Abengoa has decided to take legal action against the Spanish government for the reduction in the premium rates paid for concentrating solar power (CSP) in its reform of the domestic electricity sector.
Abengoa has decided to raise a legal battle for the reduction of premiums for concentrating solar power generation approved by the Government in its electricity reform.
Abengoa has not only taken legal action in the Spanish courts but, taking advantage of the ownership of some of its core is a subsidiary in Luxembourg, has raised international arbitration.
"In June 2013 , we filed a demand for arbitration on behalf of our subsidiary CSP Equity Investment Sarl against the Spanish Government as a signatory of the Treaty of the Energy Charter," said the document filed with the commission of the stock market of the USA (The SEC , for its acronym in English).
"Our demand for arbitration alleges that the electricity sector regulatory reform approved by the Spanish Government has broken the legitimate expectations of CSP Equity Investment ( … ) and an expropriation " adds Abengoa in the brochure. CSP Equity Investment is the investment holder of Abengoa solar thermal power plants Helioenergy 1 and 2 , Solaben 2 and 3 , and Solacor 1 and 2.
The arbitration will be held in The Hague in accordance with the rules of the Arbitration Institute of the Stockholm Chamber of Commerce. The court will settle the lawsuit with three referees, two of which have already been delivered to the supervisor nombrados. Abengoa does not specify the amount claiming, but sources indicate that the company would be around 60 million euros per year while not resolve the situation. The amount is equivalent to a cut of 33 % in revenue from the CSP. Litigation can take years and no overtones of that negotiation with Industry will move faster. Concessions for solar thermal plants are up to 40 years, so that the amount in dispute is billionaire.
In parallel, Abengoa has taken legal action in a court of Seville with respect to the CSP plant Helios I. The court rejected the action with the reasoning that Abengoa must first exhaust administrative remedies with the Ministry of Industry and the company has appealed that decision to the Audiencia Provincial de Sevilla.
Manuel Sánchez, CEO of Abengoa, said yesterday after the premiere of the multinational trading on Nasdaq that "everyone has to defend their interests." And he challenged those who question the maturity of concentrated solar power technology, inviting them to visit its CSP plant in Arizona. " If you are not convinced with the first round will do so in the second or third" .
"We are much closer to having a cost competitive with fossil fuels," he says , "is increasingly nearer the time in which such parity is achieved." "The problem is that people are committed to wanting to kill her before that time comes." Take, calculates, five more years of technological effort and innovation. Spain , as Sanchez said, has only one option to improve their energy dependence via the strengthening and renewables. " We are not like the U.S. , which also have their oil and natural gas".
"When are difficult financial situations , governments focus on resolving the short term and leave a little more future problems" he says. So you think that as the situation stabilizes," expect to see a growing concern about climate change and the search for alternative sources."
The manager of Abengoa group also mentioned that the Spanish economy is beginning the process of recovery and therefore he believes it is a good time for investors to start taking positions. "It’s getting the money ," he said , as on the eve Emilio Botin said in New York , " the worst is over."
The major energy reform beneficiaries will be the lawyers. Enterprises have begun to introduce a flood of resources and demands. While traditional power raise the bulk of the Spanish court battle, several investors renewable energy sector have chosen the path of international demands.
Spain has opened two more arbitration for alleged violation of the Treaty on the Energy Charter. The principal is presented by 16 investors (AES Solar, Solar Energy GWMLux, Eoxis Energy, Ampere Equity Fund, Element Power, European Energy, KGAL, NIBC Infrastructure Partners, Foresight, GreenPower Partners, HgCapital , Hudson Clean Energy, Impax Asset Management, Scan energy and White Owl Capital) in November 2011 by trimming PV premiums approved by the government of José Luis Rodríguez Zapatero. Compensation claim industry sources stood at about 600 million. The other demand, much lesser extent , was presented this year by firms Charanne and Construction Investments. But many more are coming .