EIB and Endesa join forces to promote deployment of renewable energy in Spain

Endesa plans to use these funds for the construction of three solar photovoltaic plants and a wind farm with a total installed capacity of 645 MW and a total investment of €500 million.

As the United Nations Climate Change Conference (COP26) in Glasgow draws to a close, the European Investment Bank (EIB) and Endesa join forces once again to promote the deployment of renewable energy in Spain. To this end, EIB Vice-President Ricardo Mourinho Félix and Endesa CEO José Bogas today signed a €250 million financing agreement — that could be increased to €700 million within the next two years — in Madrid to finance the company’s strategy for renewable energy investment and deployment in Spain. Endesa plans to use these funds for the construction of three solar photovoltaic plants and a wind farm with a total installed capacity of 645 MW and a total investment of €500 million.

This operation marks a new milestone for Endesa, as it is the first EIB operation in Spain linking the financing conditions to a target for reducing scope 1 direct greenhouse gas emissions (less than 150 g CO2eq/kWh by the end of 2023).

The operation is part of a joint strategy to direct EIB financing towards climate action and environmental sustainability. The investments will help diversify the energy mix and improve the security of supply, which is particularly important in Spain given that the Iberian Peninsula is not very well connected to the energy markets of Central Europe. The operation will also be key to increasing the share of renewables in electricity generation in Spain and Europe, in line with the climate targets adopted for 2030 and 2050.

Specifically, the overall framework loan (€700 million) will aim to co-finance a large number of commercial-scale solar photovoltaic and wind energy projects in Spain, including the transmission infrastructure required for interconnection to the grid. Overall, a whole series of renewable projects is expected to be financed within a portfolio of projects comprising 16 commercial-scale solar photovoltaic projects and 8 wind energy projects. This will provide some 1.5 GWp of solar photovoltaic power and 0.4 GW of onshore wind power, which is equivalent to the annual energy consumption of around 1 million households. In addition, a major part of the investment programme will be located in cohesion regions and will create nearly 2 500 jobs during the implementation phase, fostering economic recovery at a crucial time following the impact of the COVID-19 pandemic.

The EU Bank supports this project through a loan tied to sustainability criteria whose characteristics fully comply with the Bank's Climate Action and Environmental Sustainability (CA&ES) requirements. 

This development is part of Endesa’s commitments under its latest strategic plan for 2021-2023, which projects growth of 30% in its renewable energy fleet, up to 11 500 MW and €3.3 billion in investment (20% more than in the previous plan). Thanks to this investment, 89% of Endesa’s energy production in the Iberian Peninsula will be carbon-free by the end of 2023 — an increase of six percentage points compared to 2020.

EIB Vice-President Ricardo Mourinho Félix, who is responsible for the EU bank’s operations in Spain, said: “As demonstrated throughout COP26, the EIB is firmly committed to the fight against global warming. As the EU climate bank, it is essential for us to promote the development of infrastructure for renewable energy generation, contributing to the achievement of climate goals. The Bank has a long-standing and fruitful relationship with Endesa and the Enel Group based on a long history of operations in the energy sector that have contributed to the achievement of several national objectives, including climate action, security of energy supply and support for social cohesion.”

Endesa CEO José Bogas said: “The EIB granted us the first green loan in Spain and today we are also becoming the first to receive a loan tied to sustainable criteria. Being supported by the EU climate bank guarantees the solidity of Endesa’s commitments under our investment plan and our intention to move towards full decarbonisation. And we are going all-in: 57% of our gross debt is linked to sustainability objectives. We want to raise this to 60% by the end of 2023.”