Iberdrola raised its UK ambition, stating ScottishPower investment could reach £24bn from 2024-2028 to accelerate grid upgrades and add renewables. This would double a prior £12bn plan and align with government clean power goals. Iberdrola frames the move as a response to surging electricity demand, the need to integrate new offshore wind, and a clearer regulatory environment.
Through the period, most of the spend is earmarked for networks, with delivery weighted to transmission reinforcements in Scotland and connections that relieve congestion between Scotland and England.
According to the company, the UK has become its largest investment destination to 2026, helped by the integration of Electricity North West and a steady pipeline of grid and generation projects, and the plan is intended to quicken that trajectory, subject to approvals. The commitment is set out in a media release that puts the UK at the centre of Iberdrola’s capital rotation, noting the proposal could reach £24bn between 2024 and 2028 if market and regulatory milestones hold in place, as detailed in the company’s announcement. The investment could be decisive.
Regulatory Signals Anchor Capital
Against this backdrop, Ofgem’s shift into the RIIO‑3 cycle for 2026 to 2031, with draft determinations published on 1 July 2025, offers clearer allowances and incentives for transmission and gas networks that shape financing assumptions and delivery risk. The regulator positions the package as the start of a larger build programme, and the consultation sets the tone on cost of capital, totex treatment, and in‑period approvals that matter for multi‑year mega‑projects, all of which are central to investment committees and lenders.
For Iberdrola and peers, visibility over recoverable spend, incentives for timely delivery, and mechanisms for large onshore transmission investments will determine how fast capital can be deployed and recycled. In practice, price control calibration steers both procurement sequencing and balance sheet capacity through 2031. With the UK grid undergoing its largest expansion in decades, regulatory cadence is now a primary driver of timing and scope, as shown in Ofgem’s RIIO‑3 draft determinations.
Networks Dominate The Spend
For the current plan, Iberdrola emphasises networks over generation, citing the need to move more Scottish wind south and to harden distribution systems for electrification, including vehicle charging and heat pumps. Project pipelines include 2 gigawatt high voltage direct current links and substation builds that relieve curtailment and reduce constraint payments, improving whole‑system costs over time. Momentum is also political.
As the UK Prime Minister put it, “a clear vote of confidence,” said Keir Starmer, welcoming the investment signal. The sponsor echoed the scale, with Ignacio Galán stating the company would “double our investments for 2024‑28, reaching up to £24bn.” Delivery requires long‑lead equipment, from HVDC converter stations to subsea cable, so early works and supply chain bookings are critical. Even so, execution will hinge on timely land consents, marine licences, and inter‑utility interface management, which can bottleneck if permitting and workforce constraints persist.
Financing And Delivery Pathways
On financing, the UK’s regulated asset base model remains the backbone, but blended capital is emerging to accelerate shovel‑ready grid reinforcements. In May 2025, the National Wealth Fund announced a £600m commitment within a £1.35bn package to help ScottishPower deliver seven priority transmission upgrades, a signal that public co‑financing can crowd in private lenders where time to grid is strategic.
Bank syndicates arranged by international lenders have supported these programmes, and terms will track inflation expectations, construction risk allocation, and the evolving finance package in Ofgem’s final determinations. Procurement choices, meanwhile, are trending to multi‑lot frameworks that lock in converter station EPCs and cable manufacturing slots, protecting schedule and price amid global demand for HVDC. If regulatory allowances firm up and consenting keeps pace, Iberdrola’s UK plan can move from announcement to assets in service on a timetable that aligns with Clean Power 2030 goals. The company’s proposal to reach £24bn between 2024 and 2028, set out in its own release, underscores the stakes and the need for coordinated regulatory and delivery action across the system.