Iberdrola enters into a PPA with Bayer to supply green energy in Italy

Spanish energy company Iberdrola has extended its cooperation with German pharmaceutical giant Bayer, signing a green power purchase agreement (PPA) to supply green energy in Italy for 11 years, starting from January 2025, with a total capacity of 33 gigawatt-hours (GWh) during the period.

Iberdrola’s second solar plant, Montefiascone, in Italy, will produce power with a total installed capacity of seven megawatts (MW). Once operational, the plant will prevent more than 3,200 metric tons of carbon dioxide (CO2) from being released into the atmosphere, equivalent to the electricity needs of more than 4,000 homes, the company said in a news release.

With the inauguration of the second operational power plant and the completion of the photovoltaic installations, Iberdrola announced that it expects to achieve an operational capacity of 400 MW in Italy by 2025.

In addition to existing agreements between the two companies in Spain and Mexico, the agreement expands the international alliance between Bayer and Iberdrola, which aims to promote cleaner and more sustainable consumption.

According to the announcement, Bayer’s factory in Garbagnate, Milan, will use only electricity from renewable sources.

Iberdrola has signed long-term power purchase agreements in Europe, the UK, the US, Brazil, Mexico and Australia from onshore, offshore wind and photovoltaic projects.

Consultancy Pexapark reported that Iberdrola led the PPA ranking in Europe in 2023. Iberdrola sold approximately 90 percent of the energy it plans to produce in 2024-2025, giving the company visibility to deliver sustainable energy in the long term, according to release.

With over 180 years of history, Iberdrola describes itself as a global energy leader, wind energy producer and electricity producer. The company is committed to the energy transition with a sustainable business model based on renewable energy, smart grids, large-scale energy storage and digital transformation, it said.

Bayer describes itself as a global company with core competencies in life sciences such as healthcare and agriculture. Bayer designs products and services to help address some of the world’s greatest challenges and meet people’s most important health and nutrition needs, according to its website.

In an earlier news report, Iberdrola acquired 100 percent of its US subsidiary Avangrid, increasing its stake of 81.6 percent for approximately $2.55 billion.

According to the report, the purpose of the transaction was to increase exposure to the network business in the US at a key time for the company as it wants to expand in markets with strong credit ratings and in regulated businesses such as networks. The transaction is subject to required shareholder approval and various regulatory authorities, such as the Federal Energy Regulatory Commission and the New York and Maine state regulatory commissions.

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