Masdar has joined Spain’s Iberdrola to invest in a 476-megawatt offshore wind farm in Germany as the Abu Dhabi clean energy company moves ahead with its ambitious strategy to boost renewable energy capacity.
The Baltic Eagle wind farm, located in Germany's waters in the Baltic Sea, is valued at about €1.6 billion ($1.77 billion), the two companies said on Wednesday.
Iberdrola, which will retain a majority 51 per cent stake in the wind farm, is expected to control and manage the asset.
“When companies with long histories of pioneering clean energy join forces, it creates lasting solutions for people and the planet,” said Dr Sultan Al Jaber, Cop28 President-designate and chairman of Masdar.
“This landmark agreement between Masdar and Iberdrola will harness Germany’s abundant wind power in the Baltic Sea and bring electricity to nearly half a million homes, while cutting emissions,” said Dr Al Jaber, who is also the Minister of Industry and Advanced Technology.
Baltic Eagle, which will have 50 wind turbines, is expected to produce 1.9 terawatt-hours per year, powering 475,000 homes and preventing 800,000 tonnes of carbon dioxide from being released into the atmosphere annually, the companies said.
The wind farm, which is scheduled to come into initial operation at the end of 2024, has a minimum regulated tariff of €64.6 a megawatt-hour for the first 20 years.
All of its production has already been sold through long-term contracts, the companies said.
Iberdrola’s executive chairman Ignacio Galan said delivering the clean energy that the world needs required companies with vision that are committed to investing in new infrastructure.
“Masdar brings all of these qualities to Baltic Eagle. This is a major project that will help to drive forward green energy security in Europe, reduce emissions for homes and businesses, and support thousands of highly skilled jobs,” Mr Galan said.
Established by Mubadala in 2006, Masdar has taken a leadership role in the global clean energy sector and has helped to drive the nation’s economic diversification and climate action agenda.
It is currently active in about 40 countries and has invested or committed to invest in projects worth more than $30 billion.
Last week, Masdar raised $750 million through a green bond as part of a programme to raise up to $3 billion to meet Masdar’s equity funding commitments on new renewable energy projects in the UAE and overseas.
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The company grew its renewable energy capacity to 20 gigawatts in 2022, producing 18,000 gigawatt hours of clean energy and reducing carbon dioxide emissions by 10 million tonnes.
Masdar aims to grow its capacity to at least 100 gigawatts of renewable energy by the end of the decade, to become one of the world’s largest renewable energy companies by 2030.
Annual renewable power capacity must add an average of 1,000 gigawatts annually by 2030 to meet Paris Agreement goals, according to the International Renewable Energy Agency.
Although global renewable capacity in the power sector grew by a record 300 gigawatts last year, the gap between actual progress and the development required to achieve long-term climate goals has continued to grow, the Abu Dhabi agency said in its World Energy Transitions Outlook 2023 last month.
Iberdrola, with a market capitalisation of more than €74 billion, is the largest electricity utility in Europe and the second largest in the world.
The company, which has more than 40,000 megawatts of renewable capacity, plans to invest €47 billion between 2023 and 2025 in power grids and renewables.
