Energy Transition

Iberdrola sharpens green power focus as $6bn Mexico deal sealed

Spain-based giant says on third of 6GW renewables portfolio could be advanced within five years

Iberdrola chairman Ignacio Galán.
Iberdrola chairman Ignacio Galán.Foto: Iberdrola
Acting Editor-in-Chief, Recharge

Iberdrola said it will focus on building out its major renewable energy portfolio in Mexico after sealing a $6.2bn deal to sell its gas-fired generation assets there.

The Spain-based global renewables giant said late on Monday that it completed the sale of 13 plants totalling 8.5GW – almost all combined-cycle gas – that was first announced last April.

The sale to Mexican state power group CFE leaves Iberdrola with a 6GW renewables portfolio in Mexico, some 2GW of which could be developed inside five years, said the latter, which added that it “aims to continue growing by providing clean energy for its private customers and contributing to Mexico's renewable development”.

Iberdrola executive chairman Ignacio Galan in its recent full-year results call said the company has various wider investment opportunities as it considers its options for the Mexican proceeds, singling out the networks markets of the US, UK and Brazil for praise following recent regulatory moves.

Mexican President Andres Manuel Lopez Obrador (AMLO) last year called the gas plants deal “a new nationalisation” that gives CFE a majority position in Mexico’s power system.

AMLO’s government had for years taken a hostile stance against the influx of non-Mexican privately owned energy developers that were invited in by his predecessor, with Iberdrola a particular target of the President’s ire at what he called “foreign businessmen” who see the nation as “a land to be conquered”.

But after agreeing the sale Galan said "Iberdrola is grateful for the support and flexibility shown by the Mexican government in reaching this agreement and considers Mexico a strategic country with potential for growth and expansion, where it will show its support for Mexico and the state by developing renewable capacity."

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Published 27 February 2024, 08:51Updated 27 February 2024, 08:51
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