Bankinter | Iberdrola (IBE) and Echelon Data Centres (controlled by the US fund Starwood Capital Group) have formalised the creation of Echelon Iberdrola Digital Infra, the joint venture through which they will develop the data centre business in Spain. Echelon will hold an 80% stake in the joint venture and Iberdrola will hold 20%.
Iberdrola will contribute its experience in renewable energy generation and in the development and management of large electrical infrastructures. It will be responsible for identifying and securing land with good connectivity to the electricity grid and ensuring a continuous supply of clean energy.
For its part, Echelon will take on the processes of permitting, design, marketing and operation. The joint venture will start with an investment of €2 billion and could reach €6 billion.
Bankinter analysis team’s view: Good news for the group. Iberdrola continues to strengthen its position as a key energy partner for data centres, currently marketing more than 11 TWh to technology companies and data centre operators worldwide. Iberdrola wants to consolidate Spain’s role in the data centre business. Currently, more than 70% of data traffic to Europe passes through Spain, consolidating its position as a digital hub thanks to its strategic geographical location, robust fibre optic network and submarine connections linking it to America and Africa, as well as the high availability of renewable energy at competitive costs and advanced electrical infrastructure.
