The Company, which will assign two thirds of planned investments to international expansion, seeks to consolidate world leadership in renewables

• The Company, today holding its first Shareholders Meeting since its stock market listing, projects an Ebitda of €3.4 billion and sustained financial strength under its 2008-12 Strategic Plan
• IBERDROLA RENOVABLES foresees increasing payout ratio from 25% to around 50% in the coming years
• This year, the Company expects an estimated net profit of €400 million, 3.5 times that of 2007

IBERDROLA RENOVABLES’ Strategic Plan for 2008-2012, to be presented today at the first General Shareholders Meeting since its stock market listing, envisages investments of €18.8 billion during the period to achieve a net profit of approximately €1 billion in 2012.

The goal of the 2008-2012 Plan is to confirm the Company’s current position as leader of the world wind power sector* and standard-bearer  for clean energy worldwide. At the end of the period, it expects to remain firmly at the head of the sector worldwide and be the leading renewables group in Spain, the UK and the United States.

Investments under the Plan will be assigned essentially to international expansion, which receives three-quarters of the total. Half of the investments will be in the United States (50%), while Spain will have 23%, the rest of Europe another 25% and other countries 2%. The Company will also invest €800 million in gas storage in the United States.
Development of all renewable technologies is contemplated in the Plan, but especially wind power, in view of its current competitiveness. The Company has already lined up sites for the next seven years and turbine supplies for the next five, with contracts totalling 10,000 MW with various manufacturers (Gamesa, Alstom, Vestas, Siemens, General Electric, Suzlon, Mitsubishi, etc.).

IBERDROLA RENOVABLES also plans to boost its presence in mini-hydro developments, where it will increase installed capacity from 350 MW at present to 450 MW in 2012, as well as in solar thermal electricity where five plants of 250 MW will be built, and in biomass with three plants under construction for 50 MW in capacity, as well as other projects in offshore wind power, wave energy and solar photovoltaic energy.

In the U.S. gas sector, which generates financial synergies with the renewables sector, the Company plans to manage 5,4 bcm (billion cubic metres) in gas storage as against 3.4 bcm at present. These are large volumes, as borne out by the fact that all underground gas storage capacity in Spain amounts to about 1.6 bcm.

The goal is to achieve a capacity in renewable energy of 13,500 MW in 2010 and 18,000 MW at the end of the period, with an average annual installation rate of 2,000 MW. The Company also expects to triple production during the period, rising to 42,300 gigawatt hours (GWh).

Results similar to those of IBERDROLA in 2001

Meeting these business goals under the Strategic Plan will allow IBERDROLA RENOVABLES to achieve gross operating profit  (Ebitda) of €2.4 billion in 2010, four times that in 2007, and net profit of €800 million which would be seven times that of last year and similar to the entire profit of the IBERDROLA Group in 2001.

These magnitudes rise in 2012, the final year of the Strategic Plan, when IBERDROLA RENOVABLES projects Ebitda of €3.4 billion and a net profit of €1 billion. Gas storage business is projected to contribute around €240 million to Ebitda in 2010 and €270 million in 2012.

The Company expects achieve greater diversification and balance in the origin of its financial results, coming in equal parts from Spain, the United States and the rest of the world. More than two thirds of Ebitda is projected to origínate outside Spain in 2012, fruit of the Company’s international expansion.

These results would allow IBERDROLA RENOVABLES to increase the proportion of net profit assigned to dividends (payout) from 25% to 50% in coming years, reaching a similar ratio to the IBERDROLA Group.

The Company expects to maintain its solid financial foundations during the period, with estimated asset growth of 75%, shareholder equity of €14 billion and a financial gearing below 50%.

Forecasts for 2008

As regards results for the first half of 2008, to be finalized shortly, net profit of IBERDROLA RENOVABLES will be approximately €170 million and Ebitda €570 million. During the period, a total of 851 MW have been installed in eight countries which, added to the 1,600 MW currently under construction, will allow the Company to surpass its goal of installing 2,000 MW a year.

For 2008 as a whole, prospects are for an Ebitda of around €1.3  billion, double that of 2007, and a net profit of €400 million, which would be 3.5 times that obtained in 2007.

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* Source: New Energy Finance (December 2007)

IMPORTANT INFORMATION
 
This announcement is not an offer for sale, purchase or exchange or an request for sale, purchase or exchange of securities.  Shares in Iberdrola Renovables, S.A. may not be sold in the United States absent registration or an exemption from registration.

FORWARD-LOOKING STATEMENTS
 
This communication contains forward-looking information and statements about Iberdrola Renovables, S.A. These include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, capital expenditures, synergies, products and services, and statements regarding future performance. Forward-looking statements are statements that are not historical facts and are generally identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates” and similar expressions.
 
Although Iberdrola Renovables, S.A. believe that the expectations reflected in such forward-looking statements are reasonable, investors and holders of Iberdrola Renovables, S.A. shares are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Iberdrola Renovables, S.A., that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements, including those contained in the Prospectus filed by Iberdrola Renovables, S.A. with the Comisión Nacional del Mercado de Valores (“CNMV”) on 22 November 2007, and those that may be included in future Prospectuses and Documentation filed in the future by the Company with the CNMV and with other regulatory bodies.

Forward-looking statements are not guarantees of future performance. They have not been reviewed by the auditors of Iberdrola Renovables, S.A. 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 Iberdrol Renovables, S.A. 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 on the date hereof. Except as required by applicable law, Iberdrola Renovables, S.A. undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.