Iberdrola has unveiled a plan to invest 36 billion euros from 2024 through 2026 to accelerate the electrification of the economy. In its strategic update, the company confirms that about 60 percent of this amount, roughly 21.5 billion euros, will go toward the electricity grids—the backbone of the system—while around 30 percent, about 10.5 billion euros, will fund new renewable projects with a strong emphasis on storage solutions.
It is important to note that the gross investment plan totals 41 billion euros when including the acquisition of 18.4 percent of its U.S. subsidiary Avangrid, announced recently, along with 5 billion euros of investments with strategic partners. The United States stands out as the main arena for expansion, accounting for 35 percent of the planned investments, ahead of the United Kingdom at 24 percent and Spain at 15 percent. Latin America and the rest of the European Union and Australia follow, each at around 15 percent and 11 percent respectively.
The overarching objective is to reach a net profit between 5.6 and 5.8 billion euros in 2026, and between 5.3 and 5.4 billion euros in 2025. In 2023 the company posted a record net income of 4.803 billion euros. EBITDA is expected to land between 16.5 and 17.0 billion euros by the end of the period, with networks and renewables contributing roughly half each. The company’s management intends for 70 percent of EBITDA to be independent of wholesale electricity price swings by 2026, a strategic move to stabilize earnings over time.
With this roadmap in place, Iberdrola aims to satisfy its commitment to raise shareholder returns to 11.0 billion euros in total dividends. The plan allocates between 65 percent and 75 percent of earnings to shareholders, targeting a dividend per share between 0.61 and 0.66 euros in 2026. A floor dividend of 0.55 euros also exists under the Iberdrola Flexible Payout program, which includes share buybacks to support value for investors.
Managed networks and renewables
Looking ahead over the next two years, the focus centers on the networks, with an allocation of about 21.5 billion euros to be distributed across the United States, the United Kingdom, Brazil, and Spain. Of this total, more than 6.5 billion euros will be directed to transmission networks. This shift lifts total network assets to about 54 billion euros by 2026, up from 2023 by roughly 12 billion and 38 percent from 2022. About 85 percent of network investments target markets with regulated frameworks in the near term, while around 80 percent of the gross income from this business is protected from inflation and interest-rate movements.
Additionally, the company intends to allocate roughly 15.5 billion euros in gross terms to the renewables business, including 5 billion euros expected from strategic partners in ongoing projects. Of this renewables pool, more than half is earmarked for offshore wind projects under development in the United States, the United Kingdom, France, and Germany; approximately 28 percent for onshore wind and 18 percent for solar. Storage receives about 1.5 billion euros to lift pumping capacity by around 20 percent, acknowledging that storage is essential to stabilizing prices and reducing margin volatility in the market.