IBERDROLA Renewables has completed the acquisition of 50% of Societa Energie Rinnovabili, S.p.A. (SER), a joint venture with Italian energy group API Holding, through its API Nova Energia subsidiary, to develop, build and operate 350 MW of wind power in Italy over the next few years. 

This new company plans to start up a total of seven wind power projects between 2008 and 2009, located in Sicily and the Puglia region, with an investment of approximately €500 million.

The joint venture is in the framework of a strategic alliance signed by IBERDROLA Renewables and API Holding at the end of March, as a result of which the Company is strengthening its position in the Italian wind power sector jointly with one of the country’s leading energy groups.

API Holding, through API Oil, is among the top oil companies in Italy, concentrating on supply, transport, refining and distribution, both in Italy and abroad. It took its first steps in the wind energy sector in 2000 and now has 30 MW of wind power in operation and a 60 MW biomass plant. It also has a 280 MW combined cycle gas installation.

The wind farms to be developed by Società Energie Rinnovabili are in addition to IBERDROLA Renovable’s project pipeline in Italy of 200 MW with an option for 100 MW more. This new project falls within the framework of its strategy of accelerating international growth, underlined recently by the acquisition of four wind power projects in Hungary with a total capacity of 108 MW and an investment of €155 million.

World leader in wind power

IBERDROLA had accumulated an installed capacity of renewables of 7,342 MW at the end of September 2007, an increase of 80% over the 4,076 MW at the end of the same month last year, with 516 MW added in the third quarter, thus consolidating its leadership in the world wind power sector*. Of this total, 7,000 MW is in wind farms (2,965 MW outside Spain) and 342 MW from mini hydro power stations.

IBERDROLA’s renewable energy capacity in Spain is distributed among 13 regions, with 162 MW in new capacity added between July and September (98 MW from Andalusia, 48 MW from Castilla-Leon, 12 MW from Murcia and 4 MW in the Basque Country).

Outside Spain, the Company added 354 MW of new capacity in the third quarter. It currently has 2,046 MW installed in the United States**, 372 MW in the UK, 214 MW in Greece, 89 MW in Poland, 86 MW in France, 60 MW in Germany, 50 MW in Portugal and 49 MW in Brazil.

IBERDROLA has additionally a project pipeline in renewable energy of more than 41,200 MW in different stages of development: more than half is in the United States (around 21,200 MW) about 6,600 MW in Spain, nearly 6,100 MW in the UK and approximately 7,350 MW in the rest of the world.

Operating renewable energy plants produced 9,406 million kWh in the third quarter of the year, 68% more than the same period last year, and now provide  11% of all electricity produced by the IBERDROLA Group.

Electricity produced each year by the Company’s renewable energy installations is the equivalent of the domestic annual consumption of 10.5 million people in Spain. It also reduces CO2 emissions by more than 4.5 million tonnes a year.

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*Source: New Energy Finance (Mayo 2007)

** Includes 606 MW owned by a third party under energy sales contract

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IMPORTANT INFORMATION

The Folleto Informativo of the IPO of Iberdrola Renovables, S.A.U. is in the process of being approved by the Comisión Nacional del Mercado de Valores (CNMV). Once it is authorised, it will be made available through Iberdrola Renovables, S.A.U.’s and the CNMV’s web sites, as well as in the registered address of Iberdrola Renovables, S.A.U., the Stock Exchanges, the banks acting as underwriters and the Agent Bank.

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FORWARD-LOOKING STATEMENTS

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Forward-looking statements are not guarantees of future performance. They have not been reviewed by the auditors of Iberdrola Renovables, S.A.U. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date they were made. All subsequent oral or written forward-looking statements attributable to Iberdrola Renovables, S.A.U. or any of its members, directors, officers, employees or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. All forward-looking statements included herein are based on information available to Iberdrola Renovables, S.A.U. on the date hereof. Except as required by applicable law, Iberdrola Renovables, S.A.U. does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.