Procedural Posture

This document is a Request for Arbitration filed by Cavalum SGPS, S.A., a Portuguese corporate entity, against the Kingdom of Spain. The Claimant initiated the proceedings pursuant to Article 36 of the ICSID Convention and Article 26(4)(a)(i) of the Energy Charter Treaty (ECT), seeking the constitution of a three-member arbitral tribunal to adjudicate claims arising from Spain's regulatory overhaul of its renewable energy sector.

Factual and Legal Background

The dispute centers on a series of legislative and regulatory measures enacted by Spain that fundamentally altered the economic regime governing renewable energy investments. The Claimant alleges that it made substantial investments in seven photovoltaic power plants in Spain, relying on the stable feed-in tariffs and long-term economic guarantees established under Royal Decree 661/2007 and Royal Decree 1578/2008. According to the Request, Spain subsequently implemented a series of retroactive modifications, including Royal Decree 1565/2010 and Royal Decree-Law 14/2010, which capped eligible operating hours and reduced tariff durations. Furthermore, the Claimant asserts that Law 15/2012 imposed a 7% levy on electricity generation revenues, and Royal Decree-Law 9/2013 effectively abolished the original premium system, replacing it with a theoretical "reasonable rate of return" model based on standard facility parameters.

Claimant's Principal Legal Positions

The Claimant contends that Spain’s retroactive abrogation of the guaranteed incentive regimes constitutes a repudiation of its commitments, thereby violating multiple provisions of the ECT. Specifically, the Claimant argues that Spain breached its obligations under Article 10(1) of the ECT to provide fair and equitable treatment, to observe obligations entered into with investors (the umbrella clause), and to refrain from unreasonable or discriminatory measures. Additionally, the Claimant asserts that the regulatory changes amounted to an unlawful expropriation of its investments in violation of Article 13 of the ECT, severely diminishing project revenues and forcing the Claimant to abandon or divest from other renewable energy projects in development.

Requested Relief

In its Request for Relief, the Claimant seeks a declaration that the dispute falls within the jurisdiction of ICSID and that Spain has breached its obligations under Part III of the ECT and international law. The Claimant requests full compensation for all damages suffered, including invested sums, lost profits, and consequential damages, alongside an award for the costs of the arbitration and pre- and post-award compound interest.