Article 19 of the Energy Charter Treaty requires all member countries to strive to minimize in an economically efficient manner harmful environmental impacts occurring from all operations along the entire energy chain. In doing so, member states shall 'act in a cost-effective manner', 'strive to take precautionary measures', and agree that, in principle, the “polluter pays” principle should apply.
The Treaty also requires some specific actions from member states, relating to the promotion of market-oriented price reform and a fuller reflection of environmental costs and benefits, the encouragement of international co-operation, information sharing on environmentally sound and economically efficient energy policies, promotion of environmental impact assessment activities and monitoring, promotion of public awareness on relevant environmental programmes, and R & D of energy efficient and environmentally sound technologies, including the transfer of technology.
Building on Article 19 of the Treaty, the Protocol on Energy Efficiency and Related Environmental Aspects (PEEREA) defines in more detail the policy principles that can promote energy efficiency, and provides guidance on the development of energy efficiency programmes. It also aims to foster international cooperation between the member states by providing a framework and an indicative list of areas for joint activities.
The PEEREA is designed to reinforce energy efficiency policies and programmes based on the following principles: the introduction of market mechanisms and price formation reflecting real energy and environmental costs, cost-effective energy policies, transparency of regulatory frameworks, dissemination and transfer of technologies, the establishment of domestic programmes for improving energy efficiency, and the promotion of investments.
The Protocol requires member governments to formulate policy aims and strategies for energy efficiency (Article 5), establish relevant policies (Article 3.2), develop, implement, and update energy efficiency programmes, and create the necessary legal (Article 3.2), regulatory (Article 3.2) and institutional (Article 8.3) environment for more efficiency energy use.