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This is the largest binding agreement of its kind in Europe between an energy company and a data centre operator.
Iberdrola and Echelon create a joint venture to develop data centres in Spain
Iberdrola already supplies more than 11 TWh of electricity to technology companies and infrastructure operators worldwide, making it a leading provider of electricity to data centres.
Iberdrola and Echelon create a joint venture to develop data centres in Spain [PDF] - Iberdrola, which will hold 20% of the joint company, will contribute land with grid connection and supply 24/7 electricity to the centres.
- Echelon, a leading hyperscale data centre infrastructure operator in Europe headquartered in Ireland, will hold the remaining 80% and will manage permits, design, marketing and day-to-day operations of the joint venture.
- The first project of the joint venture will be a data centre with 144 MW of processing capacity and a secured power connection of 230 MW.
- Through this agreement, Iberdrola strengthens its strategy of providing secure, clean and competitive energy access to tech companies and promoting electrification.
Iberdrola and Echelon Data Centres, a leading owner and operator of hyperscale data centre infrastructure in Europe, have announced a strategic joint venture to build and operate data centres in Spain. This is the largest binding agreement of its kind in Europe between an energy company and a developer of this type of infrastructure.
Through this partnership, Iberdrola will hold a 20% stake via its subsidiary CPD4Green and will be responsible for identifying and securing land with grid connectivity where the centres will be developed. In addition, it will provide 24/7 electricity to the sites.
Echelon, a technology company based in Dublin and owned by Starwood Capital Group, will hold 80% of the joint venture and will oversee development, design, commercialisation and day-to-day management of the company.
The first project of this joint venture will be Madrid Sur, a 160,000 m² complex offering 144 megawatts (MW) of data processing capacity, with a secured 230 MW grid connection. The centre, which is expected to create around 1,500 jobs and become operational before 2030, will require 1 terawatt-hour (TWh) of electricity. This demand will be met by an on-site solar photovoltaic plant, supplemented by additional clean energy capacity from Iberdrola.
“This agreement strengthens Iberdrola’s strategy to facilitate the development of data centres, which have already become a key driver for electricity demand growth. The alliance signed with Echelon will allow us to leverage our portfolio of sites with grid connection and our capacity to provide these infrastructures with secure, clean and competitive energy 24 hours a day, 365 days a year,” said David Mesonero Molina, Iberdrola’s Director of Corporate Development.
David Smith, Chief Investment Officer at Echelon Data Centres, commented: “Entering the Spanish data centre market has been a strategic goal for Echelon for several years. Spain offers significant advantages to our clients: access to large-scale renewable energy with some of the lowest prices in Europe and excellent construction and operational capabilities. Our partner, Iberdrola, is a global energy leader and we are delighted to have this opportunity to work together to deliver world-class data processing infrastructure for our clients.”
A business with strong growth potential
Iberdrola already supplies more than 11 TWh of electricity to technology companies and infrastructure operators worldwide, making it a leading provider of electricity to data centres. Its subsidiary CPD4Green, focused on enabling the development of data processing infrastructure, already has a site portfolio with 700 MW capacity in Spain and potential for an additional 5,000 MW.
In recent years, Spain has established itself as the gateway for global data traffic into Europe. Over 70% of data traffic heading into the continent passes through Spain, thanks to its fibre-optic network, submarine cable connections, access to clean and competitive energy and robust electricity grid.