Litigation Funding for Energy and Infrastructure Disputes

Energy and infrastructure disputes frequently arise from projects that require substantial capital, long development periods, complex contractual structures, and cooperation among governments, sponsors, lenders, contractors, operators, suppliers, and insurers.

A dispute may concern the construction of a power plant, the operation of a transport concession, payment under an offtake agreement, access to an electricity grid, changes in tariffs, delays to a major infrastructure project, or the termination of a public-private partnership. By the time the dispute becomes formal, the parties may already have committed significant financial and operational resources.

Litigation funding may provide capital for eligible energy and infrastructure disputes in exchange for an agreed return from a successful judgment, arbitral award, settlement, or other monetary recovery. Depending on the agreement, funding may cover lawyers, engineering and delay experts, financial modellers, regulatory specialists, tribunal charges, security for costs, and enforcement.

These disputes can be commercially attractive to funders because they often involve substantial claim values, detailed contracts, sophisticated counterparties, and identifiable payment mechanisms. They can also present significant risks. Liability may be divided among several parties, damages may depend on long-term financial assumptions, public-law issues may overlap with contractual claims, and recovery may require enforcement against state-related entities or assets in several jurisdictions.

A high-value project does not automatically produce a fundable claim. Commercial fundability depends on legal merits, reliable evidence, realistic net recovery, proportionate costs, counterparty credit, procedural risk, and a credible enforcement strategy.

What Are Energy and Infrastructure Disputes?

Energy and infrastructure disputes arise from the development, financing, construction, operation, regulation, sale, transport, or decommissioning of major assets and essential services.

They may involve:

• Power-generation projects.
• Renewable-energy facilities.
• Oil and gas projects.
• Electricity transmission and distribution.
• Water production and treatment.
• District cooling and utilities.
• Roads, railways, ports, and airports.
• Telecommunications infrastructure.
• Pipelines and storage facilities.
• Waste-management projects.
• Mining and natural-resource infrastructure.
• Public-private partnerships.
• Concessions and long-term service arrangements.
• Engineering, procurement, and construction contracts.
• Operations and maintenance agreements.
• Project-finance documents.
• Power-purchase and offtake agreements.

The dispute may be contractual, regulatory, commercial, public-law, or investment-related. A single project may generate several proceedings involving different parties, contracts, governing laws, and dispute-resolution clauses.

What Is Litigation Funding?

Litigation funding, also called third-party funding or legal finance, is an arrangement under which an independent funder pays some or all of the costs of pursuing a legal claim.

Funding is commonly structured on a non-recourse basis. The funder receives an agreed return only if the funded party obtains a sufficient recovery. If the claim fails, the funder ordinarily loses the capital it deployed, subject to the agreement’s provisions concerning fraud, breach, material non-disclosure, or misuse of funds.

The funder’s return may be calculated as:

• A multiple of capital deployed.
• A percentage of recoveries.
• A combination of a multiple and percentage.
• A staged return linked to duration or procedural milestones.

The funder does not replace counsel, technical experts, or the claimant’s management. Lawyers remain responsible for legal advice and professional independence, while the claimant should retain appropriate control over the dispute and settlement.

Why Energy and Infrastructure Claims May Require External Funding

Major projects often experience financial pressure before the dispute reaches a final decision.

A claimant may need to continue operating the project while financing:

• Legal representation.
• Engineering and technical analysis.
• Delay and disruption evidence.
• Financial modelling.
• Regulatory advice.
• Document management.
• Arbitration fees.
• Security for costs.
• Parallel proceedings.
• Asset tracing and enforcement.

A contractor may be pursuing unpaid variation and prolongation claims while continuing to pay subcontractors and suppliers. A project company may face reduced revenues after an adverse tariff decision while still servicing senior debt. An investor may have lost control of a concession but lack the liquidity required to pursue an international claim.

Funding can transfer part of the cost and downside risk to a third party. It may also allow a financially strong company to preserve working capital, borrowing capacity, or investment budgets rather than allocating additional resources to a long-duration dispute.

Which Energy and Infrastructure Disputes May Be Suitable for Funding?

EPC and construction disputes

Engineering, procurement, and construction disputes are common across power, oil and gas, water, transport, and industrial projects.

