As ordered by the World Bank’s ICSID where many other cases for investors in renewable energy projects are pending, Spain must pay €128 million for cuts to compensation for concentrated solar power (CSP) plants.
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.
The award states that Spain has violated Article 10 of the Energy Charter depriving fair and equitable treatment of Eiser, a fund linked to ABN Amro. It has been unanimously pronounced by the three arbitrators and is very forceful about the illegality of the radical transformation of the regulatory framework, as the limit of the right of each state to regulate. However, it partially considers the claims of the applicants, condemning the Kingdom of Spain to pay 128 million euros plus interest, compared to more than 300 million that claimed.
Currently there are 26 cases brought by international investors regarding cuts to payment for renewable energy projects.
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”.
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.