Abengoa thermosolar plant in Sanlúcar la Mayor (Seville). BERNARDO PÉREZ

The three arbitrators appointed to the case, which was registered in 2013, condemned the Kingdom of Spain to pay €128 million in compensation plus interest. The figure falls short of the more than €300 million requested by the claimants.

The decision is a major setback for Spain, which is facing dozens of similar cases filed by other companies that invested in solar energy at a time when Madrid was offering premiums that attracted many foreign investors, including a sovereign fund from Abu Dhabi, German municipalities and a Canadian civil service pension fund – all of which subsequently filed compensation claims.

In two previous arbitration cases, the decisions favored Spain

If Spain loses further claims, the cost to Spanish taxpayers could run into the hundreds of millions of euros.

The Spanish Energy Ministry said it is thinking about appealing the decision, and that “the result of this award cannot be extrapolated or set a binding precedent.”

In two previous arbitration cases, the decisions favored Spain. In January 2016, the Stockholm Arbitration Tribunal ruled in Spain’s favor in a claim filed by Charanne B.V. and Construction Investments over cuts to photovoltaic subsidies. A further claim has since been dropped.

Eiser had partnered with Elecnor in Spain, and with the engineering firm Aries. An investment of €935 million was made in 2007 on three thermosolar plants in Ciudad Real and Badajoz. That was the year that Spain passed a decree that triggered a surge in renewable energy investment, as investors sought a piece of the premium pie.

But Spain slid into an economic crisis soon thereafter, and the sector underwent cuts. The first one was in late 2010, under a Socialist administration, and the last one took effect in 2013, under Mariano Rajoy of the Popular Party (PP). In 2014 alone, Spanish consumers were still paying €6.5 billion in renewable premiums.