Iberdrola Launches New Carbon Credit Unit to Sequester 61M Tons of CO2
Iberdrola SA, a Spanish power company that leads in producing wind energy, has launched a new business unit aimed at generating nature-based carbon credits to reduce its global carbon emissions.
The carbon credit company called Carbon2Nature (C2N) is formed through Iberdrola’s startup program Perseo. C2N will provide high-quality carbon credits in-house through projects that improve biodiversity, conserve and restore nature.
Harnessing the Potential of Nature-Based Carbon Credits
C2N leverages the potential of carbon markets, supporting the development of projects that will generate high-quality carbon credits. The new business will either develop its own nature-based solutions (NBS) or partner with others doing the same.
The goal is to capture and sequester over 61 million tons of carbon in natural sinks across more than 100,000 hectares, which includes forests, coastal ecosystems, and agricultural land. Each credit corresponds to each tonne of carbon reduced, removed, or avoided from entering the atmosphere.
The nature-based projects will prevent emissions caused by degradation, contributing to additional carbon sequestration while promoting social and environmental benefits. The newly found company believes that investing in nature is crucial to fight climate change while promoting sustainable value creation.
Speaking for the new launch, Carbon2Nature’s director Miguel Ángel García Tamargo said:
“We come to this new market with humility and a desire to do things differently, bringing all of Iberdrola’s experience in sustainability to the world of nature-based solutions and the generation of carbon credits.”
Iberdrola also plans to use the initiative to advance emerging clean energy solutions and sustainable production processes. Their new carbon credit initiative will focus on countries where Iberdrola has a strong presence.
The majority of C2N’s projects will be in Latin America, including Peru, Chile, Mexico, Brazil, and Colombia. The carbon credit company will also invest in nature-based solutions in the UK, Portugal, and its home country, Spain.
Carbon2Nature’s carbon credits will be available to Iberdrola’s customers aiming for cutting their carbon footprint and for the company’s own net zero goals.
With a focus on producing more renewable energy, Iberdrola aims to reach net zero emissions by 2040.
Iberdrola’s Net Zero Targets
As a global leader in renewable energy, Iberdrola aims to achieve carbon neutrality for Scopes 1 and 2 by 2030 and net zero emissions for all scopes before 2040.
As outlined in its Climate Action Plan, Iberdrola defines the levers and actions that will help advance its decarbonization journey. This plan contains the following major elements.
To reach its net zero goal, the company says it will continue to invest around 47 billion euros between 2023 and 2025 in these decarbonization efforts:
Increased renewable installations
Onshore and offshore wind power
Solar photovoltaic
Battery
Hydroelectric capacity
Electricity grids
The energy giant has one of the biggest renewable energy pipelines as shown and mapped below per renewable source.
All these investments, as stated in the company’s 2022 Sustainability Report, aimed towards accelerating the energy transition. By the end of the decade, the company expects to achieve 100,000 MW of installed capacity, 80% is renewables. This is possible thanks to Iberdrola’s planned investments of between 65 to 75 billion euros between 2026 and 2030.
Alongside its plan to rapidly reduce its own carbon emissions, the energy major also seeks to decarbonize the energy mix sector. Moving towards its net zero emissions, Iberdrola has employed a broad range of decarbonization initiatives.
Those efforts resulted in a 15% reduction in the company’s direct and indirect carbon emissions from 2021 to 2022. The same case happened in Iberdrola’s carbon emissions intensity (gCO₂/kWh) which shows a huge downward trend. These achievements speak for the company’s commitment to climate change and sustainability.
Source: Iberdrola GHG Report 2022
Pioneering a Sustainable Energy Transition
As part of its net zero journey, the company will employ various actions focusing on these key areas:
Decarbonization of electricity generation through the massive introduction of renewable energies
System integration through smart grids and digitization.
Electrification of demand – new uses of electricity, e.g. production of green hydrogen, for sectors that are difficult to decarbonize
Nature-based and other emerging climate solutions (ex. Iberdrola’s 2020-2030 Trees Program aims to plant 20 million trees by 2030)
Carbon2Nature is the most recent NBS initiative that the energy giant made as it commits to a sustainable energy model. The goal is to fuel its decarbonization strategies by harnessing carbon markets to bring positive impacts to the environment and the climate.
By tapping into the potential of carbon credits and nature-based projects, the Spanish energy leader’s strategies exemplify the multifaceted approach needed to usher in a net zero era.
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