The first blow for the Kingdom of Spain. The award of the International Court for the Settlement of Disputes of the World Bank (ICSID), resolves in an arbitration that article 10 of the Energy Charter has been violated, depriving a fair and equitable treatment of a fund linked to ABN Amro (Eiser).
Unanimously by the three arbitrators, and in a more than forceful way, the 3 arbitrators point out the illegality of the radical transformation of the regulatory framework. In this way, it partially estimates the plaintiffs' claims and condemns Spain to pay 128 million. Which is less than half of the more than 300 million they were claiming.
But this seems like it was only the beginning to follow the same line the rest of the processes, the bill would rise to hundreds of millions, because there are another 26 pending complaints for the cut in the premiums that renewable energies received. The companies invested heavily and, when the Government changed the rules and cut subsidies (first at the end of 2010, with the PSOE, and then, in 2013, with the approval of the reform of the electricity sector by the PP Government), the companies sued Spain.
According to legal sources, this award is enforceable from the date it is issued and does not admit an appeal, without prejudice to the maneuvers that are envisaged by the Spanish executive to hamper the application.
In fact, the Ministry of Energy announced this Friday in a statement that it will probably appeal. "The Government estimates that the result of the award cannot be extrapolated or constitute a binding precedent ”. “This award”, adds Energía, “solely and exclusively declares, of referring to the three solar thermal plants of the plaintiffs and in view of their particular circumstances, that the reform has caused its owners damage that, in the Court's singular appreciation, is considered excessive ”.
Each procedure is different?
According to the government, each ICSID procedure is different (arbitration), in the information and arguments provided. In that sense, remember that to date there has been produced a withdrawal in an arbitration and, in the two arbitrations in the field of renewables that have been expressly resolved, “the awards have proved the Kingdom of Spain right. forceful way".
According to the Ministry, the court does not question the sovereign right of Spain to take appropriate regulatory measures to address the public needs, which potentially includes the modification made. That is to say, in his opinion, "he does not question the electricity reform carried out by the Government in 2013 and 2014 that made it possible to end the tariff deficit." In this sense, it states that “the defendant faced a legitimate public policy problem with his tariff deficit, and the court does not question whether it was appropriate for the Spanish authorities to adopt reasonable measures to deal with the situation ”.
In January 2016, the Stockholm Arbitration Court already ruled on another lawsuit filed by Charanne BV and Construction Investments, two companies linked to Isolux, for cuts to the photovoltaic sector, although on that occasion it was in favor of Spain. That was the first international arbitration to be resolved from those filed against Spain under the Energy Charter Treaty.
When making the investments, Eiser was a partner in Spain of Elecnor and the engineering firm Aries. Eiser, who has had the advice of Allen & Overy, owned 36,95% in Aries Solar Termoeléctrica (Aste), which owns two 50 megawatt (MW) thermosolar plants in Alcázar de San Juan (Ciudad Real), as well as 33,83% of Dioxipe Solar (Astexol), with another thermosolar of 50 MW in Badajoz.
The investment committed in these three plants, of more than € 935 million was carried out in 2007, the same year in which Royal Decree 661/2007 was approved, the application of which caused a boom in the deployment of renewable energies in our country.
ELEC
With about 60 years of continuous growth and presence in more than 50 countries, Elecnor has become one of the most prominent Spanish business groups and a benchmark in the infrastructure, renewable energy and new technologies sectors.
La diversification of its activities has been one of the strategic axes throughout its history, which has allowed it to cover different sectors ranging from electricity, gas, industrial plants, railways, telecommunications, water, control systems, construction, environment, maintenance of facilities, to aerospace engineering.
Su strong international vocation It has led it to a continuous process of expansion that has opened the doors to new markets around the world, the main ones being Central America, South America, Africa and the Middle East.
A Group, in short, whose technical and financial solvency allows it to promote, develop and build all kinds of infrastructures on five continents.