Iberdrola commits €41bn to electrification, promising job creation and renewable energy expansion

In a major move towards sustainable development, Iberdrola has announced its plan to invest €41 billion and hire 10,000 individuals by 2026, accelerating the electrification process. This massive investment includes the acquisition of an 18.4% stake in Avangrid, previously disclosed. Additionally, Iberdrola’s partners in renewables are set to contribute €5 billion, effectively netting the investment to €36 billion.

A substantial 70% of this investment is earmarked to support growth, with 85% allocated to A-rated markets. The United States remains the primary investment destination, accounting for 35%, followed closely by the UK (24%), Iberia (15%), Latin America (15%), and others including Germany, France, and Australia (11%). The focus on network-based growth will see €21.5 billion invested to expand and strengthen networks across the US, UK, Brazil, and Spain, with transmission identified as a significant growth driver, attracting over €6.5 billion within the investment period.

Iberdrola’s investment strategy prioritizes stable and predictable frameworks, ensuring that 85% of the asset base benefits from closed framework agreements. Additionally, 80% of Networks EBITDA is safeguarded against inflation and interest rates, showcasing the company’s prudent financial management.

Selective investment in renewables, totaling €15.5 billion gross investment, will focus more than half on offshore wind projects in the US, UK, France, and Germany, with a clear directive that 100% of the investment will fund projects already under construction. Iberdrola’s leadership in storage will also be reinforced through a €1.5 billion investment, increasing pumped storage capacity by 20% and providing greater stability to the system.

The customer-centric approach involves a €2.5 billion investment, primarily targeting industrial customers and regulated generation with long-term contracts. With 85% of sales having guaranteed margins closed to 2026, Iberdrola is poised for high-mid-single-digit growth in earnings and dividends, expecting an EBITDA of between €16.5 billion and €17 billion in 2026.

Iberdrola’s commitment to sustainability is evident in its target for zero emissions in generation by 2030, significant job creation, and focus on diversity and equality. The strategic Vision 2030 underscores Iberdrola’s dedication to growth, strength, and dividends, with a particular emphasis on accelerating electrification, replacing thermal power plants with renewables, and the growing role of storage.

Ignacio Galán, Executive Chairman of Iberdrola, highlighted the unstoppable nature of energy electrification, which is set to expand exponentially in the coming years. Galán’s statement reflects Iberdrola’s commitment to decarbonization, energy security, and reducing volatility caused by fossil fuels. This ambitious plan aims to grow Iberdrola’s asset base, profitability, and financial strength, all while increasing dividends and driving job creation, skills, and economic growth.

Iberdrola’s €41 billion investment in electrification and renewable energy is a significant milestone in the global transition to sustainable and clean energy. This strategic move not only underscores the company’s leadership in the energy sector but also aligns with global efforts to combat climate change and promote economic development. As Iberdrola focuses on expanding its renewable energy portfolio and enhancing grid infrastructure, the company is poised to play a pivotal role in shaping the future of energy, demonstrating the potential for synergistic growth between sustainability and economic progress.