Iberdrola

Iberdrola, S.A.

Iberdrola Tower, Bilbao, Spain
Type	Sociedad Anónima
Traded as	BMAD: IBE IBEX 35 component
Industry	Electric utility
Founded	November 1, 1992 (1992-11-01)
Headquarters	Bilbao, Spain
Key people	Jose Ignacio Sanchez Galan (Chairman and CEO)
Products	Electricity generation and distribution, renewable energy, natural gas production, sale and distribution, telecommunications
Revenue	€32.80 billion (2013)[1]
Operating income	€7.2 billion (2013)[1]
Profit	€2.572 billion (2013)[1]
Total assets	€92.493 billion (end 2013)[1]
Number of employees	30,680 (average, 2013)[1]
Subsidiaries	Elektro, Iberdrola USA, Scottish Power
Website	www.iberdrola.com

Iberdrola (Spanish pronunciation: [iβerˈðɾola]) is a Spanish public multinational electric utility company based in Bilbao, Basque Country. Iberdrola has a workforce of around 31,330 employees in dozens of countries on four continents serving around 31.67 million customers. Subsidiaries include Scottish Power (Scotland), Iberdrola USA (United States) and Elektro (Brazil), amongst others. The largest shareholder of the company was, in 2013, Qatar Investment Holding; other significant shareholders are ACS, Kutxabank and Bankia.^[2]

Since embarking on its growth and international expansion plan in 2001, Iberdrola has become Spain’s largest energy group by market capitalisation,^[3] the global leader in wind energy^[4] and one of the world’s largest utilities by market capitalisation. The company is a component of the Euro Stoxx 50 stock market index.^[5]

History

Iberdrola was created on November 1, 1992 as a result of the merge between Hidroeléctrica Española and Iberduero.^[6] Hidroeléctrica Española, also known as Hidrola had started activity in 1907, while Iberduero started in 1944 as the result of the merge between Hidroeléctrica Ibérica (1901) and Saltos del Duero.

The origin of Iberdrola lie in the Spanish industrialisation in the early 20th century, when Hidroeléctrica Ibérica was formed. As of 2011 and with the integration of Scottish Power and Energy East, now renamed Iberdrola USA, the company has become a major multinational group.

In 1840, a group of American entrepreneurs created the Hartford City Light Company, setting in motion the incorporation on the eastern seaboard of the US of Energy East, which would much later become Iberdrola USA. Meanwhile, thousands of kilometres away in Spain, a similar process was underway. In 1901 in Bilbao, a group of entrepreneurs headed by engineer Juan de Urrutia established Hidroeléctrica Ibérica. In 1907, Hidroeléctrica Ibérica shareholders created Hidroeléctrica Española to supply Madrid and Valencia. A decade later, Saltos del Duero was founded, opening the country’s first hydroelectric facility in 1935, the Ricobayo power plant.

World War I forced the industry to seek new sources of energy and to install large distribution networks. Amid huge instability, US power companies began to join forces, attempting to become strong enough to withstand the economic and financial uncertainty. However, no one foresaw the magnitude of the stock market crash of 1929, which brought these emerging groups to the verge of ruin. In Spain, which had experienced a period of economic growth at the start of the 20th century, the industry suffered a severe setback in 1936 whose impact would be felt for the following two decades: the Civil War abruptly halted development, destroyed facilities and made maintaining the little equipment that remained extremely difficult.

Spain suffered international isolation in the 1940s and experienced extreme difficulty in acquiring technology and materials, prices of which were soaring. It was against this backdrop that Hidroeléctrica Ibérica and Saltos del Duero joined forces to form Iberduero.

In 1955, the South of Scotland Electricity Board (SSEB) came into being, paving the way for the creation of Scottish Power four decades later, in 1990. Two years after that, Hidroeléctrica Española and Iberduero[4] teamed up, creating Iberdrola. In the latter part of the 20th century, Iberdrola began expanding into Latin America, mainly Mexico and Brazil.

