Iberdrola will invest €58 billion by 2028 to grow further in Networks in the United States and the United Kingdom
- United Kingdom, main focus of investment
- Networks are the focus of the company's strategy
- Financially sound forecasts
- Remuneration of €20 billion
- A transformative plan
Iberdrola has announced investments of €58 billion during the period 2025-2028 to promote the electrification of the economy and the new needs of electricity networks. These investments represent a 30% increase over the 2021-2024 period. This was announced by Europe's second-largest utility by market capitalisation at its Capital Markets Day presentation in London.
The Group's chairman, Ignacio Galán, said that this Strategic Plan transforms the company into a more regulated company focused on the United Kingdom and the United States: ‘We are going to invest €58 billion until 2028, two-thirds of which will go to transmission and distribution networks, mainly in the United Kingdom and the United States.’
Of the £58 billion investment, 85% will go to countries with an A rating and stable, predictable and attractive regulatory frameworks. This will enable growth to be driven with greater stability, predictability, profitability and security.
United Kingdom, main focus of investment
By country, 65% of the investment will be focused on the United Kingdom and the United States. The United Kingdom is the main destination for investment, with £20 billion, followed by the United States, with £16 billion. Behind them are the Iberian Peninsula, with £9 billion, Brazil, with £7 billion, and other EU countries and Australia, with £5 billion.
With this strategy, the company has set itself the target of achieving gross operating profit (EBITDA) of €18 billion in 2028 - €3 billion more than in 2024 - with networks being the engine of growth, as they will contribute 55% to operating profit. In addition, the company's goal is for 75% of EBITDA not to depend on energy prices by 2028.
For its part, the company has set an adjusted net profit target of €7.6 billion for 2028, which is €2 billion more than in 2024.
Networks are the focus of the company's strategy
Analysing the main investments by business area, the company plans to invest £37 billion in the network business: £25 billion will be allocated to distribution networks and £12 billion to the transmission network. The investments are aimed at markets with closed frameworks or in advanced negotiations and with an average return on equity (ROE) of 9.5%.
This will bring the regulated asset base to €70 billion in 2028: €50 billion will be from the distribution network and €20 billion from the transmission network at the end of the period.
The company plans to allocate €21 billion to the renewable energy and customer business. Of this amount, 38% will go to offshore wind power, 24% to onshore wind power, 10% to storage and another 10% to solar power. Seventy-five per cent of these projects are already under construction.
Financially sound forecasts
This entire Strategic Plan is orchestrated within a careful financial framework, which allows the company to maintain its BBB+ credit rating. This is thanks to Iberdrola's highly diversified sources of financing and business, its solid financial structure (73% of its debt is fixed-rate and long-term) and its active liquidity management.
In addition, the company, which has already carried out a €5 billion capital increase, has planned a €13 billion asset rotation and alliance plan, of which 75% has been completed.
As a result, the company expects to generate €52 billion in cash flow during the period, driven by new investments.
Remuneration of €20 billion
These results will enable the company to fulfil its commitment to increase shareholder remuneration in line with the evolution of results and distribute nearly €20 billion in dividends between 2025 and 2028. Iberdrola will thus allocate between 65% and 75% of its profits to shareholder remuneration (payout). In addition, the Group has set a minimum dividend of €0.64 for this period, as part of Iberdrola's Flexible Remuneration programme, which includes share buybacks.
The chairman also reaffirmed the outlook for 2031, driven by predictable growth and an acceleration in electrification.
Iberdrola plans to invest more than €45 billion between 2029 and 2031 in order to continue increasing its results by at least mid/high single digits while maintaining its financial strength and growing dividend. In addition, it will focus on countries with an A rating, mainly the United Kingdom and the United States.
Of the €45 billion, the company will allocate €30 billion to networks, which will enable it to increase its asset base to more than €90 billion by 2031.
A transformative plan
The Strategic Plan will enable Iberdrola to advance its commitment to society through its social dividend. In fact, the company plans to create 15,000 jobs worldwide over the next four years and make purchases worth €65 billion from thousands of suppliers, supporting more than 500,000 jobs in the value chain.
In addition, it will contribute more than €40 billion to the public coffers in the countries where it operates until 2028.
Given its commitment to innovation, the company will invest €1.6 billion in R&D&I during this period.
Iberdrola continues to advance in its commitment to accelerating the electrification of the planet and aims to reconcile its growth with the goal of becoming CO2 neutral by 2030.
