Iberdrola has confirmed plans to invest over $1 billion in its Brazilian operations over the next three years.

The Spanish utility owns a 39 per cent stake in Brazilian energy company Neoenergia and says that its main focus over the next few years will be the construction of new hydropower plants.

Neoenergia is part of Iberdrola’s extensive Latin American investment portfolio, which accounts for 13 per cent of the firm’s earnings and nearly one-quarter of net profits.

Iberdrola said in a statement that it is expecting to bring around 710 MW of new hydropower capacity on stream in Brazil by 2013 as part of plans to invest $1130 million in the country between 2010 and 2012. It already operates 1740 MW of generating capacity in Brazil.

Other investments will include improvements to and the expansion of electricity distribution infrastructure in Brazil. Neoenergia is now the largest electricity distributor in north-eastern Brazil, with 28 300 GWh and a 44 per cent market share.

Iberdrola commissioned 275 MW of new hydropower capacity in Brazil in 2009, and has invested $3640 million in the country since its arrival there at the end of the 1990s.