Claims may concern:

• Delay and extensions of time.
• Variations and change orders.
• Disruption and loss of productivity.
• Defective design or workmanship.
• Failure to meet performance guarantees.
• Commissioning delays.
• Liquidated damages.
• Suspension or termination.
• Unpaid certificates.
• Cost escalation.
• Force majeure.
• Changes in law.

These disputes can require several expert disciplines, including engineering, scheduling, quantum, geotechnical analysis, and performance testing.

A funder will examine the contract, notices, programmes, instructions, payment records, expert evidence, counterclaims, and the relationship between the pleaded loss and the alleged breach.

Claims supported by contemporaneous project records and clearly defined payment obligations are generally easier to assess than global claims based on broad allegations of project disruption.

Power-purchase and offtake disputes

Power-purchase agreements and other long-term offtake contracts are central to many energy projects. They allocate volume, pricing, availability, payment, curtailment, dispatch, change-in-law, force-majeure, and termination risks.

Disputes may concern:

• Failure to take or pay.
• Non-payment for delivered energy.
• Tariff calculations.
• Capacity payments.
• Availability deductions.
• Curtailment.
• Fuel supply.
• Grid access.
• Performance testing.
• Change in law.
• Early termination compensation.

These claims may be suitable for funding where the contract provides a measurable payment formula and the disputed amounts can be modelled using reliable operational and financial data.

The funder will also examine whether the offtaker has sovereign support, a government guarantee, escrow arrangements, credit enhancement, or another reliable source of payment.

Concession and PPP disputes

Public-private partnerships and concessions allocate responsibility for designing, financing, building, operating, and maintaining public infrastructure over an extended period.

The World Bank’s PPP materials identify renegotiation, government step-in rights, termination, and dispute resolution as recurring issues in long-term PPP arrangements.

Disputes may arise from:

• Delayed land access.
• Failure to obtain approvals.
• Changes to service requirements.
• Tariff adjustments.
• Government interference.
• Demand or volume risk.
• Failure to meet performance standards.
• Step-in by government or lenders.
• Renegotiation.
• Compensation events.
• Termination payments.
• Handback obligations.

PPP claims can be difficult because the underlying contract may combine private-law obligations with statutory powers, public-service requirements, fiscal constraints, and political considerations.

Funding analysis must distinguish between contractual rights, regulatory decisions, and any public-law or treaty claims that may arise from the same facts.

Project-finance disputes

Infrastructure projects commonly rely on limited-recourse or non-recourse project finance. Lenders expect repayment principally from the project’s revenues and security package rather than the sponsor’s general balance sheet.

Disputes may involve:

• Events of default.
• Debt-service shortfalls.
• Reserve-account requirements.
• Lender step-in rights.
• Intercreditor priority.
• Enforcement of security.
• Sponsor support obligations.
• Completion guarantees.
• Hedging arrangements.
• Cash-waterfall disputes.
• Refinancing.
• Restrictions on distributions.

Litigation funding may be relevant where a project company or sponsor holds a substantial claim but cash is trapped, lenders control enforcement decisions, or existing finance documents restrict additional expenditure.

The funding structure must be coordinated with the project’s security arrangements, direct agreements, negative pledges, lender consents, and payment waterfall. A claimant should not grant a funder rights over recoveries that conflict with existing secured obligations.

Renewable-energy disputes

Renewable-energy projects may generate disputes concerning:

• Withdrawal or reduction of incentives.
• Grid-connection delays.
• Curtailment.
• Changes in tariff methodology.
• Equipment underperformance.
• Availability guarantees.
• Land and permitting.
• Environmental approvals.
• Battery degradation.
• Resource forecasts.
• Carbon-credit ownership.
• Decommissioning obligations.

Solar, wind, battery-storage, hydrogen, and other low-carbon projects may involve new technologies and evolving regulation. This can complicate both liability and damages.

A funder will distinguish technology risk from legal breach. A project’s underperformance does not necessarily establish supplier, contractor, operator, or government liability.

Oil and gas disputes

Oil and gas disputes may arise under:

• Production-sharing agreements.
• Joint-operating agreements.
• Drilling contracts.
• Transportation agreements.
• Gas-sales agreements.
• LNG sale and purchase agreements.
• Farm-in and farm-out agreements.
• Decommissioning arrangements.
• Host-government contracts.

