Spain's Supreme Tribunal rules against PV system owners

Spain’s Supreme Tribunal has ruled against five appeals presented by solar producers in which they called for compensation for the cuts to the solar feed-in tariff introduced by the government in 2010. The solar businesses are calling for compensation for damages and losses caused by, among other measures, Royal Decree 14/2010, which considerably reduced the hours paid under the feed-in tariff.

The National Association of Photovoltaic Energy Producers (ANPIER) has harshly criticized the decision of the high court, which it considers “unjust”. With this judgement “one of the darkest hours of Spanish Democracy is consummated,” according to the organization.

A ruling was eagerly anticipated by the renewable energy sector, which put its hopes on the high court recognizing the damage caused to producers by the government through these cuts. This ruling will apply to another 150 solar businesses which have presented similar appeals to the Supreme Tribunal.

In a press statement, the Supreme Tribunal explained that it looked at whether the cuts had been offset by favorable regulations earlier, and whether, with these, the regulations offered a “reasonable compensation” of 8% annually for these installations, paid over a period of 30 years. To reach these conclusions, the high court indicated that it had consulted expert reports.

The experts consulted argued that the cuts to payment were offset by regulations introduced later under Royal Decree 413/2014. This regulation was introduced in 2014 by the Spanish government and established the details of a new compensation program which substituted for the feed-in tariff.

ANPIER rejected the reports of the experts. “This court has allowed a crude and arbitrary evaluation based on only four installations out of 62,000,” stated the organization.

The five appeals were specifically presented against the decision by the Council of Ministers which rejected petitions for liability for damages and losses to solar producers through modifications introduced in Royal Decree 1565/2010, Royal Decree 14/2010 and the law 2/2011.

The Supreme Tribunal considered that under Royal Decree 661/2007, which governed the feed-in tariff, producers “did not acquire a perfect and limitless right, to receive a ‘regulated tariff’ for the total of the net energy produced during the entire life of the installation under the terms set in this regulation”.

Furthermore, “the form, the quantity, the extension and the duration of these incentives cannot be set in stone with that initial regulation, but are subjected to necessary adaptions and prevailing circumstances”.

In reply, ANPIER stated that PV system owners would not have made these investments if they were aware that the government could introduce changes in compensation.

“If the families that comprise our producers would have received even a hint that the conditions offered by the Spanish state in the Royal Decree had even a minimum possibility of being altered, they would not have risked a cent,” stated ANPIER President Miguel Ángel Martínez Aroca.

The Supreme Tribunal also ruled that laws were in accordance with the Spanish Constitution and rejected the claim that they infringed on principles prohibiting retroactive measures. It also warned that the modifications introduced by the government are not contrary to EU rules relating to legal certainty and protection of investor confidence.

ANPIER is confident that the Court of Justice of the European Union will rule in favor of PV system owners, and that the rulings of international lawsuits will also be favorable. Currently there are numerous international lawsuits initiated by foreign companies against the Spanish government for changes to renewable energy regulations.

“We are going to endure the paradox that under the same circumstances Spanish citizens will not be compensated, and international investors will be,” argued ANPIER President Martínez Aroca.

This article was translated by Christian Roselund. For the original in Spanish, please see the pv magazine LatinoAmérica website.