Iberdrola has launched an investment plan worth €75bn for 2020 to 2025, a significant portion of which will be spent on doubling its renewables capacity.
The Spanish energy supplier said 90% of this investment volume, €68bn, will be organic and will be aimed at consolidating its business model, based on “more renewable energy, more networks, more storage and more intelligent solutions” for its customers.
The rest, €7bn, corresponds to the recently announced acquisition of US company PNM Resources.
More than half of the organic growth (51%) will go to renewables and 40% to networks.
Renewables capacity is expected to double to reach 60GW in 2025, compared to 32GW in 2019.
At the end of the period, the clean energy portfolio will be divided between onshore wind (26GW), offshore wind (4GW), solar (16GW) and hydro (14GW), Iberdrola said.
Planned investments in networks will exceed €27 billion by 2025 and the regulated asset base will reach €47 billion in 2025, after a 1.5-fold increase from 2019.
This rate of expenditure will represent an average annual investment of €10bn between 2020 and 2022, and €13bn a year in the period of 2023 and 2025.
The plan encompasses “targeted investments” in countries with climate ambitions and A rating, with the US and the UK accounting for €34 billion in investment, 50% of the total.
It also includes a 60% increase in investments in Spain, with more than €7bn allocated to renewables and over €4.5bn to networks.
Iberdrola expects to obtain a gross operating profit (EBITDA) of €15bn by 2025, an increase of €5bn from 2019, with average annual growth of 7%.
Net profit would amount to €5bn, after growing annually by between 6% and 7% during the period, Iberdola stated.
Iberdrola chairman Ignacio Galan (pictured) 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 procurement of goods and services from Iberdrola’s more than 22,000 suppliers will contribute to sustaining up to 500,000 jobs globally by 2025.
The company said 20,000 new recruits are expected by the group during the same period.
In line with European recovery plans, Iberdrola said it is planning the installation of 600MW of green hydrogen capacity by 2025 (800MW by 2027 together with Fertiberia).
The first projects in Spain will be completed with initiatives in other countries.