Spain loses its first renewable energy case in international courts
The International Centre for Settlement of Investment Disputes (ICSID) has given a ruling partially in favor of Eiser Infrastructure Ltd., Solar Energy Luxembourg, which invested in thee CSP plants, and ordered the Spanish state to pay €128 million plus interest, according to a press release by the Minister of Energy.
After this ruling was made known, the Spanish National Association of Solar Energy Producers (ANPIER) complained regarding compensation for Spanish PV investors. Neither Spain’s Supreme Court nor its Constitutional court awarded compensation for renewable energy producers after cuts were introduced with regulatory changes during the last few years in Spain. Only international investors have been awarded in rulings regarding the cuts.
Currently there are 26 cases brought by international investors regarding cuts to payment for renewable energy projects, including PV projects, pending before ICSID. The Spanish government denies any possibility that this ruling, the first known ruling against the Spanish state on the matter of renewable energy payments, can be extrapolated “nor construes a binding precedent for other pending arbitration”.
Additionally, the Spanish government notes that the two previous renewable energy arbitrations were decided in favor of Spain, however those two cases were not brought before ICSID.
This ruling by ICSID is centered on the consequences of Spain’s electricity reform in 2013 and 2014. With this reform, the feed-in tariff program previously in force in Spain was retroactively cancelled for renewable energy installations and replaced with a complex payment program.
The Spanish government argues in a press release that the ruling “does not question the electricity reform brought before the government in 2013 and 2014”, and partially grants the claims of investors, who had asked for more than €300 million. The government also stated that this ruling established compensation for the damage considered “excessive” with the electricity reform.