Iberdrola has placed its confidence in the UK and USA’s energy network plans following the Spanish outfit’s decision to concentrate two-thirds of worldwide spending in the next three years on beefing up grids in the two countries.
Chief executive Pedro Azagra Blázquez (pictured) told investors at a capital markets day yesterday (24 September) the hike in the UK-US cash allocation from 40% to 65% of total gross investment to 2028 had been underpinned by strong demand and the “well defined, stable and predictable regulatory frameworks” provided by London and at state-level on the other side of the Atlantic.
Smaller amounts have been earmarked for Spain and Portugal (€9bn), Brazil (€7bn) and other EU countries plus Australia (€5bn) as Iberdrola aims to consolidate its position in ‘A-rated’ nations and looks to boost overall spending to €14.5bn a year – a €1bn increase on the previous plan.
The total €37bn that has been designated for the expansion of transmission and distribution networks offers an average return on equity of 9.5% and forms the key driver of a predicted €2bn increase in the company’s adjusted net profit to €7.6bn by 2028, according to the new spending plan.
“Our investment plan is not only ambitious but transformative,” said Azagra Blázquez.
“The priority is the right countries where we have personnel with the right skills and governments that have shown commitment.”
The remaining €21bn has been allocated to increasing generation capacity as the Spanish giant adopts a more “conservative approach” to increasing its 45GW renewables portfolio.
75% (3.5GW) of new wind, solar and storage projects are already in construction including the 1.4GW and 963MW East Anglia 3 and East Anglia 2 projects being delivered by ScottishPower Renewables off east England.
New and repowering onshore wind projects in the USA that still qualify for tax investment credits introduced by former president Joe Biden will also be progressed as part of Iberdrola’s “focus on high growth and high return markets”, added Azagra Blázquez.