IBERDROLA RENOVABLES, the world’s leading wind power company(1), reports net profits of €360 million for 2010, down 3% on the previous year. Gross operating profit (Ebitda) for the financial year rose 9.8% to €1,455.7 million. 

Net profit from the renewables business, excluding gas, was €380.4 million, an increase of 15.5% while Ebitda rose by 19.4% to €1,449.3 million. This reflects growth in international business, which contributed €700 million and now represents 48% of the total. 

The gas business, however, performed less well, principally due to falling demand in the US and tighter seasonal spreads. IBERDROLA RENOVABLES will work on a rationalisation of these assets during 2011. 

Despite the difficult economic climate, the company successfully built on its strategy in 2010, with operating profit growth achieved thanks to higher capacity and output, and it is now the leading wind power company in Spain, Europe and the UK and the second largest in the US.

IBERDROLA RENOVABLES built more renewable capacity in 2010 than any other utility in the world, bringing 39 new wind facilities on stream in eight countries with combined capacity of 1,780 megawatts (MW), lifting total capacity to 12,532 MW(2), and exceeding the company's target for the year.

The company also achieved record output figures in the year, generating a total of 25,405 million kWh (+18.2%). Of the total, 24,519 million kWh were generated by the company’s wind farms, which continued to form the core of its business, accounting for 96.5% of the generation mix. At the same time, around 90% of expected 2011 output is covered by long-term contracts.

IBERDROLA RENOVABLES has also continued to improve efficiency, achieving a 3.8% reduction in operating costs per megawatt. The company has also maintained a solid financial platform, generating cash flow of €1,123.3 million, with leverage standing at 28.4%, one of the lowest ratios in the sector. Assets totalled €25.85 billion.

Gross margin for the year was €2,025.2 million (+11.6%), boosted by higher output and a successful pricing policy. Investments in 2010 totalled €2,935.2 million, over half of which was in the US, where IBERDROLA RENOVABLES was the fastest-growing renewables company for the second year running.

Key aspects in 2010 

1.  The US: key to growth

The US business was the key growth driver for IBERDROLA RENOVABLES in 2010. The company led the development of renewable energy in this country in the year, bringing on stream a total of 1,043 MW, making it the second largest wind power operator in the country.

The company has received over $1 billion in grants from the US government, the largest amount of incentives awarded to any renewables energy company in the world to date.

Another key aspect of US strategy has been to buttress the long-term profitability of renewable energy plants by entering into power purchase agreements (PPAs). In 2010 IBERDROLA RENOVABLES finalized PPAs for more than 700 MW at a higher price than in previous years, making it one of the most active companies in this area. The company is currently studying opportunities to lock in sales of a further 1,000 MW.

In 2010 the Portland renewables control centre (CORE), the most advanced installation in the sector in the US, controlling the nearly 800,000 signals from the company’s 2,500 wind turbines there, came into operation.

Last year the company also brought on stream the Penascal wind complex in Texas, the largest operated by IBERDROLA RENOVABLES worldwide, with installed capacity of 404 MW.

It also has a portfolio of more than 400 MW of photovoltaic projects in the US, all developed in accordance with the company's opportunity, sustainability and profitability criteria.

2.  The UK: headquarters of the company’s offshore business

The UK, along with the US, will be another key market for IBERDROLA RENOVABLES in coming years, with a particular focus on offshore wind energy projects.

For this purpose, the company early last year created an Offshore Business Division in Scotland, which will lead development of the large volume of marine wind energy projects awarded to the company. These amount to around 12,000 MW worldwide.

In partnership with Vattenfall, IBERDROLA RENOVABLES holds the rights to build in the UK one of the world’s largest offshore wind farms, the East Anglia Array, with installed capacity of up to 7,200 MW. At the end of last year this project was given authorisation to connect to the British land-based grid operated by the National Grid. This is the largest access to a grid ever granted for an IBERDROLA Group project.

Having obtained this concession, work has now begun on the first phase of the project, East Anglia ONE. Up to 400 state-of-the-art wind turbines will be brought on stream at the 1,200 MW facility which will be located 43 kilometres off the coast of Suffolk, in eastern England.

The company has a further 2,300 MW under development in the UK, including the 400 MW West of Duddon Sands facility (developed in partnership with Dong). Construction of this wind farm is scheduled to begin in 2013.

The company, via its subsidiary ScottishPower Renewables, is already the leading developer and generator of onshore wind energy in the UK with installed capacity of 932 MW. The company also plans to expand the Whitelee wind power complex, the largest in Europe, and a flagship facility worldwide, by a further 217 MW to 539 MW.

3.  Leading renewables company in Spain in 2010

IBERDROLA RENOVABLES was the fastest-growing company in its sector in Spain in 2010, installing an additional 420 MW to bring its total installed capacity up to 5,696 MW.

Of the total, 5,302 MW is in wind power, 342 MW in small-scale hydroelectric plants, 50 MW in solar thermal facilities and 2 MW in forestry biomass plants. By region, the largest share of its installed capacity is in Castile-La Mancha (1,981 MW), followed by Castile-Leon (1,323 MW), Andalusia (803 MW) and Galicia (627 MW).

The company expanded to 292 MW the installed capacity of its El Andévalo wind farm in San Silvestre de Guzmán in Huelva. This facility, the largest wind complex in continental Europe, started up last year.

4.  The international business, a booming market

IBERDROLA RENOVABLES is making progress in Latin America towards becoming the leading renewable energy company in Mexico and Brazil, as demonstrated by the recent award of a 258 MW project in Brazil, where the company currently has 50 MW of installed capacity, while in Mexico it has 106 MW, a figure that is set to double in 2011.

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