Portuguese energy company EDP plans to invest 670 million euros in Spanish networks between 2026 and 2028. This represents a 14% increase compared to its previous plan (2024-2026), when 590 million euros were expected. With this investment, the Portuguese electricity company plans to increase its assets in Spanish low-voltage lines – concentrated in Asturias and Cantabria – to 2,000 million euros (7% more than in 2024).
The company qualifies its forecast for Spain as an “ambitious investment plan”, as it has presented to the Portuguese stock market regulator (CMVM). It should be noted that investments in networks are limited by national regulation, although the Ministry for Ecological Transition has recently increased these limits to stimulate electrification and the arrival of investment projects in Spain.
EDP predicts that, of these 670 million, 35% (approximately 235 million) will be allocated to the modernization of its lines and predicts that electricity consumption will grow by 12% until 2030. Another 235 million will be dedicated to the digitalisation of the network. The remaining 10% (67 million) will serve to provide greater resilience to networks so that they are better prepared for the increase in extreme weather events. And finally, 20% of the investments (around 134 million) will be allocated to supporting electrification and decarbonisation in Spain.
After the presentation of its plan, EDP fell by 6.6% on the stock market, following a stock market rally over the last year in which the stock went from 2.88 euros at the beginning of April to almost 4.40 euros before the markets opened this Thursday. Industry sources indicate that it could be burdened by a tax dispute in Portugal in which around 350 million euros in taxes would be owed on the hydroelectric assets sold to Engie.
This investment plan comes despite complaints from electricity companies about the financial remuneration rate proposed by the CNMC for the next six years. The regulator has proposed a rate of 6.58%, which will need to be approved by the end of the year, when the industry expects at least 7%. In Portugal, the proposed remuneration rate for networks, which is not yet final, is 6.3%.
The company has decided to concentrate its efforts on networks for the next three years and to focus on renewables standbywhich had been the main growth vector in previous plans. The company has in fact decided to freeze the rotation of green assets in Spain, as the difficult market situation leads it to postpone sales plans, given the decline in valuations.
Globally, EDP plans to invest 12 billion euros. Its main focus will be on the United States, like other large utilities such as Iberdrola. Even the turnover of the assets, which rises to 5,000 million euros, will largely come from the North American giant. The previous plan, from 2024 to 2026, envisaged investing 25,000 million
At the network level, it also plans to increase its investments in Portugal. The company, whose largest shareholder is the Chinese state with 21.4% of the capital, plans to invest 1.8 billion euros in its country’s networks until 2028.
With these plans, the company ensures that profitability will improve. As highlighted by the company in a press release, “a net result is expected to grow from approximately 1,200 million euros in 2025 and 1,200-1,300 million euros in 2026 to approximately 1,300 million euros in 2028 (+8% compared to the estimate for 2025), improving the qualitative profile of the results with a lower weight of profits from asset rotation and a greater weight of regulated markets with a A”.
All this “will allow the minimum dividend to be increased to 0.21 euros per share until 2028 (+5% compared to 2025), with a dividend distribution target of between 60-70% for the whole of 2026-2028, guaranteeing an attractive return for shareholders”, adds EDP. In addition to the Chinese state, Opidum stands out among the owners of EDP (a vehicle owned by Unicaja and the Masaveu family, which holds 6.82% of the shares).
Regarding gross operating margin, the company expects to go from 4.9 billion euros in 2025 to 5.2 billion euros in 2028, which represents an increase of 6%. To reach these figures, EDP also intends to tighten its belt. The company explains that they seek to “increase efficiency and agility across the company, maintaining competitiveness with a stable nominal opex (maintenance costs) of approximately €1.9 billion for the entire plan (…) supported by automation, robotization and asset performance management with artificial intelligence as a facilitator of greater efficiency.” As regards financial optimization, it is expected that the debt will be reduced by 1,000 million euros in these three years, going from the current 16,000 million to 15,000 million in 2028.
