Billed as Europe's top solar farm, Iberdrola's 500MW Núñez de Balboa is set to be joined by the firm's PV projects of 590MWp and 328MW. Image credit: Iberdrola
Iberdrola scored a bullish financial performance in a year when it almost doubled its spending on renewables, delivering Europe’s self-styled largest solar plant in the process.
The Spanish utility giant managed last year to pass the €10 billion (US$10.8 billion) EBITDA mark and boost annual net profits by 13% to €3.4 billion (US$3.7 billion), according to financial results released on Wednesday.
Iberdrola’s jump in profits in 2019 came as, over the year, its revenues rose 3.9% to €36.4 billion (US$39.1 billion) and its shares on the Madrid stock exchange swelled from €6.9 (US$5.2) to €9.2 (US$10). The boost also took place as the firm invested €8.16 billion (US$8.8 billion) all in all in 2019, up 32% on 2018.
At 41%, nearly half of every euro spent by Iberdrola in 2019 went into renewables, which bagged €3.34 billion (US$3.63 billion) from the utility. The green energy funding, a full 85% jump on what Iberdrola had spent in 2018, was chiefly split between the US, the UK and Spain.
The financial performance of Iberdrola’s Renewables division was, however, slightly muted. From revenues to gross margins and EBITDA, all full-year metrics saw drops from 2.4% to 12.5% between 2018 to 2019. The firm linked to the downturn to a 32% fall of hydro output in Spain.
Solar feats in Spain and Mexico, hybrid in Australia
The profitability decline for Iberdrola’s green energy assets in 2019 contrasted with its record of buoyant installations. As of the end of December 2019, the utility boasted 31.9GW of renewable capacity delivered worldwide, a 9.4% jump on the 29.1GW it had posted one year prior.
At 27.5%, the largest year-on-year capacity boost took place in Mexico, where Iberdrola commissioned 368MW of PV systems around one year ago. In 2019, the utility also recorded jumps in green energy installations in Brazil (20.8%), the UK (20%), the US (11.6%) and Spain (4.6%).
As shown by the table below, Iberdrola now counts 500MW of operational PV in Spain, all of it part of the Núñez de Balboa plant in Extremadura. The solar farm, billed as Europe’s largest to date, is set to be joined by PV projects of 590MWp and 328MW Iberdrola is developing in the same region.
Iberdrola's installed PV capacity as of the end of 2019
|Country||Installed PV capacity|
Across the pond in the US, the utility giant has completed PV plants in Oregon (83MW), Colorado (35MW), Connecticut (13MW) and Arizona (12MW). According to the latest update, “preliminary work” is taking place in the US to assess the roll out of a 1GW pipeline of new wind and solar.
Elsewhere, Iberdrola’s solar highlights of 2019 include the 320MW PV-plus-wind hybrid in Australia alongside Ireland’s DP Energy – its debut in the country – and its 149MW contract win at Portugal’s PV auction last summer, which will see the firm pay in return for the right to produce.
Iberdrola is one of a raft of deep-pocketed utilities disrupting Europe’s solar landscape as they carve out ever larger projects. This very week, fellow Spanish giant and solar proponent Endesa said it will embrace green energy more decisively after a big fiscal hit from coal assets last year.
The prospects and challenges of solar's new era in Spain and the rest of Europe will take centre stage at Large Scale Solar Europe 2020 (Lisbon, on 31 March-1 April 2020).
The business of solar is changing, as the industry scales up, technology, IT and new players to the market will add complexity. This sparks a host of opportunities such as co-location of solar and storage and the rise of unsubsidised solar projects as well as challenges which will question the very business model of European solar asset owners. Solar Finance & Investment Europe is the meeting place for institutional investors, sovereign wealth funds, solar, wind and storage funds and large energy buyers to do business.