With ScottishPower and Iberdrola formed in Europe, in 1998 Energy East Corporation came into being in the US following New York State Electric & Gas's acquisition of Central Maine Power, Southern Connecticut Gas Company, Connecticut Natural Gas Company, Berkshire Gas Company and RGS Energy Group (the parent of Rochester Gas & Electric). Following the arrival of Jose Ignacio Sanchez Galan in 2001 Iberdrola began focusing on renewable energy. In 2007, the company continued its international expansion, increasing its presence in the UK and the US via the integration of Scottish Power^[7] and Energy East.^[8] Iberdrola has faced several merger attempts and made additional acquisitions:

• Attempted merger between Iberdrola and Repsol in 1997, which failed due to a lack of agreement between the companies.
• Attempted merger between Iberdrola and Repsol in 1999, which was rejected by La Caixa (Repsol’s main shareholder).
• Attempted merger between Iberdrola and Endesa in 2000, which was stopped due the conditions imposed by Spanish Prime Minister José María Aznar.
• Attempted hostile takeover bid by Gas Natural for Iberdrola in 2003, which was vetoed by Spain’s National Energy Commission (Comisión Nacional de Energía, CNE).
• Acquisition of Scottish Power by Iberdrola in November 2006, which led to the integration of this company in April 2007. This gave rise to Europe’s third largest utility.
• Acquisition of US company Energy East by Iberdrola in 2008.^[9]
• Acquisition of Brazilian company Elektro in 2011.

Company Chairmen

Hidrola chairmen

• Lucas de Urquijo Urrutia (1907-1910)
• José Luis de Oriol y Urigüen (1910-1911) (1936-1941)
• Fernando María de Ybarra (1911-1936)
• José María de Oriol y Urquijo (1941-1960)
• Íñigo de Oriol Ybarra (1960-1992)

Iberduero chairmen

• Pedro de Careaga and Baseabe, Conde de Cadagua (?-1977)
• Pedro de Areitio (1977–1981)
• Manuel Gómez de Pablos (?-1992)

Iberdrola chairmen

• Iñigo de Oriol Ybarra (1992–2005)
• Jose Ignacio Sanchez Galan (2005 to present)

Lines of business

Deregulated business

Iberdrola’s liberalised business combines power generation, and gas and electricity supply. The company had assets with combined installed capacity of 45,009 MW at the end of 2013. Iberdrola manages its production assets, comprising hydroelectric, combined-cycle gas, nuclear and co-generation plants located in 40 countries, mainly in Europe, North America and Latin America. Output in Spain: 58,076 GWh in 2013, of which 14,795 GWh were produced at hydroelectric plants. As a result, 79% of Iberdrola’s production in Spain was CO2 emission free.

Regulated business

Iberdrola provides service to more than 32.26 million people. In Spain has over 11.64 million supply points and a total distributed energy of 58,076 GWh. The TIEPI indicator for supply quality has been situated at a value of 0.62 hours. In the United Kingdom, the affiliate for the ScottishPower Group has over 5,79 million distribution clients. The volume of energy distributed has been 19,936 GWh. Iberdrola USA has 2.44 million power supply points in the United States of America. The volume of energy distributed has been 17,994 GWh. In Latinamerica, Iberdrola has distributed a total of 38,562 GWh in 2013. The number of customers has been 12.4 million, +4% of growth.

Renewable energy business

At the end of 2013, Iberdrola had operating installed capacity above 14,247 MW –53% outside Spain– producing a total of 33,899 GWh of electricity in the year.

Main subsidiaries

ScottishPower

The UK’s 4th largest energy provider, ScottishPower has 5,79 million customers across the country and 7,380 employees. It has generation assets in hydro, coal, combined cycle gas and cogeneration, as well as a distribution network covering 65,000 km of underground cables and 47,000 km of overhead lines. ScottishPower is involved in smart grid projects in Glasgow and Liverpool, and provides charging points as a member of the Glasgow consortium which is developing an electric vehicles project. The installed capacity in the United Kingdom has reached 6,342 MW and production has been 19,936 GWh in 2013.

