Hansen, S. Schloemer, Ch. von Stechow (Eds.)), 2012. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA. See also International Energy Agency (IEA): Special Report Net Zero by 2050: A Roadmap for the Global Energy Sector. 2021. Available at: . Visited on 1 June 2021. 2 See RWE AG and RWE EemshavenHolding II BV v. Kingdom of the Netherlands (ICSIDCase No. ARB/21/4). Available at: . Visited on 1 June 2021. 3 See Uniper SE, Uniper Benelux Holding B.V. and Uniper Benelux N.V. v. Kingdom of the Netherlands (ICSID Case No. ARB/21/22). Available at: . Visited on 1 June 2021. 4 The Dutch Coal Prohibition Act puts an end to the use of coal for the production of electricity by 1 January 2030. 5 See Prairie Mining Limited v. Republic of Poland . Available at: < dispute-settlement/cases/1104/prairie-v-poland>. Visited on 1 June 2021. 6 See e.g., UNCTAD’s Investment Dispute Settlement Navigator. Available at: . Visited on 1 June 2021. 7 The International Energy Agency (IEA): Special Report Net Zero by 2050: A Roadmap for the Global Energy Sector. 2021. Available at: . Visited on 1 June 2021. 8 Ibid. p. 22. IEA estimates the total annual energy investment at around USD 5 trillion by 2030 in the net zero pathway. 9 This will require annual additions of renewable energy facilities . For example for solar PV, this translates into installing the world’s current largest solar park roughly every day. Ibid. p. 14. 10 Ibid. p. 18. Fossil fuels are to fall from four-fifths of total energy supply today to one-fifth.


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