(Bloomberg) -- The boss of one of the world’s biggest renewable energy companies, Iberdrola SA, told the UK government it will boost investment despite a windfall tax on low-carbon power producers.
Iberdrola’s Executive Chairman Ignacio Galan met Chancellor of the Exchequer Jeremy Hunt this week following the government’s decision to tax what it calls “excess profits” of wind and solar energy producers. The renewable industry has said the tax threatens to curb investment in a sector that’s vital to shifting the UK away from a dependence on fossil fuels and reaching its goal of net-zero greenhouse gas emissions by 2050.
“We are willing to match the UK government’s green energy ambitions,” Galan said in a statement following the meeting. “With a stable and predictable regulatory environment, we are ready to continue to invest at record levels. And we are even prepared to accelerate that investment if the conditions allow.”
Iberdrola plans to spend more than €7 billion ($7.3 billion) in the UK over the next three years, its second-biggest country for investment after the US, according to a strategy published earlier this year. The company’s Scottish Power unit is one the UK’s largest wind farm developers, while Iberdrola also invests in grid infrastructure that needs to be scaled up as power demand increases with the electrification of transport and home heating.
The company could do even more if the government and regulator wanted to further beef up the power grid or cut down on regulations that slow the pace of new wind farm construction.
The meeting between Galan and Hunt marks a change in tone from the days immediately after the windfall tax was announced.
Representatives of the renewable energy industry, including the head of Scottish Power, lambasted the government for forcing them to pay for a crisis created by soaring fossil fuel prices. They were particularly aggrieved by a perception that the government is offering a better deal to oil and gas companies.
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