Summary

Petitioners NextEra Energy Global Holdings B.V. and NextEra Energy Spain Holdings B.V. (collectively, "NextEra") seek to enforce an arbitral award issued by the Internal Centre for Settlement of Investment Disputes ("ICSID") against Respondent the Kingdom of Spain ("Spain"), see Award, and collect legal fees, costs, and interest granted by a decision denying annulment of that award, see Decision on Annulment ("Decision"). In September 2025, the court granted NextEra's motions for summary judgment and ordered the parties to submit a joint proposed final judgment. The parties subsequently represented that they agreed on all terms except for the applicable pre- and post-judgment interest rates.

Pre-Judgment Interest Rate. The parties dispute whether the pre-judgment interest rate specified in the Award and Decision is a monthly or annual rate. The Award requires Spain to pay pre-judgment interest "at the rate of 0.234%, compounded monthly." Award ¶ 37(3). Similarly, the Decision states that Spain shall pay "interests on th[e] amount [awarded] at the rate of 0.234% compounded monthly." Decision ¶ 533(3). Spain reads the text to mean that the interest rate is 0.234% per year, with the interest compounded monthly. See JSR at 15. By contrast, NextEra contends that the interest rate is monthly, and amounts to over 2.8% per year. See id. at 7.

Spain has the better argument. In issuing the Award, the tribunal explained that it had selected the interest rate "on the basis of 5-year Spanish sovereign bonds as at the date of the Award." See Award ¶ 12. The "5-year sovereign bond rate was 0.234%" on that date. Id. ¶ 13.

It is undisputed that the bond rate was an annual rate. In fact, Spanish law requires the 5-year sovereign bond yield to be calculated and expressed as an annual figure. See Article 14.2, Order ECE/27/2019, B.O.E. n. 19, Jan. 22, 2019 (Spain). Because the Award incorporated the Spanish 5-year bond rate, it follows that the 0.234% is an annual rate, not a monthly rate.

The same rationale also applies to the Decision. Like the Award, the Decision adopted the Spanish 5-year sovereign bond rate. It ordered Spain to pay interest on legal fees and expenses at "the same interest rate granted in the Award." Decision ¶¶ 532-533. Because the interest rate in the Award was an annual rate, the rate in the Decision also applies on an annual basis.

That the Award and Decision relied on the Spanish 5-year bond yield is enough to resolve the parties' disagreement, but if more evidence were needed, the background convention of expressing interest rates provides it. As a default rule, interest rates are "expressed as a percentage of the principal payable for a one-year period." Interest Rate, Black's Law Dictionary (11th ed. 2019) (emphasis added); see also Joel G. Siegel & Jae K. Shim, Dictionary of Accounting Terms 243 (4th ed. 2005) (defining "interest rate" as the "rate, usually expressed as a percentage per annum charged on money borrowed or lent"). That convention has been recognized in this Circuit too. In Robinson v. District of Columbia, 341 F. Supp. 3d 97 (D.D.C. 2018), for example, the Court considered the plaintiff's request for "pre-judgment interest at a rate of 4%, compounded monthly." Id. at 114. The Court understood the plaintiff to be requesting interest at a rate of 4% per year, and for the interest to be compounded monthly. See id. & n.15.

Despite the full text of the Award and Decision and the background convention regarding interest rates, NextEra argues that because the phrase "compounded monthly" follows the interest rate specified in the Award and Decision, the rate is a monthly rate. JSR at 5. But that argument fails twice over. First, it attempts to forge a connection between the interest rate period and the frequency of compounding when none exists. An interest rate is not defined by the frequency at which the interest compounds. See, e.g., Robinson, 341 F. Supp. 3d at 114 & n.15 (acknowledging the difference between interest rate period and compounding period). Nor does the compounding period bear any logical connection to the interest rate. See Siegel & Kim, supra, at 91 (defining "compounding period" as "time during which compound interest is computed," which can be "on a daily, monthly, annual, or other basis"). Indeed, interest accrued at a given rate may never compound. See Simple Interest, Black's Law Dictionary (11th ed. 2019) (defined as "[i]nterest paid on the principal only and not on the accumulated interest."). Just because the Award and Decision specify a compounding period, that does not mean the interest rate is tied to that period.

Second, NextEra's argument runs headlong into the ordinary reading of the text. The Award grants interest "at the rate of 0.234%, compounded monthly." Award ¶ 37(3). The phrase "compounded monthly" is set off by a comma, suggesting that it "stands independent of the language" fixing the interest rate which precedes it. See United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 (1989). And that makes sense. An interest rate cannot compound monthly.

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For the foregoing reasons, the rate of pre-judgment interest is 0.234% per year. The rate of post-judgment interest is 0.234% per year for the Award and the rate specified in 9 U.S.C.

§ 1961(a) for the Decision. The parties shall file a joint proposed final judgment by October 26, 2026, which includes the arbitral award, legal fees, arbitration or legal costs, and a table forecasting the amount of pre-judgment interest that will have accrued from the day the proposed judgment is entered until thirty days thereafter.

It is SO ORDERED.
Date: October 13, 2026

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