The master's thesis deals with the issue of inconsistency between competition and environmental policy in the context of state aid rules. Furthermore, it shows how the constant change of the objectives in environmental policy and the incompatibility of the support schemes with state aid rules in the single market of European Union (EU) cause discrepancy and legal uncertainty for investors in renewable energy power plants. Investments in renewable energy sources (RES) are risky, long-term and require high upfront costs. Constant regulatory changes and ex post encroachments on investors expected rights create a risky environment for such large-scale investments. The purpose of this master’s thesis is to present to the reader the need for change and harmonization of the entire legislative framework of investment policy, with the aim of combating climate change as effectively as possible. Should the EU wish to completely decarbonise the European continent by 2050, it must first create a secure investment environment and eliminate regulatory risks in the field of investments in RES in at the single market. The master's thesis further examines the issue of (in)effective legal protection from the point of view of unenforceable arbitral awards in proceedings between the investor and the Member State. In addition, it considers the options available to investors in cases where a Member State interferes retroactively with expected rights of the investor or by Member state’s unilateral (direct or indirect) actions causing damages to the investors. Moreover, it also advocates the implications of the Achmea judgment, the Agreement for the termination of Bilateral Investment Treaties between the Member States of the European Union and the arguments of the Member States specified in various arbitration proceedings. Further, it also addresses unresolved issues regarding the incompatibility of the Energy Charter Treaty (ECT) with the acquis communautaire. The master's thesis seeks to demonstrate the need and urgency of action by the EU and its Member States with the aim of unifying the environmental-energy legislative package and establishing a system that will provide a stable and safe environment for direct investments in RES production plants.