State Consent, Power to Regulate, and Renewable Investments: A Perspective on the Limits of Expropriation under the Energy Charter Treaty

State Consent, Power to Regulate, and Renewable Investments: A Perspective on the Limits of Expropriation under the Energy Charter Treaty

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The Energy Charter Treaty has recently limited the power of sovereign States to regulate investments in their economy in the energy sector. The protections offered by the ECT were initially meant to attract investment in new sources of energy, while guaranteeing the rights of investors against illegal expropriations. The recent Spanish tariff deficit arbitrations, based on the expropriation provision of article 13 of the ECT, have shown that States can be confronted with mass claims on the basis of this regional agreement. This article looks at the current situation in wake of the Spanish “solar war” arbitrations.