The World Bank, through its private sector investment arm the International Finance Corporation (IFC), is providing a loan to Iberdrola for €300m to develop renewables projects in countries dependent on fossil fuels, especially coal.
The loan linked to ESG (environmental, social and corporate governance) criteria, will target projects in countries including Morocco, Poland and Vietnam.
Of the agreed amount, €170m has already been committed to finance onshore wind projects in Poland.
In addition, both institutions are analysing collaboration options to support the development of new innovative clean energy projects, such as offshore wind and green hydrogen, in additional emerging markets.
The current loan is subject to the fulfilment of two strategic ESG objectives for Iberdrola.
The first goal is to reduce the company’s absolute direct and indirect greenhouse gas emissions by more than 60% by 2030 from the 2020 baseline, including scopes 1, 2 and 3, from the company’s operations, customers and supply chains.
The second objective is to more than double Iberdrola’s installed renewables capacity by 2030, which at the end of the third quarter of 2023 exceeded 41,000MW.
The operation is part of the alliance signed in May last year to promote the energy transition in emerging markets.
A green loan for US$150m, linked to sustainability objectives, was formalised to finance digitalisation and energy efficiency improvements in the electricity distribution networks operated by Iberdrola’s Brazilian subsidiary.
The IFC had already previously agreed a loan with Neoenergia for US$115m in 2022.
José Sainz Armada, Iberdrola’s director of finance, control and corporate development, said: “This loan will allow Iberdrola to continue contributing to the energy transition, decarbonisation and electrification of developing countries, which are still highly dependent on fossil fuels.
“It also consolidates IFC as one of our major allies in the financing of renewable projects.”
Alfonso García Mora, vice president for Europe, Latin America, and the Caribbean at IFC, added: “This loan is a significant step in the global IFC-Iberdrola Energy Transition Partnership, which aims to support Iberdrola’s expansion and re-entry into emerging markets in need of decarbonizing their energy matrix.
“We look forward to partnering with Iberdrola on projects that can accelerate a just and equitable transition to a low-carbon and sustainable energy future in developing and emerging markets.”