Iberdrola (IBE1.DE) plans to invest EUR 4.8 billion in the United Kingdom over the period 2010-2012.
Two-thirds of the investment earmarked for the UK will be for Scotland,
primarily to develop wind farms, smart grids and carbon capture in the
event that ScottishPower wins the government competition.
Iberdrola’s Chairman, Ignacio Galán made the announcement Monday during a meeting with the Scottish First Minister, Alex Salmond, in Bilbao, Spain.
He also indicated that this “significant volume of investment” will involve purchases of EUR 5.4 billion during the period, which represents an opportunity for suppliers in Spain’s Basque region and their Scottish counterparts.
“In this way,” Galán explained, “Iberdrola will continue to act as a driving force behind development in Scotland and the Basque Country, two regions that are very important to our company and where we have significant plans for the future”.
Iberdrola began operations in Scotland four years ago with the purchase of ScottishPower. Through ScottishPower, Iberdrola aims to play a key role in the British energy sector and contribute to the plan to curb greenhouse gas emissions through its investments in wind power, nuclear energy and so-called clean coal.
The start-up of offshore wind farms ranks among the company’s key projects in the future. Iberdrola Renovables (IBR.MC) and Vattenfall have, for example, been awarded the rights to construct the largest offshore wind farm in the world–7,200 megawatts (MW)–known as the East of Anglia Array, capable of providing energy to five million homes.
The company also has an additional 2,300 MW in the pipeline in the UK, including the 500-MW West of Duddon Sands wind farm (developed in partnership with Dong), the construction of which will commence in 2012. Iberdrola has therefore established the group’s Offshore Business Division in Scotland to channel the development of the significant volume of facilities it has been awarded around the world, totalling close to 10,000 MW.
On shore, ScottishPower Renewables is now the leading wind power developer and generator in the country, with an installed capacity of 816 MW. It also operates the largest wind farm in Europe: Whitelee located south of Glasgow. The aim is to increase the capacity of this installation by 217 MW to 539 MW by 2012.
Iberdrola has also progressed through to the final round of the British Government’s public tender process to construct a commercial-scale carbon capture and sequestration (CCS) facility at its Longannet plant. The company has confirmed plans to establish a global Centre of Excellence in the UK to develop CCS technology.
Iberdrola also plans to gradually roll out smart electricity distribution grids across the UK, and has announced a project to start installing these networks in Glasgow.
Another of the group’s projects in the UK is its participation in the program to construct nine new nuclear power plants, for which it has established a joint venture with GDF Suez (GZF.DE) and Scottish and Southern Energy (SSE.L). Last year, the consortium acquired a purchase option on the Sellafield site from the Nuclear Decommissioning Authority (NDA). The partners are currently preparing a detailed plan to install a new nuclear plant on this site with a capacity of 3,600 MW.
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