Iberdrola Signs INR 369 Bn Green Financing with 24 Banks for East Anglia Three Offshore Wind Farm

Iberdrola has signed green financing for the East Anglia Three offshore wind farm for approximately INR 369 billion (around €4.1 billion).

Iberdrola has signed this financing with 23 banks and the Danish Export Credit Agency (EIFO). The participating banks are: BBVA, HSBC, ING, NatWest, SMBC, MUFG, Bank of China, Crédit Agricole, CaixaBank, Santander, BNP Paribas, Helaba, Barclays, ANZ, Rabobank, FAB, ICO, Abanca, Kutxabank, Standard Chartered Bank, Bank of Ireland and CID. Crédit Agricole CIB and MUFG acted as financial advisors for the transaction and Allen & Overy acted as legal advisors to the borrower.

The transaction, which was 40 percent oversubscribed, is one of the largest of its kind to date and will cover a substantial part of the total investment in the project, estimated at approximately EUR 5.2 billion.

The financing will be provided through green project finance, which is a financing structure for large projects in which the loan is granted mainly on the basis of the future income that the project will generate. In other words, the money is repaid with the cash generated by the project once it is up and running, all underpinned by confidence in the shareholders' long-term management of the asset.

The financing consists of senior debt (approximately 70 percent) and capital contributed by the shareholders (the remaining 30 percent), and is backed by long-term power purchase agreements (CfDs and PPAs), which provide investors with certainty regarding future revenues. Construction has also been supported by a bridge loan granted by MUFG and Crédit Agricole.

The funds raised will be used to cover the construction costs of the wind turbines, substations, submarine cables and converter stations, both onshore and offshore. It will also finance the operation and maintenance costs prior to commercial operation, which is expected to start in the fourth quarter of 2026.

Project revenues will be supported by long-term contracts: with CfD (Contracts for Difference) contracts awarded by the UK government and a long-term power purchase agreement (PPA) signed with Amazon in 2024. This combination ensures high revenue visibility over the lifetime of the project.

Iberdrola and the Abu Dhabi renewable energy group Masdar have agreed this week to co-invest in the East Anglia THREE offshore wind farm. This EUR 5.2 billion transaction is the largest in offshore wind energy in the decade and the largest alliance ever made by Iberdrola.

Under the agreement, each company will have a 50 percent stake and management of the asset, which will be key to advancing Europe's ambitious goals for the development of this technology. Its completion is subject to the usual third-party approvals.

East Anglia Three is being built in the North Sea, 69 km off the coast of Suffolk (United Kingdom). The farm will have 95 Siemens Gamesa wind turbines of 14.7 MW each, enabling it to reach an installed capacity of 1,400 MW.

East Anglia Three will contribute significantly to the UK's decarbonisation targets, generating clean energy for more than 1.3 million homes and avoiding the emission of millions of tonnes of CO₂. It will also boost the local economy through job creation and the development of the industrial supply chain.