Iberdrola USA

Iberdrola USA, which became part of the group in September 2008, distributes electricity and gas to 2.44 million customers in the states of Maine and New York. It has offices located in its principal distribution centres in the two states. In New York, the business is shared by two operating subsidiaries – New York State Electric & Gas (NYSEG) and Rochester Gas and Electric (RG&E)– both headquartered in Rochester. In Maine, Central Maine Power (CMP) has headquarters in Augusta. NYSEG serves 878,000 electricity customers and 261,000 natural gas customers across more than 40% of upstate New York, whereas RG&E serves 367,000 electricity customers and 303,000 natural gas customers in nine counties around the city of Rochester.^[10] CMP is the largest energy supplier in Maine, serving over 600,000 customers.

Iberdrola USA promotes important infrastructure projects in both Maine and New York. In Maine, CMP began construction in September 2010 of the Maine Power Reliability Program (MPRP),^[11] a $1.4 billion upgrade of the state’s transmission network which will also improve grid connections to Canada. It also began the roll-out of a smart meter installation plan for 625,000 customers in Maine. In New York, important infrastructure projects have been undertaken at Ithaca and Corning Valley.

Iberdrola Ingeniería

With projects in more than 30 countries throughout Europe, Asia, Africa and North and South America, Iberdrola Ingeniería and Construcción’s services include engineering, supply, construction and commissioning, turnkey projects and operational support. In the area of R&D, is developing the Iter project.^[12]

Iberdrola Inmobiliaria

Iberdrola Inmobiliaria offers a range a real estate products, with a focus on residential property, holiday homes, offices, factory premises and shopping centres.

Assets in Spain

Aldeadávila dam (Salamanca).

Iberdrola also owns hydroelectric plants, especially in the Duero river basin (provided by Iberduero) and the Tajo and Segura river basins, etc. (provided by Hidroeléctrica Española).

Construction is finished on the 848 MW La Muela plant (at Cortes de Pallás, Valencia)^[13] and on the 175 MW San Esteban II plan, on the Sil river. The San Pedro II project has started its construction. See also: Saltos del Duero.

Combined cycle plants

• C. T. de Castejón 2, in Castejón (Navarre), with 386 MW.
• C. T. de Castellón, in Castellón, with two units with a combined 1,650 MW.
• C. T. de Santurce, in Santurce (Vizcaya), with 402 MW.
• C. T. Tarragona Power, in Tarragona, with 424 MW.
• C. T. de Arcos de la Frontera, in Arcos de la Frontera (Cádiz), with two groups with a combined 1,613 MW.
• C. T. Bahía de Bizkaia, in Ciérvana (Vizcaya), which is operated jointly with three other operators (EVE, Repsol YPF and BP with 25% each), of 780 MW.
• C. T. de Aceca, in Villaseca de la Sagra (Toledo), of 391 MW.
• C. T. de Escombreras, in Cartagena (Murcia), with 831 MW.

Nuclear plants

Iberdrola operates the following five nuclear plants individually or jointly with other companies:

• Almaraz Nuclear Power Plant (1983/1984)
• Trillo Nuclear Power Plant (1988)
• Cofrentes Nuclear Power Plant (1984)
• Vandellòs II (1988)
• Ascó II (1986)

Thermal plants

Iberdrola also owns three conventional thermal plants, mostly coal-fired, although they can also use fuel-oil and gas-oil. These are:

• C. T. de Velilla, in Velilla del Río Carrión (Palencia), with two units, one of 148 MW and one of 350 MW, in operation since 1964 and 1984, respectively.
• C. T. de Lada, in Langreo (Asturias), which had as many as four units, but now only has one of 350 MW, put into operation in 1981.

Renewable energy

Iberdrola wind generators in the Park La Cotera (Burgos).

Headquartered in Valencia (Paseo de la Alameda), the Iberdrola Renovables subsidiary had been listed on the stock exchange until July 2011, when Iberdrola decided to integrate it into the parent company. At the end of 2013, Iberdrola had operating installed capacity above 14,247 MW -53% outside Spain- producing a total of 33,899 million kWh of power in the year.

Major assets

• Renewable Energy Operations Centres - CORE (Toledo, Portland and Glasgow)

Iberdrola's Renewable Energy Operations Centres (CORE for their initials in Spanish) in Toledo, Portland and Glasgow are the world's most important renewables facilities and pioneers in the industry for their cutting-edge technology.These centres control all Iberdrola's renewables facilities and their related substations worldwide 24/7, 365 days a year. Iberdrola's first CORE was set up in Toledo in 2003, with the other two coming on stream since.

