INVESTMENT ARBITRATION IN THE ENERGY SECTOR

A significant development in the renewable energy field has happened in several countries like Italy, Spain and the Chez Republic over the last years mainly due to the state´s support for renewable energy projects. However, because of the financial crisis, these countries decided to review and change the policies. As a result of the changes implemented renewable investors were affected in some manner. Consequently, many arbitrations claim against these states have been brought under the Energy Charter Treaty. The present Chapter analyses this jurisprudence. Based on the results of these arbitrations the lack of consistency results evident. Different interpretations around the Fair and Equitable Treatment standard and how to find a balance between the need for a stable and predictable investment framework and the sovereign right to regulate are the principal cause of diverse decisions. The concept of the standard in the treaty is reviewed and compared with the evolution of the concept in other investment agreements. In conclusion, possible amendments to increase consistency in the arbitrations under the Energy Charter Treaty will be proposed.