King & Spalding has secured a $55 million judgment for its clients in an Energy Charter Treaty arbitration against Spain arising out of unexpected cutbacks Spain implemented in its renewable energy sector in 2013/2014. The firm is handling a number of nearly identical cases against Spain as well as similar cases against Italy, Bulgaria, and Romania.
The arbitral tribunal found that Spain treated Athena Investments (formerly Greentech Energy Systems) and Foresight Group unfairly and inequitably by abolishing a feed-in tariff program that was designed to attract investments in the renewable energy sector and help Spain meet EU-mandated green energy targets.
The European Commission intervened in the proceeding to support Spain and to argue that the dispute should be heard before EU courts, rather than in arbitration. The arbitral tribunal unanimously rejected that contention.
King & Spalding’s team was led by partners Ken Fleuriet and Amy Frey (Paris) and Reggie Smith and Kevin Mohr (Houston). The tribunal’s award includes an order for Spain to cover all of the claimants’ costs of arbitration, and it imposes an aggressive interest rate on the compensation awarded until the date of Spain’s payment.