Claims may concern cost recovery, reserve estimates, operator conduct, cash calls, lifting rights, pricing, delivery obligations, tax stabilisation, force majeure, sanctions, and termination.

These cases may involve commercially sensitive geological, pricing, and operational information. Funding diligence must therefore be conducted under strict confidentiality and information-security arrangements.

Transport and logistics disputes

Infrastructure funding may support disputes involving:

• Rail projects.
• Toll roads.
• Ports and terminals.
• Airports.
• Shipping infrastructure.
• Logistics concessions.
• Public transport operating agreements.

Claims may concern ridership or traffic assumptions, access charges, construction delay, capacity, revenue sharing, service standards, regulatory change, or early termination.

The funder will test whether the claimant’s losses arise from a contractual breach or from commercial assumptions that the claimant agreed to bear.

Utilities and regulated-service disputes

Electricity, water, telecommunications, district cooling, and waste projects may be subject to price controls, service obligations, licence conditions, and technical regulation.

Disputes may concern:

• Tariff determinations.
• Connection charges.
• Licence revocation.
• Performance penalties.
• Access to networks.
• Quality standards.
• Cost pass-through.
• Regulatory asset valuation.
• Universal-service obligations.
• Compensation following restructuring.

Regulatory non-compliance and private entitlement are separate questions. A regulator’s decision may affect the economics of the project without necessarily creating a damages claim against another party.

Contract Structure and Risk Allocation

Energy and infrastructure disputes cannot be assessed by reading one contract in isolation.

A project may involve:

• A concession agreement.
• An EPC contract.
• An operations and maintenance agreement.
• A power-purchase or offtake agreement.
• Fuel or feedstock supply contracts.
• Finance documents.
• Direct agreements.
• Shareholder arrangements.
• Insurance policies.
• Government guarantees.
• Land and access agreements.

The contracts are commercially connected but may have different governing laws, notice provisions, liability caps, and dispute-resolution clauses.

A delay caused by government access problems may trigger claims under the concession, the EPC contract, finance documents, and insurance policies. The project company may owe the contractor compensation before recovering from the government counterparty.

A funder must identify where the economic loss sits within the contractual structure and which entity has standing to claim it.

Notices, Time Bars, and Claims Procedures

Major project contracts commonly impose detailed claims procedures.

A party may be required to provide notice of:

• Delay.
• Force majeure.
• Changes in law.
• Variations.
• Compensation events.
• Regulatory decisions.
• Additional costs.
• Relief events.
• Default.
• Termination.
• Referral to a dispute board.

The legal effect of non-compliance depends on the contract and governing law. Some provisions operate as strict conditions precedent, while others may permit relief where the counterparty had actual knowledge or suffered no prejudice.

Funding diligence will usually examine notice compliance early. A substantial economic loss may not produce a viable claim if contractual time limits were missed.

Quantum and Financial Modelling

Damages in energy and infrastructure disputes can depend on long-term assumptions extending over decades.

Possible claims may include:

• Unpaid invoices.
• Construction and prolongation costs.
• Lost revenue.
• Lost profit.
• Increased financing costs.
• Replacement power or fuel costs.
• Reduced project value.
• Termination compensation.
• Equity loss.
• Debt breakage costs.
• Decommissioning costs.
• Regulatory asset-value adjustments.

Financial models may depend on assumptions concerning:

• Commodity prices.
• Electricity demand.
• Inflation.
• Exchange rates.
• Interest rates.
• Plant availability.
• Operating costs.
• Tariffs.
• Tax.
• Discount rates.
• Remaining project life.

A funder will test whether the damages model reflects legally recoverable loss rather than the project’s total economic underperformance.

Sensitivity analysis is particularly important. A claim may appear highly valuable under one price or demand assumption but substantially weaker under a more conservative scenario.

Public-Private Partnerships and Renegotiation

Long-term infrastructure agreements must often respond to changes in demand, technology, regulation, and public priorities.

The World Bank’s PPP resources recognise that interpretation of contractual obligations, renegotiation, government step-in, termination, and dispute resolution may become either cooperative or contentious.

Not every commercial deterioration amounts to a breach. The claimant must distinguish among:

• Risks allocated contractually to the private party.
• Government compensation events.
• Regulatory change.
• Force majeure.
• Political decisions.
• Ordinary demand risk.
• Poor project performance.
• Events requiring renegotiation but not damages.

