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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 a 20% stake in the joint venture, will provide land connected to the electricity grid and supply electricity 24/7 to the centres.
- Echelon, a leading operator of large-scale data centre infrastructure in Europe based in Ireland, will hold the remaining 80% and will take care of permits, design, marketing and day-to-day management of the joint venture.
- The first project for this partnership will be a data centre with a 144 MW processing capacity, for which it has secured a 230 MW electricity connection.
- With this agreement, Iberdrola reinforces its strategy of providing access to secure, clean and competitive energy for tech companies and pushing for electrification.
Iberdrola and Echelon Data Centres, a leading owner and operator of large-scale 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 technology infrastructure.
Under this agreement, Iberdrola will hold a 20% stake through its subsidiary CPD4Green and will be responsible for identifying and securing land with connection to the electricity grid where the centres will be developed. It will also supply electricity to the centres 24/7.
Echelon, a Dublin-based tech company owned by Starwood Capital Group, will own 80% of the company and will be in charge of the development, design, marketing and day-to-day management of the joint venture.
The first project this joint venture will carry out will be Madrid Sur, a 160,000 m² complex that will offer 144 megawatts (MW) of data processing and has already secured a 230 MW electricity connection. This centre, which will create around 1,500 jobs and is expected to be operational before 2030, will require 1 terawatt hour (TWh) of power, which will be supplied by a solar photovoltaic plant to be built on site, complemented by additional clean energy capacity from Iberdrola.
‘This agreement reinforces Iberdrola's strategy of facilitating the development of data centres, which have become a key driver of growth in electricity demand. The joint venture signed with Echelon will allow us to leverage our portfolio of sites with access to electricity connections and our ability to offer these infrastructures secure, clean and competitive energy 24 hours a day, 365 days a year,’ said David Mesonero Molina, Director of Corporate Development at Iberdrola.
David Smith, Director of Investments at Echelon Data Centres, said, ‘Entering the data centre market in Spain has been a strategic objective for Echelon for several years. Spain offers significant benefits for our customers: access to large-scale renewable energy at some of the lowest prices in Europe and large construction and operating capacities. Our partner, Iberdrola, is a global energy leader and we are delighted to have this opportunity to partner with them to offer our customers the best data processing infrastructure.’
A business with high growth potential
Iberdrola already sells more than 11 TWh to tech companies and operators of these infrastructures worldwide, making it a leader in data centre electricity supply. Its subsidiary CPD4Green, dedicated to facilitating the development of data processing infrastructures, already has a portfolio of sites for 700 MW in Spain and has the potential for another 5,000 MW.
In recent years, Spain has established itself as the gateway for global data to the European continent. More than 70% of data traffic to Europe passes through Spain thanks to its fibre optic network, submarine connections, availability of clean and competitive energy and its electricity grid.