Managing investment disputes in an energy transition era: the influential role of the arbitral concept of a fair and equitable treatment standard on new energy investments in Nigeria

Abstract

For several reasons, the new energy transition from fossil fuel-dominated energy to cleaner energy sources has garnered momentum in recent times. Clean energy sources are already paving the way for an energy revolution around the globe. At record levels, many nations have embarked on the transition to clean energy, leading to a rapid increment in investments by governments and energy companies/investors. In a similar fashion to fossil fuel investments, this will inevitably lead to new contracts and agreements from which conflicts and disputes between governments and investors may arise. Due to the peculiarity of the sector and the shortfalls of court adjudication, these disputes will be resolved by international arbitration in the International Centre for Settlement of Investment Disputes (ICSID). In its’ published arbitral decisions in past and recent times, the ICSID has developed the concept of a Fair and Equitable Treatment Standard to protect investors against harsh and arbitrary treatment from host governments. This paper will interrogate how this significant concept seeks to protect existing energy investments and boost new ones amidst the energy transition to create an investible atmosphere in Nigeria.