Iberdrola Signs €5.3 Billion Credit Line with Rates Tied to Climate, Diversity Goals
Global energy and electricity provider Iberdrola announced today that it has signed a €5.3 billion credit line, its largest ever, with conditions linked to the company’s performance towards its climate and socialSocial criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. More goals.
Under the new sustainability-linked facility, signed with 33 international banks, rates on the credit line can be adjusted up or down annually based on Iberdrola’s delivery on two sustainability objectives, including its emissions reduction goals across the value chain, and its target to increase the percentage of women in relevant leadership positions in the company. Iberdrola has set goals to achieve carbon neutrality in its power generation plants by 2030, and to reach net zero across its full value chain by 2040, and to increase the presence of women in relevant positions to 35 % by 2030.
The new financing follows the company’s announcement in 2021 of plans for its financing structure to have an increasingly higher percentage of green and sustainable products, estimated to account for nearly two-thirds of its debt by 2025. Iberdrola currently has almost €20 billion of outstanding green bonds, and more than 96% of its €20 billion credit line portfolio is now sustainability-linked.
According to the company, its “ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. More + F” initiative, integrating its sustainability and financing strategy, strengthens its €47 billion investment plan to support the decarbonization of the economy and move away from fossil fuels. Announced in November 2022, the 2023 – 2025 investment plan targets €17 billion for renewable energy, and €27 billion in its electricity networks, and a goal to boost renewable capacity to 52,000 MW by the end 2025.
Iberdrola said that it expects to update its investment plan in March 2024.
Ignacio Galán, Executive Chairman of Iberdrola, said:
“This credit line is yet another example of the financial community’s strong confidence in our strategy, based on value creation through investment in the energy transition and financial discipline. The transaction also enhances our commitment to our ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. More goals.”
