Iberdrola Divests 2.6 GW of Mexican Energy Assets, Including Wind and Solar, in $4.2 Billion Deal to Fund Grid Expansion
Key Insights
Iberdrola completed the sale of 2.6 GW of Mexican energy assets, encompassing thermal, wind, and solar power, to Cox for approximately $4.2 billion.
The divestment includes 15 power plants, with a significant portion comprising 1.23 GW of renewable wind and solar generation capacity.
This strategic move aligns with Iberdrola's broader plan to reallocate capital towards substantial investments in grid and transmission infrastructure across its core markets.
The Spanish utility aims to invest €55 billion over the next six years in networks to meet anticipated surging energy demand in Europe and the United States.
Iberdrola, the Spanish energy giant, has finalized the sale of 2.6 gigawatts (GW) of its energy assets in Mexico to water and energy management firm Cox for approximately $4.2 billion. The transaction, announced by Iberdrola on Thursday, July 31, and confirmed by Cox as recently closed, encompasses a diverse portfolio of 15 power generation plants.
The divested capacity includes 1.37 GW of thermal (fossil fuel) power and a substantial 1.23 GW of renewable wind and solar power generation. This significant divestment aligns directly with Iberdrola’s stated strategy to substantially ramp up investments in grid and transmission projects across its core markets, notably in the United States through its subsidiary Avangrid and in the United Kingdom via Scottish Power.
Iberdrola has previously outlined plans to commit up to €55 billion ($59.6 billion) towards transmission and distribution networks over the next six years. This ambitious investment is designed to proactively address the anticipated surge in energy demand across key markets in Europe and the United States, facilitating the integration of more renewable energy and enhancing grid resilience.
The strategic shift underscores a broader industry trend where major utilities are optimizing their asset portfolios, divesting non-core or less regulated generation assets to fund high-growth, regulated infrastructure projects. This approach aims to secure more stable revenue streams and support the massive infrastructure upgrades required for the global energy transition. The sale to Cox represents a significant step in Iberdrola's re-prioritization of its capital allocation, focusing on the foundational elements of the future energy system.