Italy’s Reduction of Existing Renewable Energy Incentives: The Ruling of the CJEU on the Compatibility of the Spalma-Incentivi Decree with EU Law

Abstract

On 15 April 2021, the Court of Justice of the European Union rendered its preliminary ruling in Joined Cases 798/18 and 799/18 on the compatibility with EU law of the photovoltaic incentives cuts enacted by Italy in 2014 under the so-called Spalma-incentivi Decree.

The judgment is of pivotal importance as, for the first time, the Court analysed, in the light of the fundamental principles and rights of EU law and of the European Convention on Human Rights on the protection of economic operators, the legitimacy of national legislation reducing incentives previously granted to investors with the aim of fostering the production of renewable energy.

The Court’s judgment is part of a broader framework of rulings, both national and international, addressing this issue. In this articulated context, the Court provided a restrictive interpretation of the investors’ expectation that national legislation providing for future benefits might not be altered.

Keywords: CJEU, Court of Justice of the European Union, EU law, ECHR, FET, ECT, International Investment Law