A funder will examine whether the claim seeks enforcement of an existing legal right or attempts to transfer an agreed commercial risk after the project became less profitable.

Arbitration of Energy and Infrastructure Disputes

International energy and infrastructure contracts frequently provide for arbitration.

Arbitration may offer:

• Neutrality.
• Specialist decision-makers.
• Procedural flexibility.
• Confidentiality protections.
• Consolidation or joinder mechanisms where available.
• Cross-border enforceability.

The ICC Arbitration Rules 2026 entered into force on 1 June 2026. Article 12(6) reiterates the requirement concerning disclosure of qualifying third-party funding relationships for conflict-checking purposes.

Disclosure of the funder’s existence or identity should not be confused with automatic disclosure of the complete funding agreement. A tribunal may nevertheless order targeted production where terms are relevant to conflicts, security for costs, adverse costs, control, or termination.

The funding agreement should therefore anticipate procedural scrutiny and require cooperation with applicable disclosure duties.

Investment Arbitration and Third-Party Funding

Energy and infrastructure investments sometimes generate disputes between foreign investors and states under investment treaties, investment laws, or state contracts.

Potential claims may concern:

• Expropriation.
• Discriminatory treatment.
• Revocation of licences.
• Changes to incentive regimes.
• Government interference.
• Denial of justice.
• Failure to honour protected commitments.

Treaty protection should not be assumed merely because a project involves a foreign investor or state entity. Jurisdiction depends on the applicable treaty or investment instrument, nationality, ownership structure, protected investment, consent to arbitration, and timing of the alleged conduct.

Under ICSID Arbitration Rule 14, a party must disclose the name and address of a non-party providing qualifying third-party funding. Where the funder is a legal entity, the notice must also identify the persons and entities owning and controlling it. The disclosure obligation continues throughout the proceeding.

Funding disclosure assists conflict checks. It does not establish the merits of the claim, the claimant’s financial condition, or an automatic entitlement to security for costs.

Security for Costs and Adverse Costs

A funded claimant may face an application for security for costs, particularly where the claimant is a project company with limited assets or is in financial distress.

The respondent may argue that the claimant would be unable to satisfy an adverse-cost award. The claimant may respond that funding, insurance, guarantees, or available assets provide sufficient protection.

The funding package should address:

• Whether security is included in the budget.
• Whether the funder will provide security directly.
• Whether adverse-cost insurance is available.
• Whether the funder accepts any adverse-cost liability.
• Whether that liability is capped.
• The effect of a large security order.
• Whether the funder may terminate after an adverse procedural ruling.

A funding agreement covering only counsel and experts may leave a material procedural exposure unfunded.

Sovereign and State-Entity Counterparties

Many infrastructure projects involve ministries, municipalities, state-owned utilities, sovereign wealth entities, or government-controlled companies.

The presence of a state-related counterparty raises additional questions:

• Is the contract with the state or a separate legal entity?
• Is there a sovereign guarantee?
• Does the entity have independent assets?
• Does sovereign immunity apply?
• Is immunity from jurisdiction distinct from immunity from execution?
• Are commercial assets identifiable?
• Are special approval or budgetary requirements relevant?
• Can the award be enforced outside the project state?

A state-owned counterparty should not be assumed to enjoy immunity merely because of government ownership. Equally, a contractual waiver of immunity should not be assumed to remove every restriction on execution.

Enforcement analysis must be jurisdiction-specific.

Multiple Parties and Parallel Proceedings

Energy and infrastructure disputes commonly involve several contractual tiers and potential defendants.

The project company may pursue the government counterparty while facing claims from the EPC contractor and lenders. The EPC contractor may seek recovery from subcontractors, designers, and suppliers. Insurers may dispute coverage while reserving subrogation rights.

Parallel proceedings may include:

• Commercial arbitration.
• Construction adjudication.
• Regulatory review.
• Court proceedings.
• Investment arbitration.
• Insurance arbitration.
• Insolvency proceedings.
• Enforcement actions.

A funder must assess whether the proceedings reinforce or undermine one another, whether findings may overlap, and whether inconsistent outcomes are possible.

The claimant must also avoid double recovery where the same economic loss is pursued under several contracts or legal regimes.

