Iberdrola’s Strategic Asset Divestment in Romania Signals Progress in Decarbonization Agenda

iberfrola building

With this transaction, Iberdrola relinquishes its 80 MW wind power capacity in Romania, effectively exiting the market. (Credit: Iberdrola)

by | Apr 29, 2024

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Iberdrola, a global leader in renewable energy, continues to make strides in its strategic plan to divest non-core assets, with its recent agreement to sell its renewable assets in Romania for approximately $98 million to Premier Energy Group. This move marks a significant step forward in Iberdrola’s asset rotation plan, which aims to optimize its portfolio and focus on key growth areas in the energy transition.

The agreement sees Premier Energy Group, operating through its Romanian subsidiary Premier Renewable Invest Co SRL, acquiring 100% of the ‘Eolica Dobrogea One’ wind energy company from Iberdrola. With this transaction, Iberdrola relinquishes its 80 MW wind power capacity in Romania, effectively exiting the market. The sale is pending standard regulatory approvals customary for such transactions in Romania.

Key Partnerships

  • Expansion of Co-Investment Alliance with Norges Bank Investment Management: Iberdrola has expanded its co-investment alliance with Norges Bank Investment Management to 2500 MW in Iberia.
  • Strategic Agreement with Masdar: In December, Iberdrola closed a $16.9 billion agreement with Masdar to co-invest in offshore wind and green hydrogen projects in Germany, the UK, and the US.
  • Partnership with GIC in Brazil: Last September, Iberdrola partnered with GIC to invest approximately $495 million in the expansion of transmission networks in Brazil,
  • Divestment of Gas-Fired Plants in Mexico: Iberdrola’s sale of over 8400 MW of gas-fired combined cycle plants in Mexico for approximately $6.2 billion.
  • Strategic Alliance with BP: In March, Iberdrola and BP signed a strategic alliance to deploy 11,700 fast-charging points for electric vehicles in Spain and Portugal.
  • Expansion of Alliance with MAPFRE: Iberdrola and MAPFRE have expanded their strategic alliance, incorporating approximately $165 million through a joint venture.
  • Co-investment in Offshore Wind Farm with Energy Infrastructure Partners: Iberdrola’s recent alliance with Energy Infrastructure Partners to co-invest in the Wikinger offshore wind farm.

This divestment aligns with Iberdrola’s broader strategic vision, targeting approximately $13.4 billion in asset rotation over the 2024-2026 period.

Iberdrola’s Strategic Vision

In November 2022, Iberdrola outlined a strategic vision during its Capital Markets & ESG Day, identifying key trends shaping its path forward. These trends underscore the momentum of electrification across sectors, driven by decarbonization imperatives and technological advancements. Iberdrola emphasizes its role in industrial processes, transportation, and digital infrastructure, recognizing electrification as unstoppable.

Ignacio Galan, Iberdrola’s Executive Chairman:

“Our strategy will focus on delivering enhanced grid to support security of supply, now 60% of our total investment, as well as a strong expansion of renewables capacity, driven by the substitution of fossil technologies and additional demand. We also recognize an increasing role of storage technologies to preserve the balance between supply and demand 24 hours a day.”

Iberdrola stresses the importance of renewables and storage in replacing fossil fuels and balancing supply-demand dynamics. With a focus on offshore wind, onshore wind, and solar projects, the company commits to expanding its clean energy portfolio. The company plans substantial investments of approximately $45.5 billion, including acquisitions like the 18.4% stake in Avangrid. Partner contributions in renewables projects bring net investments to roughly $40.2 billion. Key markets like the US, UK, Brazil, and Spain will see significant network expansion.

Iberdrola maintains a customer-centric approach, directing investments towards industrial customers and sustainable growth. Job creation, diversity promotion, and governance standards remain focal points. Iberdrola reaffirms Vision 2030, foreseeing accelerated electrification, expanded networks, and increased renewables capacity. The company aims to drive growth while maintaining financial strength and advancing its strategic pillars.

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