Energy Security and the Environment.

Order Description

1. The Kingdom of Saxonia and the Socialist Republic of Hispanicana are both members of the Energy Charter Treaty. Electronica is a company specialising in electricity generation and distribution established in Saxonia. In 2013, Electronica was awarded a 15-year exclusive licence by the Ministry of Energy of Hispanicana to operate and modernise the electricity networks of Mercato, the largest city of Hispanicana. Electronica paid USD67 million and committed to spending a further USD13 million on the modernisation project over the next 4 years in particular on new energy efficient facilities. In return, the operating licence allowed Electronica to annually adjust electricity tariffs up to a maximum of 2.5%. In November 2015, following an unprecedented parliamentary electoral win by the Hispanicana Anarchist Alliance, the Hispanicanan Parliament enacted a law which inter alia prohibits any tariff increases for all public utilities (including electricity) for five years to rein in the official inflation rate of 7%. In January 2016, after a week of heavy storms Electronica issued a press statement and contacted all households in the Mercato metropolitan area to inform them that their electricity will be cut periodically during February 2016 to allow for the repair of the damage caused to the distribution system by the week-long storms. In response, the Ministry of Energy summarily decided to impose a fine of $2.7million on Electronica to be spent on the costs of a full investigation of the damage caused to the network. The investigation is being conducted by the state’s Public Engineering Audit Agency has not as yet come to any conclusion. Furthermore, the Minister of Energy -Dr Fidel Markez- in a televised speech before the Parliament in late 2017 encouraged the citizens of Mercato to: “…refuse to pay their electricity bills until our investigators find out what the heck is going on!” Electronica wishes to bring a claim based on the Energy Charter Treaty and asks for your advice on whether the conduct of the Parliament, the Ministry of Energy and Dr Fidel Markez are in breach of the provisions on ‘expropriation’.