Iberdrola and Irish company Echelon have created a joint venture to build and operate data centres in Spain.
It is the largest binding agreement of its kind in Europe between an energy company and a developer of these technological infrastructures.
Iberdrola will have a 20% stake in the joint venture through its subsidiary CPD4Green. It will be responsible for identifying and securing land with connectivity to the electricity grid where the centres can be developed. In addition, it will supply electricity 24/7 to the centres.
Echelon will own 80% of the company and will be responsible for the development, design, marketing and day-to-day management of the joint venture.
Echelon’s major shareholder is Starwood Capital Group, a global private investment firm with approximately $115bn in assets under management in North America, Europe and Asia.
The first of the projects in this joint venture will be Madrid Sur, a 160,000-square metre complex that will offer 144MW of data processing and which already has a 230MW electricity connection secured.
This centre, which will create around 1500 jobs and is expected to be operational before 2030, will involve a demand of 1TWh that will be covered by a photovoltaic solar plant which will be built on-site, complemented by additional clean energy capacity from Iberdrola.
“This agreement reinforces Iberdrola’s strategy of facilitating the development of data centres, which have already become a key vector for the growth in electricity demand,” said David Mesonero Molina, corporate development director of Iberdrola.
“The alliance signed with Echelon will allow us to value our portfolio of sites with access to electricity connection and our ability to offer these infrastructures secure, clean and competitive energy 24 hours a day, 365 days a year.”
David Smith, chief investment officer at Echelon Data Centres, said: “Entering the Spanish data centre market has been a strategic goal for Echelon for several years.
“Spain has material benefits for our customers: access to large-scale renewable energy with some of the lowest prices in Europe and large construction and operation capacities.
“Our partner, Iberdrola, is a global energy leader and we are delighted to have this opportunity to partner to offer the best data processing infrastructures to our customers.”
Iberdrola already sells more than 11TWh to technology companies and operators of these infrastructures worldwide, which makes it a leader in the supply of electricity to data centres.
In addition, its subsidiary CPD4Green, dedicated to facilitating the development of data processing infrastructures, it already has a portfolio of sites for 700MW in Spain and potential for another 5000MW.