Experts say that Eiser’s profitability is 5% before the ICSID, compared to 7.3% of the reform

Experts say that Eiser’s profitability is 5% before the ICSID, compared to 7.3% of the reform

The experts of Brattle and BDO appointed in the international arbitration of the Ciadi against Spain about the cuts to the renewable facilities of Eiser Infrastructure Limited and Solar Energy Luxembourg calculate that the profitability of these investors was between 3.7% and 5%. % after the electrical reform in 2013, compared to 7.39% in the new legislation.

These considerations are included in the ICSID award referred to the parties last week, in which for the first time this institution pronounces on the cuts to renewable facilities in Spain, and does so in favor of the plaintiffs, who in In this case, they will be entitled to an indemnity of 128 million. The ICSID received about thirty complaints about this matter.

In the award, neither the expert appointed by the State’s attorney nor Eiser’s attorney included the economic returns of the plants in the percentage of “reasonable profitability” established by the Government. Brattle, designated by Eiser, figures the profitability of the solar thermal projects of the investor at 3.7%, while BDO, chosen by the State, does so at 5%.

“The real profitability before taxes of the plants is well below the target rate foreseen by the new regime,” says the award in view of these testimonies, before confirming that the Eiser facilities did not comply with the standard of “efficient” plants applied “retroactively” in 2013 by the Government.

In fact, the capital costs of the plants were about 40% higher than the level considered “efficient” by the reform. The complainant’s experts, from Brattle, attribute this difference to aspects such as the fact that the plants were owners, instead of tenants, of the land on which the projects were based.

The operating and maintenance costs of the plants also exceeded those considered efficient, even more so when in 2012 new taxes were approved that also levied the gas used by the solar thermal plants. As a result, the revenues of the facilities registered a decrease of 66% after the reform of 2013.

In 2014, one of the plants, Aires Solar, had operating income of 19.92 million, compared to the 27.76 million needed to respond to the company’s debts, while another facility, Dioxipe, received 7.79 million, against the 13.94 million needed to repay the debt.


The award shows precisely that the indebtedness of investors in renewables and their difficulties in repaying the debt after the cuts were not taken into account when defining the new remuneration regime for the reform.

In an interrogation, the director of the solar department of the Institute for Diversification and Energy Saving (IDAE), Carlos Montoya, confirmed that it was the Ministry’s officials who carried out the “estimations and crucial calculations” to define the remuneration standards “without take into account the real characteristics and production of the plants “.

“The new regime does not take into account the real costs, including the debt service, or the actual efficiencies of certain existing CSP (solar thermal) facilities,” the award states.

Montoya added during the hearing that he also used his personal knowledge based on a project or projects he had supervised, and “admitted in his testimony that the process was not based on a

Mathematical analysis of rigorous data, when stating that ‘if you look for […] an average or a mathematical formula, there is not one’ “, indicates the award.


The court ruling also describes the expectations on which Eiser decided to invest in renewables in June 2007. To do so, it carried out ‘due diligences’ and counted on the advice of Gómez Acebo

& Pombo. At that time, the main risk identified was that the project could not be built in the 36 months established in Royal Decree 661/2007.

The debt of the projects was equivalent to 70% of the capital in the case of the Astexol plant, and 63.5% in the case of the other two plants, known as Aste. In December 2011, Eiser valued its investments at 148 million euros.


The costs of the award, which include the fees of the arbitrators and court costs, amount to $ 956,159, of which $ 277,929 correspond to President John R. Crook, 177,439 to referee Stanimir Alexandrov and $ 123,964 to the other arbitrator, Campbell McLachlan .

The court has concluded that it is not the Spanish State that assumes the total cost, but that each party pays its own legal and other expenses, as well as the respective fee for the fees and expenses of the members of the tribunal and of the Accrued rights for the use of the ICSID.

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