Masdar and Iberdrola announce $16.23 Billion Partnership Agreement

Global green energy giants – the UAE’s Masdar and Europe’s Iberdrola – on Tuesday announced a $16.23 billion strategic partnership agreement to evaluate the joint development of offshore wind and green hydrogen projects in key markets including Germany, the UK and the US.

The announcement was made at the ongoing UN Climate Change Conference – COP28 – following both companies’ successful co-investment in Baltic Eagle, in Germany.

The new milestone of this alliance will be to achieve a further co-investment in relation to the 1,400-megawatt (MW) UK East Anglia 3 offshore wind project. This deal has been under negotiation for the last few months and could be signed by the end of Q1 of 2024 and Masdar’s stake in this wind farm could be 49%.

East Anglia 3 is currently in construction, with full commissioning scheduled for Q4 of 2026. The windfarm secured a 15-year CPI-linked Contract for Difference (CfD) from the UK Government in July 2022. The project will power over 1.3 million British homes and create 2,300 jobs.

Beyond the East Anglia 3 transaction, both companies will work together to jointly invest in future offshore wind and green hydrogen projects in Europe and other markets. Work to identify other opportunities is already underway, and it is anticipated that the total value of joint investments in offshore wind and green hydrogen as part of the alliance could reach $16.23 billion.

Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology, Chairman of Masdar and COP28 President, welcomed the partnership and said that it will see the two companies coming together to use their expertise and resources to advance renewables in Europe and around the world.

“At COP28, we know that the world must triple global renewable energy capacity by 2030 to keep 1.5C within reach. Robust partnerships such as the one between Masdar and Iberdrola today will propel us towards this goal,” he said.

Quick Action Needed

Iberdrola’s Executive Chairman, Ignacio Galan, said that with 118 governments already pledging to triple renewable energy capacity by 2030 at COP28, reaching this goal will require immediate action from these governments and the private sector.

“Following our long-term commitment to renewables, networks, and storage, this innovative alliance with Masdar today shows once again our determination to continue delivering,” Galan said and added that by combining their renewables experience and financial strength with those of Masdar, Iberdrola can deliver more secure, competitive and clean energy, quicker.

Masdar’s Chief Executive Officer, Mohamed Jameel Al Ramahi, said that they will once again explore developing one of the UK’s largest offshore wind farms and other prospects in Europe. With an abundance of wind resources, the UK and Europe are prime markets for Masdar.

“As we target 100GW by 2030, Masdar is focused on developing innovative projects from the very early stages to further strengthen our offshore wind expertise. We have been active in the UK for more than a decade, pioneering landmark projects including the world’s first floating offshore wind farm. At COP28, projects such as the 1,400MW East Anglia 3 offshore wind farm show how we can create jobs, power homes and cut emissions,” he added.