Ignacio Galán, Iberdrola’s executive chairman in his office. Image courtesy Iberdrola
Iberdrola has completed its exit from the UK smart meter market, days prior to acquiring an additional 30% stake in Brazil’s Neoenergia; both hailed as strengthening the Group’s investment focus on regulated networks businesses.
The Spain-based multinational utility giant has been looking to tap into the growth prospects offered by regulated networks businesses, this week announcing two initiatives to do so.
Tuesday saw the company complete sale to Macquarie of 100% of SP Smart Meter Assets Limited (SPSMAL), ScottishPower’s subsidiary responsible for managing its around 2.9 million meter smart meter business in the UK, for approximately £900 million (€1.1 billion; $1.2 billion).
Two days following the announcement, Iberdrola announced an agreement to acquire a further stake of 30.29% in Brazilian power utility Neoenergia for R$11.95 billion (€1.9 billion; $2.2 billion), bringing their stake to 84%.
With both transactions, Iberdrola says they are progressing their growth strategy based on electricity networks businesses, with 1.4 million km of power lines in the US, the UK, Brazil and Spain.
The announcements both come months after Iberdrola announced a €5 billion ($5.9 billion at the time) capital increase in July to finance what they call an “unprecedented investment opportunity” and accelerate their growth strategy in the US and UK networks segment.
Iberdrola at the time said their network asset base is expected to exceed €90 billion ($105.6 billion) by 2031, with the vast majority from the US and the UK (75%). Their home market of Spain will be home to the minority of 10% with Brazil constituting the remaining 15%.
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Smart metering
According to Iberdrola, the strategy to concentrate investments in regulated networks will drive total UK investments to £24 billion ($32.5 billion) between 2024 and 2028, primarily in transmission and distribution networks, as well as in renewable generation.
On the smart metering front, ScottishPower will continue working with Macquarie to support the rollout of smart meters among its customers while focusing on network development. With the sale, Macquarie now manages over 13 million devices, of which over 10 million are smart meters.
Through ScottishPower, Iberdrola has been present in the United Kingdom for 20 years, having invested more than £35 billion ($47.4 billion) in transmission and distribution networks and renewable generation.
After the acquisition of Electricity North West (ENW), ScottishPower became the country’s second largest distribution network operator. The company holds three distribution licences in Scotland, England and Wales and a transmission licence in Scotland, and operates 170,000km of lines.
Neoenergia stake
Iberdrola reached the agreement with Caixa de Previdência dos Funcionários do Banco do Brasil (PREVI), the largest pension fund in Latin America, reinforcing its position as majority stakeholder.
The transaction is expected to be closed in the next months.
Neoenergia supplies electricity to close to 40 million Brazilians through five distribution companies in the states of Bahia, Rio Grande do Norte, Pernambuco, Sao Paulo, Mato Grosso do Sul and Brasilia and 18 transmission lines, making it the largest distribution Group in Brazil by number of customers.
Neoenergia has more than 725,000km of distribution lines and 8,000km of transmission lines, as well as 3,800MW of renewable generation, mainly hydroelectric.
By 2024, Neoenergia had invested more than R$9.8 billion (€1.5 billion; $1.8 billion), to expand, upgrade, maintain and automatise its networks.
According to Iberdrola, in the coming years, Neoenergia faces strong growth prospects thanks to expected increase in investments in regulated networks with attractive regulatory frameworks, a core part of Iberdrola’s strategy going forward.
Iberdrola is expected to share more on their new strategy in their upcoming Capital Markets Day on September 24, 2025.
