Abu Dhabi renewable energy firm Masdar and Iberdrola have set up a $16.2bn (EUR15bn) alliance to invest in offshore wind and green hydrogen projects in key markets including Germany, the UK and the USA.
The first step of the partnership, which was unveiled at the UN Climate Change Conference (COP28), will be for Masdar to take a stake of up to 49 per cent in Iberdrola’s 1.4 gigawatt (GW) UK East Anglia 3 offshore wind project.
The UAE clean energy firm said the deal has been under negotiation for the last few months and could be signed by the end of Q1 2024.
The East Anglia 3 offshore wind project is under construction, with full commissioning scheduled for Q4 2026, Masdar said in a statement. The wind farm secured a 15-year CPI-linked contract for difference from the UK in July 2022.
The clean project is set to power more than 1.3 million British homes and create 2,300 jobs.
Beyond the East Anglia 3 deal, the two entities will work together to jointly invest in future offshore wind and green hydrogen projects in Europe and other markets.
Masdar said the two entities are already collaborating to identify other opportunities and the total value of their joint investments in offshore wind and green hydrogen could reach EUR15bn.
The agreement follows a pledge by 118 countries at the COP28 climate summit to triple the world’s renewable energy capacity by the end of the decade as they seek to wean themselves off fossil fuels.
“Now that 118 governments have already pledged to triple renewable energy capacity by 2030 at COP28, reaching this goal will require immediate action from these governments and the private sector,” said Iberdrola’s executive chairman, Ignacio Galán.
Masdar, Iberdrola accelerate energy transition
Meanwhile, Masdar and Iberdrola have previously teamed up to develop an offshore wind farm in German waters in the Baltic Sea and announced separate multibillion-euro investment plans in Britain, the world’s second-largest offshore wind market behind China.
“We are very pleased to be expanding our existing alliance with a leading long-term partner like Masdar from Germany, where we are already constructing new offshore wind turbines, to the UK and across the world,” said Galán.
The global green energy giants closed their EUR1.6bn alliance to develop offshore wind in the Baltic Sea earlier in November. Baltic Eagle will consist of 50 wind turbines built on monopile foundations, each with a unit capacity of 9.53 MW.
The wind farm will have an anticipated annual production capacity of 1.9 terawatt-hours (TWh), enough to meet the clean energy demands of 475,000 homes. It will prevent 800,000 tons of carbon dioxide from being released into the atmosphere annually.
The wind farm, which is scheduled to come into initial operation at the end of 2024, has a minimum regulated tariff of $71.29/MWh for the first 20 years. Similarly, 100 per cent of its production has already been sold via long-term contracts.