• The Whitelee Wind Farm (Glasgow, Scotland)
  

  Whitelee wind farm Glasgow.

With initial installed capacity of 322 MW, it is currently being enlarged to 539 MW. The complex is situated south of Glasgow and covers an area of 55 square kilometres, the same as that occupied by Glasgow itself. It boasts the first renewables learning centre in the UK, enabling a large number of people to find out more about the various renewable energy sources.^[14] Whitelee has obtained the prestigious Queen’s Award for its commitment to sustainability. The award recognises excellence in habitat management and the promotion of local community involvement in the renewable energies project.

• The El Andévalo wind farm (Huelva, Spain)

The El Andévalo wind farm, which was commissioned in 2010, is the largest wind power facility in Spain and continental Europe. It has installed capacity of 292 MW and is located between the towns of El Almendro, Alosno, San Silvestre and Puebla de Guzmán in the south of Huelva province. To transfer the power generated by these wind farms and connect them to the transmission grid, Iberdrola has built a new 120-kilometre line between Spain and Portugal, which means this complex occupies a key strategic position in the power interconnections between the two countries.^[15]

• Peñascal Wind Power Project (Texas, USA)

The Peñascal wind farm^[16] is the largest facility operated by the company worldwide, with installed capacity of 404 MW. Located in Kenedy County, Texas, its innovative features include a radar that detects the arrival of large flocks of migratory birds and shuts down the turbines if visibility conditions represent a danger.

See also

• Jose Ignacio Sanchez Galan
• Wind power in Spain

References

External links

• Official website

Press articles

• We need a co-ordinated European energy policy and an end to states protecting their own interests
• Maine chooses Iberdrola to build gas pipeline to state properties
• Iberdrola Begins Work On Its First German Offshore Wind Farm, Plans 11 GW Of Offshore Wind In Europe
• Iberdrola joint venture bags $182 million investment for Brazilian wind farms
• Iberdrola USA Foundation and Fundacion Iberdrola Scholarship Program Completes Successful First Year
• Iberdrola invests 1.6 bln eur in German wind farm
• Wind energy in Poland: Iberdrola opens a wind farm
• Iberdrola prices 750 mln euro 2017 bond
• Iberdrola USA Subsidiaries Recognized for Outstanding Sandy Recovery Efforts
• Iberdrola sells 1 billion euro bond

Euro Stoxx 50 companies of the Euro Area (Last update October 2015) Air Liquide Airbus Group Allianz Anheuser-Busch InBev ASML Holding Assicurazioni Generali AXA Banco Bilbao Vizcaya Argentaria Banco Santander Central Hispano BASF Bayer BMW BNP Paribas Carrefour Compagnie de Saint-Gobain Daimler AG Deutsche Bank Deutsche Post Deutsche Telekom Enel Engie SA Eni E.ON Essilor International Fresenius SE Groupe Danone Iberdrola Inditex ING Group NV Intesa Sanpaolo L'Oréal LVMH Moët Hennessy Louis Vuitton Münchener Rückversicherungs-Gesellschaft Nokia Orange S.A. Philips Electronics SAFRAN Sanofi SAP SE Schneider Electric Siemens Société Générale SA Telefonica TOTAL S.A. Unibail-Rodamco UniCredit Unilever Vinci SA Vivendi Volkswagen Group

IBEX 35 companies of Spain Abengoa Abertis ACS Amadeus IT Group ArcelorMittal Banco Bilbao Vizcaya Argentaria Banco Popular Español Banco Sabadell Banco Santander Bankia Bankinter Bolsas y Mercados Españoles Caixabank DIA Enagás Ferrovial Fomento de Construcciones y Contratas Gamesa Corporación Tecnológica Gas Natural Grifols Iberdrola Inditex Indra Sistemas International Airlines Group Jazztel Mapfre Mediaset España Comunicación Obrascón Huarte Lain Red Eléctrica de España Repsol Sacyr Vallehermoso Técnicas Reunidas Telefónica Viscofan