Iberdrola has concluded discussions with Norges Bank Investment Management to add an additional 644MW of renewable energy capacity in Spain to their joint clean energy initiative.

The expanded alliance now encompasses around 2.5GW of projects under development in the Iberian region.

Under the agreement, Norges Bank Investment Management will acquire a 49% stake in the renewable energy portfolio for €203m ($217.78m), valuing the entire portfolio at around €414m. Iberdrola will retain the remaining 51% stake.

The transaction will proceed without the need for external debt financing, Norges Bank stated.

The new projects, which are exclusively solar, are situated in Extremadura, with a capacity of 328MW and already operational, and in Castilla y Leon, with a capacity of 316MW.

Earlier in January, the two entities revealed negotiations to double the size of their initial partnership, which was close to 1.3GW.

Initially, a total of 674MW was added, with the extra 644MW now fully agreed. 

Both solar projects have also secured power purchase agreements for a portion of their energy output.

The partners have indicated that there is a potential for the alliance to extend its reach to other countries in the future.

In June 2023, Iberdrola finalised a deal with the fund to sell a 49% share in a Spanish renewable energy portfolio with a capacity of 1.26GW.

Last month, the European Investment Bank sanctioned a €700m loan to support the expansion of Iberdrola's electricity distribution network in Spain, with the total project cost estimated at €1.44bn. Iberdrola will fund the remaining €740m.

Iberdrola also recently announced plans to invest €41bn to hasten electrification and enhance power grids globally.

This investment plan includes the acquisition of an 18.4% stake in Avangrid for $2.5bn.

Of the total investment, €21.5bn is earmarked for grid network expansion and reinforcement in the US, the UK, Brazil and Spain, with the US assets set to receive 35% of the total investment.