* Spending mostly shared between Britain, Spain, United
* Hopes for EU funding for hydrogen project
* Shares buoyant in morning trade
MADRID, Nov 5 (Reuters) - Spanish wind energy group
Iberdrola plans to invest 75 billion euros ($88
billion) in its renewable energy production, grids and retail
operations by 2025 to capitalise on growing global demand for
clean power, it said on Thursday.
Countries and companies the world over are seeking to cut
emissions to combat climate change, buoying renewables-focused
companies including Iberdrola.
Pursuing the opportunities created by the "energy
revolution" facing the world's major economies should help to
boost net profit by more than 40% from 2019 to 5 billion euros
in 2025, Iberdrola said.
Shares rose throughout morning trade and were up 3.1% on the
day at 1300 GMT, outperforming a positive Spanish stock index
and taking Iberdrola's gains so far this year to around
a quarter. It has become Spain's second biggest company after
Zara owner Inditex.
For years, renewable companies have struggled to generate
big profits, while fossil fuels have provided easier margins,
but as COVID-19 lockdowns have hobbled energy use and hammered
oil and gas markets, the investment focus has been transformed.
Oil and gas companies, including Royal Dutch Shell,
BP and Total, are moving towards renewable
power, but Iberdrola's new spending plan eclipses their combined
planned investments in low carbon.
Other utilities are joining Iberdrola in building green
capacity and wind energy is set to reach record growth globally
over the next five years.
Denmark's Orsted is in the midst of a $30
billion investment plan and Italy-based Enel, the
region's leader, has set aside 14.4 billion euros to build
renewables capacity and phase out coal between 2020 and 2022.
Iberdrola promises steady earnings for its shareholders.
They will receive between 0.40 and 0.44 euros per share by
2025 as the company sets aside a total of 94 billion euros for
both the investment plan and its dividend plan, Iberdrola Chief
Financial Officer Jose Sainz said.
The money will mainly come from operations and cash
management, but 19% will be from taking on debt, Sainz said.
Half the overall investment will be split between the United
States, where it announced last month its local unit Avangrid
would buy utility PNM Resources, and Britain,
where it owns Scottish Power.
At home in Spain, spending, mainly on renewables and
networks, will more than double to 14.35 billion euros over the
life of the plan.
Iberdrola hopes one costly Spanish project, building
capacity to produce hydrogen from renewable sources, will get
European Union funds as the bloc seeks to emerge from a
coronavirus-induced recession by focusing spending on
By 2030 Iberdrola aims to increase solar and onshore wind
capacity by 2.5 times and offshore wind power by 4.5 times, to
reach a total generation portfolio of 95 gigawatts (GW).
($1 = 0.8523 euros)
(Reporting by Isla Binnie, additional reporting by Jose Elias
Editing by David Goodman and Barbara Lewis)