Insolvency and Distressed Projects

Energy and infrastructure claims often become most valuable when the project or contractor is experiencing financial distress.

Funding may assist:

• A project company unable to finance arbitration.
• A contractor with substantial unpaid claims.
• An insolvency office-holder monetising legal assets.
• Lenders seeking to preserve project value.
• A sponsor facing termination of a concession.
• A company in restructuring.

Insolvency introduces questions concerning authority, creditor approval, ownership of claims, existing security, priority over proceeds, avoidance risk, and the interests of the estate.

A funder will also consider whether the respondent is financially capable of satisfying an award. A strong claim against an insolvent counterparty may have limited value unless supported by insurance, guarantees, bonds, or recoverable assets.

Enforcement of Energy and Infrastructure Awards

A favourable award is valuable only if it can be collected.

The New York Convention’s principal purpose is to ensure that foreign and non-domestic arbitral awards are recognised and generally capable of enforcement in contracting states, subject to its limited refusal grounds.

The funder will nevertheless assess:

• The seat of arbitration.
• Annulment risk.
• Asset location.
• Corporate ownership.
• Existing security.
• Sovereign immunity.
• Competing creditors.
• Foreign-exchange restrictions.
• Sanctions.
• Public-policy objections.
• The cost and duration of enforcement.

Project assets may be essential public infrastructure and legally difficult to seize. Revenue accounts, commercial receivables, contractual payment rights, guarantees, or assets outside the project state may offer more realistic enforcement routes.

Confidentiality and Funding Due Diligence

Energy and infrastructure disputes involve commercially and politically sensitive information.

Funding diligence may require access to:

• Project contracts.
• Financial models.
• Government correspondence.
• Technical reports.
• Operational data.
• Tariff calculations.
• Legal opinions.
• Lender documents.
• Insurance policies.
• Settlement discussions.
• Asset information.

Before disclosure, the claimant and counsel should consider confidentiality, privilege, state-secrecy restrictions, data protection, contractual limitations, sanctions, and secure document handling.

A staged diligence process is generally preferable. Initial review may rely on a claim memorandum, contract summary, chronology, budget, damages model, and enforcement outline before access to the complete project record is granted.

How Funders Assess Energy and Infrastructure Claims

Legal merits

The funder will analyse contractual entitlement, governing law, jurisdiction, notices, causation, defences, limitation, and counterclaims.

Technical evidence

Engineering, operational, delay, and performance evidence must support the pleaded case. A legal argument cannot compensate for unreliable technical data.

Realistic net recovery

The funder will test financial models, contractual caps, deductions, set-off, counterclaims, tax, financing costs, and settlement scenarios.

Budget and duration

Major project disputes may require multiple experts, lengthy hearings, parallel proceedings, challenges, and enforcement.

Counterparty credit

The respondent’s assets, guarantees, insurance, public funding, and payment mechanisms are central to fundability.

Contractual and financial structure

The funder must understand lender rights, security, direct agreements, payment waterfalls, and competing claims over recoveries.

Enforcement

A credible asset and enforcement strategy is required from the beginning.

Risks and Limitations

Project value is not claim value

A multibillion-dollar infrastructure project may generate a much smaller legally recoverable claim.

Financial models can magnify uncertainty

Small changes to tariffs, commodity prices, discount rates, or project life may materially alter damages.

Public-law issues may complicate contractual rights

A regulator’s decision, legislative change, or public-interest measure may affect the project without creating a compensable contractual or treaty breach.

Counterclaims may exceed the primary claim

An employer or government counterparty may allege delay, defects, underperformance, or breach of service standards.

State involvement complicates enforcement

A successful award may still face immunity, public-policy, budgetary, or asset-identification obstacles.

Long-duration funding can be expensive

The funder’s required return may increase where proceedings, challenges, and enforcement extend over many years.

Forward-Looking Legal Assessment

Energy and infrastructure disputes are likely to remain an important category of commercial claims as governments and private investors finance energy transition, transport, digital infrastructure, water security, and public services.

The strongest funding opportunities are likely to involve:

• Substantial EPC claims.
• Unpaid offtake or capacity payments.
• High-value concession and PPP disputes.
• Termination compensation.
• Project-finance enforcement claims.
• Renewable-energy disputes supported by clear contractual rights.
• Major regulatory or investment claims with established jurisdiction.
• Respondents supported by assets, guarantees, or reliable payment mechanisms.

