hit tracker
Wednesday, February 28, 2024
HomeLatest NewsInternational lawyers press in Spain for renewable energy arbitrations

International lawyers press in Spain for renewable energy arbitrations

Date: February 28, 2024 Time: 19:24:30

The companies affected by the premiums to renewables squeeze one month of the general elections on July 23. The awards pending payment that Spain accumulates in international arbitration courts reach 1,300 million dollars (1,200 million euros), according to the International Arbitration Compliance Index. This figure excludes late-payment interest, costs and expenses paid by the country to hire lawyers. In total, these obligations are over 250 million dollars.

Specifically, Spain has been involved in 55 international disputes and the practice corresponds entirely to the renewable energy sector. Nikos Lavranos, founder of the Dutch consultancy NL Investment Consulting and co-author of the publication, highlighted this Tuesday at a press conference in Madrid that Spain is the second country with the highest number of awards pending payment, ranking at the level of Venezuela or Russia. All have been channeled through the Energy Charter Treaty or various bilateral investment treaties framed within the European Union (EU) community law. According to legal sources, when all the processes are resolved, the cost will rise to between 2,000 and 2,500 million euros, which is around 0.2% of GDP.

“If Spain does not pay, it can encourage others to continue along that line and add to the list of defaulters”

“Spain is weakening the level of investor confidence and sooner or later it will have to pay,” stressed Lavranos, who was accompanied by Nick Cherryman, a partner at the New York law firm Kobre & Kim LLP, and Lena Sanderb, a partner at the California law firm Gibson, Dunn & Crutcher LLP. The three of them took advantage of the trip to the Spanish capital to meet with actors from the political (and also business) sector and urged the Government to come out of 23-J to “clean up the past” and advance a “regulatory framework that continues to attract investors”. . “It is an error from the financial point of view that the Spanish State does not want to pay. If Spain does not pay, it can encourage others to continue along that line and add to the list of defaulters,” Cherryman said.

However, despite the fact that the private sector has been denouncing regulatory instability, the latest Renewable Energy Country Appealness Index (Recai) report, prepared by the consulting firm EY, maintains Spain as the eighth most attractive country in the world to invest in renewables, for behind the United States, Germany, China, the United Kingdom, France, India and Australia.

first lost award

The State lost the first of the arbitrations in 2017. The award sided with the British firm Eiser Infrastructure Limited and its Luxembourg subsidiary Energía Solar Luxembourg. Eiser was a partner in Spain of Elecnor and of the engineering firm Aries. In total, 935 million euros were invested in three plants in 2007, the year in which Royal Decree 661/2007 was discovered, the application of which was not a rapid use of ‘green’ energies. However, the sector was subsequently subjected to pay cuts. The first of these occurred at the end of 2010, with the PSOE, and then in 2013 with the approval of the reform of the electricity sector by the Popular Party.

ICSID continues to issue favorable pronouncements to the companies affected by the retroactive withdrawal of premiums for renewables. The last one that has been known is the one that affects the German BayWa, which must receive compensation of 22 million euros. The Government will also have to face the payment of 480,000 euros for default interest (a figure that differs if it does not occur in the short term) and 370,000 euros for the order on costs. Spain. The State has 15 awards pending payment, while it has been favorable in nine. There are another 25 pending publication and five have been closed by agreement.

illegal aid

The Antin fund, which has just launched a takeover bid for the Spanish Opdenergy, RWE, Renergy, Triodos, Nextera, Cube, Soles Badajoz or Eurus are some of those affected by the arbitrations. According to government sources, Spain is reluctant to make the payments because it believes that “they may be contrary to EU law and constitute illegal State Aid.” The Institute for Energy Diversification and Saving (IDAE), under the Ministry for Ecological Transition, has accumulated almost fifteen contracts so far this year between law firms, legal advisors and experts. The awards add up to a total amount of 4.8 million euros.

Everything related to the administrative, accounting, budget and financial management of expenses and contracts that are necessary for the defense of the country’s interests in renewable energy arbitration is now in the hands of the State Attorney’s Office.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

Most Popular

Recent Comments