1

IBERDROLA’s experience in UK

Juan Rivier Head of Prospective Iberdrola Renovables

Madrid, 20th November 2014

WIND INVESTMENT OPPORTUNITIES IN UK

2 2

46 GW of installed capacity and 31 million customers

7.205 M € of EBITDA in 2013

Investments worth 3.053 M €

Net benefit of 2.572 M €

On of the largest world utilities with…

Figures for 2013

IBERDROLA main figures

3 3

IBERDROLA worldwide

* Data at 12M 2013

Tunisia

Mexico

Bolivia

USA.

Venezuela

Chile Brazil

South Korea

Taiwan

India

Kenya

Kazakhstan

Qatar

UAE

Russia

Algeria

Syria

Ukraine Rumania

Finland

Latvia

Poland

Slovakia Germany

United Kingdom

Switzerland

Greece

Albania

FYR of Macedonia

Portugal

Spain France

Italy

Current presence Generation / Distribution

Engineering

Renewables Hungary

Active in over 40 countries

4 4

Focus on stable and attractive businesses and countries

EE.UU - Wind - Networks

Reino Unido - Wind - Networks

Brasil - Wind and Hydro - Networks

México - Wind & CCGTs

IBERDROLA

Stable & Attractive

frameworks

5 5

IBERDROLA in UK

Iberdrola is present in UK through Scottish Power since 2007

6.5 GW of installed capacity of which 1.6 GW of Wind

3.5 Electrical Customers* & 2.2 Gas Customers

Over 100.000km distribution & 4000km transmission lines

*Electrical supply points

3.150 M€ investments since 2012, 1.260 M€ in Wind

Current 2014-16 Strategic Plan allocates 40% of new investment to UK

6 6

UK Regulatory framework

UK is undergoing a radical change of the renewables supporting mechanism

Shift from… Renewables Obligation:

• Quota system with tradable GC

• Floor to the value of the GC

to… Contract for Differences:

• Stable price during 15 years

• Competitive auctions

Strong focus on risk reduction and affordability (LCF)

7 7

UK Regulatory framework

A change in the regulation is not negative per se…

• Transparent discussion with stakeholders

• Long lead times, with transition period with both mechanisms available (2014-2017)

• Not a single retroactive change

but… • Budget allocation not consistent with Round 3 project sizes and supply chain development looking at the necessary long term cost reductions

• Uncertainty due to lack of budget visibility for the next auctions