Iberdrola has created a new joint venture, Echelon Iberdrola Digital Infra, alongside Echelon Data Centres, which plans to invest more than €2 billion ($2.3 billion) in large-scale data centre developments across Spain. The JV, and completion of the transaction to set it up, were initially announced in July.
The new venture, which Iberdrola believes is the largest between an energy company and a data centre developer, has more than 700 MW secured and a potential portfolio of 5000 MW. Now, after obtaining the necessary regulatory approvals, Echelon Iberdrola Digital Infra will begin its commercial activity with a focus on hyperscale technology companies and providers of infrastructure and services for AI.
The first project of this alliance will be Madrid Sur, a 160 000 sq m complex that will have 144 MW for data processing, and has a 230 MW electricity connection already secured.
The estimated demand of the project is 1TWh. It will have a photovoltaic solar plant and additional renewable energy from Iberdrola to guarantee all its electricity consumption.
David Mesonero Molina, director of Corporate Development at Iberdrola, commented: “This agreement reinforces Iberdrola’s strategy of facilitating the development of data centres, which have become a key driver of growth in electricity demand. David Smith, director of Investments at Echelon Data Centres, said: “Spain offers significant benefits for our customers: access to large-scale renewable energy at some of the lowest prices in Europe and large construction and operating capacities.”
Iberdrola will be responsible for identifying and securing land with good connectivity to the electricity grid and ensuring a 24/7 clean energy supply. For its part, Echelon will assume the permitting, design, marketing and operation processes. The stake in the joint venture will be up to 80% for Echelon, which is a privately held company that develops, owns and operates hyperscale data centres campuses in Europe. The company has a portfolio of more than 2GW in Tier 1 markets such as Dublin, London and Milan.
The remaining 20% goes to Iberdrola through its subsidiary CPD4Green, the company’s digital infrastructure arm set up to accelerate the deployment of data centres with potential partners, starting in Spain. Iberdrola has secured 700 MW in electricity connections for the joint venture in strategic areas near Madrid, and is planning new projects that could add up to €6 billion ($6.9 billion) of investment.