Funding will generally be less suitable where the claim seeks to transfer an agreed commercial risk, damages depend on speculative long-term assumptions, contractual notices were not preserved, or enforcement depends on protected public assets.

The transition to lower-carbon infrastructure may create new disputes involving grid access, storage, hydrogen, carbon markets, decommissioning, and evolving technology. Those disputes will still require the same core analysis: legal entitlement, causation, recoverable loss, procedural viability, and collection.

Conclusion

Litigation funding can provide the capital required to pursue eligible energy and infrastructure disputes without requiring the claimant to bear the full cost and downside risk.

These claims can be suitable for funding because they frequently involve valuable contractual rights, detailed project records, substantial damages, and sophisticated counterparties. Their complexity also creates material risks. Several contracts may apply, technical causation may be contested, financial models may be sensitive to assumptions, and enforcement may involve state-related entities or assets in multiple jurisdictions.

A funder will therefore examine more than the scale of the project or the amount claimed. It will assess jurisdiction, contractual entitlement, notices, technical evidence, realistic net recovery, counterclaims, finance structure, counterparty credit, and enforcement.

Litigation funding for energy and infrastructure disputes is most effective where the claim is legally meritorious, technically supported, economically proportionate, procedurally viable, and capable of producing an enforceable monetary recovery.

Frequently Asked Questions

Can an energy arbitration be funded?

Yes. Funding may cover legal fees, technical and financial experts, tribunal costs, security for costs, and enforcement, subject to the agreement and applicable law.

Can a project company obtain litigation funding?

Potentially. The funder will examine the company’s authority, finance documents, lender rights, security package, payment waterfall, claim merits, and expected recovery.

Are PPP and concession disputes suitable for funding?

They may be, particularly where the claimant has a clear contractual entitlement to payment, compensation, tariff adjustment, or termination amounts. Public-law, political, and enforcement risks require separate assessment.

Can investment arbitration claims be funded?

Potentially. Jurisdiction under the relevant treaty or investment instrument must be established. ICSID Rule 14 requires continuing disclosure of qualifying third-party funding relationships.

Can funding cover security for costs?

Potentially, if expressly included. The claimant should confirm whether the funder will provide security, finance it, or support an insurance or guarantee arrangement.

Does a large infrastructure project automatically create a fundable claim?

No. Funders assess the legally recoverable net claim, not the project’s total capital value. Contractual risk allocation, evidence, counterclaims, budget, and enforcement remain decisive.

References

[1] International Centre for Settlement of Investment Disputes, ICSID Arbitration Rules, Rule 14: Notice of Third-Party Funding, effective 1 July 2022.

[2] International Centre for Settlement of Investment Disputes, ICSID Administrative Council Approves Amendment of ICSID Rules, 21 March 2022, explaining the continuing third-party funding disclosure obligation.

[3] International Chamber of Commerce, ICC Arbitration Rules 2026, effective 1 June 2026, including Article 12(6) concerning third-party funding disclosure.

[4] United Nations Commission on International Trade Law, Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958).

[5] World Bank Group, PPP Reference Guide, official materials concerning public-private partnerships and infrastructure.

[6] World Bank Group, Renegotiation, Government Step-in Rights, Termination and Dispute Resolution, official PPP guidance.

[7] WinJustice, Writing and SEO Guidelines, including the approved professional structure, source hierarchy, numbered references, and no-table requirement.

[8] WinJustice, Approved Article Examples and Editorial Patterns, including the rule-source-significance-limitations analytical method and GCC arbitration pattern.

About WinJustice

WinJustice is a UAE-based litigation funding company providing funding solutions for eligible commercial disputes, litigation, and arbitration claims.

Through legal, financial, and enforcement assessment, WinJustice seeks to support meritorious claims while helping claimants manage the cost and financial risk of pursuing legal proceedings.

For more information about litigation funding or to submit a claim for preliminary assessment, visit WinJustice.

This article is provided for general informational purposes only and does not constitute legal, financial, tax, Sharia, or investment advice. The legality, availability, and terms of litigation funding depend on the applicable jurisdiction, forum, governing law, and circumstances of each dispute. Funding remains subject to legal, financial, and enforcement assessment.