Iberdrola invests €4.5bn to expand Brazil's power network

Spain’s Iberdrola is to invest nearly €4.5 billion in Brazil’s electricity networks aimed at assisting the country in expanding, modernising and digitising the system which will enable it to connect to new industries such as agri-food.

The plan is part of the Group's new investment cycle in electricity distribution networks in Brazil, which will reach €9 billion euros over the next five years, following the recent renewal of the concessions.

The investment will be focused on the electricity infrastructure in the state of Bahia up to 2030.

The plan, carried out through its subsidiary Neoenergia Coelba, includes setting up 54 new substations, more than 2,000 kilometres of high-voltage lines and 42,000 kilometres of medium-voltage networks.

“With this, the state of Bahia will receive 50% of the investments in electricity distribution networks planned in the next five years by Iberdrola's Brazilian subsidiary, Neoenergia, which will reach 50,000 million reais (9,000 million euros) after the recent renewal of its distribution concessions in the country.” 

The announcement was made by Iberdrola's Executive Chairman, Ignacio Galán, during his keynote speech at the Bahia Farm Show, Brazil's largest agricultural fair.

The inauguration of the event, in which Neoenergia has participated for more than a decade, was also attended by Brazi'ls Vice President Geraldo Alckmin, the Minister of Mines and Energy, Alexandre Silveira, the Minister of Agriculture and Livestock, André de Paula, Bahia governor, Jerônimo Rodrigues, the Senator of Bahia, Jaques Wagner, among other authorities and institutional representatives, as well as the CEO of Neoenergia, Eduardo Capelastegui.

Galán recalled that the signing of the renewal of distribution concessions for a further 30 years, last May, "has been key to guaranteeing predictability through regulations that encourage investments in a framework of legal certainty, such as the one maintained in Brazil, thus promoting the start of a new investment cycle".

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During his speech, Ignacio Galán highlighted the role of electrification in moving towards a more competitive, self-sufficient, secure and sustainable energy model and stressed that investments in electricity infrastructures are "a real engine of development", employment and making the local economy dynamic thanks to the purchasing of equipment, the creation of new industries and the training of professionals.

Iberdrola has been present in Brazil for almost three decades and serves more than 40 million people through Neoenergia. 

The Group's Brazilian subsidiary, present in 18 states and the Federal District, is the leading electricity distribution group and the company that invests the most in electrical infrastructure in the country.

"Brazil is a strategic market for Iberdrola," said Galán. 

Iberdrola's trajectory in Brazil began in 1997 with the integration of the distributors Coelba (in Bahia) and Cosern (in Rio Grande do Norte).

Since then, the company has invested more than €20 billion in the country.