Amazon inks PPA to purchase electricity from UK wind farm

The project is expected to become fully operational in 2026.

Amazon has expanded its clean power partnership with Iberdrola by signing a renewable energy power purchase agreement (PPA) for nearly 160MW of an offshore wind farm located off the coast of Suffolk in the UK.

Last year, the Spanish utility giant announced that it will partner with Amazon to help the e-commerce giant procure renewable electricity from wind and solar projects in Europe, the US and the Asia-Pacific region.

Today (21 March), Iberdrola announced a new PPA with Amazon at the Haizea Wind Group facility in Bilbao where the manufacturing of 50 monopiles is underway, which will then be shipped to the UK to support the wind turbines of the East Anglia Three offshore wind farm.

This East Anglia wind farm is a ScottishPower project, an Iberdrola company, with a capacity to generate 1.4 gigawatts (GW) of renewable energy.  The project will be powered by 95 Siemens Gamesa 14.7MW turbines and will support more than 2,300 jobs during construction and 100 long-term jobs over its lifetime.

The project is expected to become fully operational in 2026 and will support Amazon’s commitment to match all the electricity powering its operations with 100% renewable energy by 2025.

Additionally, the two companies have launched the global “Journey to Cloud” programme, enhancing Iberdrola’s digital operations by migrating them to the Cloud and leveraging Amazon Web Services (AWS)’s computing and data services.

Amazon is aiming to halve the time it takes to produce weather simulations and will also optimise renewable energy efficiency with artificial intelligence (AI) and machine learning.

Iberdrola subsidiary ScottishPower has also developed an IoT platform to enhance its UK Low Voltage network. It is planning to integrate generative AI through Amazon Bedrock to enhance customer experience and aid field workers.

Iberdrola’s director of large customers and industrial solutions Sergio Hernández de Deza said: “Today, two global leaders join forces in an agreement that will mean more energy independence, more local jobs and lower emissions on both sides of the Atlantic.

“We are excited to partner with Amazon in the field of generative AI and big data, allowing our business to innovate and scale at speed.”

Partnership progress so far

Amazon and Iberdrola are also collaborating through PPAs concerning energy from two offshore wind farms in Germany, Baltic Eagle and Windanker. The retailer is set to source 1.3 TWh each year from these two projects.

In the US, Amazon has signed agreements which include Amazon Wind Farm Osagrove Flats wind farm for 150MW and the repowered Leaning Juniper IIA for 90MW.  The two projects will support around 300 jobs and 200 jobs during construction, respectively.

Iberdrola’s carbon emissions intensity currently stands at 55 grams per kilowatt-hour (kWh) in Europe, approximately 80% less than the industry average.

The company is aiming to achieve carbon neutrality for Scopes 1 and 2 by 2030 and net-zero emissions before 2040 for all scopes, including Scope 3.

Iberdrola’s €41bn electrification commitment

In addition to the expansion of its collaboration with Amazon, Iberdrola has announced a commitment to invest €41bn by 2026 in accelerating the electrification of energy networks.

The company also plans to create 10,000 new jobs and increase sustained employment in suppliers worldwide.

This investment includes the purchase of 18.4% of Avangrid, the US based energy company, as announced by Iberdrola earlier this month.

The company’s partners in renewables will contribute €5bn, bringing the net-investment to €36bn. Nearly 70% of this investment will support growth.

Approximately 60% of Iberdrola’s investments, totalling €21.5bn, will be allocated to network-based growth. This allocation aims to expand and reinforce networks in key regions such as the US, UK, Brazil and Spain.

Transmission, identified as a growth driver by the company, will receive more than €6.5bn in investment during this period. Moreover, the company plans to increase its network assets by 38% to €54bn, with €15bn allocated specifically to transmission.

In addition to network expansion, Iberdrola will selectively invest €15.5bn in renewables, focusing on offshore wind projects in the US, UK, France and Germany. All investments in renewables will be directed towards projects already under construction.

On the storage side, the company plans to invest €1.5bn to increase pumped storage capacity by 20%, thereby enhancing system stability and reducing volatility in margins.

Another major portion of Iberdrola’s investment, €2.5bn, will be dedicated to customer-focused initiatives. This includes providing energy solutions to industrial customers through PPAs and regulated generation with long-term contracts.

Looking ahead to 2030, Iberdrola anticipates a further growth in energy networks and renewables, with a projected asset base of €65-€70bn.

Iberdrola’s executive chairman Ignacio Galan said: “The electrification of energy is unstoppable and will expand exponentially in the years ahead.

“Our strategy will focus on delivering enhanced grid to support security of supply, now 60% of our total investment, as well as a strong expansion of renewables capacity. This plan will allow us to grow our asset base, grow our profitability and strengthen our finances.”