The Energy Investment Risk Assessment (EIRA) is a publication of the Energy Charter Secretariat that evaluates specific risks affecting energy investment that can be mitigated through adjustments to policy, legal and regulatory frameworks. It aims to identify policy gaps, provide learning opportunities, and stimulate reforms which make the investment climate of countries more robust and reduce the risk of investor-State disputes.
Results for countries in the review are presented in the form of individual country risk profiles. Other types of investment risk such as commercial, technical and geopolitical, are not within the scope of the publication. In 2017 the first non-public edition of EIRA was developed. EIRA 2018, expected this fall, will be the first public edition of the Report. To date, more than 30 countries are participating in EIRA.
What is the aim of EIRA?
EIRA assists governments to identify and eliminate specific risks in the regulatory and legal environment which impede the inflow of investments. It assesses risks to energy sector investment that countries can control and limit through their actions. This information is essential as it enables governments to undertake required steps to make their regulatory frameworks robust, which is beneficial to induce investments in the energy sector.
The secondary aim of EIRA is to provide a reliable source of useful information to energy companies, investors and the financial sector on different aspects of the regulatory and legal environment in countries considered for investment.
Which risk areas are covered by EIRA?
EIRA focuses on three risk areas: (1) unpredictable policy/regulatory change, (2) discrimination between domestic and foreign investors, and (3) breach of state obligations.
To measure these risks, four indicators have been identified:
- The foresight of policy and regulatory change
- Management of decision-making processes
- Regulatory environment and investment conditions
- The rule of law (compliance with national and international obligations)