Spanish energy giant Iberdrola has launched a €75 billion (£68 billion) investment plan, targeting increased renewables and network improvements.
The company – which owns the UK’s ScottishPower – is hoping to boost the “industrial fabric and jobs” in the countries it operates in, committing to economic recovery with the plan set to run till 2025.
Of the €75 billion, €68 billion will be organic with more than half going to support renewables growth, and 40% to networks. This will allow Iberdrola to double its renewable capacity to reach 60GW in 2025, compared to 32GW in 2019. It will be split between onshore wind (26 GW), offshore wind (4 GW), solar (16 GW) and hydro (14 GW).
The bulk of the investment – 83% – will go to countries with climate ambitions and A ratings, in particular the United States and the UK. Together, these two countries will account for half of the total investment, or €34 billion.
As such, Iberdrola will be able to support the UK’s net zero carbon emissions by 2050 target, along with the government’s ambition of growing offshore wind capacity to 40GW by 2030. ScottishPower Renewables already has 40 operational windfarm sites that produce over 2,000MW of power in the UK, as well as its East Anglia One offshore wind farm that is expected to be fully operation in 2020.
Iberdrola will invest more than €27 billion by 2025 in networks, with its regulated asset base set to reach €47 billion in 2025.
A further key area of investment for the company will be green hydrogen, which it views as a ‘strategic vector for industry.’ It is contemplating the installation of 600MW by 2025, and then expanding this further to 800MW by 2027 together with Fertiberia. The first projects will be in Spain, with more projects set to be considered following these.
The need for green hydrogen to aid hard to decarbonise industries in hitting climate targets is increasingly being championed, with Wood Mackenzie recently stating it will play a ‘vital’ role. ScottishPower Renewables is involved in a green hydrogen project just outside of Glasgow, where it is providing green electricity for a new 10MW electrolyser.
Through its new investment plan, Iberdrola will contribute to sustaining up to 500,000 jobs globally by 2025, as well as 20,000 new recruits.
The plan builds on its previous commitment to invest €10 billion by 2020, which has allowed its renewables arm in particular to see strong growth despite recent challenges created by the COVID-19 pandemic.
Ignacio Galán, chairman of Iberdrola, said: “After 20 years of anticipating the energy transition, our business model positions us as a key agent in the transformation of the industrial fabric. With our experience, our engagement with society and our financial strength, we are advancing a model for long-term sustainable economic growth capable of meeting the current challenges of society.”
Investments and efficiency will boost Iberdrola’s results, allowing it to make €5 billion net profit in 2025. This will help cement the company’s financial strength and move it towards being carbon neutral by 2030, by which time it aims to have 95GW of renewable capacity.