The European Commission said it will investigate an arbitration award ordering Bulgaria to pay €61.04 million plus interest to ACF Renewable Energy Ltd., which invested in a Bulgarian solar plant under a 2011 renewable energy support scheme.
Bulgaria modified the scheme in 2013 and 2014, prompting ACF to pursue arbitration. The arbitral tribunal found Bulgaria breached the Energy Charter Treaty and awarded compensation in January 2024. Bulgaria notified the European Commission but has not paid the sum.
The European Commission said its preliminary view at this stage is that implementing the award would constitute state aid under Article 107(1) of the Treaty on the Functioning of the EU, making it potentially incompatible with the internal market. The investigation will also consider whether the award breaches EU treaty provisions on the jurisdiction of the Court of Justice of the European Union.
The probe allows Bulgaria and interested parties to submit comments. It does not indicate the European Commission’s final decision.
EU law generally prohibits intra-EU investor-state arbitration under bilateral investment treaties or the Energy Charter Treaty, following the 2018 Achmea judgment and the 2021 Komstroy ruling. The EU formally withdrew from the Energy Charter Treaty in June 2025.
The European Commission said that legal protections for investors remain through national courts and EU law, and member states must ensure renewable energy support measures are stable and do not undermine the economic viability of projects.
In December 2025, Bulgaria’s Ministry of Energy awarded more than 4 GWh of energy storage capacity across 31 projects under its RESTORE 2 procurement plan, committing BGN 228.9 million ($137.2 million) to develop standalone renewable energy storage infrastructure nationally.
And in October 2025, International Power Supply switched on Bulgaria’s first battery energy storage system (BESS) manufacturing facility near Sofia with an initial annual capacity of 3 GWh, with plans to expand to 5 GWh by the second quarter of 2026.
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