Masdar has sued the Spanish government. The multi-pronged company funded in part by the government of Abu Dhabi helped build the world’s first 24/7 solar power plant in Spain, a feat made possible in part with subsidies. But Spain has now cut incentives for renewable energy, which eats into Masdar’s investment.
In order to bridge the divide between electricity prices and costs and recoup an estimated loss of nearly $2.39 billion, Spain has slashed and in some cases completely eliminated the subsidies that first made renewable energy projects competitive against fossil fuels.
Masdar took advantage of these subsidies in 2008, when Torresol Energy was established. The Spanish engineering group SENER has a 60 percent controlling interest in the company, while Masdar has a 40 percent interest.
Through Torresol, Masdar helped to established the 20 MW Gemasolar power plant, which produces renewable energy around the clock thanks to groundbreaking solar storage technology, and the Valle 1 and Valle 2 plants with a capacity of 50MW each are still in progress.
Gemasolar alone diverts roughly 30,000 tons of CO2 emissions from the atmosphere each year.
Related: Super green Masdar Headquarters design awarded to Brookfield Complex
But Spain’s decision to cut tariffs jeopardizes Masdar’s investment in the country, so the company filed their complaint through the International Center for Settlement of Investment Disputes (ICSID) on February 11, 2014.
“As a result of the Spanish government’s unwillingness to overturn the regulatory changes, we are pursuing legal action to protect our investments,” a spokesman for a Dutch subsidiary of Masdar, Solar & Wind Cooperatief UA told Reuters.
The paper adds that foreign funds RREEF Infrastructure and Antin Infrastructure have also filed suits over the new energy laws.
:: Reuters
