Solar Wars Part X: The Force Is Strong With Investors

Previous Solar Wars articles explained how arbitral tribunals considering intra-EU claims under the Energy Charter Treaty (ECT) have consistently rejected the application of judgment of the Court of Justice of the European Union in Slovak Republic v Achmea (Case C-284/16), which held that an arbitration clause in bilateral investment treaty (BIT) between two EU states contravened EU law. Those articles also considered measures being taken by the European Commission (EC) to eradicate intra-EU BITs and BIT arbitrations, and to reform the ECT.

Recent developments have confirmed that tribunals continue to reject Achmea-style challenges to jurisdiction, and as a result over the last three months Spain has suffered a losing streak in ECT arbitrations of alarming proportions.

Spain takes a hammering

Between 31 May and 2 August 2019 five different ECT arbitral tribunals handed down awards ordering Spain to pay EU investors compensation for the reform of its solar incentive scheme (as to which, see previous Solar Wars articles):

On 31 May 2019 a tribunal ordered Spain to pay two Dutch subsidiaries of New York-listed NextEra Energy290 million plus interest and costs - the largest ECT award arising out of the reform of Spain's incentive scheme so far (NextEra Energy Global Holdings BV and NextEra Energy Spain Holdings BV v Kingdom of Spain (ICSID Case No. ARB/14/11)). Rejecting Spain's Achmea jurisdictional objection, the tribunal held its remit was to determine whether...