Iberdrola to Invest €47bn in Energy Transformation in 2023-2025; Improves EBITDA and Net Profit Outlook
Iberdrola has said that between 2023 and 2025, the company will put in €47 billion to help with the energy transition.
Ignacio Galán, Iberdrola Executive Chairman, made the announcement at Capital Markets & ESG Day 2022.
He said: "The record global investment plans we have set out today will help us to bring more self-sufficiency and resilience against potential energy shocks in the countries where we operate, by reducing their dependency on oil and gas and by continuing their path to Net Zero."
Following are the takeaways from his announcement:
Record investment plan of €47bn to 2025, driven by organic investments in all markets and PNM Resources transactions.
During the plan, strong financial ratios are well within the limits of current ratings. This is thanks to a model based on fixed-rate financing, long-term maturity profiles, active liquidity management, and optimising green financing. No capital increases are expected, and asset rotation backs this up.
€27 billion (57%) of investment in electricity networks to increase asset base, reaching €56bn by 2025 – providing predictable frameworks and protection from macroeconomic uncertainties.
€17 billion of investment in renewables to deliver 52 GW of renewable installed capacity by 2025 – based on projects with the best risk/reward profile and a high-quality pipeline.
More than 80% of investments are allocated to A-rated countries with stable regulatory frameworks and ambitious electrification targets: improving geographical diversification through an additional focus on countries like Germany, France, and Australia.
EBITDA will reach €16.5–17bn by 2025 (8–9% CAGR), with net profit increasing to €5.2–5.4bn (8–10% CAGR).
The dividend will increase in line with net profit (65-75% payout) to €0.55 to €0.58 in 2025, with a floor of €0.46 in 2023–24 and €0.50 in 2025.
The company reaffirms its ESG credentials:
Targets to become carbon neutral by 2030 in scopes 1 and 2 and reach Net Zero in all 3 scopes by 2040.
12,000 new hires by 2025, supporting over 500,000 jobs along its value chain by 2030.
Reaffirming the 2030 outlook, which is driven by growth in all markets and faster electrification: investments of €65–75 billion in 2026–30 to add more than 100 GW of capacity and €65 billion in network assets.